Imagining a Digital Economy for All in Ukraine

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Imagining a Digital Economy for All in Ukraine

With Russian bombs raining down on his citizens, on March 14, 2022, President Volodymyr Zelensky of Ukraine said:

“As long as the state is at war, as long as the people are defending themselves, the economy must be preserved and restored. As much as possible in the current difficult conditions. Life must appear on the streets of the cities. Where security allows. Where people can provide it. […] For the country to live. For the restoration of Ukraine to already begin. And it depends on each of us, on each of us who is able to work. […] Economic suppression of Ukraine is one of the tasks of the war against us. And we have to fight back from that as well. Save our economy. Save our people.”

Zelensky instructed his government to remove as many obstacles to SME continuity as possible. As a result, Ukraine shifted taxes for all small and medium enterprises to a simple scheme: 2% of sales. Even this tax is flexible: if a business cannot pay, it is granted an exemption. Additionally, excise duties on all imported goods have been cut to zero.

As other sectors are severely impacted by the infrastructural damage caused by Russian weapons, technology and IT firms shoulder significant responsibility for bolstering Ukraine’s economy amid ongoing conflict. The industry has seen remarkable growth over the past year, bringing in a record $2 billion in export earnings in the first quarter of 2022. A staggering 77% of Ukrainian tech companies have brought in new clients during the war—many from Western countries. By May, the volume of IT exports had increased by 28% compared to the previous year, as reported by the IT Ukraine Association.

The Ukrainian tech and IT sector is resilient by design, not by chance. These numbers are the product of several actions, some of which are the culmination of years of effort:

  • The strong digital infrastructure in much of the country—including backups in the event of system interruption or failure—ensures that the internet remains mostly operable, especially in cities.
  • Ukrainian tech firms had already made contingency plans dating back to Russia’s 2014 invasion and annexation of Crimea.
  • The government helped by not drafting tech workers into the military. Additionally, tax breaks offer financial relief to small and medium enterprises.
  • Tech companies pursued various approaches to ensure worker safety and minimize the risk of a total outage. Apart from the 2014 invasion, working through the COVID-19 pandemic acclimatized Ukrainian firms to a distributed workforce.
  • Tech workers have received special IT security training to ensure that their participation in cyber warfare operations does not impact client work.

In March 2022, the Digital Planet team launched a new initiative: “Imagining a Digital Economy for All in Ukraine.” We spoke with many IT and tech companies in Ukraine, as well as their clients, to learn more about their experience navigating managing people and projects during the war. These conversations continued throughout the summer, as the business world shifted in response to the ever-changing operating environment. You can view these interviews in the form of short video episodes under “Conversations with Industry Leaders.”

Digital Ukraine: One Year Since the Invasion

“Backup is our favorite word right now.”

-Kateryna Ryzha, project manager and head of PMO, Softjourn

One year later, the Digital Planet team presents the second installment of Imagining a Digital Economy for All in Ukraine. For “Digital Ukraine: One Year Since the Invasion,” we revisited our earlier interviewees to gain perspective on how companies are meeting the demands of digital business as the resistance continues. As demand for Ukrainian expertise grows in response to the nation’s dynamic disaster response, executives are devising new ways to manage their workforces alongside technological innovations. Employees are learning to work faster, rely more heavily on asynchronous communication, and keep detailed records to ensure their team members can easily return to work after unexpected downtime. In Ukraine, a new picture of the future of work is emerging: one that is adaptable, collaborative, and responsive to federal stakeholders rather than dependent on them. We invite you to watch the latest episodes in conversation with our Ukrainian colleagues and friends below.

Digital Ukraine: One Year Since the Invasion

Digital Ukraine: One Year Since the Invasion - Episode 1: Reconnecting with Softjourn

One year after Russia’s unprovoked invasion of Ukraine on February 24, 2022, Bhaskar Chakravorti is rejoined by Sergiy Fitsak, Kate Ryzha, and Lyubomyr Nykyforuk of Softjourn to discuss the current state of Ukrainian business and digital infrastructure. The global technology services provider is headquartered in Ivano-Frankivsk, where many of its employees remain. Sergiy and Kate reflect on the importance of building redundancies to increase digital resiliency against power outages and continuously monitoring their team’s equipment needs and circumstances. Over the last year, Lyubomyr has noticed increased demand for Softjourn’s consultancy and technical expertise, adding, “If [Russian forces] planned to make us weaker, they actually get the opposite.” As the conflict continues, Sergiy reminds viewers that “Ukrainian people are not fighting to survive. They are fighting because we understand what freedom is, and we are fighting for freedom.”

February 16, 2023

Digital Ukraine: One Year Since the Invasion - Episode 2: Reconnecting with VIMAS Technologies

Bhaskar Chakravorti revisits Igor Guryanov, Chief Technology Officer of VIMAS Technologies. The pair discuss how the ongoing war in Ukraine has changed digital business one year later, from data storage and product development to government assistance and employee mobilization. Igor reports that VIMAS has seen modest growth since the invasion, to which he credits the adaptability and resiliency of Ukrainian electricity and internet service providers. With employees in Ukraine and the United States, VIMAS continues to fulfill its business obligations while integrating the latest technological developments, like ChatGPT, into its products.

March 14, 2023

Conversations with Industry Leaders

Imagining a Digital Economy for All in Ukraine: In Conversation with Softjourn - Episode 1

Bhaskar Chakravorti speaks with Sergiy Fitsak and Lyubomyr Nykyforuk of Softjourn, a global technology services provider with offices in California, Ukraine, and Poland. They discuss the changes in the tech industry with the Russian invasion, shedding light on how employees are being supported, what contingency plans are in place with backup technology support, and how the government is supporting them through this crisis.

March 23, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with Softjourn - Episode 2

Bhaskar Chakravorti speaks with Sergiy Fitsak and Lyubomyr Nykyforuk of Softjourn, a global technology services provider with offices in California, Ukraine, and Poland. They discuss how the tech industry, also called the IT Army, is battling the crisis on the economic end, especially with tech-driven relief processes, and how the world can help them put up a stronger front.

March 23, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with Softjourn - Episode 3

In conversation with Sergiy Fitsak and Lyubomyr Nykyforuk of Softjourn, Bhaskar Chakravorti, Chair, Digital Planet raises critical questions about how the Ukrainian government is supporting the tech industry through tax reforms amidst war, the digital public infrastructure and what it will mean to resurrect the digital economy in a post-war Ukraine. Sergiy and Lyubomyr share their experiences in continuing to work from Ukraine, staying connected with loved ones who have fled across the border, and leveraging digital tools to keep their business operations up and running. They see themselves as an “IT army”; tech professionals in Ukraine are participating in a cyber war as well. They are also taking steps to prevent the risks of Russian cyber counter attacks.

April 06, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with Softjourn - Episode 4

In this latest episode of Imagining a Digital Economy for All in Ukraine, Bhaskar Chakravorti talks with Kateryna (Kate) Ryzha, a Project Manager, and the head of PMO at Softjourn. They discuss the contingency measures that Softjourn had in place to ensure its workers were safe, while still continuing ongoing projects without too many disruptions. Kate also talks about the resiliency of Ukrainians during the trying situation—IT workers continue working to contribute to the Ukrainian economy, in fact, many of them have also begun helping government institutes move their services into the cloud. Kate herself worked as a volunteer in Western Ukraine, trying to secure resources for those who need it. She concludes on a positive note, wishing the war to end soon, and hopes that their experience working in difficult situations together will make them stronger

April 12, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with VIMAS Technologies - Episode 5

This is the fifth episode of Digital Planet’s Imagining a Digital Economy for All in Ukraine series. Bhaskar Chakravorti, Dean of Global Business at the Fletcher School talks to Andrew Maksakov, President, and Igor Guryanov, Chief Technology Officer, both of VIMAS Technologies, which is based out of Kyiv, Ukraine. Andrew and Igor talk about deciding to stay in Kyiv to keep the company going. In fact, Igor has even moved into the company premises, both to keep his family safe, but also to be able to control the computers and equipment in the aftermath of Russian missile attacks. Andrew and Igor also talk about the resilience of the Ukrainian tech industry and the IT workers, many of whom have already moved back to Kyiv after the Russian troops were ousted. Igor goes on to explain how remote work, as well as good infrastructure over the past two years, has tremendously helped the IT business, which they were able to leverage to ensure uninterrupted services to big customers like Amazon, the British Council, and several US-based Fortune 500 companies. They also emphasize the role played by the Ukrainian IT army, not only in helping citizens stay safe but in also supporting DDOS attacks and targeting Russian digital infrastructure. The IT army has also provided support for building military applications and translated and transcribed online resources to English, in order to get support from the English-speaking world. Andrew and Igor conclude by asking people to continue to do business with Ukrainian tech companies, for both financial and moral reasons.

April 22, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with Languametrics - Episode 6

In Episode 6 of Imagining a Digital Economy for All in Ukraine, Bhaskar Chakravorti, Chair, Digital Planet, interviews Kenneth Spiegel, the CEO of Languametrics, which is based in Tampa, Florida, and has partnered with Ukrainian software development company VIMAS Technologies. Spiegel explains how Russia’s war against Ukraine has adversely disrupted his company’s business relationships and R&D operations in Ukraine. They discuss how Languametrics and VIMAS Technologies are navigating their deliverables and projects across borders. Learn more from Kenneth about Ukraine’s impeccable talent, dedication, and fortitude that has helped business continuity even amidst a tragic war.

April 25, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with Nikama GmbH - Episode 7

In Episode 7 of Imagining a Digital Economy for All in Ukraine, Bhaskar Chakravorti, Chair, Digital Planet is in conversation with Dr. Mads Kyed, Chairman of the Board, Nikama GmbH. As clients of Ukrainian software developers, Dr. Kyed elaborates on how digital infrastructure in Ukraine has supported business continuity with minimal disruption in Nikama’s software development processes–despite the difficult situation in Ukraine. At the same time, Dr. Kyed also highlights the risks associated with Russia’s invasion including the personal safety of developers in Ukraine, its own business interests, and the impact of war on digital infrastructure. Commending the work ethic and attitudes of the Ukrainian workforce, Dr. Kyed also shares his experience working with software developers in Ukraine who possess unparalleled talent in understanding client needs.

April 26, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with Leater Integration - Episode 8

In the eighth episode of Digital Planet’s Imagining a Digital Economy for All in Ukraine series, Bhaksar Chakravorti, Dean of Global Business at the Fletcher School converses with Mykola Zhandarov, CEO, Leater Integration, based out of Kyiv in Ukraine. Leater Integration is an IT company which focuses on AV and security integration. Because of the nature of the work, which primarily involves buying different hardware and integrating them for customers, as well as due to the fact that most of their customers are in Ukraine itself, Leater’s business has been negatively impacted by the war. Despite this, Mykola also expresses hope that Ukraine will emerge victorious after the war, and the tech industry will play a critical role in rebuilding the country.

May 11, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with Intecracy Group - Episode 9

In the 9th episode of the Imagining a Digital Economy for All in Ukraine series, Bhaksar Chakravorti, Dean of Global Business at the Fletcher School interviews Yuriy Sivitsky founder and Board member of Intecracy Group, in this episode of Imagining a Digital Economy for All in Ukraine. Intecracy Group is based in Kyiv, Ukraine, and currently hosts a conglomeration of around 15 tech companies. The Intecracy Group was founded by mathematicians and software engineers to develop large-scale software projects on demand. They offer a wide range of services, covering a variety of technologies in countries around the world. Yuriy recounts how although the domestic market crashed immediately after the Russian invasion, their international business thrived. He also talks about the unwavering support received by them from international businesses, which parallels the international support from NGOs and other organizations for Ukraine during the war. Yuriy also discusses how events of the past, the company’s foresight, and government assistance has helped them keep their business going in spite of the ongoing conflict.

May 12, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with IMS Management Services Corporation - Episode 10

In the 10th episode in this series, Bhaskar Chakravorti, Dean of Global Business at The Fletcher School talks to Dave Lowenstein, CEO of IMS Management Services Corporation, based in Los Angeles, California. IMS is a client of Softjourn, a global tech company with an office in Ukraine, and a subject of previous interviews in this series. David talks about the excellent work done by Softjourn, and more broadly, about the resilience and quality of service provided by the rapidly growing tech sector in Ukraine.

May 12, 2022

Imagining a Digital Economy for All in Ukraine: In Conversation with VIMAS Technologies - Episode 11

In the 11th episode of this series, Bhaskar Chakravorti, Dean of Global Business at The Fletcher School converses with Andrew Maksakov, President, and Igor Guryanov, Chief Technology Officer, both of VIMAS Technologies, which is based out of Kyiv, Ukraine. They talk about how both Kyiv and Ukraine as a whole remain under attack, although the capital city is now more stable. They also discuss how their business, and the IT business generally, has remained stable, despite the personal psychological pressures facing them all. The best thing to do, they believe, is to support the government and the military by doing their jobs well.

June 29, 2022

This research is a part of the IDEA 2030 initiative, made possible by the generous support from the Mastercard Center for Inclusive Growth.

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