Outsourcers build out business in Finland

FINLAND is the hot place for outsourcing. Local IT services firm Tieto says it is likely to be ahead of schedule in transferring jobs to lower-wage countries as it looks to cut costs and fight off increasingly global competition, its chief says.

Tieto aims to have 40% of staff in lower-cost countries like India, China. Poland and the Czech Republic by the end of 2011. Chief Executive Hannu Syrjala (above) told Reuters: "We will likely reach it ahead of target as the development has been so fast. "Due to the financial crisis, the IT industry has changed and the competition has become global. The price competition is tough."

Tieto had 34% of staff outside Finland at the end of June, compared with 19% at start of 2008 when Syrjala took over at the company.

A partner of Tieto. 250-strong ScienceSoft. an IT consulting and custom software development company in Europe, has just appointed Akif Ali (below, left) as Managing Director of ScienceSoft Oy - ScienceSoft's Finnish subsidiary located in Helsinki.

He will be overseeing business development. sales and marketing efforts in the Nordic countries. This is the next step in ScienceSoft's business expansion in Northern Europe, which will strengthen the existing relationships with customers in the region.

Nick Kurayev, CEO of ScienceSoft Inc. talked to IT Europa:

Why did you choose Finland?

"We have a strong background and a good network in Finland thanks to our reliable partner Juhani Lano. Also, several years ago we helped one of the leading Nordic IT service companies Tieto set up an operation in Europe and we have very good relationships with a number of people from that time. In our opinion, it is very challenging to enter the Finnish market without strong partnership and advice from local partners."

"Besides, during our work with Finnish colleagues, it turned out that our nations have very much in common when it comes to doing business and working together. These similarities made the working process smooth for both sides. We believe that our presence in the Finnish market will increase our customers' loyalty towards the company."

Which part of the market are you working in?

"We target the SMEs segment as well as large companies. Mostly, these are IT companies with their own product lines and IT consulting arms. However, we also approach businesses in the healthcare and telecom industries."

What skills are you offering?

Among other things, we are a one-stop shop for mobile apps on any mainstream platform from Android and iPhone to Blackberry: we provide consulting and development for Microsoft technologies and platforms. ncluding SharePoint and Dynamics. There is competence and automated database and application migration. And we do a lot of custom development and testing on .Net. Java, PHP, C++."

Do you have a particular advantage?

"We believe that our position is quite strong in the Finnish market. Unlike many local companies, we have a powerful nearshore presence; unlike most offshore/nearshore companies, we are able to communicate with our clients locally and provide local delivery of the services."

"Besides, like many mature players, we have Microsoft Gold Certified Partner and Oracle Partner statuses. We are also an IBM Core supplier and we have an ISO 9001 certification."

Where else in Europe are you finding interest?

"We work practically everywhere in Western Europe. Particularly, we have a lot of business in the Netherlands and in the Nordic countries. Recently, we have been expanding in the German-speaking countries; these countries are becoming increasingly open to our services."

Who are your main competitors - local IT suppliers or Indian outsourcers?

"Competition depends on a particular market. In countries such as the Netherlands we compete mostly against offshore/nearshore suppliers or local companies with offshore presence. In Finland the competition seems to be more from the local companies. Although, we have to add that it is not a purely competitive relationships. Local IT suppliers can themselves benefit from accessing our pool of competence and nearshore resources".