We are committed to Armenia - Ursula Burns

15:39 • 06.12.17

Ursula Burns, Chairperson of VEON Supervisory Board, was recently in Armenia with several other companies' top representatives.  In the course of her visit, she had a chance to meet with journalists in Yerevan to speak about telecommunication industries' development perspectives, and  VEON's mission and vision, as well as to respond to questions and concerns.

Ms Burns  brought extensive international experience to the role having served as Chairman and Chief Executive Officer of Xerox Corporation (2009 – 2016). She is a director of the boards of American Express, Exxon Mobil, Nestlé, Datto and Uber, and regularly appears on lists of the world’s most powerful women. US President Barack Obama appointed her to help lead the White House national program on Science, Technology, Engineering and Math (STEM) from 2009-2016, and she served as chair of the President’s Export Council from 2015-2016 after service as vice chair 2010-2015.

A major telecommunications company, VEON currently serves more than 235 million customers across Europe, Asia and Africa. It operates in Armenia under brand Beeline.

According to Ms Burns, VEON is now on its way of serious transformations. After being in some of the markets for 25 years, it is now initiating reforms to adapt its development strategy to technologies which are important to use or cannot be treated  as repeated by competitors. As an important project in Armenia, Ms Burns highlighted particularly their initiative to launch an incubator to assist the startups in bringing their ideas to life.  

Ms Burns, you were once included into an online magazine's top 10 list of people living the American dream. What marked the start of your business career and what paved your way to VEON?

All of my business career at XEROX was generally in the US, UK long time ago and Japan for a short time. I now spend most of my time with VEON.

I got interested in VEON primarily because of the opportunities to fundamentally change the way that telecom companies actually operate, and their strategy of transformation is pretty bold, risky andor I think good and strong. That's one reason: fundamental change. The second reason is that changes are happening in markets that are generally  are not in focus.

Particularly large US players are now focused on them, and it's good opportunity for these markets to develop and to have investments in the country.

The other reason is the people who I met at the HQ; they have been tremendous - tremendous fighters, very good operators. So I was very excited about the opportunity to work with the new kind of people.  

Ms Burns, you turned a special attention to under focused markets. The changes in the Armenian telecom industries are definitely obvious today, and your visit to our country also testifies to that. What made you show that kind of interest in Armenia, and how do you evaluate the existing potential here as the company' chairwoman?

The markets were really interesting to me. I had never been to Armenia before, though I had heard a lot about Armenia. And I  probably met more Armenians than you would know because we have many Armenians all over the United States and a lot of Armenians in Brooklyn.

I am spending this time of my chairmanship in VEON going to places. I think that it's really important for me to get grounded in this business by going to the places where the business is done. So  I'll spend the rest of my time here (first half of 2018) just kind of touching and feeling the people who run the business, the customers who operate with our services and solutions, and getting to know of the way that business is done.

You said that the ability to rapidly react to changes is one of the cornerstones contributing to VEON's success. So what changes are you planning for the near future?

There are series of levels of changes that are happening in VEON today. One is about the offer that we are giving, i.e - the kind of service that you can provide to customers. The second is in how to run the company. And the third is probably - internal culture.

This is a company that offers a set of services to clients in a certain way based on a certain set of technologies that are predominant in the field - fixed line telecommunication services,  telecommunication services that connect point-to-point to other services etc. The whole nature of business and telecom in particular is changing because of the opportunities and capabilities that digital communications and data as a source of currency offer. As all companies are changing, telecom absolutely has to change. It is one of the fundamental touchpoints. It implies competition-based changes. We know of normal telecom companies, but there are also service providers like Faccebook, like WhatsApp  - these are different ways to get the same thing done, to get communication done. VEON is a 25-year company, and a 25-year company has to change based on what is happening, what technologies are available for it to compete with and to be competed against. So it is adopting a more and more digital nature. We are using data to the advantage of customers.  

In these economies, there is a chance that a change may happen at a pace much faster than it happened in the United States, for example, and we can jump a whole series of steps.

VEON started as an independent and relatively small company, and large shareholders came in and basically governed the company fairy directly, and we are moving a little bit away from a type of small number of shareholders' model to a more open, larger number public investors' [model].

The third thing is in the culture of the company; we are moving away from the old traditional model to a little bit flexible and open model. And open not only in new ideas but also in the technology, in its hierarchical structure. We have open space offices, and it's a good indication of the change, of the type changes we want - more open communications, more egalitarian systems, a lot more ideas.

So there is a culture change, and there is a governance change that we are trying to go through.  

We have to actually go with the change. We have a very big customer base, a very big position; around the world we have more than 235 million customers, users of our service.

We have to manage this transition very carefully. The technology change has to be done in a careful market-focused way. So we have to make sure that in all the markets that we serve in very different countries - from Italy to Russia, from Algeria to Armenia - we are aware of the local circumstances to make our services customer-oriented. The governance changes are very risky obviously, and we are trying to change and put into the hands of the local people more and more authority and at the same to make sure that we do not lose control of the company and our clients.

Culture change is something you won't see, but you will be able to feel it; you'll see it in the numbers over time. What you will be able to see and feel is in service if you are a subscriber (which you should be) to Beeline as a provider.  You will be able to see a lot more offers, a lot more flexibility and a lot more creativity.  

The number of customers is growing, but the mobile market is becoming smaller and smaller because of competition etc. What are the prospects of VEON AREMNIA for development and expansion of business, and what are the obstacles in terms of providing the Armenian population with services that the rest of telecom companies do not offer - for example digital TV pack?

Smartphones also are the biggest player of mobile TV; the biggest amount of cellphones have a digital TV function, so it is not our advantage. The mobile market has been shrinking in the last few years, but VEON is a growing company. We have more customers now, but of course, we do not like the effects of the shrinking market. One reason is the aggressive competition as customers do not see any differentiation between players.

We invested in high-speed data networks: 3G and 4G network, and we now have a modern 4G network in Yerevan and in most places across the country. I hope you feel improvement in the quality of mobile internet for Beeline. In addition, we are going to launch a new product; I am sure you have heard about our global VEON platform, which is coming to Armenia soon, a unique offer comparing to peers.

Artificial intelligence is becoming part of our reality. The question is whether you have any plans to boost research and development in that field in Armenia.

One idea we have decided to implement in Armenia is to organize an incubator for technology startups to help them translate their ideas into reality and allow also customers to enjoy these ideas.  We will provide an office space, technology infrastructures for the startups to help them develop their ideas in lab conditions, and access to expertise (technology expertise, business expertise).

We hope that this incubator will really help to not only accelerate the technology development of VEON but also bring new ideas to assist in the technological development of the country. We have an IG hub in Armenia; it isn't fully accomplished yet, but we hope it will become bigger. We have 

this kind of hubs also in Tajikistan, Uzbekistan, Kazakhstan and also in Georgia. Technologically they are already using it. I hope our product will be recognized, and we will be able to develop our capacities here.

What additional opportunities and advantages will the incubator startup offer in Armenia?

Well, many of the application developers develop the code, but they do not have access to the mobile network to test it. So they finish the application and put it into AppStore, and then it won't work or the IOSP does not work in Android. The big advantage of this incubator is the fact that we have access to the mobile network for testing, so we can see how the application works across the network, and they can see how it "behaves". Although apps are made to look simple, they are actually not simple. We can take a lot of the experimentation - and time and cost with the incubators if they are working closely with this. It's really a huge advantage, and there really a big difference if you want to stop office work and develop your amount yourself. We are going to have an R&D hub, so we have to really think of ways for developing this business.  

Is it hard to do business in Armenia compared to other countries? What's your general opinion about the business environment here?

There are very few countries where doing business is easy, considering especially the environment. Countries are unique - different languages, definitely different cultures and different infrastructures. Scale is a very important thing, for example, for capital companies. We have to continue to detect how to bring unique solutions that are scaled enough so that we can afford them.

As for Armenia, although it is really difficult to do business here, we still like it. We are committed to Armenia, and we invest a lot of money here. We have fixed and mobile telephone communication networks, we launch new technologies and are very committed to this market. And that means we like to operate here. We are here because there is a market to be served, and there is a market to be served profitably. So we want to be here not because only we like Armenia but because the business here is a good business to be in. It's not easy, but it is definitely profitable.

It is really hard to make forecasts in a fast-paced business environment, and nevertheless, where do you see the telecom industry in the coming 10 years. Where does this industry go, and eventually, what's your vision of your company?

First of all, the amount of data consumed by consumers and businesses matters. We see no limit right now. The second thing is the number of devices that need data in real time, and that real time is actually increasing, which means that shortly the industry will have to deliver 5G. 


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