 TOP BUSINESS PERSONALITIES |
 | Interview with
DR. NENAD POPOVIC
President of
Russian electrothecnics,
Joint Stock Company
Moscow
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RUSEL was recently named company of the year
in the category for best industrial applications
manufacturer of the 2001 all-Russian contest organized
by the business weekly "The Company".
What is the secret of your success?
Management has been the key. We have developed
excellent managers in all of our companies, and
we are investing in their continued education.
Success is essentially a reflection of our people,
who are all highly educated at the PhD or MBA
levels, bringing added-value to our services and
products.
Our success is also thanks to our determination
to serve our clients. Our philosophy is that we
do not sell only products - we sell solutions.
We are producers but our business is also focused
on custom engineering, which involves adapting
our products to our clients. So we strive to continually
help our partners build new projects. This is
necessary to help towards their fast growth, to
make up for their shortfalls in technological
infrastructure.
We have realised that cost is an issue in Russia.
Therefore, we are selling products of high quality
at a low price. These products are up to the highest
western standards and they are less expensive.
They meet all technical standards and they are
six times less expensive. Therefore, we are capturing
the largest portions of Russian companies - the
middle ground. Our philosophy is not to be "Mercedes",
but to be a "Mitsubishi", for example,
which will be more popular and more accessible.
Now there is an opportunity to support the
development of Russian companies from low-tech
to high-tech solutions. It is a real opportunity
to boost business methods by ten years… But
do you feel that Russian companies are really
investing in new facilities and new technologies?
Yes, numerous companies are upgrading their infrastructure.
Companies like Wimm Bill Dann are adopting modern
technology for their production lines, and there
are many other joint ventures which are succeeding
and use the latest technologies.
The economy of Russia was not market-oriented
in the past, but today if you find the right joint
venture partner, bring together your knowledge
of high level technology and western management
together with the knowledge of your partner in
the Russian market - success is yours to achieve.
We still need a better banking sector in Russia,
but it is rapidly improving and there is presently
an increasing amount of good credit lines and
low interest rates available from western and
Russian banks. Moreover, certain syndicated credits
are offered specifically for investments in new
technology and for international expansion initiatives.
We expect UES (United Energy Systems) to be
restructured and liberalised, leading to the privatisation
of generating companies and regional energy companies.
How does RUSEL fit into the future shape of the
Russian energy sector?
Regarding privatisation of the energy sector
in Russia, the most important thing is that new
shareholders and new investors will have to invest
in the restructuring of power plants. Therefore,
as a producer of secondary equipment we are an
excellent partner for these investors. In UES
there has been little investment in the past 20
years, so the first thing that the privatisation
will do is encourage investors to reconstruct
and develop new production possibilities. This
is where our secondary equipment will be necessary,
so we expect investment levels to increase by
5-10 times in the next five years, because companies
will need to re-build, modernise and compete in
deregulated energy environment.
So what added-value services can RUSEL bring
to foreign investors and potential partners? Is
it local knowledge?
Certainly - in Russia it is important to establish
a joint venture partnership with a company that
has local knowledge, and our case we already have
a strong local working network, with 45 companies
established all across Russia, from east to west,
and our latest office was recently opened in Sakhalin.
We also have licenses from Western companies to
produce locally and to develop various joint ventures.
So we feel that partnerships will complement our
existing business strategy.
You are exploring the possibility of opening
an office in New York and Houston… Does this
signal a focus to build stronger links with U.S.
investors?
Our Holding is not only active in technical production,
but also in the trade of metals and consumer products
like furniture. For example, three weeks ago we
bought in the biggest furniture factory in the
Balkan region, which exports to the USA, Russia
and Western Europe. This is an example of how
we are facilitating new international trade opportunities,
from Europe, to the U.S.A., to Russia, and vice-versa.
We are actually considering opening an office
in Houston, because of the opportunities presented
by Sakhalin investments. Numerous oil and gas
multinationals are based in Houston, and these
are the same U.S. companies that are participating
in Sakhalin project. Moreover, there was a recent
decision by the Russian Government, which dictates
that the share of Russian companies in the Sakhalin
project should be a minimum 50%. Having said this,
we are an excellent partner for the western companies
involved in Sakhalin, since we have are already
present with local production of equipment and
technologies, so we can satisfy all requirements
of the project.
In essence, our U.S. office will act as a bridge
for American companies to invest in Sakhalin.
My strategy is to attentively consider the requirements
of clients and partners, and to be permanently
in touch with them regarding all business and
technical issues.
If we look ahead to the future, what will
RUSEL look like in ten years?
RUSEL will have a stronger presence in Europe
and America. It will be a global powerhouse, integrated
solutions to buy, sell and develop engineering
knowledge anywhere in the world.
Our synergy between different markets will lead
us to produce worldwide where production is cheapest.
Our international exposure will allow us to sell
in the most profitable markets, which also allows
to select the best conditions for our companies
in terms of production, project development, construction
and sales.
It would be interesting to develop relations
with China, the USA and other countries. Our focus
will definitely be in new technologies and business
models, using the latest standards in production.
We are focused on the global picture, the global
map.
Business is about overcoming challenges. What
was one of your biggest challenges, and how did
overcome it?
At first, this was only one company, but then
we started to develop and attract other companies.
We harmonized business of many companies, gathering
new ideas from different areas and bringing in
new people who could work jointly and complement
each other.
So to create this holding and to be able to produce
turn-key projects… this was a huge challenge.
In doing so, we created a new potential within
our holding to develop and build integrated turn
key projects.
What would be your final message to the readers
of our magazine?
I would certainly invite investors to consider
investing in Russia. The market is stable, independent,
and practically all the spheres of industry are
privatised. Young people are looking to grow and
develop their companies, and business people are
no longer just looking to buy and sell their assets.
Human capital is excellent, and young Russians
have an strong knowledge of economy and technology,
with strong possibilities to learn and grow. You
can also find trustworthy joint venture partners
in Russia, who will help develop business opportunities
in Russia that will be marketable in Russia or
any other country of the world. This is definitely
the right time to invest in Russia.
Note: WINNE cannot be held responsible for the content of unedited transcriptions.
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