Israeli companies move business offshore as war increases instability - Aman Group
Pasternak explained that companies whose clients are abroad may have sympathy for the situation in Israel, but there is a limit to how much this will impact their business decisions.
Israeli IT company Aman Group has seen a spike in the number of companies requesting to use its offshore services and move at least some of their activity abroad during the war, according to company CEO and owner Ben Pasternak.
Aman offers offshore, hybrid offshore, and Israeli operation options. During the war, the company saw a 25 to 30% increase in requests for off-shoring at least some activity from their Israeli clients.
It makes sense that people don’t want to choose to use services based in countries with large amounts of instability, Pasternak said, explaining that this is true regardless of how they see a country. Even for a country you like or want to see succeed, if you worry about stability, you won’t want your central systems based there, he explained.
“People don’t buy from conflict zones,” he said. “This is a problem that is starting to have an effect that we can see becoming more and more significant,” he added.
Aman Group works with companies in a variety of fields including banks, credit companies, insurance companies, gaming companies, and many start-ups.
While Aman is encouraging and supportive of its employees who are in reserve duty, this absence of employees during the war is one of the issues that creates instability for clients, leading them to request to move operations to Aman’s offshore sites, Pasternak explained.
Judicial overhaul also caused issues
The judicial overhaul, like the war, created a general atmosphere of difficulty working with Israeli companies, Pasternak explained. Investors don’t necessarily pay attention to all the small details, and instead are very influenced by the overall atmosphere in the country they are considering investing in, Pasternak offered as an explanation.“We have been creating an atmosphere of instability and uncertainty for too many years,” he said, saying this is impacted by the judicial overhaul as well as by the war. “Given alternatives, people don’t want their business in Israel,” he added.“We have high technological abilities, there is talent and motivation,” he said, saying that this gives Israel an advantage, but these are tempered by the disadvantages of Israel’s air of instability, he explained.Pasternak explained that companies whose clients are abroad may have sympathy for the situation in Israel, but there is a limit to how much this will impact their business decisions.“That is why our ability to combine work in Israel with work in our offshore site is valuable to companies,” he said.“I really hope, as an Israeli and as a patriot, and for this very large company whose headquarters are in Israel, that the situation will change very quickly, immediately after the end of the fighting and after we reach diplomatic agreements,” he said. This could bring about a big rebound for business in Israel, because “the talent is here, the abilities exist here.”
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