Alexander Egorov: “We’re in the best time for digital services”

Alexander Egorov, CEO of Reksoft, has shared his expert commentary on the 2020’s impact on the world and IT industry for 17th Annual Survey of the Software Development Industry of Russia:

It’s been a difficult and eventful year for business. The pandemic has hit every sector of the economy, including the IT market. But we can already say with certainty that overall, software development in Russia has coped well in the face of this challenge. It’s helped that software companies have historically been well placed to work remotely by using modern means of communication, and so proved ready to respond to new ways of working. Compared with other sectors, software development has continued to thrive thanks to its flexibility and willingness to digitise working processes. In addition, financial support and other stimulus measures from the state have reduced the impact of the pandemic.

We can expect to see some trends persist even after life returns to normal. First of all, the pandemic has underlined the value of online services. Consumer expectations are higher than ever in terms of the quality and coverage of online connectivity, educational and entertainment content ecosystems for children, information security services that ensure safe, reliable browsing, and cloud solutions and services that make remote working possible. Digital transformation has accelerated even in the more sluggish spheres of life and the economy, which has encouraged our clients to develop and implement as quickly as possible new technologies that will meet the changing needs of end users, whether those are citizens, business or government.

The market has changed, with new models of interaction between consumers and service providers being formed. At many companies, there is increased interest in digital projects, with the aim to transform at pace their products and services to meet new market realities. The difference between today’s drive to digitise and that of earlier periods is that the pandemic has made companies view increasing competitiveness through internal optimisation processes as central to their survival, rather than a more speculative interest in a promising area of activity. The speed of transition to digital has increased even in those industries that have traditionally relied on offline channels. Everyone now realises that if they fail to adapt to the new normal, the market will leave them behind.

One of the most important trends in consumer behaviour is versatility. Consumers are increasingly looking to do as much as possible without having to leave the house, instead preferring to make purchases from a safe distance when it suits them. Increasingly, the most successful businesses are ones whose customers can reach them via a range of channels, interacting via a website, social media or in person offline. In addition, consumers expect a personalised company offering, with products and promotions tailored to their own needs.

Governments, too, are changing the way they offer public services. We’ve seen increased interest from public sector clients in digitisation and artificial intelligence services, including consulting, solution development and implementation, particularly in the implementation of digital transformation and import programmes.

This has been good news for our business. Because Reksoft specialises in the development of complex digital turnkey solutions and helps clients implement digital transformation projects, the pandemic has not affected the quantity or quality of our work. Far from it – we have been able to increase business over the year, and even develop a series of new projects in new areas.

In a world where change is accelerating, the set of processes and technologies we have developed over thirty years has proven a major draw for our clients as they seek to adapt their businesses. Creating digital solutions is different to a bolt-on IT project, because it often involves significant organisational changes on the client’s side, right up to tweaking the business model. To make the most of this interconnectedness, we take an integrated approach. In addition to the design and creation of our solutions, such as consulting on planning the digital transformation process at the enterprise level, we make use of a wide range of tools to prepare the client’s information system landscape for work in the new regime so they can hit the ground running.

For our clients, digital transformation is not only about internal changes and incremental improvement. It’s also a chance to find their new place in a changing market by creating digital platforms, which then attract other market participants. Almost all of our new projects are related to the creation of platforms of various shapes and sizes. For big business, this means creating ecosystems. For more niche players, it’s about understanding how they can transform their business to connect to these platforms and ecosystems and add value.

According to our forecasts, large digital platforms will in the next decade occupy a significant share in many industries, perhaps up to 80% of the volume of a specific market sector. Consulting will focus on the operation of these platforms, providing services for technical support, further development and information security, and consulting on the front end of these platforms for all participants.

Based on our experience in digital transformation over the past year, I can say with confidence that now is one of the best times for the implementation of digital projects. A relatively small investment in digital technologies can significantly improve the competitiveness and efficiency of your business, with a pay-off within two to three years.