Poland’s IT industry is booming. How can you benefit from that?

Not that long ago, I wrote an article on software companies in Poland. That was a kind of outsourcing guide for CTOs. Many of the examples mentioned in that text are still up to date. This time, I decided to focus on putting the accent on software development companies, so you can learn about the reasons why it became so popular and why Polish developers are in demand these days. Also – how you can shape your cooperation with software development companies from Poland.

Why are IT solutions getting so popular these days?

In my previous text on IT outsourcing services, I mentioned that nowadays “every company is a tech company”. At least to some extent. It’s because rather sooner than later pretty much everyone realizes that solid software can significantly improve their business and therefore – bring some tangible benefits. 

The use of technological solutions is a source of competitive advantage. Information technologies can streamline existing processes, but they can also open some new paths for entirely new business ventures. This applies in particular to the IT industry, the emergence and development of which are inherently related to the development of technology. 

Many enterprises that are based on or are using technology to develop freely need qualified personnel consisting of IT specialists, especially programmers (a.k.a software engineers). The increased demand for programmers in many countries of the world has opened up development opportunities for companies offering the services of such specialists based on remote cooperation with clients – and one of the countries that became an IT industry hub was Poland.

Overview of IT industry in Poland

You can hear about Poland being “the IT center of Europe”. This is the result of both the creation of domestic IT companies and the enormous interest of international corporations in opening their branches and large centers of modern services in Poland, employing hundreds of employees. There’s no doubt that the IT sector is one of the main drivers of the growth of Polish economic development. 

In Poland there are nearly 50 thousand software companies and over 800 of them offer custom software development services (as per Clutch). These numbers are pretty impressive and that many companies appeared in Poland rapidly. Even though, IT industry in Poland is still a relatively new sector. More than half of the operating enterprises were established after 2011, and only 5% of them were established before 2000. The reasons for such a sudden increase can be found both in the number of programmers on the market and the willingness of foreign companies to outsource software development to Poland. Let’s dive into some more details. 

Plenty of IT graduates from Poland matching the needs of industry

We can start by explaining the reasons why there are many Polish programmers on the market. There are 18 technical universities located in Poland (such as AGH University of Science in Kraków, Warsaw University of Technology or Silesian University of Technology in Gliwice) with over 74 000 ICT students. It means plenty of specialists who can start working in software development companies. 

Exceptionally high English Proficiency Index (EPI) in Poland

Poland is one of the most proficient countries in using the English language on a daily basis. Poles are considered to have a high EF EPI index, which places them on 14th position in Europe and 16th in the world (as per 2020 data). Therefore, it’s relatively easy for the majority of Polish software developers to cooperate with international clients. 

Good location and little time zone differences

In addition to technical skills and excellent knowledge of the English language, it is the location of the country in the central part of Eastern Europe that translates into the attractiveness of our home market. Poland is located in the Central European time zone which means easy everyday communication for potential clients from both Western Europe and Scandinavia, as well as from the Middle East or even the United States (especially the East Coast). 

Great quality-price ratio

Now, let’s focus on the most important factor for all of you who work as managers – money. Even though you probably know that it’s extremely reckless to select a partner to build your high quality software based solely on price, at the same time, it’s worth knowing what causes the differences in average hourly rates.

Even though from the table above we can read that those software developers from Eastern Europe may be considered “pricey” – their services are still way less expensive than the software development companies from the USA, the United Kingdom or the Netherlands.

In the article on outsourcing software development to Poland that I mentioned before, I related to the testimony of Steve Sydenham who explained why outsourcing your IT to Poland will ruin your life. Even though it may sound quite daunting – the conclusion of that article is that this “ruining” refers to the fact that quality offered by Polish software development companies is “too good”, their services are “too cheap” and the communication with them is just brilliant.

🚀 Are you planning to develop a new software product? At The Software House, we’ve got over 100 successful projects in our portfolio. Schedule free software consultations and tell us about your business needs! 

Software houses in Poland

A large number of software houses in Poland obviously means a lot of rivalry on the domestic market. Therefore, software houses in this location constantly compete with each other for clients. This situation has led to the formation of mutual support initiatives. Their aim is to help Polish software houses strengthen their position on the market. An example of such an organized initiative associating the programming industry in Poland is an organization called SoDA (Software Development Association Poland). 

SoDA currently affiliates over 60 entities employing over 5,000 people. The organization is responsible for hosting a number of events, building the common prestige and strength of the community, promoting the activities of its members, as well as initiating and conducting activities which enable members to establish new business relationships and acquire new clients.

This large number of IT companies operating on the Polish market also led to strong fragmentation of the software house industry in Poland. Enterprises that wanted to stand out from the competition decided to find some market niches. Such a strategy has led to further changes on the market of software companies and currently they can be categorized in terms of their specialization or used technology. This gives companies the ability to focus all resources on developing software in a predetermined direction. 

From the client’s point of view, this approach gives greater certainty that the selected vendor has extensive experience in such a niche and that the company has implemented a number of projects using certain technology.

Below, I present the categories by which Polish software houses can be divided in terms of such service specialization.

Software houses’ specialisations and their development stack

The first group are software houses specializing in web development. Depending on the vendor’s preferences, they may use a variety of technologies to build backend (i.e. PHP, Node.js) and frontend (i.e. React, Angular, Vue.js) parts of their clients’ web applications. The range of services provided by Polish web development companies may vary. From creating simple websites based on ready-made solutions such as WordPress, to extensive, custom web applications, using modern architecture (e.g. microservices) or infrastructure (DevOps services). If you are interested in a specific web technology (for example Node.js) – you can easily find top Node.js Developers in Poland on Clutch. 

The second group are software development companies that focus on mobile development. The most popular operating systems are obviously Android and iOS, therefore mostly used mobile programming languages are Kotlin (Android) and Swift (iOS).  Nowadays, however, hybrid technologies (e.g. React Native) are becoming more and more tempting solutions and Polish mobile development companies are more and more willing to use them. It is also worth mentioning the issue of user experience (UX), which is particularly important in mobile applications. For that reason, companies focused on mobile development often offer services in the field of UX design and UI design.

The third group includes Polish companies that are focused on building certain systems. In this case, development teams primarily create enterprise web apps, SaaS (Software as a Service) products, CRMs (Customer Relationship Management) or e-commerce platforms. If you are interested in hiring e-commerce developers, again you can use the ranking of top e-commerce developers in Poland on Clutch.

Last but not least, there’s a group of software houses that offer the most extensive range of services. These are the so-called full-stack companies. Software houses that offer all the services necessary to develop software and a plethora of technologies. Companies like these create both web applications and those running on mobile devices. Full-stack software houses focus on a scaling strategy rather than on a narrow specialisation.The services of such full-stack companies are eagerly used by CTOs who need a long-term technological partner, who can appreciate experience in various technologies or types of systems and use them for the benefit of their software. It obviously requires more specialised developers but also opens the great possibility of acquiring better clients.

Different payment models

Now, let’s take a closer look at how the settlements with Polish IT vendors may look like. We can distinguish the three most popular payment models: fixed-price, time and material and body leasing.

Fixed-price

It’s definitely the most frequently used model which is characterised by a clearly defined deadline for the project to be completed. The fixed-price model allows customers to pay a fixed-price for a project as agreed by both parties. This settlement can be prepaid after the project is completed or it can be broken down into specific project stages – milestones. This model works best in small to medium sized IT projects with a clearly specified scope. It should be agreed at the very beginning of cooperation and the system requirements must be clearly defined. In this model, it is very important to start with analysing all the requirements carefully. Otherwise, it will be extremely hard (or even impossible) to introduce any changes during the development process. 

Time and material

It’s a model resulting from the popularisation of the so-called agile methods of building software. In this case, the client plays a much more significant role in development as they are very much involved in working with the service provider. This model works best for clients who require flexible and agile project development, where requirements may change frequently, and is typically used in projects that are under constant, undefined development. In terms of payment – costs are still settled based on the time spent on the project by the team working on it. Sometimes in this model, clients may decide to introduce the so-called fixed budget. It’s the maximum amount of money that mustn’t be exceeded.

Body leasing

Another very common form of cooperation is about leasing individual employees, or entire teams, to the client. This solution is usually short-term. It may take several days, weeks or months and is used to provide ongoing support to the client who already has their internal IT team. There are two popular models of employee leasing – working at the client’s side (in-house) or working entirely remotely. In both cases – a full-time salary for the employees is applied.

It’s good to have a good understanding of those payment models. All these payment models may suit your business indeed. The only questions are – what do you really need and how much do you want to pay.

Summary

There are multiple factors that made Poland the center of IT in Europe. I hope that the article you just read brought a closer look at how the IT industry in Poland looks like and why it’s worth cooperating with Polish development companies.

As you can see, there are a few different groups of companies that may build software for you. You can also choose from a range of payment models. Everything depends on your actual needs.

If you are looking to outsource the development of your software to Poland – you couldn’t get better! Recently, we’ve been named the best Polish software development company by Clutch. At The Software House, we really like to cooperate with CTOs and software companies that look forward to starting a long-term partnership. Feel free to contact us anytime. Initial consultations are free, so let us know what you expect your next big project to be.