Oleg Baranov, Neoflex: In present realities banks try to invest more in infrastructure for remote service

Oleg Baranov: In March when a story with a pandemic began to be developed, we thought too of what to do: whether we will go to work, whether we will not be. There was a week when we tried to understand how everything will be developed. But the situation was unrolled itself, without our big participation. Our company as the IT company, ranked as category continuously acting, to us permitted to work in the normal mode. Therefore, considering that most of employees in digging passed to remote work, in general we continued to work and already even got used.

Occurred changes very much, and, it seems to me, they already changed and will affect how the IT companies will work in the future. I will give a banal example. We in March were connected to the Diadoc system - to the electronic document management system allowing to sign is deleted different documents. This process began to a pandemic: whether our employees foresaw succession of events, whether this accidental combination of circumstances.

Nevertheless, at the moment already more than 20 banks with which we regularly work are connected to this system too: we sign documents in a remote view with them. Here also state banks, including VTB, and different foreign banks, for example, of Raiffeisen, HSBC, ING, Cetelem and others enter. So now it becomes a certain standard.

Earlier, by the way, we too so worked, but only with Sberbank which has the system "Sberbank of Nuclear Heating Plant". And it is already not less than a year as all document flow with Sberbank goes far off. And now it becomes the standard de facto. There is still a change. All, probably, know that now, especially state organizations, hold competitions on special platforms far off. So all market already works years three. And in April we had first cases when also the agreement is signed far off. So earlier a competition was held on the platform far off, but then the agreement was signed in paper form. In April we for the first time signed the contract on marketplace. It was one of the largest state banks. It is possible to note that the movement towards completely remote document flow accelerated. So would "reach" there in the fall, and now – in two months.

If to speak about our Neoflex company, the remote operation mode always was as in the company the multifilial structure, is office in Moscow and in a number of the cities. In Russia - Voronezh and Saratov – our largest development centers. Also there is an office in Johannesburg in South Africa. In this sense we had dispersed teams always the last years 10.

Moreover, our customers always were not in those locations where there are commands. And in this sense specialists of Neoflex had accesses by Wednesdays and infrastructure of our customers in the volume necessary for project implementation earlier. It is absolutely standard case when a dispersed team from 10 people, for example, in Saratov, 10 people in Voronezh and 5 in Moscow work for bank, without coming to its office, or when in office of bank there is a key command from several analysts, prodzhekt-managers which provides communications.

In this model our company works already long ago, and radical changes did not happen. All infrastructure which is for this purpose necessary not only on our party, but also on the party of the customer was initially.

When I prepared for this interview, I called the colleagues and asked whether something changed in March, April in terms of providing access to infrastructure in connection with a coronavirus. In one bank from top-10 the answer was as follows: "Earlier to us access to the new person whom we connected to the project, 2-3 months could give that was long and not really conveniently, and now it accelerated and access is given in a month".

So our customers in these conditions became more effective in terms of connection to the infrastructure, at least the staff of the external companies. I think, it concerns also the staff of the organizations.

Oleg Baranov: When active changes – a coronavirus, crisis, forecasts of media, – we, as well as everything began, began to think whether it is necessary to undertake some emergency measures, to stop hiring in the company of new employees, to introduce a regime of economy whether everything will be gone tomorrow. Probably, it is normal that such discussions always happen at the beginning of crisis. But, after week discussion no essential signs that now something will change occurred, and we delayed the solution.

Some things were automatic. For example, many business trips between branches are normal at us: employees go from one branch to another. All this automatically stopped. Certain marketing activities, especially those which require physical participation, such as conferences stopped. So some activities were "frozen" not according to our solution, and dictated by the industry owing to circumstances.

But, if to speak about hiring of employees, then we did not stop it. To Neoflex there are many projects which demanded additional resources. I looked at statistics: from March 1 to this moment in the company more than 50 people were in addition employed while all at us 550 people in the company. 10% - very good speed. In this sense if the coronavirus also influenced us, then it is positive because in labor market it became easier for us to attract in the company of employees of good qualification. Before them it was more difficult to look for.

Still the fact according to our statistics which I can note. If to speak about dismissal of employees, in all companies there is a certain routine of the personnel, especially in the IT companies where in labor market good specialists are very demanded. And it is always a serious problem. But I can tell that for the last 2 months it practically reduced to zero. For us it is good because we could grow actually slightly quicker, than we would grow if nothing occurred this spring.

Oleg Baranov: First, I want to tell that any of large projects in which we participate and they, as a rule, go in large banks, state and foreign, it is not frozen, not stopped, not suspended. Nothing of that kind occurred. Moreover, some of our customers on behalf of their top management somewhere officially, somewhere unofficial said that they should use this crisis, on the contrary, quicker to develop the IT infrastructure and to catch up with the competitors.

We had one case, will not call the organization when her Chief information officer contacted us at the end of March and told that, unfortunately, they should reduce partially costs for ours with them the project. And it offered our command to reduce twice. We told: "OK. We, of course, are sorry what you so tell, but there is nothing to do, let's reduce". Agreed to reduce a command since May 1.

We already took measures for on what projects of the released employees to redistribute, and already practically made it, but then colleagues from this organization called back to us in the 2nd half of April and told that they thought and decided to stop completely the project and our command since May 1 completely to display. We pogrustit again and agreed. But, the most interesting that else in a week they called again and told that changed the mind: "We thought, the project cannot be stopped after all, let's work further". This story shows that all were in the judgment period – whether everything will be bad, whether it is quite good, thought over some measures.

I will add that we have also clients of the non-bank sector, and here really there are cases when the organizations, probably, suffered stronger. Perhaps, it is less large organizations. They really stop some projects. But, fortunately for Neoflex, the banking sector is our key direction. Here more than 80% of our business therefore it not so strongly influences us are concentrated.

If to say about what happened to a negative color, then it is the speed of start of new projects. Once again I will emphasize that any current project is not stopped in banking sector, and here the speed with which the planned new projects are started, really now slowed down a little. Some projects increased decision making terms.

I assume that our customers think too of where all this will be developed, and, perhaps, some projects will be started with delay, or will even be postponed until the best times.

Oleg Baranov: Here, probably, there is an obvious thought: there was a dispute of "little-enders" and "big-enders" on earlier whether banks will have in the future offices. I cannot forget how I was present a few years ago at a conference where the head of one very large known bank told a phrase, addressing audience which to me was remembered: "Do you go to offices of airlines to buy air tickets because you do not need to purchase the ticket, and still to communicate to those who sell tickets? Also you will not go to offices of banks to communicate because you will receive all banking services online, and offices will not be necessary". He told it when all bought air tickets online, about three years ago.

The dispute on necessity of bank offices still exists, but at most banks, except for, for example, "Tinkoff", offices and infrastructure so far after all are. It is obvious that what now occurred, will affect rates of process of reconsideration how to service clients and, it is obvious that these two months all service clients more online, than earlier.

My opinion: investments into creation for those at whom not everything is made and a dodelyvaniye for those banks which already have an infrastructure for completely remote service of the clients, will only be increased as a result occurred for the last 2 months. All, at last, will understand that the future precisely there. Besides, I do not apply for a role of the seer or banker, but it seems to me that will be as with airlines: we buy tickets online and we will open accounts online, to perform all banking activities online.

I think, one of the reasons why banks stop nothing in crisis now – all understand that this future and it is necessary to beat competitors on this field. Someone already far ahead, someone makes titanic efforts to catch up and overtake.

Oleg Baranov: Any radical change did not happen. Those strategic projects which were kept, they also are kept. Perhaps, 2 months are too short term, and we will see something a bit later. Perhaps, there is a certain delay: for example, banks will be felt that they sustain some losses with some lateness and, as a result, will be forced to review the budgets or something like that.

However so far I do not see that someone changed something. Those who ran in this race, trying to beat competitors, all of them also intensively run and even try to run quicker.

Oleg Baranov: The Neoflex company is engaged in business applications and custom development. In this sense of a problem of information security are not, as such, our profile. However, we have some projects in this area, but they are connected more likely with the fact that we are engaged in such technologies as Big Data and Fast Data much – i.e. technologies of stream processing of Big Data.

We have an interesting stack of technologies called by Fast Data which allows to analyze big data streams, terabytes of data in real time. It is more and more demanded at our customers for the solution, including, problems of information security.

But it, most likely, is not connected with a coronavirus directly, and connected with the fact that more and more service happens online, more and more data are generated by different information systems, and there is a requirement of the analysis of all these data, including regarding identification of events of information security in real time.

For example, we have a project executed for one of the largest banks where we analyze different a log of information systems in real time and find out whether there were no events to which the security service needs to react or some other method. We did this project last year, i.e. it is not connected with a coronavirus.

Such trend is, and, probably, the coronavirus will strengthen it because people will work even more online, more and more information systems in banks will use, implement also data which they use will become even more. Therefore the demand of this task will become even higher.

Oleg Baranov: Probably, now all work approximately equally. At me personally and at the staff of Neoflex with whom I communicate in day passes 5, 10, and sometimes 20 calls to Teams. Many joke, and in this joke there is an element of truth that people became better to work because earlier they had free time between meetings to go to the dining room, or to communicate to colleagues, or to go to the client and on the road to listen to radio in the machine. And now konf-calls go one by one. And I understood on the skin that it is the truth.

We even had a new format. When we understood that we long sit on a quarantine, we organized once, before May 9, an online party. Each participant brought a glass of wine or a bottle of beer at home, we were connected to Teams and minutes 40 talked with each other.

Nevertheless, much already want to return to office. But it is a single question – whether we will return to office completely or we will live in that mode which began in March, or in some other.

Oleg Baranov: Some large known foreign companies and some Russian, already announced that they will work nearly completely far off further. And some will be partially far off. If to speak about Neoflex, we discussed this issue recently, and different opinions were expressed: from that the minimum configuration to enter one day when all employees can work from the house, and the extreme point was that nobody to force to come to office to come only when it is necessary. So to permit nearly 5 days a week to be out of office.

There were also compromise positions – 2 or 3 days. For example, to make Monday and Friday free, Tuesday through Thursday to come to office. Others told that 3 days are much that they also so well work.

I do not know yet, than it will come to an end. It not the solution of company management, but collective intelligence which tries to adapt to new reality. But, I think, it is inevitable that, at least, partially we – the IT companies - everything will work far off. Their work is connected with information and the physical location is not so important. The question, in my understanding, remains only in that how much it will be.

Still, maybe, as an example: when all of us began to live in Zoom or Teams, there was such subject as the code of a corporate behavior when using means of remote access, conferences. Some employees did not turn on video, and some turned on, and it turned out that whether they lie on a bed slightly "under a blanket". Also there was the whole new subject – the code of behavior on corporate calls. For example, video should include. We and so communicate with colleagues little, and it is necessary to see each other at least if you call.

There are also other nuances, do not want now in detail to speak about them. So there will be the whole new sphere, it is possible to tell – how to live online.

Oleg Baranov: It is a difficult question. I will tell so. The Russian economy – quite peculiar therefore, in my understanding to draw parallels how it occurs in other countries, is impossible. On classics any industry should at some point begin to be consolidated. Whether we will have it – very dialectic question. I think that it will depend on how national economy as far as it will be open, market as far as process of investments into the companies, in businesses will resemble how it works around the world will develop in general. The answer is unevident.

Oleg Baranov: It affected already a little. Earlier the standard model of work assumed business trips. We never worked with full-time in the territory of customers. Always there came the small command for one-three weeks, studied requirements, held necessary meetings, approved documents. After that we returned, did something of Russia then usually then went the second time – to set, implement, tune up the solution.

As soon as there was a case to a coronavirus, at once it became clear that we cannot execute some projects in this model. But, we managed to agree quite easily with most of foreign customers to complete far off projects which already started.

In this sense, they had lokdauna too, they understood too that airplanes do not fly therefore they quite easily met halfway. And, probably, it was not feature of Neoflex or the Russian contractor: it occurred everywhere. About the international work I can tell small baize too. We have an office in Johannesburg, and one our colleague just was in a business trip there in March. There too announced lokdaun, airplanes cancelled, and it could not depart. He stayed in Johannesburg to the middle of May, at first working far off while was tough lokdaun.

Then permitted to go to office, and it began to work at our office in Johannesburg. Spent nearly two months there, but now returned by the evacuation airplane organized by Russian authorities.

Also Neoflex has a representation in Hong Kong, and one my colleague was in Hong Kong, and her family, children – in Russia. It got in lokdaun too, and as a result arrived to Moscow in May too. And reached through Belarus where from Minsk it was possible to reach to Moscow legally. In this sense the international business in all the beauty showed features of remote interaction.

Oleg Baranov: You know how I already spoke, now such stage when banks develop the IT infrastructure because, on the one hand, all of them go to "digit" more, and on the other hand – they compete. Therefore if to take dynamics not in 2 months, and for several years, probably, these IT budgets grow. Whether this process can once stop? It seems to me, no, in the short term it does not seem because information technologies develop, and, it seems, it is inexhaustible process.

When I was 24-25 years old, I came to the first work location to the IT company. There 40 programmers sat and programmed something. I sincerely asked them: "Why you program if you already have a program which you wrote and sell? Why further to program?". And, as far as I know, this company still programs. Whether development will stop? Whether we will cease to develop something? Probably, no.

Oleg Grigoryevich, I thank you for interesting answers. And also I thank all who watched us today.