IT Services Hungary: A back office for the world
The countryʼs largest ICT service provider, IT Services Hungary transcends the SSC genre by handling a range of challenges for clients around the world. The companyʼs CEO explains more in this exclusive interview.
IT Services Hungary Kft. has grown beyond the bounds of a simple shared service center, as they now offer full IT services to a broad range of firms who choose to contract them. With 4,500 employees and offices in Budapest, Pécs, Debrecen and Szeged, the local subsidiary of T-Systems International is currently the largest back-office-type operation in the country.
We spoke to Christopher Wilson, CEO and Managing Director of IT Services Hungary, about his company and the SSC sector in Hungary.
How is IT Services different from a typical SSC?
ITSH has developed from a traditional SSC into an IT Service provider. As our skill levels have developed, we have been able to take more and more responsibility for delivery of end-to-end services. Our staff not only provide technical services but also business services, like international sales support, delivery management and IT development. An example of our progress in this regard is our involvement in the companiesʼ latest cloud-based service and the daily operation and management of Open Telekom Cloud. This is also an area where our team is using the latest technologies and skills to deliver this service.
How is IT Services uniquely structured to serve businesses?
T-Systems has a USP in the global market called Zero Outage. This is what the team strives for in delivering our services. We are proud of our quality record and ITSH has played a major part in a significant reduction in the number of critical, major and minor outages in the last five years. At the same time, we also have to focus on our cost. There is little point moving services to places such as Hungary if they are delivered at the same price as high cost countries. So our managers balance the need for high quality at the best price. This becomes a bigger challenge in a more competitive market, as salaries and benefits play a major part in our overall costs. As competitors benefit from growing their business in countries such as Hungary, so the competition means more companies fighting for staff in a relatively small market. Hence the need for strong engagement with universities and schools to grow the next generation of staff with the right skills.
Why is Hungary a good place for your SSC? Why are there so many SSCs in this market?
The geographical location of Hungary means we can provide technical skills in the same time zone as many of our customers. Coupled with that, the infrastructure in Hungary – including a state-of-the-art telecommunications network – is excellent. Also, Hungarian employees are open to new technologies and we have very many talented employees. The challenge for universities and educational establishments is in keeping pace with the increasing demands of SSCs and providing the right skills.
What are some of the special challenges of running an SSC with nearly 4,500 workers?
The greatest value in a company such as this is the highly skilled, loyal workforce with valuable skills. Therefore, one of the biggest challenges is employee retention. We have to devote particular attention to providing appropriate working conditions, an advanced infrastructure, the right salary and performance structure, as well as continuous skill development opportunities.
Another serious challenge is finding experienced professionals in the IT industry to compliment the staff who we train internally. Hungary is becoming increasingly popular among international corporations, a positive position for sure but also one leading to competition in the labor market. On the basis of this yearʼs Randstad survey, ITSH is the eighth most attractive workplace in Hungary; whilst this is a good position, we aim to ensure we can improve on that position in the coming years.
As head of T-Systems Malaysia, you helped expand that company. What lessons did you bring from Malaysia, and any other past positions, that have proven relevant here?
As an expat leader of large organizations, it is important to quickly understand and embrace the local culture. You cannot join an organisation as mature and complex as ITSH and make decisions based solely on your “home” understanding; you must understand that businesses and people operate in subtly different ways in each country. This is even the case for global organisations that are set up using the same governance blueprints. The subtle nuances in each country can mean great success if understood and adapted to – or else cause a lot of pain if not acknowledged.
What changes have you made at IT Services? What changes would you like to see and how are you working on those? Will the competencies of the company expand?
As the world of IT changes with great speed, ITSH has to adapt accordingly. Providing services such as mainframe at one end and the latest Digitalization and Cloud technologies at the other, means that we have to adapt robustly to this changing market. Since the start of this year, IT Services has operated within a new organizational structure, establishing four business divisions to support four different business needs. This enables us to react in different ways to different customer needs and expectations. However, we still maintain the overarching principles and governance of ITSH.
We are constantly expanding our ICT competencies, we train our colleagues in the fields of new technologies in preparation for the future, and as a result of our constant expansion we take on experts whose knowledge enhances the range of our services.
How does the supply of workers and office space impact the business? Do you see changes in the HR and property situations that may affect the market?
At the moment it appears that it is increasingly difficult to find IT experts that speak foreign languages, and the recruitment of those with specialist IT expertise presents a serious challenge. As I mentioned earlier, there is strong competition on the labor market and unfortunately we also have to face the fact that many young people accept work abroad. ITSH promotes the industry among young people through campaigns and programs organized for secondary school students, in the process revealing the many opportunities in this sector. It would be useful to rethink the teaching strategy, making teaching more practice-oriented and strengthening both IT and language teaching. We need to work with the establishment to grow a pool of young well-educated people, educated with the right skills to support our growing and more demanding roles.
Is there anything else you would like to add?
On a personal note, I have lived in Hungary with my wife for nearly a year now. We have come to know a beautiful country with a great culture, an interesting history and a potential for the future. Every day, I work with young people – the average age at our company is 32 years – and represent this country through talent, creativity and hard work. Perhaps their self-confidence could be stronger since they have every right to be proud of what they have achieved and created within their country.
Source: Budapest Business Journal, 28/06/2016