IT STARS

When talking about the Bulgarian economy in 2020, one field attracts the attention – information and communication technologies (ICT). This is rather understandable. The sector is the third most developed one in the country after trade and industry. Unlike many other fields in the Bulgarian economy, the IT sector dealt much more effectively with the challenges posed by the Covid-19 pandemic. Staff redundancy and salary cuts were significantly lower in the ICT field and some companies even increased their activities and continued hiring. The transition to home office work went smoothly, without quality losses and with minimal security risk. The number of companies from the ICT sector that sought state help to mitigate the financial effects of the pandemic was much lower than the one of firms in other fields of the economy.

What are the reasons for the stability and continued development of the ICT sector in Bulgaria?

Objective reasons are one part of the answer. In recent years Bulgaria has become a centre of the IT industry in the region. It attracted foreign investments and stimulated the establishment of local companies and startups with advantages such as low corporate tax, excellent Internet connectivity, convenient geographical location for ITO and BPO services, relatively low labour costs and, last but not least, young specialists who were intelligent, prepared, ambitious and open to the world and the latest trends.

However, the potential of these factors would hardly be adequately developed without visionary and prepared top-level managers and owners. Some of them are foreign investors. Others are Bulgarian entrepreneurs. Yet a third group is of Bulgarian and foreigners at high managerial positions in the companies in the sector. What unites them all is their energy to turn their dreams and plans into a reality, their high expertise, skill to recognise the latest and most perspective trends in the field, and talent to build teams and to develop strategies that work. Thanks to these men and women the ICT sector in Bulgaria is resistant, adaptive and proactive even in a year like 2020.

Talking to some of the best IT managers in Bulgaria is an enriching experience. Regardless of whether we discuss the latest novelties in cloud services and cybersecurity, data processing, business website SEO, development of software and different apps, or building of motivated and creative teams of specialists, we find a common trend. Thanks to good IT managers Bulgaria is confidently leaving its old comfort zone as an outsourcing destination and is reimagining itself as a location with potential to be a leader in providing products and services with high added value.

Cheap, but quality labour force laid the foundation of the early IT industry boom in Bulgaria. Quality education and foreign languages proficiency among employees made the country a strong competitor to traditional outsourcing markets such as India. But with the development of the ITO and BPO sector the Bulgarian labour market began to suffocate from lack of professionals. Labour expenses, which included not only salaries but also social benefits, began to grow, endangering to wipe out one of Bulgaria's main advantages as an outsourcing destination.

Facing such challenges, good IT managers in the country initiated proactive policies. They targeted labour force shortage with strategies such as creation of their own educational centres to train the professionals the company needed. Investments in employee personal and professional growth stimulated the horizontal and vertical career development of anyone with the potential to achieve that.

The IT managers in Bulgaria also focused on a group on the labour market that is traditionally considered "unsuitable" for the IT sector: women. The companies in Bulgaria broke the stereotype and proved that women could be as good in these jobs as men. As of 2019, 28% of the employees in the Bulgarian IT sector were women, compared to an EU average of 17%. Many of them are also in managerial positions in the good IT companies.

In their aim to secure even more attractive labour conditions, the managers of the quality IT companies provided not only excellent wages to their employees. They realised how important flexibility was to modern workers. Years before the spring of 2020, when thousands of companies were forced to transition fully or partially to home office work, the good IT managers provided their employees with the option to work remotely when they want or need to.

By the end of the 2010s the profile of the IT sector in Bulgaria also began to change. Realising the growing competition from cheaper outsourcing destinations, visionary managers changed direction towards upgrading their company activities. They invested in their R&D departments and started to create their own products and services with high added value. The trend was accelerated by foreign investors who discovered the potential of Bulgarian developers, engineers and professionals.

Thanks to this forethoughtfulness, the ICT sector in Bulgaria was in excellent shape when it faced the 2020 crisis.

Of course, the managers in the IT sector still have to deal with challenges. Some of these are old, as talent retainment and the need to bring development activities further. The lack of trained professionals is not as acute as it used to be, but creation of teams and improving their motivation, often from a distance, remains a challenge. Other crucial tasks before the sector are new, such as the need to provide continuous, quality and secure work process in an unstable and unpredictable environment. Many Bulgarian IT companies are partners or a part of international firms and are consequently dependent on what happens in the global economy. Startups need to work ten times harder to succeed. All companies without exception need to pay special attention to the health of their employees and to cybersecurity.

The condition of the Bulgarian IT sector demonstrates that good Bulgarian and foreign managers are more than well-prepared to lead their companies and employees through 2020 stronger and more confident. This is an encouraging piece of news in the unstable times we live in, because it shows yet again that when a leader is a visionary, and is intelligent and smart, all challenges can be efficiently overcome.