Petar Torneff: The IT Sector in Bulgaria Offers Talent and Quality. It is a Myth that Bulgaria is a Cheap Country with Undervalued Workers

The Bulgarian IT sector has established its place as one of the most powerful engines of the local economic growth. It has a serious contribution to the GDP of the country and provides jobs for nearly 100,000 people – with a tendency for this number to increase. Apart from ideas and traditions, the Bulgarian IT industry also offers talent and quality.

“The myth that Bulgaria is a cheap country with undervalued workers must be refuted. People invest a great lot in themselves in order to become better specialists”, says Petar Torneff, Managing Director of Accenture’s Advanced Technology Center in Bulgaria.

More and more companies care to develop and retain their professionals by providing them with flexibility and benefits that the government cannot – or will not, with an eye to the future.
What will happen to the industry in 2023? Why is the focus on technology increasingly shifting to the individual footprint on the environment? Why has a real country decided to develop its digital twin in the metaverse? How does the political uncertainty in Bulgaria affect the local businesses?

Read more in the interview with Petar Torneff from Accenture Bulgaria for Boulevard Bulgaria.

Asen Grigorov (Boulevard Bulgaria): The IT industry has finally attracted the attention of the Bulgarian politicians. It seems that at last they have begun to understand its great importance for the country. Recently, data on the contribution of IT industry to the country’s GDP has been officially announced. And the numbers are impressive.

Petar Torneff (Accenture Bulgaria): Yes, the contribution amounts to 6% of GDP, or ca. €4 billion in revenue for 2021 alone (since the 2022 figures were not published by the time the interview was taken). This huge growth is due to several factors. One of them is the pandemic, that has actively directed people and companies towards digital transformation. The results are truly impressive, as the increase in numbers is up to 22%, compared to 2020, when it amounts to only 12.7%.

Asen Grigorov (AG): Are people really looking for remote opportunities in terms of work? Is that where the great interest in software demand has come from?

Petar Torneff (PT): I must agree that the interest came from digitization. As a result of the pandemic, people suddenly felt as if in a new environment. An opportunity had to be established for them to work and shop efficiently – even though remotely. This immensely motivated most companies not only to provide options for remote work, but also to promote their employees’ well-being. All team members needed to feel comfortable enough while carrying out their daily non-work activities, such as shopping, watching video, doing what they love online.

AG: Has this trend continued in 2022? The statistics show that the main demand is for services that optimize working conditions in one form or another, for both employers and employees.

PT: Yes, this trend has persisted. That is why the curve went up so headlong. However, by 2023, a slight cooling is expected – both in terms of the market and the companies that are about to start optimizing their costs. Although in the last 2 years a stable growth was established, we surely know that such processes are cyclical, in any case.

AG: How has the military software sector evolved – in regards to the war in Ukraine, where the situation continues to escalate? What we see on the battlefield is that 90% of the Western aid to the Ukrainians consists of machines with a large number of computers and equipment inside. Have you seen this market trend in 2022?

PT: Partly, yes. The military forces have perhaps placed the strongest focus on security. Such actions lead to investments in remote management of the programs. Therefore, for example, if drones can be used, they prevent putting human capital at risk. Fortunately, we do not work in this sector.

AG: I was wondering if you see such a trend in 2022, due to the newly changed environment.

PT: Yes, there is such a trend. There are many companies and startups engaged in providing transport services. In Bulgaria, there is an already established startup of such type (Dronamix). It operates in this very field – through using drones. It is a well-known fact that what the military sometimes does, sometimes finds its way into the marketplace.

AG: What do we actually have in Bulgaria? Dronamix is a good example of an almost entirely Bulgarian product. What else does the Bulgarian IT sector currently own and offer?

PT: The Bulgarian IT sector offers talent and quality. The myth that Bulgaria is a cheap country with undervalued workers must be refuted. People invest a great lot in themselves in order to become better specialists. Our country is starting to rank higher, based on this criteria, along with the further establishment with its key focus on providing high quality services.

AG: Isn’t this just a national myth?

PT: Absolutely not. More and more companies strive to create digital hubs in Bulgaria, motivated by the excellent quality.
However, there is one more factor that motivates such a decision. As a result of all investments that come mainly from the USA, the Netherlands, Germany, the UK, etc., another problem arises – the lack of employees.

AG: That was my second question. What can we offer? Where is the balance between the demand for a service and the lack of employees?

PT: This is one of the greatest challenges for all companies. Over 10,000 jobs were created last year alone.

AG: Are these entirely new jobs?

PT: Yes, in addition to the ones already available on the market. Currently, the entire BPO and IT sector employs around 90,000 people. The number is large, and in the next 1-2 years it will surely grow to over 100,000. Again, here comes the question on how to find skilled candidates.

AG: The answer seems obvious to me – by attracting people from outside.

PT: One possibility is for this to happen organically. Most companies organize IT academies, through which they engage junior specialists and develop them. As a next step, they include them in the various programs, part of the current work projects. The other option that we can rely on is to attract people from outside.

AG: What do you mean by “outside”?

PT: In the recent months, we missed the opportunities that arose, as a result of the war in Ukraine. Most of the specialists there went to Poland and Romania where they were offered better introductory programs for new employees.

AG: Their programs seem to perform better in attracting quality specialists – in one form or another. There are no such programs in Bulgaria, aren’t they?

PT: Currently, there are no such programs. The government must do everything possible to vote on the most pressing issue, and that is the Blue Cards. They will make it possible to process the applications of people from abroad much faster. And, therefore – make it easier for companies to hire them into their teams.

AG: Blue Cards – these are the certificates of the forcibly resettled people that act as work permits. If at this moment you want to attract three good specialists, on which market will you look for them? Is this either the Bulgarian, or the world market? Or do you seek another way?

PT: At the moment, we are mainly looking in the Bulgarian market because we cannot afford to attract employees from outside. The process is difficult, so we act in two directions. In the first scenario, we develop academies for junior specialists, while in the second – we seek for job-ready professionals on the market. As a company, we attract them by giving them the opportunity to develop, acquire new skills, grow professionally and have comfort and stability in the long term.

Currently, these are the only options. The market is so saturated that all companies are trying to retain their people. And we ourselves invest bigger efforts in this direction. We work on the creation of new benefits and various programs for employee development and discuss the ideas with the management and HR teams.
In most cases, companies usually focus on the so-called material benefits – such as a sports card, a transport card, a fuel card, etc. We decided to come up with a different approach. On the one hand, for example, in an unpleasant situation when a relative of a loved one passes away, the government only provides 2 days of paid leave. On the other hand, we decided to provide 4 weeks of paid leave, fully financed by the company, so that the person can have enough time to recover from the loss.
When it comes to maternity leave, the state calculates 90% of the remuneration for the first 16 weeks after giving birth. We, on the other hand, provide 100% of the salary for all new moms, for the same period of time. To the men who want to take advantage of a paternity leave, we provide additional 6 weeks, in addition to the 14 days, guaranteed by the state.

AG: These are practices from the global markets that you apply, or we could say you invent them here?

PT: We introduced the hybrid model of work 5-6 years before the pandemic, as an efficient practice. The policy was named “40/60”, including 40% work time outside the office, and 60% – in the office.
To date, most of the colleagues and I work remotely, but basically our policy is 50/50. The good thing is that we have recently reached 30% people returning to the office. We see that fully remote working model is not that efficient, due to the lack of social contact. People simply need to communicate with others. It is much harder to develop employees that you cannot meet in person, as you are not aware of their feelings and identification with the company.

AG: If I am very good at writing code, what does it matter if I work for either Accenture, or Company X? Also, what does it matter if I work for a company based in Bulgaria or anywhere else in the world?

PT: There are people for whom all of this does not matter and they will not disappear. Even before, our business relied on the so-called contractors. These are people who come, work as part of a certain project at the company for 5-6 months, and then move on to another.
However, another group of people exists and is bigger and stronger. It unites people who want to communicate. A few days ago we had a Christmas party – the first in the past two years. Over 1100 people work for Accenture in Bulgaria, as part of the two company units – Technology and Operations. At the party, we gathered a total of 600 our colleagues – and realized that a huge percentage of them have not met the others in person, by then.
People used to get acquainted and felt in a unique way – surrounded by other colleagues. I don’t think that this feeling can be replaced fully by working remotely.

AG: What will happen in 2023? What are the trends in your business field?

PT: The trends will further establish the type of technologies that are used – Cloud, artificial intelligence (AI), Machine learning (ML), Edge computing, Cloud computing, etc. The key topic is sustainability – and how we use technology.

AG: When one thinks of ecology and climate change, the IT field is not necessarily associated with a big negative impact on the environment. However, if you imagine server farms, you begin to think that there may be something to improve.

PT: There is, for sure. And the topic is very interesting. Sustainability without technology is impossible. It represents the base that helps to achieve it. The more important question is how to make technologies more sustainable.
This is the so-called “dark side” of the IT sector. According to the latest data in one of Accenture’s most recent reports, in the period 2007-2010 it has contributed to about 1.5% of the harmful carbon emissions. To date, that amount is about 4%. In the last 12 years, this negative footprint has increased by about 150-160%. However, by 2040, it is expected to grow to 14, or a 250% growth. If the necessary changes are not made, the scenario will become truly frightening.

AG: In my opinion, the growth in numbers comes from Bitcoin mining.

PT: It is not the only factor. However, it is interesting that you mention Bitcoin.

AG: I say this as a joke, but, in fact, it involves a lot of hardware and energy power.

PT: It is no joke. For 2021, maintaining Bitcoin technology consumed more energy than Switzerland in a year. Also, at the moment, AI and ML are coming to the fore. To train within a complex deep learning algorithm around 84 hours, it consumes 650,000 kW/h. These units of energy are equal to the carbon emissions produced by about 57 people for an entire year.

AG: And how does the industry solve this equation?

PT: This is a difficult task. It is where the green software concept begins. It should promote a number of benefits – both for society and the environment. The goal is to find a way to consume less energy, and optimize the software. Another task involves finding a solution for using less hardware in order to reduce carbon emissions. At Accenture, we have launched a series of sustainability trainings, with the green software being one of the first for every engineer in the team to go through. The trainings even show our people how to create the algorithms they must write.

To train an AI recognize flowers through a smartphone’s camera, huge data sets are usually used. The aim of these applications is to be as accurate as possible and to recognize the objects faster. Usually, they study at 96%, and strive to reach 98% accuracy. However, just the 2% efficiency increases the energy consumed by the algorithm 7 times. Getting acquainted with the data is extremely important in order to be able to review the entire software development cycle – including analysis, design, implementation, testing before deployment and support.
The average user also contributes a lot to the negative carbon emissions produced by the hardware they use. We all use laptops, phones, electronic watches, etc. About 60% of the burden of carbon emissions comes from such devices. Therefore, we must seek a way to optimize the amount of consumed energy.

AG: This is what we count on you to do – provide an optimized software that we shall all use.

PT: Yes, of course. But you must know that even as an ordinary user, each of us can do many things that at first glance seem insignificant and yet are extremely important. For example, if you open your phone, you can look at the names at the most used applications. These are probably Facebook, Instagram, Messenger, LinkedIn, etc. As a next step, check how many of them are put in dark mode (with a dark screen). Using this function saves 60% of the consumed energy per each application. This means that if the most part of your mobile apps are used in such a mode daily, you, as a user can decrease your negative footprint on the environment.

AG: Let’s talk a bit more about the metaverse. This year, it has become a key topic – in terms of investments, as well. Investors in the USA believe that it would not work efficiently. The shares of Meta started to fall in price. What is your definition of “meta”?

PT: The metaverse is something that I believe has a great potential. However, it will take time to grow and prove as an efficient instrument. This is a space in which you can implement so many projects. An example of an interesting initiative that Accenture Song is currently working on involves Tuvalu, an island country that is in danger of extinction. As the temperatures rise, the ocean level rises and little by little the island becomes to sink. For the citizens, this is scary because it is expected that within 15 years some of the islands will completely disappear. The project that Accenture Song developed represents the creation of a digital twin of part of the islands, transferred entirely to the world of meta.

AG: The Minister of Justice and Internal Affairs of Tuvalu says they will become the first digital country. What does this mean?

PT: This is a very interesting concept. It turns out that the metaverse can provide an opportunity to recreate the entire island, together with all its elements, in the digital environment.

AG: This is amazing, as the recreation includes landscapes, hills and not only intellectual property, in terms of art, but even the geographic characteristics.

PT: Absolutely. Their Minister published a video that a simple eye would not realize was filmed in the metaverse. Only at the end of the footage, the camera’s focus is pulled away and there is a deliberate pixelation that proves that what you see is not the real place.
The metaverse can offer many possibilities. If you want to open a factory, why waste resources when you can make a digital twin in such a universe, see how it would work at full capacity and only then decide where to build it and invest huge capital?

AG: So, you are saying that the metaverse is not just pictures and chats.

PT: Surely, it is not limited to just that.

AG: I see that many big brands are currently investing in this direction. For example, they open stores for fashion goods. However, do the more serious industries see opportunities in the metaverse?

PT: Yes. Microsoft and Accenture have teamed up and are working towards a more accessible and cheaper implementation of products in the metaverse. Currently, the costs are quite high. Therefore, we need to continue the development of opportunities. I can assure you that our partnership is not just accidental.

AG: Okay, let us sum everything up. Does the political instability and the lack of elected stable government in Bulgaria bothers the IT sector? How does these trends affect you?

PT: Yes, I cannot deny that we see a number of negatives. Once again, the discussion about an increase in maximum insurance income, which will negatively affect our sector the most. This is worrying because the IT sector generates high incomes and operates successfully without any support from the state – without tax breaks and efforts to make it more attractive.
That is why we, the member companies of key branch associations, have come together and reacted strongly to this proposal. It was already introduced last year when many of us picked up the difference, so it would not affect the employees. But how many times can we do it? The greater this gap becomes, the less companies will be able to advocate for their people.

About Petar Torneff

Petar Torneff is the Managing Director of Accenture’s Advanced Technology Center in Bulgaria. He has been working in the IT field for over 15 years. He graduated in “Computer Systems and Technologies” at the Technical University of Varna, the Leadership Development Program at Harvard Business School and EMBA at the American University in Bulgaria.

About Accenture

Accenture is a leading global professional services company that helps the world’s leading businesses, governments and other organizations build their digital core, optimize their operations, accelerate revenue growth and enhance citizen services, creating tangible value at speed and scale. It’s a talent and innovation-led company with 738,000 people serving clients in more than 120 countries.