Women's IT Sector Enterprises

Case Study No. 2

The VIRTUAL Computer Club in Donetsk, Ukraine

Case Study Authors

Natalia Tutukova (zeus_club@rambler.ru) and Katerina Pilipchenko (postmaster@liga.donetsk.ua)

Enterprise History

The VIRTUAL Computer Club is a woman-run IT sector microenterprise located in Snezhnoe in the Donetsk region of Ukraine. Tutukova Natalia developed the business plan for the Club while studying at the Donetsk Women’s Business Support Centre of the Donetsk Regional League of Business and Professional Women. The Centre of Employment then awarded her unemployment benefit to set up the club as a business. It opened in March 2002 with three computers and by the end of the year had ten (Celeron 2100s).

In 2003 it become a member of the Donbass Association of Computer Clubs and in 2004 a young people’s NGO was created. In 2004 the premises began to be refurbished. In 2005 it planned to increase the number of groups doing computer courses, and also to deliver training on personal growth.

Enterprise Profile

The Computer Club provides a variety of services for the local population:

· computer games for young people (from six years up);

· computer training courses;

· typing, printing and copying of documents;

· personal development training for children and parents.

It runs ten workstation PCs using Windows XP Home Edition, Star Office and various computer games. It has an internet connection, one landline and one mobile phone. The VIRTUAL Computer Club employs two women (the owner and an administrator), and one man – the computer trainer.

Enterprise Performance

In 2004, 12,000 hours of computer games were provided and 60 people received computer training. The total sales volume was US$5,500 and approximately US$200 a month profit is made. Monthly expenditure is US$300 on salaries and utilities.

There have also been broader impacts of the success and profile of the enterprise: Natalia enjoys a good reputation in local government circles and has been invited to participate in Snezhnoe's Working Group on Strategic Planning on Economic Development.

Main Success Factors

1. Availability of a government-provided subsidy – in this case, unemployment benefit – to help survive the difficult investment and cash flow time of business start up. A related success factor has been provision of government subsidy through the local Job Centre: in this case one year’s subsidy of staff salaries which helped the Club to survive while serving a relatively poor clientele.

2. Taking an individual approach to clients in comfortable surroundings, enabling a service customised to individual requirements.

3. The quality of programmes for young people, amongst whom there is a strong demand for ICT access and services.

Main Benefits for Women

1. Monthly salaries of US$60.

2. The provision of two jobs for women who were previously unemployed.

3. The need, in running such an enterprise, for the women themselves to build up their computer skills.

Main Negative Impacts or Risks

1. Competition from computer clubs using unlicensed software (music, films and pornography) and allowing young people to smoke and drink.

2. The lack of central heating in the VIRTUAL Computer Club, and the poor quality and high cost of the alternative heating system.

3. Lack of spending power among young people, who are a key target group.

4. Losing customers as more people install computers at home.

Good Practice in Management

1. Devolved responsibility: a high level of responsibility is devolved to the Club's workers who enjoy the manager’s complete trust and run the Club in her absence.

2. Providing individualised service to clients.

3. Creating and implementing advertising campaigns to increase the number of clients using the enterprise's services.

Main Challenges

1. Lack of support from the landlord for maintaining and improving premises, leading to higher overhead costs.

2. Lack of potential for expansion due to condition of the current premises.

3. The high costs of legal software purchase.

Case Photograph

Case Details

Author Data Sources/Role: Enterprise Manager Role

Region: Eastern Europe Start Date: 2002 Submission Date: April 2005

The "Women's ICT-Based Enterprise for Development" project is coordinated by the University of Manchester's Institute for Development Policy and Management. The project is funded by the UK Department for International Development's Knowledge and Research programme.

http://www.womenictenterprise.org/ukraine.htm August 2005