15:19 Jul. 15, 2016
Wojciech Balczun is tasked with revamp of Soviet-era monopoly
The Polish boss of Ukraine's railways Wojciech Balczun was struck by the disparity between his new surroundings and the plight of the business: while the work space he inherited was decked out with pricey redwood furniture and featured a hotel-style mini-bar, the company's most modern freight locomotive dates back to 1969 and most passenger wagons also are from the Soviet era, Volodymyr Verbyany writes for Bloomberg.
What Balczun found underlines the challenges Ukraine still faces, two years after its second revolution in a decade demanded an end to the wide-scale mismanagement and corrupt practices that flourished under ousted leader Viktor Yanukovych. Dependent on aid from abroad, the nation's foreign donors want the government to intensify anti-graft efforts, with measures to boost transparency so far bearing little fruit.
Fresh from overseeing a much-lauded revamp of train travel back in his homeland, 46-year-old Balczun was picked to similarly transform Kyiv-based Ukrzaliznytsya, a sprawling monopoly with almost 300,000 employees and about USD 2.5 billion in annual revenue. His first impressions gave him pause for thought.
"My expectations were little better than reality," Balczun said in an interview, likening his new office to a museum. "Having been here for a few weeks, I'd have given a lot of thought before applying for this job if I had the chance again. But it's one of the best challenges a railway manager can imagine."
The government, embarking on a privatization drive, can't offload Ukrzaliznytsya after parliament prohibited its sale. For now, Balczun plans to shave 10 percent off the company's costs, saving USD 280 million a year and helping free up cash to upgrade outdated rolling stock. He'd also like to stem graft, though was astonished when he discovered red tape would prevent him from immediately firing an employee caught stealing.
"Corruption is a huge problem -- it seems to me the entire system was established in order to facilitate it," Balczun said, stressing he needs full autonomy to implement his overhaul. "I'd like to start with an unprecedented modernization program."
Balczun has hired fellow a Pole to overhaul procurement at Ukrzaliznytsya, saying he needs "new people with spotless reputations." Since his appointment, the company has signed an accord with Bombardier to start joint production of locomotives in Ukraine.
Despite the challenges ahead, he says he's ready for the daunting task:
"I'm not a person who's comfortable with losses," Balczun said. "I'd like to become a symbol of positive change in this country."