How to strategically outsource IT development for HealthTech?

Oleg

Hi, Igor. Thanks for accepting my invitation to record the video podcast. I'm happy to see you today. I'm sure we will have a great episode today since I'm very well aware of healthcare and have great experience in HealthTech since the majority of our customers at Devico and DeviQA are from HealthTech. Please introduce yourself and tell us a bit about your professional background.

Igor

Yeah, sure. So, first of all, thanks for inviting me. It's my pleasure of joining your podcast. So, first and foremost, about myself, I'm happily married with two kids. That's the most important thing. I'm living in Berlin for the last five years. I'm mostly Israeli. Mostly. And I've been working in the IT industry for more than 20 years. I started as a networks technician, and then progressed from there to software development, and from there to software leadership roles in various companies, various industries, and now, in various countries.

Oleg

Okay, great. Thank you. Could you please provide an overview of the current project with Vivira Health Lab you are actively involved in and elaborate on the specific challenges or issues it addresses?

Igor

So, in Vivira Health Lab, we're building software solutions for musculoskeletal conditions. We have an app that treats various conditions and indications for back pain. At the same time, we're now building additional apps and additional programs that will treat more body parts with similar and other conditions as well. In terms of challenges, I mean, we're not different from anyone else, with the same challenges as any other tech company. So, it starts with balancing out the technical debt. And in the product progress, understanding where the right thing to do and when to do it. So, those are the common themes that you have throughout every company throughout every industry. On top of that, we have the challenge of the HealthTech sector where we can see a little bit slower adoption rate, a little bit slower development base on top of having various interesting regulations that we need to adhere to, which affects not only how we go about building products, but also, specifically, what do we have in our software and in our products. That's, basically, the main challenges for us.

Oleg

Great. And one of the main challenges for people is back pain. I can tell you.

Igor

100% yes.

Oleg

Especially for IT guys – for you, for me, and for even people who do sports. So, it's very relevant. Are there any specific areas within the healthcare tech industry you're particularly passionate about or find intriguing?

Igor

Yeah. So, I was pretty much always interested in AI, but with the progress of AI in the last year, that interest and that area where we're starting to boom even more. We see even here in the small area of Berlin that much more companies that are focused on AI in the HealthTech sector is starting to boom and starting to rise and thrive. Even though we've got an interesting law, or at least a draft of a law for the EU AI act, which will probably slow a little bit the progress and the development of AI in Europe, I still believe, strongly believe, that it is inevitable that AI will thrive and will boom. It's just something that will happen, I think, much sooner than later.

Oleg

It's just, you know, from my perspective as a user, it's just sad to see all those regulations from the EU side compared to the US where they're flexible, open. I understand the risks, I appreciate them, et cetera. But again, as a user, as a tech guy from tech industry, it's just sometimes very sad.

Igor

Yeah. And I do agree that there should be limitations, there should be some boundaries to AI. And no one wants to wake up in the matrix owner in the Terminator movies, but nonetheless...

Oleg

Sometimes it's too much, you know. Sometimes it's too much because you slow down the progress.

Igor

Yeah. Unfortunately, I can totally subscribe to that. Yeah.

Oleg

Are there any professionals or leaders in your network who inspire you in your professional journey?

Igor

So, I always go back to the previous people who led me, who helped me to thrive. So, my previous CTO and VP R&D in the last company I worked in Israel were definitely a huge source of learning and inspiration, still are, actually.

Oleg

What's his name?

Igor

The CTO is Gil, and the VP R&D, she's Inessa. So, both of them were, still are really a source of not only inspiration, but we're pinpointing ideas how to go about tech, and how to be a CTO, and whatnot. And also, the first CTO that I worked with in Berlin – Oliver. So yeah, we're still to this day good friends and exchange a lot of interesting ideas and thoughts. Otherwise, I do take part in various CTO gatherings where I find that sharing experiences and ideas, and learning from each other, or at least validating the things that you do, or devalidating is very, very contributing I don't think only to me but to everyone else as well.

Oleg

Thank you. You have a diverse work experience spanning multiple industries. How do you leverage it when approaching the challenges in the digital space?

Igor

Yeah, that's interesting. So, on the one hand, each company is unique and unique in every specific point in time of that company, but there are overarching themes and overarching characteristics that can and should be replicated between companies. For instance, I worked in a company where we produced solutions for IT optimizations and security. From that, I definitely inherited a lot of let's call it healthy anxiety towards security, and IT security, and cybersecurity. So, that's something that I'm taking from that company to every other position that I assume on myself. For a different example, I was working in an online gaming shop where it's kind of obvious that you can take from there – the understanding of what makes users tick and how to go about gamification. And not everything should be gamified, and definitely not medical devices, but to a degree, you need to understand how users interact and how can you help them make the most out of your solutions or products.

Oleg

Are there common trends or principles that you find applicable across different industries when it comes to growth and transformation in digital business?

Igor

Yes. So, growth is difficult if you don't have a solid foundation. Actually, growth is difficult period, and if you don't have solid foundation, that's impossible. So, specifically with digital transformation, introducing new tools and tech to your colleagues and to your peers is also difficult. It's also not as straightforward as one might think. Unless the people are bought in and on board, they will be reluctant to change. So, one needs to apply a lot of preparation, a lot of groundwork before applying any digital transformation, let's call them that.

Oleg

It makes sense. Can you share some highlights from your journey as the chief technology and product officer and the challenges you faced in scaling and running multiple teams?

Igor

It is challenging to run multiple teams from multiple areas of expertise, but at the same time, very much rewarding as well. I like it. And the biggest challenge for me is to balance out the context switching between each and every topic, between the various teams that I run, and between my responsibilities as the CTPO. On the strategic level, on the upper management level, it's definitely challenging to have this constant 'Okay, let me put my head of the techie or let me put the head of data, or the product, or whatnot'. So, it takes a lot of R of B to balance this out. Nonetheless, it is quite rewarding. As for scaling, as I said before, it is difficult to upscale, and to grow, and to preserve the initial culture. And we can even see it in huge companies and very established companies as Netflix. Netflix has a really great initial cultural page. Even though they were so much focused on culture, with a lot of foundation, they still struggle. Nowadays, they struggle with their culture and how to adapt to the massive scale-up they went through the recent couple of years. So yeah, if they're struggling, everyone struggles.

Oleg

How to resolve conflicts within teams?

Igor

Oh, that's a good question. So we try to go about this very pragmatically. So, conflicts are usually about professional stuff. And it's not only me trying to remind everyone, but everyone tries to remind each other as well – this is only work, and we're talking about the work, not the person. We're trying really, really hard to separate the persona from the work. Eventually, we're getting pretty much every time. I don't remember a time where we did not get to a solution where the most pragmatic, the most suitable solution at that point in time was emerging eventually after a lot of deliberation, maybe some emotionals. Yeah, eventually, the solution presents itself once the group, the people, the team are focused on finding pragmatically the best solution there is.

Oleg

How do you balance the technical aspects of product development with the need for strategic and creative thinking?

Igor

Okay, I actually don't see them so much separate because we're not producing sausages. And we need every feature, be it the smallest color button change, to imply strategic and deliberate creative thinking. Because it's not just throw over the fence and go implement it, and throw over the fence and QA it, and throw the fence and deploy it. It doesn't work like this. I mean, it can work like this, but it's not sustainable. It's not productive, not, well, not contributing to anything. And we imply creative thinking and strategic mindset as mandatory aspects of anything and everything that we do. It's just a prerequisite to your starting of each and every day.

Oleg

Do you have any routine for creative thinking? Some of the teams, some of the leaders I interview, they book time slot in their diary, and they gather together every period of time – second day, once a week – and they brainstorm, brainstorm, brainstorm, brainstorm. And most of the great companies, they reached the level where they were at that time successful by just brainstorming and generating creative ideas. What is your routine for that process?

Igor

Yeah, so we have, as I stated, we do have a mindset of strategic and creative prerequisites for everything that we do, but nonetheless, we do have dedicated slots and meetings, and recurring meetings that we do discuss, 'Okay, let's talk about the upcoming release, but what comes after that, and what comes in the next quarter. And two afterwards.' And I have various dedicated meetings with various people about what are we doing next, and what are we doing next year, or what are we doing in three years. So, this kind of sessions, yeah, definitely scheduled. But I find them kind of a routine of our constant, well, creative mindset, creative and strategic mindset because the focus for me just changing with the lens of 'Okay, are we talking about tomorrow, next quarter, or next year?' So, that's the only difference that I can see here in terms of change between these meetings.

Oleg

What strategies do you employ to ensure that the technology and products developed align with the company's overall business objectives?

Igor

Yeah. So, we use the OKR system, and from that, we derive what we want to produce and develop next. Together with our discovery process that we imply to discover what we want to develop next, we're approaching product development very pragmatically. So, in terms of what else can we use, or we have a new shiny toy that we can apply, yes, we can use it, but the approach for every, for instance, new tech, or new tool, or new idea is very pragmatic. Is it helpful for us? Is it needed for us right now? If yes, let's explore it. Let's test it out, expand the testing radius. And if it's still applicable, if it's still good for us, excellent adopted. So, the strategy is, as I said, very much pragmatic and very straightforward. If it's helpful for us, great. If it's not, discard it. In terms of specifically the tech stack, we really try not to go to a tech zoo and limit our scope of what tech we use. It doesn't mean that we don't use the latest greatest, but it means that we use very deliberate, very dedicated things that we know that we evaluated, tested, and deem very helpful for us.

Oleg

I like the phrase 'tech zoo'. I will start using it.

Igor

To be extremely transparent, I once by myself created the zoo, and I saw the fruits of my labor: how it's not conductive, and how it's not helpful to anyone eventually and in the long run.

Oleg

What role do leadership qualities play in driving innovation and success within your teams? How do you cultivate these qualities among your team members?

Igor

So, I like that you emphasize qualities because you don't have to be a leader by title in order to lead the topic. I see it throughout my department, my teams – people are leading topics, despite the fact that they're not a team lead, or tech lead, or whatever. Yeah, the obvious approach is encourage it, encourage leadership, and encourage people to be able to lead. But that's not enough. At times, you need to give a little nudge and push a little bit people to be able for them to shine. On a different note, I ran a couple of workshops on leadership for various people in the company, which hopefully, helping also to increase and enhance their leadership skills.

Oleg

How do you balance the need for innovation with the practical aspects of scalability when developing products, especially in a dynamic industry like HealthTech?

Igor

Yeah. So, we try to put sunlight on all aspects of development, be it the current product development, be it tech debt, or something a little bit long-term, as innovation. As soon as we can see, and we can sunlight everything and give clear or more or less clear percentages to each and every area, it's easier to balance it out, and it's easier to play around with this percentage to increase at times this or that. From the responsibilities aspect, I am trying to, well, untangle myself, and try to think a little bit more focus on what comes next, and empower the hands on the keyboard people to focus on what are we doing right now and how we go about development. Again, with innovation, it is a tricky question. And yes, we try to keep the innovation and innovative mindset all the time. But at times we also dedicate specific time slots for that. For instance, in December, we just ran a hackathon for a full week in the theme of AI. So, we ended up with a lot of interesting, very innovative projects, which are quite impressive. That's just an example of how you balance out the need to innovate with the day-to-day feature development and tech dev.

Oleg

Thanks for the response. Given the global shift towards remote work, what insights or strategies have you found most effective in maintaining a connected and productive team in a virtual setting?

Igor

Yeah. So, I've been working with remote setups for many years. With COVID, it's definitely increased quite a lot. And I found that it's really important to not only give everyone the opportunity to work properly, to have a good setup of home office and whatnot but also emphasize not only work connection between the people. So yes, we're here to work. We're here to produce. We're here to give amazing results, but it's not only that. And it cannot end with that. So, we would try to regularly do extracurriculum stuff and meetings that are not necessarily work-related. For instance, on Mondays, we do a traffic light check-in – so, who's in which mood. Instead of one of the dailies, we run kudos between the team members. And we also have off-topic meeting just for chat in the department once a week. That's only on the department level. Also, we have similar stuff on the company level. So yeah, it is very important to emphasize that yes, we're here to work, we're here to produce, but there's more. It is important to keep good, healthy connections between team members.

Oleg

From what I understand, you have quite a few meetings every day. Besides, the meetings you mentioned, probably, standups, once-a-week retrospectives, or once per two weeks retrospectives, and so on. How does your team manage to work with the amount of meetings you have per day? Do you find any challenges here, or it works perfectly, and this is like ideal balance? What's your opinion about that?

Igor

So, it never works perfectly, of course, but we do try to optimize towards, well, not perfection, but to optimize the setup every time. So, once in a while, we do go through the calendars and see if it's extremely fragmented, then we try to optimize and try to squeeze the meetings into several slots. In any case, we do try to make it so that you have dedicated, deep work time pretty much for every team member, to be the product manager, developer, QA, designer – it doesn't matter. You need to have some dedicated, deep work time, probably excluding me. I still didn't find those time slots, but I'm still searching.

Oleg

How do you manage quality of deliverables within your team, especially working remotely?

Igor

Quality of deliverables? So, as I said, we are in a regulated environment, but even if we weren't, I would still apply things like SOPs for software development. So, we have very defined processes that work quite well in terms of how do we go about an idea that that is rolled into a product ticket, that is rolled into a development ticket; how is it tested; how is it delivered; how is it tested in production later on. So, how do we ensure? We have a lot of good and healthy processes that are clearly defined and adhered.

Oleg

That's awesome. Could you comment on the challenges associated with the shortage of qualified specialists in the IT sector, particularly in relation to your business and healthcare tech industry?

Igor

Well, it's quite straightforward. If you don't have good people on board, it's really hard to deliver good results and good quality results. In HealthTech, it's a little bit, I would say, even enhanced because I would even go about and say in our specific industry, in the DIGA industry, which is healthcare steroids, we have the need of professionals that can actually understand not only how to go about software, but how to go about software in a very highly regulated environment. It takes time to onboard people. And it takes time to understand all the complexities and all the different delicacies, and nuances that we have with respect to our industry. So, yeah, the shortage and the lack of variety, it's getting harder and harder to produce high-quality results.

Oleg

Could you share how your development team is structured in your project? And have ever outsourced your techniques to an external vendor?

Igor

So, we're structuring our teams not as cross-functionals but by teams that are dedicated by their specialties. So, we have a backend team, we have a mobile team, we have a QA team, IT team, data team, and a product team. And we find that this specific setup is the most beneficial for us. I worked before in cross-functional setups, which were very much applicable to those companies and those points in time. But it makes sense for us, with very specific challenges that we have in each area of expertise, to have it as non-cross-functional. Did we ever outsource? Yeah, of course. I mean, I'm working with outsource companies for the last 10 years. It's a good experience, and it's an interesting setup. It depends on the point in time of a company, what exactly they need.

Oleg

Okay. Yeah. If you have been working for 10 years, probably you're happy with deliverables and with the result. What were the precise factors that prompted you to consider IT outsourcing?

Igor

So, I think, and that's my personal experience, that there are three reasons for playing an outsource company. So, it could be a price – on the price basis. It could be on the speed to scale up. Or it could be on a speed to scale down. And the scale-down part, obviously, it's much more applicable in recent years, in recent couple of years. But beforehand, yes, the speed to scale up. Yeah, it was a really valuable and important factor.

Oleg

Especially in 2021, close to the end, I remember how scale-up was much, much way more applicable than scaling down. Now, it's a different time.

Igor

Yeah. It was quite interesting with COVID that everyone were afraid of what's going on.

Oleg

Yeah. They started reducing teams, but then it showed boom, like 10 times more. That was fine.

Igor

Yeah. I hope that the scale-down period is close to be over, and we'll see again a rise in tech hires.

Oleg

I hope so too. I interview different people, some of them are well-known businessmen, some of them less, but the hypothesis that I hear from most of them is that it's about a year, maybe less. Of course, it depends on the rates cut, when the rates are starting or slowing down. But also, there are other factors. I hope closer to the end of the year, we will see some positive changes.

Igor

I actually heard exactly the same prediction with let's call it even H2 24 and 25 is, well, not definitely, but is looking much, much brighter than the past couple of years.

Oleg

My only concern – when all people do one thing, you should do the opposite thing. So, when everyone is saying that it will be like that, as per my experience, it usually doesn't happen. But let's see. Let's see. What are the drawbacks and benefits of outsourcing?

Igor

Well, the benefit is you more often than not get very top-notch professionals quite fast, which is the entire point. But yeah, it's really important to state it because you do get more often than not very top-notch professionals, especially if you're dealing with a company that knows what they're doing, and they have very established processes of onboarding people first to the company and then to the companies that want to work with. The drawbacks? It's not a drawback, it's more of a challenge, I would say, I experienced this for at least a couple of companies – to remove the label of the external developer or the external IT person, QA, whatever, and make the external people feel as part of the team, and part of the group, and not less than anyone else. Yes, it's a different setup for them, for us. Nonetheless, this is the biggest challenge that I found, that you can overcome. Yeah, I've done it at least a couple of times successfully. So, yeah, that will be the only challenge that I can think of.

Oleg

How do you measure the success of collaboration with an IT outsourcing vendor?

Igor

On a much strategic level, it's getting two out of the three criteria that I mentioned before. So, price, speed to scale up, and speed to scale down. So, if you have two out of those, that's already great. Otherwise, as I mentioned before, if we remove the external label, and they're part of the team. Let's say, of a developer that's part of the team is measured exactly in the same manner that every other developer is measured. So, it's on the individual level – it's exactly the same as any other developer. And on the company level – hitting the two or three criteria.

Oleg

Yeah, I agree with you. What I see in my business – the majority of our clients treat engineers like their employees, almost the same level, with additional benefits that they are not obliged to provide but wish to do. And of course, meetups – all kinds of stuff. So, it really helps a lot to differentiate, especially when the market is highly competitive, to obtain the resources. And yeah, it's definitely beneficial. My last question: what advice would you give to other companies considering IT outsourcing?

Igor

Think carefully what exactly you need. If you're just starting a company, it will be really, really difficult to onboard someone really fast. Obviously, you have some caveats, and you have some case-by-case, different success stories, but more often than not, you do need someone fast. So, I'll definitely consider an outsource company, especially in the early stages of a company. Also, when you need to scale up really fast, I would definitely recommend to consider, as we spoke, not to consider but to treat the developers as internals and not to differentiate. Very simple example that I saw and removed it – adding 'external' to the email address of an employee. It's so detrimental and so creating different classes and different levels, and it's so unnecessary. Treat people as people, and treat all developers on the same level, and you'll do great. So, that's my only recommendation.

Oleg

That's an interesting point I saw in my business list a few times, and good that you've reminded. These days, we don't have this, but in the past, we faced with the same. Yeah. It was a bit weird for me, but it's okay. Different processes, different rules. But I agree with you. Igor, thanks for joining me. I really found this episode very useful. I noticed quite a few insights that will help me and, I hope, my auditory. You're definitely an experienced CTPO, and there are things that I learned.

Igor

Thank you, Oleg. I enjoyed this conversation, and it was my pleasure. Thank you.