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DOMESTIC MARKET SHORT ON OPPORTUNITIES, INTERNATIONAL WORK A GIVEN FOR SOFTWARE FIRMS

Software without borders

SOFTWARE solutions are easily exported and there are almost no barriers to selling such products to foreign customers as long as you can perfectly tailor them to their needs.
Young Slovak IT firms have managed to take advantage of these facts and have succeeded in trading their software to foreign clients.
Slovak IT firms generally agree that the small software market in Slovakia does not offer enough challenges, and if a company wants to develop, its only opportunity is to penetrate markets abroad.

SOFTWARE solutions are easily exported and there are almost no barriers to selling such products to foreign customers as long as you can perfectly tailor them to their needs.

Young Slovak IT firms have managed to take advantage of these facts and have succeeded in trading their software to foreign clients.

Slovak IT firms generally agree that the small software market in Slovakia does not offer enough challenges, and if a company wants to develop, its only opportunity is to penetrate markets abroad.

Foreign clients follow the newest software trends and are more willing to buy sophisticated solutions developed through progressive technologies, compared to conservative Slovak customers.

There are no particular obstacles to exporting software. Basically, it is possible to carry out the whole process, from acquiring the project to submitting solutions, only through the internet.

"We considered the export of our services and products as a natural part of our business activities right from the establishment of our company in 1997," Martin Krupa, director of software IT firm ui42, told The Slovak Spectator.

"We have never concentrated only on Slovak-speaking customers. After all, many 'Slovak' customers are representatives and branches of international companies," he added.

Radoslav Kavčiak, product manager of the ActivIT firm, thinks that, "the Slovak market does not offer a sufficient growth source for a software product firm."

"Activities abroad are important. We work on many projects that are far ahead of developments in Slovakia. Foreign customers have more progressive thinking due to the stronger competitive pressures on bigger markets," said Michal Ohrablo, sales manager of Anasoft APR, which has operated on the market since 1991.

Slovak IT firms have been successful on international markets with their internet and intranet applications, and software solutions for the business, banking, and financial sectors, as well as government, telecom, manufacturing, and small and medium-sized enterprises.

Solutions in the area of system integration and applications development are used in communication with business partners (business to business - B2B), customers (B2C), employees (B2E), customer relations management (CRM), enterprise resources planning (ERP), and web content management systems (Web CMS).

All software firms emphasise that the most crucial point for success is fitting software solutions to customers' needs.

"Companies appreciate our unique solutions. Our philosophy is to avoid forcing clients to use ready-made solutions; instead, we tailor the products according to the customer's needs even if it requires the help of external experts - people with needed know-how and experience in the particular field," said Kavčiak.

"That is why we leave significant room in our products for client customisation and we try to integrate already existing IT products into the customer's office with our solutions that will create a working compact," he added.

Insiders agree that it is not the price that mainly sells the products of young Slovak IT firms abroad. When choosing a software provider, foreign clients prefer reliability, solution quality, and a professional approach.

"For sure the price is not the most important. On international markets there is already competition several times cheaper than us, especially in India or Russia," said Ohrablo.

These young firms found their way to foreign customers mainly through good recommendations by Slovak business partners that are subsidiaries of international companies or have contacts abroad.

"We also cooperate with partners that know local markets well and we take part in exhibitions," said Krupa. "Every successful project helps us make progress [on international markets]," added Ohrablo.

Gradually, they also build contacts alone. The firm ActivIT, for example, plans to open a representative office in the Czech Republic this year and it is also considering establishing one in western Europe.

According to the experience of these companies, foreign customers are generally more demanding than those in Slovakia. "They know better what they need and they are more demanding in choosing suppliers. They stress quality and references," said Krupa.

Dealing with foreign partners from a long distance can sometimes cause problems with communication and the coordination of all suppliers if the project has several participants. "However, these are common problems in carrying out big projects," said Kavčiak.

The IT sector used to suffer the biggest outflow of workers from Slovakia to more developed countries. Conditions for IT employees in western Europe, which suffers a lack of IT specialists, have always been advantageous. However, insiders say that, although there is still such a threat, that is not exactly the case anymore.

"The source of cheap IT developers is moving further east - to the Balkans and the countries of the former Soviet Union. I think concerns about a massive Slovak IT brain drain are not justified. European Union entry will not dramatically change the situation either," explained Kavčiak.

They also suggest that salary is not the only motivating factor for IT developers, whose pay is generally higher than average incomes in other fields of the Slovak economy. This follows the trend in western Europe, where people in the IT sector also earn more than those in other professions.

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