As the pandemic affected plans of digitalization of the Russian Railway. Interview of TAdviser with Evgeny Charkin

Evgeny Charkin: You know, essentially we did not change strategy, it was our solution at the level of the management. Everything that we planned and approved on Board of Directors at the end of last year, we will make. I will remind that at us the corridor of strategy is 2025. But, proceeding from that economic situation which is and the situation connected with a pandemic, priorities on preserving of life, health of our employees and our clients we made reprioritizing within our strategy. Everything, as for contactless interaction between employees, between Russian Railway company and our clients, came to the forefront and received the top priority in terms of further development.

Also we, certainly, looked at cost efficiency. Proceeding from cost efficiency of each project, we, besides, made rebalancing of projects in terms of what we will do at first, and that a little later. But in general, I will repeat, our plans and a target picture remains invariable.

Evgeny Charkin: At us the big discussion was of board of the company at the level on what we do in terms of financing, terms, and we made the decision that we do not brake anything. We forward push projects on those principles about which I told. We did not stop any project.

I can tell that, on the contrary, as digitalization "fulfilled" during this period and how effective it proved to be, I would tell that the management believed even more that in digitalization the source of competitive advantage on the future for us is.

Proceeding from what we saw in terms of new formats of work for a pandemic, first, very well that we already had very big backlog which allowed us not to lose in terms of controllability in our company, on the one hand. On the other hand, we even received new clients because we developed very good handshaking with clients in terms of electronic document management, electronic sales.

Of course, we received natural outflow of clients because people began to go less for the objective reasons during a pandemic. And on the other hand, new clients who did not carry the loads earlier through the railroad because we offer clients very high-quality instruments of interaction with us came. It is electronic marketplace which we develop. Here we just saw a gain of the customer base.

Summing up, the first – all this that is connected with electronic interaction: electronic document management, electronic sales channels to our clients. Plus we started the new website just at the height of a pandemic. And on our website in addition to traditional sales – transportations by train, we develop multimodal transportations: i.e., an opportunity for our clients to purchase and perform a trip from a door to a door.

The second the element, important for us, in terms of priorities of digitalization is a contactless interaction in the organization. Therefore everything, as for means of collective work, technologies of deserted removal and information transfer about an infrastructure status, received a bigger priority, than it was to a situation with a pandemic.

Evgeny Charkin: Here, I would tell, at us too nothing exchanged. We as looked very qualitatively and accurately at expenses, and we continue to do it. In the company the program of operational efficiency which "is sewn up" in the long-term program of development is approved. In it all effects of digitalization are put, as a result of optimization of management processes including optimization our internal. Therefore this subject both was in very serious focus of the management, and continues to be.

Evgeny Charkin: Topical issue. At us last Thursday (on June 18 – a comment of TAdviser) there took place very big meeting under the leadership of Oleg Valentinovich Belozerov – our CEO, the chairman of the board, with federal executive authorities, with participants of IT market who are involved in process of import substitution in the Russian Railway. And our activity in this plan was highly appreciated from participants. I am grateful to all colleagues together with whom we carry out work on import substitution.

The answer very simple – at us nothing exchanged in this respect. We have a plan according to which we report to the president of the country. I will remind that we received direct order from Vladimir Vladimirovich Putin according to the results of the III Railway congress at the end of 2018 on formation of the program of transition of the Russian Railway to primary use of domestic software. We continue to work. All our systems are broken into 10 classes, on each of which there is a specific plan which we implement.

Evgeny Charkin: Import substitution subject – extremely difficult, and in some directions we already implemented those plans which we said. For example, on the subject connected with protection against spam. Here we passed completely to domestic technologies. And we transferred our mail system to the CommuniGate Pro platform. So in some directions a lot of things is made.

And in some directions we see need of joint, more dense work with the market as there is not always an adequate answer from the market to our requirements. Case in volume and a problem that we should not receive what we have now if we importozameshchatsya. We are not interested just replacement by similar solutions, let and domestic.

I will remind what told earlier: at us all program of digitalization has specific measurable effects which we are obliged to receive. Without it we will not reach those KPI which are put in the long-term program of development of the company. It means that we, creating the order to the market, should receive not that we have now, and what we want to have in 3-5 years.

And here already there come difficulties, considering our scale. We have about 250 thousand users of an ERP system, about 120 thousand users of an electronic document management system with very big functionality. Here, of course, additional efforts from the market that our needs to satisfy are required.

And here it is important as our position – that we were ready to give to the market the order and provided it. I perfectly understand colleagues: they need the order, confidence that their product will be purchased, on the one hand. But, on the other hand, and the accurate message is necessary to us from the market that the market is ready to give us solutions which are necessary to us.

And we need such solutions which will meet security requirements as safety of our processes is a top priority. I can tell that our testing methodology and settings in operation of systems – it is in many respects similar to acceptance of weapon in the Ministry of Defence. We very qualitatively and long test everything because we are obliged not to break the processes connected with security, reliability, stability of our work.

In addition to security it is also reliability and cost efficiency. We should be sure, and the market should understand it, and should react to our needs for this plan adequately.

Evgeny Charkin: Our work in this direction breaks into two components. The first is a providing life and health of our employees, and here we did huge work. We in 10 days on March 25 brought 115 thousand our employees to remote work. In principle, on scale it is unprecedented work. It is not my assessment, it is assessment which was sounded, including, and at meetings with the president of the country.

The second component is health and life of our clients. There are several directions in which we work. The first, what I already told, - all this what is connected with electronic document management, digital channels of sales, communications with the Russian Railway. The second is what you mentioned. We tested these technologies at stations. Effects are ambiguous because there are several objective factors which at this stage do not speak about unambiguous efficiency of these technologies yet.

For example, in order that the person was tested by the thermal imager and opened before it a tourniquet, about 3 seconds are required. It means that in rush hours there will be "stopper". The second that we saw: when people are masked, and they, fortunately, generally carry them, opportunities for identification of the person and accuracy of this identification are not up to the end optimal. So here the efficiency is required to be increased in terms of quality of work of these technologies too.

But at the same time, unambiguously, we will develop the technologies connected with contactless temperature measurement at the mass number of people as in our internal premises and buildings, and for our clients.

Evgeny Charkin: Yes, they have perspectives. We tested this technology at the Leningrad station. But it is necessary to finish, including, and business process. For example, the operator who saw the person with a temperature sits. What to do next? As to identify it how to find what is farther the protocol of interaction?

Also it is also necessary not to forget and, probably, to suspect the future that we deal with a specific disease, with specific manifestations now. But further there will be other diseases with other symptoms. It is obvious too. Now for us it will become, certainly, a good lesson on the future, but also we, and colleagues in IT market should think that more universal solutions and more universal protocols, business processes which will concern not only a specific disease – COVID-19 are necessary.

Evgeny Charkin: Question here, maybe, not absolutely in terms of technologies. Technologies are capable to make, in principle, anything in terms of remote work. Means of a secure access, means of electronic document management, means of group work are different messengers and other solutions can ensure very high-quality remote work.

There are problems, in my opinion, slightly others. The first, is unconditional – despite existence of information security tools all the same there is a question of safety of data. For example, the employee works on the home computer. Yes, it has necessary information security tools. But at the same time family members, children go at his place. How at the same time access to the equipment is protected? Big question.

The second – fully to work far off, a certain working situation is necessary after all. Not all people, unfortunately, have conditions under which they can sit down in the quiet selected premises and be engaged in the work. Very often happens so that people live in one-room apartment which in parallel have a house life, children run nearby, spouses go, and there is a question of working efficiency and, including, psychological climate at these employees.

There are people to whom it is comfortable on "udalenka", and there are those who want to return to office as fast as possible. We conducted a research among our employees. For example, from the point of view of employees in an IT block. And communications in holding are engaged in questions IT about 40 thousand people, i.e., selection rather big. And so, from the point of view of employees who are engaged in development programming, problems are not present any in respect of remote work. They it is absolutely quiet and with not smaller efficiency do the work.

But everything, as for production processes, there are very serious difficulties here. Here after all other order of interaction, other solve order of questions is necessary, and the efficiency of remote work is not so high in comparison with traditional processes. Therefore there is no definite answer to your question.

Evgeny Charkin: It is very correct question, thanks. Really, the subject of Internet of Things is very important for us. In the previous answers I indirectly began to say why. For us IoT – it a method is qualitative, to timely collect information without involvement of people. For us it is a fundamental issue as many efforts in the field of digital transformation are aimed at providing deserted interaction at information flows, on the one hand now. And on the other hand, to provide lack of influence of the person on collecting and quality of information which then gets to information systems. IoT here for us is extremely important tool.

What we are going to do in this plan. In each production direction we have a program of implementation of technologies of Internet of Things. And the subject of import substitution and here is extremely important for us. Now we very seriously look at domestic standards, internet protocols of things and at creating, including, and own base R&D on development of devices and platforms which will help us to implement a layer of Internet of Things.

The key directions where we implement this technology, this infrastructure management: everything that is connected with status monitoring of our infrastructure, both traveling, and power, the traction rolling stock - locomotives and cars. And here we build the whole stack of technologies. Internet of Things in it is an information retrieval. Still blockchain technologies about which many are skeptical for the reasonable reasons, including about cost efficiency. We look at it very soberly too and we carry out detailed formations of the feasibility statement at any project a blockchain. Nevertheless, it is good technology to construct the confidential environment.

In this plan we have several interesting projects together with market participants. For example, on carriage economy – an information retrieval using sensors and creation of the environment where all participants of process see the same information in real time.

It is possible to speak about the confidential environment of both a carriage complex, and a locomotive complex. In the latter case all exactly the same: an information retrieval about a locomotive status from a board using sensors and implementation of the platform where all participants – not only the Russian Railway, but also producers of locomotives, and service companies – have the same array of information. Based on it participants can build predictive models and the solutions. Thus, here not only Internet of Things, but Internet of Things are a method to obtain qualitative, consistent information.