Reduce IT costs, go to Russia

by Rebecca Burn-Callander - Friday, 12th October 2007

When London-based betting brokerage firm Betbrokers wanted to list on AIM last year, they came up against a brick wall. Their IT management system simply wasn’t up to scratch.

Director Carl Whitehead was quoted a minimum of £1.3m by UK developers to fix the problem – miles beyond the £1.1m-turnover firm’s budget. He took drastic action.

Whitehead brought in Sapphire Group, the onshore/offshore specialists, who
offshored the IT development to their own team in Russia, while they managed
the project from their office in Romford. It brought the costs down to £275,000, one-fifth of the UK quote.

But Whitehead’s fingers had been burned on a previous long-distance contract. “Last time we offshored, the time difference made communication really difficult. Their designers made several decisions without checking they were what we wanted, and they felt sufficiently remote enough to refuse to correct them without large
additional costs.”

It soon emerged that this time the language barrier was not going to be a problem. “The Russian project manager speaks almost perfect English,” says Whitehead. And when the developers produced five sets of impeccable references, a deal was struck.

It’s a marriage made in heaven. “Bugs are fixed in less than an hour,” says Whitehead. “Their development times for longer work are, in general, quicker than I could do it with UK staff.”

But the proof is in the pudding: did the system meet AIM compliance requirements? “Yes!” says Whitehead. “We floated on AIM in November last year.”

Tags: it outsourcing, carl whitehead, aim, offshore, betbrokers, sapphire group, floating a business, growing a business, doing business overseas, business advice,