Daniel Ruzicka, Mikenopa: «An agreement is just the beginning»
When Daniel Ruzicka left for Moscow far back in 2007, he had a vague idea of how long he would have to stay in this unknown country. He had a difficult task: to open a representative office of Czech company Mikenopa that had offices in Czech Republic, Greece and Slovakia at the moment. Now Mr Ruzicka has a lot of Russian friends, his elder daughter goes to the first form of a Moscow school, and the business of providing internet-based technologies and event equipment to hotels is growing under his guidance not only in Russia, but also in other countries. We have met regional director of Mikenopa office in Russia and CIS Daniel Ruzicka and talked to him about special aspects of doing business in Russia, requests of corporate buyers, the changing market, loyalty and high standards.
Mr Ruzicka, were your professional activities connected to informational technologies before you came to Mikenopa?
I am not a typical IT- expert or seller. Before that I worked in hotel business as long as I can remember: I graduated from Hospitality School in the Czech Republic, then a university and started working in hotels, the last three years as a manager. Those were times when Internet technologies grew rapidly, and we had to provide it in a hotel in Prague. This is how I met Mikenopa owners. We agreed that it was an interesting and a promising project and it would be great to develop it in other countries. Little by little, and half a year later I was made a job offer. Its no secret that I was interested in it from the start: when I worked in Czech hotels I did not have an opportunity to travel and to gain international experience. Besides, Mikenopa`s business is directly connected to hotel business I was an expert in. But it was hard to take the final decision: to leave the customer to become a provider not many of us would have had the courage. I agreed only half a year later. This is how I started working in Mikenopa and ten months later found myself in Moscow.
You speak Russian very well. Your knowledge of the language came in very useful, didnt it?
You wont believe it, but when I came to Russia, where I had never been before, I did not know a word in Russian! I thought English would be enough for my work with hotels (and the majority of our customers are international hotel chains). But half a year later I realized that the success of my career here was directly connected to the knowledge of Russian. Indeed, hotel top managers are mostly foreigners, and we talk in English. But I have to explain something in Russian, for example, to an IT specialist, and you can not do without it. This is why I started trying to talk Russian. And I have made progress, as you can see!
It is a hard task to start business almost from scratch in a foreign country...
We started preliminary activities in Moscow in November 2007. The process of document preparation, getting an Internet provider license and other issues took some time, of course. And in 2008 we finally opened our Russian office Mikenopa LLC. And our first customer in the capital of Russia appeared almost a year later it was Hilton Leningradskaya. The problem is that it is always difficult for customers to trust a company that has no experience in the Russian market, even if it has two hundred customers in Europe. But when we got the first customer, we proved with our work that their choice was right. And three months later we signed a contract with Marriott Tverskaya that is run by Interstate Hotels & Resorts, as well as Hilton Leningradskaya.
And after that work started humming: at first we provided Internet to Moscow hotels, then to hotels of the Northern capital, and then to the regions. The most remote Russian city we provided Internet to was Irkutsk. In 2011 we opened our office in Kiev (Ukraine), in 2012 in Baku (Azerbaijan), in 2013 our second office in Russia in Saint Petersburg, and in 2014 our legal entity appeared in Astana (Republic of Kazakhstan). Besides, from 2013 Mikenopa is present in the Baltic States Latvia, Lithuania and Estonia. The legal body is Czech, but it is run by Moscow office.
And what helps you achieve such results?
It is very important for our company and for me personally to be trusted. You know, you can promise a lot of things. But our customers should be sure that conclusion of an agreement is not the end, it is the beginning! If we have promised something, we will do it and prove the customer has made the right choice and our service quality meets his expectations. We do not belong to companies that have a large advertising budget. Mikenopa`s success is due to word of mouth to a large extent. At the same time we keep in mind that if only one or two customers out of ten usually share information about their good experience, everyone will speak about their negative one. This is why it is very important for us to provide services up to the highest standard.
This is why we only provided Internet during our first years, and the second activity, technical support of conferences, appeared much later. We had a clear understanding that it is a completely different kind of service that required additional highly qualified staff, a large amount of high quality equipment etc. And I was fortunate to meet John Maxwell Kopisky, a former employee at SB Holding (audiovisual equipment provider editors note). On October 1, 2013 we bought SB Holding and started providing technical support to events at first in Moscow and since last year in Saint Petersburg and Astana.
Mr Ruzicka, if we speak about Internet service, why are your customers mainly international hotel chains? Do you plan to increase your work with individual hotels?
Yes, indeed, most hotels we provide service to are hotel chains. The reason is that they, unlike many individual hotels, have clear standards. Say, in Holiday Inn hotels no matter where they are, in Rome or Singapore when you connect to the Internet in the lobby, you may be sure hackers are unable to trace your passwords or personal data, and all the participants of a 500 person conference are provided with high speed Internet. Managers of individual hotels often think you can connect Internet the way you do it at home and it would be enough. But the network should cope with constantly growing customer demand, and there is a huge amount of programmers` work behind it. I am speaking not only about safety requirements. Nowadays guests arrive at a hotel with a whole armoury of devices a smartphone, a tablet, a notepad. And all the gadgets need high quality Internet access.
We should say that in 2014 our company set the record in the number of new customers, that include more and more individual hotels. There are several reasons for it. Sometimes hoteliers leave international hotel chains for individual hotels and bring high standards with them. Sometimes managers who go abroad see the way Internet works there and want to have the same in their hotel. And guests themselves become more and more demanding they are used to a certain service level and expect to have it everywhere, including Russia.
Can you see any changes in customer demand in the field of technological support of events?
Although we have been working in this field since 2013 only, we can see market changes. There are different causes for it. For example, last year Olympic Games attracted corporate customers` attention to Sochi, so the number of events in Moscow and Saint Petersburg decreased. But by the end of 2014 everything was as before. But the economic situation had its effect, of course: when rouble rate dropped, many European customers moved their events from Europe to Russia and cut budgets. Some try to arrange events with their own equipment, some ask for discounts, some order as little as possible: for example, microphones, a screen, a projector, speakers etc. Indeed, it does not make running business easier, especially when the cost of equipment has grown several times after the Black Tuesday, because it all is brought from abroad.
Of course, advanced technologies are more expensive. But at the same time the customer himself should understand what 3D-mapping is, for example, and how to use it to make the anniversary of the company more spectacular. We hold educational seminars in order to tell customers about our special services. We always follow new trends, participate in the main events for developers and service providers, find what we think may be interesting for customers in the local market and are ready to offer it.
To continue the topic of conference service, do you work with corporate buyers directly or through agencies?
Both. We also have agreements with hotels. It makes no sense for them purchasing expensive equipment and having it in stock, so they order it from us when they need it: our experts arrive, install everything, support the event and then leave. Some hotels ask to outsource their business centres, so that our company organizes its work. I should say that this approach is not common in Europe, it is a Russian feature. You will not find this practice anywhere else. In such cases our employees are present in the business center all the time: a receptionist, a manager, an engineer. And in this case we greatly depend on the volume of conference services sales of this very hotel, because current work of a business centre, when a guest needs to have ten pages printed, does not cover costs of these employees, of course.
What other features of business in Russia can you point out? Has anything surprised you?
I was disappointed at the process of document flow. You need a huge amount of documents everywhere, and if you put a full point in the wrong place, your document will not be accepted at all. When I was in the tax inspection and other organizations, I saw piles of papers that had been submitted by someone some time ago and now they lay in the corner because no one needed them anymore nobody would turn to them ever again. I am sorry for trees that are wasted! But these are Russian requirements and they are to be observed if we want to work here.
I liked very much the fact that Russian people consider trust more important in business, and I have already mentioned it. If you live up to their expectations make everything in due time, for a good price and offer good quality, the customer will not look for another provider whose services cost a little less. It simplifies business.
Mr Ruzicka, does your company have a lot of competitors? And in what way are you different from them?
Yes, quite a lot, as in any branch of economy. We try to offer distinctive service quality and working approach. For example, last year we started teaching our employees English, so that they could communicate with foreign customers. We have a certain dress code: we are a hotel partner, and if we work there, we should look like hotel staff a suite, a shirt and a tie. If we speak about Internet service, we have programmers on a full-time basis, i.e. we do not offer software developed by other parties. It means that if a customer asks for some graphic or technical standards a picture on the right or a weather forecast, we can promise to develop the model of the web portal he needs because we know how to do it. Besides, we have a well-trained customer support service, our experts always know who is calling, where from, what are network settings there, what engineer is on duty, how we can help and how quickly. All this brings positive result.
Our company has both international competitors and local Russian. If we speak about our advantages in comparison to international competitors, the whole team except for me is Russian. We know the Russian market and know the way to work here. International companies that run business in Russia through their partners, but are located somewhere in Europe are not so successful in this respect. At the same time we offer European standards and experience of our parent company, which is also a plus. Our international approach is our great difference from Russian competitors.
Besides, the size of our company is medium, it is the golden mean. Unlike large monopolists where settlement of some issues involves several departments and can take quite a long time, we work quickly. But at the same time our company is not small and we have both feet firmly on the ground from the financial point of view: we survived the 2008-2009 crisis and due to our partners and shareholders we are confident in our future. We understand that there are good times and bad times and are ready to everything. We appreciate our team, because the result of our company depends on our employees` expertise. I am very proud of our team!
Daniel, do you plan to stay in Russia?
When I was leaving for Moscow, I had a vague idea of how long I was going to stay here. Many managers who go to another country and do not achieve the result they imagined, bars of gold, within two years, go back. I am persuaded that this is no way to success. And our customers know that I did not just sign an agreement, went back and left everything to sink or swim. It is possible to contact me even outside working hours, and the reaction will be quick. Besides, starting from 2013 I am not just an employee: having appreciated our results in Russia and the CIS, our shareholders suggested I became their partner in this legal body. So for me it is not just work, it is my creation, my investment to the future. So it is very hard to say when my family and I return to Czech Republic.
What is your vision of your office in Russia and the CIS in two or three years? What is your goal?
There are several more regions and cities that are worth being present in the AV-area. It is a challenge, though, because offices require a big team and a large amount of investment. It is quite possible that within a couple of years we will open another 2-3 offices in Russia and as many in the CIS countries. Besides, this quarter we are stating operation in Georgia, and plan to open an office in Armenia till the end of the year. And we have a lot of projects for 2016 and even 2017. So we have a lot of interesting work ahead!
Interviewed by Natalia Travova
participants of ABT