Although foreign direct investment into the Czech Republic is growing strongly, many business analysts say the country needs to attract more knowledge-based investments in industries such as information technology. Derek Cummins, managing director of Dimension Data, an international IT company that entered the Czech market in late 2005, talks to The Prague Post about the country's future in terms of attracting IT investment and how the country could become more attractive to foreign companies. Cummins also reveals the biggest obstacle facing an Irishman living in Prague — finding a good pint of Guinness.

1. Dimension Data is a global IT firm, but it waited a long time before entering this region. The Prague office, officially opened in November 2005, is the country's first in Central and Eastern Europe. Why did it take so long for Dimension Data to come here?

We are indeed a global company. We are already present in over 32 countries worldwide and are Cisco's number one partner globally in 2005, which was announced at the end of last year. The decision to open a Czech office was based on two things: the growing demand from our multinational customers for us to open an office here and the fantastic growth potential for the IT sector in the Czech Republic.

2. When Dimension Data was considering expanding to Eastern Europe, why did it decide to go to the Czech Republic? How are the conditions for IT firms here different than in other new European Union member states?

As I mentioned earlier, the Czech Republic offers some great growth opportunities in the IT sector, certainly the highest within the new EU member states. The proximity of the Czech Republic to our other European offices was also a factor in the company's decision.

3. Many business analysts say the Czech government is focused on attracting automotive and other kinds of manufacturing investments but isn't placing enough emphasis on bringing in major technology firms. What do you think needs to be done to modernize the country's foreign investment portfolio?

Despite the government's focus on the manufacturing sector, the Czech Republic should still be attractive to technology firms. This country has a great skill base in IT and a large number of students graduating from technical universities. The Czech Republic also has a long and historic reputation for innovation and technical expertise. Today, I see signs of this reputation more than ever before. Also, I believe the right people should recognize this strength and try to capitalize on it to ensure future foreign direct investment from global IT firms.

4. One drawback for IT companies looking to invest here is the fact that the Czech Republic has high labor taxes. Do you think introducing a flat tax would make the country more attractive to IT firms?

I think a flat tax would be much simpler and more transparent.

5. What were the biggest challenges you faced when launching Dimension Data's office in Prague?

I have lived here for over five years, so I was pretty well prepared for the obstacles. There are the usual obstacles like finding good office space and hiring people. You need both these things to be able to start communicating with customers, which was a priority. The Dimension Data brand is well known outside the Czech Republic so we needed to communicate both to customers and our partners that we were here.

6. How should a company approach entering the Czech IT market? Can a newcomer gain new clients quickly, or is the market pretty well saturated?

Dimension Data prides itself on its extensive customer list of global multinational companies. We offer a truly global service, and there are a large number of these multinational companies with a Czech brand. Naturally, [catering to existing clients] is the best approach to take when entering the market.

7. Dimension Data has its headquarters in South Africa. Are you perceived differently than if you were a company based in the U.S. or Europe?

Not at all. It's an advantage. There aren't many global South African IT services firms in the world, so we stand out. We've received a lot of positive press in this market recently because we're the second largest South African firm after Pilsner Prazdroj [owned by SAB Miller of South Africa] in the Czech Republic. Also, we have attracted good quality candidates who were attracted to us specifically because of our origins and the fact that we're different from traditional global IT services firms.

8. You've been living and working in this country since 2000. Have you ever considered moving on?

No, never! I originally came to the Czech Republic with the intention of staying for two years; now, five years later, I'm still here. I really love this business environment and also the people, culture, countryside, architecture and richness of the Czech language. There are so many things to do here on the weekend, so you can never get bored. I don't see myself moving on in the near future because my home is here. I'm looking forward to spending summer weekends in my chalupa [cottage] in north Bohemia.

9. As an Irishman living in the Czech Republic, what are the most difficult, and also the best, parts of your life?

The most difficult thing is finding a really good pint of Guinness. I recently was in Dublin and drank several pints, and I can tell you there really is no comparison to the Guinness in Dublin and the Guinness in Prague. The best part is that the Irish and Czechs have a long historic tradition together, as we originate from Celts. It has always been clear to me that the Czech people have a good impression of the Irish and like them very much. We also both share a passion for having a good time and a few pints. There's also quite a large Irish business community here, and we often get together for social and business events.

10. The Czech Republic will meet up with Ireland in the qualification matches for the Euro 2008 soccer championship. Which team will you be cheering for?

Uvidíme [We will see]. I think I'll cheer for both teams! As I said, the Czech Republic is my home, so I have a loyalty to the Czech national team, which has had more success recently than the Irish team. However, I still have to cheer on the Irish team because it represents my roots and my birthplace.