SLOVAKIA
Comes of Age








Mr. MIROSLAV MIKULCIK




Interview with

Mr. MIROSLAV MIKULCIK
General Manager of CSC Slovakia (Computer Sciences Corporation)

07/02/02


CSC is one of the world's leading consulting and IT services firms. It has been operating in the Slovak market since 1997. What was the main reason for CSC to set up operations in Slovakia?

CSC Slovakia was established during our mothers company's acquisition of some companies in Germany, Austria and Switzerland. One of the companies that we acquired was a Swiss company that had a subsidiary based here in Slovakia and CSC Slovakia was established through this subsidiary. I joined the company two years ago. I am relatively new in CSC; I started together with my colleagues to develop activities for CSC in the Slovak market as previously CSC Slovakia had concentrated on providing services to our partners in Germany and Switzerland. Our main goal in the area of service provision in this market is to be a partner for potential investors in Slovakia. We are able to help investors here by providing information services in a market that they are not familiar with.

What was CSC'S expansion strategy in Central and Eastern Europe?

Generally the strategy was created after the acquisition of one company in Austria and it was two years ago when they started to prepare their strategy for Eastern Europe, particularly for Slovakia, the Czech Republic and Poland. CSC as a global corporation focused on separate sectors especially the financial sector that is presently being restructured in these countries. Recently most of the banks in Slovakia have already been privatised.

What were the main opportunities offered by the financial sector in terms of investment in consulting and IT services?

The first very important step was to stabilise the economy and start restructuring in other sectors. For us it was a very good opportunity to be here. We transferred the know-how from our partners in the US and provided the right services. Our partner in Slovakia is Allianz. This is a global contract and we provide services not only for Slovakia but also for Germany, Poland, and Russia, Thailand is also our client. It is a contract that was negotiated by CSC in Germany because Allianz is a strong German company. Our other important client in the Slovak market is VUB. We provide banking information systems for them and today they belong to the Intesa BCI Group who are also our client. These are very important contracts and partnerships for us.

What is your market share in Slovakia? How do you actually position yourself in terms of services that you provide?

According to IDC there are five big leaders in the area of IT services generating for FY 2000 up to 5 to 15 million EUR. We belong to the second largest group of IT service providers that are generating from 1.5 to 3.5 million EUR. We are not generating revenue from HW support and installation. It is for many IT Service companies significant item on total revenue from IT services. As for the IT environment for example in the finance sector many banks used local services. But presently the situation is changing and they are trying to change their solutions in order to compete with European standards. This is a chance for us to grow and become more competitive in the local market. But still this is a very small market and everybody is trying to offer everything, not only local companies but of course the well-known suppliers such as COMPAQ and IBM. Everybody is trying to supply not only products but also services.

Do you think CSC would be present in Slovakia if you had not acquired partners in Austria?

In my personal opinion, Slovakia is a very small market for such a strong company as CSC. The Slovak market is not so interesting but the surrounding geographical areas could be interesting. This country as I always say is facing a very important task, and that is to prepare its economy for integration.

CSC has been operating in the Slovak Republic for five years now, how would you evaluate your financial results and your goals.

During the last two years we have experienced considerable growth. We expect to reach revenue of about 120 million SK for our past fiscal year and our percentage of growth was 100% for two consecutive years and we would like to stabilise our financial growth of 15-20%.

Do you intend to diversify your services?

Basically we provide three kinds of services which are consulting, system integration and outsourcing. In Slovakia we currently provide most services in consulting or for systems integration. Our goal is to become a strong partner for some institutions and provide them with services such as outsourcing. We have just started to prepare discussions with potential clients and partners. As I already mentioned we are focused on the financial sector now. In the very near future we would like to use our corporate know-how to help in the reconstruction of state institutions. It is necessary to prepare institutions for reconstruction particularly within the healthcare and social sectors as they maintain information about property and citizens. It is necessary to prepare for the transformation processes, at present we have no system of registers if we take business registers for example; there is no possibility to find your health insurance record on the Internet.
How would you evaluate present conditions for business in Slovakia? Do you feel it is becoming easier to provide services to your clients than five years ago?

There are two factors here. One is the standard methodology that we have to use as a global company. We have a special methodology for business development where we strictly analyse the situation and our client's stability. The other thing is the real market situation in relation to competition or personal contacts. It is a very small market and we all know one another.

In 2001 CSC Slovakia was a general sponsor of a conference "Invest Forum Central Europe" in New York, which featured over 400 attendees from countries of the Visegrad Four Group. How would do you perceive Central Europe and especially Slovakia as a potential investment destination?

We supported this conference in New York, London and Bratislava (November 2001). We tried to send a message to the participants that we were present in this region and that we are a very strong company and good partner for them. We demonstrated that we could help them with engineering processes, services, especially with IT and consulting services.

According to the talks that you may have had with foreign investors, what is their general feeling about investing in Slovakia?

The conferences were very good for presenting Slovakia but the presentation was very general. Slovakia was presented as a country with a growing market but what was not very well presented were concrete opportunities and concrete projects for investors.

In which sectors would you see the best potential for foreign investors?

Industry is very important this sector presents concrete opportunities. There was no presentation of that at the conference. In London it was a bit better, the organizers arranged meetings with local people.

It seems that Germany and Austria tend to invest more in Slovakia than any other countries because they have the right knowledge about this country. Do you feel that Slovakia has problems promoting itself?

There are different approaches. There is a cultural aspect here that has to be taken into consideration. Austrians are closer to the Slovaks and Czechs and they understand our culture better. The people from the US concentrate more on the projects, opportunities and rentability. Austrians and Germans spend more time in developing relations and business opportunities, they try to help the people here develop their own ideas.

At the meetings that you have held with potential investors, did you have a feeling that issues like the forthcoming elections, NATO and EU enlargement were issues for common discussion?

Yes, of course. The next elections are very important. I think the NATO summit is the main issue now.

You joined CSC two years ago. Can you give us a brief insight into your professional background?

I was working in the IT sector in Austria for a company called Servodata. I also worked in the financial sector and then after I gained some experience I established my own company in Slovakia. At that time CSC was looking to acquire some local companies but due to the small market they decided against this and asked me to develop business activities in the Slovak market.

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World INvestment NEws, 2002.
This is the electronic edition of the special country report on Slovakia published in Forbes Global .
May 27th, 2002 Issue.
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