Danish-owned Vedel IT offers IT offshore software development from Malaysia, where the opportunity to recruit globally and build multicultural teams form a unique and attractive combination. Scandinavian companies so far make up the bulk of Vedel IT’s clients.
Founder Mark Vedel, with experience from IT systems implementation since 1989, came to Malaysia because his wife wanted to move back to her home country with the family. In the process he came across a unique opportunity to offer highly skilled IT resources in a multicultural environment to clients.
One of his flagship clients appreciate the large cultural diversity they can get in their team, giving more value in the creation of new software solutions compared to having a monoculture team consisting mainly of one or two nationalities. They obtain input from the different cultures perspective into their daily work – increasing the quality of the end product.
Cost-difference also matters with it comes to offshore development. As Mark Vedel was building up his business when the global financial crisis hit in 2008 it was an advantage having Dong Energy and SEB on board as clients. “I was luckily to have them as clients through the crisis; they were running on a different metrics than just cutting costs – they were so big. Dong energy was replacing external consultants with offshore teams. The offshore team was also better integrated in the company as the external consultants would come from different external companies and not always aligned with the companies’ goals. And because the technical level also was high in Malaysia the customer could replace three freelance consultants with two senior developers in Malaysia. The business case was needless to say quite good.”
Today the demand is perhaps bigger than ever. “We experience an enormous increase in the demand for IT resources. We are inundated with requests from potential new customers, and sometimes must say no to taking in new customers.”
Commenting on cost-savings for the clients using Vedel IT Mark says: “You save somewhere between fifty per cent to 2/3 of the cost depending on your type of company and what kind of salaries you need to pay. Some customers might view the cost saving as less, which can be for various reasons: they may be a very attractive company to work for, so they can hire people in Scandinavia at a lower salary point because it is considered so cool to work for the company. Think of companies like google. For these companies it is the access to talented resources that is the motivation to have a development team in Kuala Lumpur, rather than the cost savingss
Vedel IT adds a fee to the client’s team members salaries for the services to recruit the team, facilitate the office space, provide internet, social activities etc. – all these things that enable the customer to focus entirely on their software development work. It can also be a build-operate-transfer assignment, as was the case with DONG Energy. Vedel ITs customers in Kuala Lumpur include SEB Pension, Topdanmark, Sitecore, Lessor and TimeLog.
The key to the whole attractive package is MSC Malaysia – the national ICT initiative designed to attract world-class technology companies to Malaysia.
“As a shared service centre or as a technology company you can apply for MSC status, which is core to our business: without it we could not do what we are doing! The most important benefit is the access to work permits for IT talent. So we can hire as many non-Malaysian technical people as we need.”
“So when we are sourcing for customers we don’t have restrictions to which countries the candidates can come from. This gives us an unlimited ability to execute on the customer’s requirements for IT resources, which is the most important thing for our customers,” explains Mark. If you need twenty-five developers you must have a robust mechanism to make sure you get those people; otherwise you can’t operate your business.
“So the ability to execute is a very strong business driver for coming to Malaysia and with the MSC status we have an unshakeable ability to execute, because we can always find the people we need. If there’s a certain niche IT skill you need and if we can’t find people in Malaysian with these skills, we can always find lots of candidates from the region who has those skills. With hiring a senior IT developer from Syria, Vedel IT now has 21 different nationalities among our employees. With Malaysians being the largest group we also hire people from Iran, India, Pakistan Sri Lanka, Kazakhstan, Bangladesh, Vietnam and Philippines.”
It is easy to persuade skilled IT resources to move to Kuala Lumpur for work, says Mark, since they can have better living conditions for them and their families in Kuala Lumpur compared to what they experience in their home country.
“Kuala Lumpur offers many advantages for the software developer considering moving here. It has a rich multicultural experience, it is clean and safe, it offers a good prospect for their future life as well as an international experience for them, so we can cherry-pick the very best IT resources from within the region. In contrast, if you set up a development centre in India, Ukraine or Philippines, you will only get Indian, Ukrainian and Philippine developers respectively.“
“A related benefit is that when you have a multi-national and multicultural team you avoid the typical cultural barriers that can occur between a Danish or Swedish organisation working with a fully Indian or fully Philippine team,” Mark points out.
Good infrastructure and reasonable cost of doing business are other key benefits. “Kuala Lumpur is the location of choice if you want one corporate centre for Asia or South East Asia. It also helps that Vedel IT has established a very strong brand name in the job market by now. You have to be able to recruit the top IT Talent and a good reputation helps a lot. We guarantee our customers that we continue requiting until we have built the team they need.”
“As for the future, information technology is becoming a core area for many businesses. You cannot think of any bank, insurance company, telecom, transport, or pharmaceutical business where information technology is not absolutely central – if not the central component of business development.”