In recent years, Bangladesh has been accredited with one of the emerging IT outsourcing and software exporting countries in South Asia. The IT sector has been continuously contributing to the country's gross domestic product (GDP) that resulted in the steady growth of the economy. Comparing Bangladesh IT sector to that of the neighbouring country India, which is regarded as a strong competitor in South Asia, India is acknowledged as the innovation hub that delivers world class technology solutions internationally while Bangladesh is still striving to place its name on the global IT landscape.
Minhaj Mimo, co-founder of Battery Low Interactive, a cross platform app, game and web development company, said, "The competition in the software service industry, especially in the augment and virtual reality sector, is intense among pre-existing companies. New entrants must highly differentiate themselves before entering the saturated market."
Minhaj also went on saying how it was even more difficult for him, along with his partners Minhaz Us Salakeen Fahme and Istiaque Ahmed, to penetrate the market initially since Bangladeshi people five years ago were not acquainted with augment and virtual reality. Battery Low Interactive introduced the Battery Low Outreach Program to solve this issue-- by showcasing products in schools and conducting seminars- and now, the programme has partnerships with 77 institutions in Bangladesh. Undertaking these activities has increased the company's recognition, especially during this pandemic when virtual solutions are in high demand.
Farraz Rahman, co-founder of Elo, a software development company specialising in technological consultancy and development of customised software solutions shed more light on the topic of challenges in the software service industry. He mentioned, "Registering a company was a hurdle that felt much more difficult than it needed to be. The presence of a lawyer makes it a lot easier, but this might not be an option for most companies during their infancy."
Moreover, he stated that the biggest challenge for him was the issue of generating market recognition, which is a catch-22 situation since businesses do not trust new companies and recognition does not come without prior experience.
According to the United Nations Conference on Trade and Development's (UNCTAD's) World Investment Report 2020, foreign direct investment (FDI) inflows to Bangladesh dropped by 56 per cent in 2019.
The Bangladeshi government is actively seeking to attract more foreign direct investment (FDI) to alleviate the risks involved with being over-dependent on the textile industry and has identified ICT as a "thrust sector". However, due to a complicated business environment, this sector is facing immense problems for growth, especially when numerous Bangladeshi graduates return from abroad to create positive economic change.
"Being an international company with a worldwide footprint, we feel Bangladeshi laws have some limiters on foreign involvement. It is much harder to incorporate a company with non-resident Bangladeshis or foreign citizens who want to invest," said Miraj Hossain, co-founder and CEO of Bae Innovations, a recent Bangladesh and Canadian-based company, helping enterprises and entrepreneurs-- with technology solutions, incubators, and business strategies-- to aid their sail.
These entrepreneurs all agreed on two points, when asked about how to differentiate in the local market, which says a lot about the importance of these factors. First of all, a good team is required who believe in the same goal as the company's and is always ready for effective collaboration. The second point highlighted was the importance of maintaining quality in service and innovation. For future foreign entrepreneurs in the software service industry, Miraj, along with the co-founders of Bae Innovations, Tanveer Fahad Haq and Mehedi Hassan, pointed out not to cut corners and seek shortcuts only to gain short-term benefits.
However, Minhaj stressed the necessity of another crucial factor that companies can adopt to differentiate themselves and that is security. Cyber security is a major concern for consumers since no one wants their personal information out in the limelight. Hence, he stated that companies should start taking steps on bolstering strong security for positioning themselves strongly in the future.
The writer is a third year student of BBA programme at the Institute of Business Administration (IBA), University of Dhaka. She can be reached at email@example.com