Outsourcing service providers in Eastern Europe – Lower costs, higher quality

Outsourcing service providers in Eastern Europe – Lower costs, higher quality

Interview with Egor Kozlov of GFE Solutions, and Philipp Jansen of LÜHR FILTER

All over Europe we experience a shortage of skilled workers. Many companies work with outsourcing service providers in order to occupy their vacancies. But regional providers can be too expensive, especially for small and mid-sized companies. However, prices of Eastern European providers can be much cheaper while providing the same or even better quality. Egor Kozlov, CEO of the Ukrainian company GFE Solutions, and Philipp Jansen, CFO of LÜHR FILTER, talked to the Kloepfel Magazine about their joint project.

What service does GFE Solutions provide for its customers?

Kozlov: GFE Solutions is a specialized engineering services company. We provide remote engineering services for customers from many different industries. We support technical departments with design engineers, strength analyzers and CNC-programmers.

What makes the Ukrainian market so attractive for German companies?

Kozlov: Ukraine is known for the high quality of its public education system. On top of that, our graduates are able to integrate flawlessly into Western corporate culture. Due to our overlapping time zones, we are available to customers whenever we are needed. The main motivation for our partners to outsource their positions to us is cost. While the Ukraine may not be the cheapest outsourcing destination it is certainly cost effective. Companies with employees in Ukraine save up to 70% compared to companies with in-house staff. This means that they will have larger profit margins and more capacity to develop their business. Lower costs also mean that a wider range of skills fall within the budget.

Jansen: The choice of a Ukrainian service provider was primarily due to a shortage of skilled workers in the German engineering sector. It is becoming more and more difficult for us to find skilled workers in Germany. Moreover, Kiev is known for educating good designers and engineers with high technical skills. They are also very talented in software and programming. In addition, German service providers sometimes demand four times the price for similar quality. As a medium-sized company, we naturally have to look for alternatives. However, the critical requirement for the implementation of such a project is always that it is in compliance with labor law, which is the case with GFE Solutions’ remote service.

What distinguishes GFE Solutions from its international competitors?

Kozlov: We are engineers with a commercial gut which tells us every day that the customer is king. We believe that this way of thinking should exist in all supply chains around the world. We expect the same from all of our employees. Availability, flexibility, value creation – these are the simple tools in our approach that allow us to provide excellent services with fast reaction times. In fact, we never say no. Sometimes it takes a lot of effort to fulfill all of the customer’s needs but we have a precious reward as a result, when customers say: “Thank you, I’m happy now! “ And that is what our success is based on.

Which financial and process-related advantages can GFE Solutions provide for its customers?

Kozlov: Our services are competitive and cheaper than those of our European competitors. Still we believe that our quality is more important than our price. We have opened a new version of outsourcing. Outsourcing is often considered as an issue for customers because the service provider has to be instructed constantly. Objectives have to be made clear, special desires need to be fulfilled and much more. In order to solve this, we operate completely customer-oriented. We study all special needs and work temporarily onsite to provide our customer with the best possible service. In this way our customers feel like we are colleagues rather than external service providers.

How was your technical department organized before the cooperation with GFE Solutions?

Jansen: In the beginning, we had a high work load in our technical processing. As a medium-sized business that mainly works on a project basis, we cannot immediately hire new employees when more capacity is needed. After all, the additional capacity becomes unnecessary when the workload is reduced. As a result, we have already relied extensively on the support of external service providers, which, of course, can be pricey.

What was the main objective of the GFE Solutions project?

Jansen: The goal was to set up an external engineering team that would work exclusively for us. At the same time, this team should be able to take a break for up to four weeks in times of low capacity utilization. This was possible with GFE Solutions in Kiev. There, a team was set up which was trained in our processes and procedures and works on our systems from Kiev. The time-consuming and expensive work, which is not critical for construction, is taken over by the team in Kiev. Meanwhile, our engineers focus on the strategically important and quality-defining topics.

How does GFE Solutions operate on a project?

Kozlov: Details are extremely important for us as all of our customers are very different. All of them have their special traditions and style. That is why we define a perfect team for each project focused on individual requirements. We gather information and our cloud environment allows strong communication throughout our entire team. Thus we never lose information, are always in touch and stay below the time-related milestones of the schedule. Our team leaders also regularly fly to the customer for personal meetings, to clarify current project details and to make sure that everything goes as planned.

Jansen: In our project, a team leader was appointed by GFE Solutions right at the beginning. This team leader speaks perfect English and acts as an interface between our company and GFE Solutions. He commutes weekly between Kiev and Stadthagen, stays one week in Kiev and the next week with us. The Team Leader is strongly integrated into our processes. He takes care of any new members or terminations in the GFE team and teaches the other team members. He collects the questions and challenges during the week at our headquarters and takes them to Kiev, where he designs solutions together with the team.

Which aspects were particularly important considering LUEHR FILTER’s corporate philosophy and customer requirements?

Jansen: For us, it was important that the engineers have the appropriate training in the field of construction technology. That’s why our team at GFE Solutions consists exclusively of qualified design engineers. In addition, it had to be ensured that the employees were also trained in the use of our CAD system. This was the case with our candidates. Of course, knowledge of the English language was also required, as communication had to be flawless. In the end, the employees had to familiarize themselves with the system just like any other new employee.

Kozlov: I am an engineer and I have a master’s degree in machine building technology. I started as a construction engineer and became CEO of a machine building plant for the production of all-terrain vehicles. Our employees are all qualified and experienced engineers in different fields. Some of them have experience in heavy machine building, others in helicopters or all-terrain vehicles. But the most important thing that unites us is our high motivation. We are a team of passionate engineers, determined to support our customers.

What developments and benefits have been achieved through the joint project?

Jansen: The benefits achieved particularly lie in increased professionalism and financial savings. The faster and more extensively we obtain the required technical documentation, the shorter the execution times. Simultaneously, we experienced an increase in quality. We were very satisfied with the cooperation. That is why we are already planning to expand the cooperation further by employing 20 GFE Solutions engineers by the end of the year.

Kloepfel Consulting
Andre Vollstädt
Phone: +4921188259417