HIGH-END HOMES SEE NEW CONCEPT: AFFORDABLE LUXURY SMALLER CITIES GETTING ON THE STARTUP INVESTMENT RADAR
6 28
PACKAGING PROBLEMS: HELPING FIRMS COPE WITH NEW ENVIRONMENTAL RULES 36 May, 2019 / Volume 23, Issue 5
www.business-review.eu
TELECOM INDUSTRY THREATENED BY RISING COSTS AND NEW TAXES
38
www.business-review.eu Business Review | May 2019
EDITORIAL 3 REAL ESTATE
• Editorial •
Anda Sebesi
6 High-end homes get new concept: affordable luxury
• Deputy Editor-in-Chief •
8 Plotting expansion: Forte Partners flexes development muscles
COVER STORY
Working in (digital) Romania
S
1o Working Romania
alary is no longer the main pillar of an HR strategy, in Romania or worldwide. In an increasingly competitive labor
ENTREPRENEURSHIP
market, employers need to find new ways to attract and
retain the best people. The challenge of the digitalization of jobs is increasing locally too, with both employers and employees needing to adapt fast to the new context.
26 Local entrepreneurs looking
Embracing digital technology is essential in order to consolidate
for fresh approach in energy industry
competitiveness. Digitalization has become part of how companies work, and it is relevant in different functions of a business, from
28 Smaller cities getting on the
marketing and HR, to finance and legal.
startup investment radar
It is common knowledge that engaged employees are less likely to leave an organization, and more likely to provide exceptional customer service, and help drive the overall performance of the
MARKETING AND ADVERTISING
business. According to Deloitte 2019 Global Human Capital Trends, talent mobility is among the most important trends today. The same report underlines that, in the context of the tightest labor
32 Consultancy firms taking
market of the past two decades, improving internal talent mobility
over advertising agencies – who will win?
and finding the right people are ongoing issues.
34 Brain gain: neuromarket-
So companies are making huge investments globally in the pro-
ing opens up new avenues
fessional development of their employees, especially considering that the incoming generation has a limited amount of patience and
CITY
if they don’t reach their expected growth internally, they’ll look outside the company for new opportunities. This is why Business Review has chosen to dedicate this month’s cover story to how some of the most dynamic local employers, in terms of hiring in the last year, have designed their HR
40 Cash for culture: spon-
strategies to hire and keep talents and how they are coping with
soring summer festivals
the digitalization of the local workforce.
42 Calendar
FOUNDING EDITOR: Bill Avery DEPUTY EDITORS-IN-CHIEF: Sorin Melenciuc, Anda Sebesi JOURNALISTS: Anca Alexe, Aurel Dragan, Romanita Oprea, Oana Vasiliu, Razvan Zamfir CONTRIBUTOR: Ovidiu Posirca COPY EDITOR: Debbie Stowe PHOTO EDITOR: Mihai Constantineanu ART DIRECTOR: Raluca Piscu PUBLISHER: Bloc-Notes Media Network ADDRESS: 58 Stirbei Voda Street, 3rd Floor, District 1, Bucharest, Romania LANDLINE: 031.040.09.31 EXECUTIVE DIRECTOR: George Moise BUSINESS DEVELOPMENT DIRECTOR: Oana Molodoi SALES MANAGERS: Radu Fireteanu, Alexandra Rosca EVENTS MANAGERS: George Darie, Mara Dragoiu EVENTS & MARKETING: Luiza Luca PRODUCTION: Dan Mitroi DISTRIBUTION: Eugen Musat EMAILS: editorial@business-review.eu, sales@business-review.eu, events@business-review.eu
Publicație auditată pe perioada Apr 2015 - Mar 2016
ISSN NO. 1453-729X
www.business-review.eu Business Review | May 2019
4 NEWS
WHO’S NEWS
the current level of 27.9 percent of total energy in Romania
BR welcomes information for Who’s News. Submissions may be edited for length and clarity. Get in touch at anca.alexe@business-review.ro
until 2030, while the reference scenario sets out an increase to 32.4 percent. In the potential A scenario, the share of renewable energy will rise to 35 percent in 2030, while the last scenario estimates a share of 35.5 percent. Wind and solar energy are considered critical in increasing the share of renewable energy, given the estimated evolution
Georgios Argentopoulos is the new general manager of Sphera Franchise Group, replacing Mark Hilton, who will continue to support the group as a strategic consultant, ensuring a smooth transition for his successor. Previously, Argentopoulos led a complex portfolio of businesses in the retail, real estate and telecom industries. His main objective will be for the company to maintain its focus on providing top quality products and services to its customers.
Net installed wind power capacities will reach 6 GW for the reference scenario
Romania could get 35 percent of its energy from renewable sources with EUR 17 bln investment
page 5
gies globally. Net installed wind power capacities will reach 6 GW for the reference scenario, while under potential scenarios A and B they are expected to reach 7 GW. In the current scenario, installed capacity in wind farms will reach 4.3 GW (from 3 GW currently).
By Sorin Melenciuc
“Cumulated investments Romania could increase the
Energy in Romania: Potential for
in the Romanian energy sector
share of its energy from renew-
Development in the Horizon of
for the projected period are ex-
able sources from 27.9 percent
2030.
pected to be over EUR 17 billion
to 35 percent with investment
Alexandru Mihai has been appointed head of the leasing department of MLP Group. He has more than 15 years of experience in leasing commercial space. Before joining MLP Group, Mihai served as head of the industrial department at Activ Property Services. He also worked for Easy Asset Management and Cushman & Wakefield. His responsibilities included running negotiations, leasing commercial space, carrying out surveys, preparing market analyses and cultivating client relations.
of the cost of these technolo-
Photo: Dreamstime
The study sets out four
in the case of the potential A
of EUR 17 billion, a scenario
scenarios: current and refer-
scenario, EUR 20 billion in the
that might prove cheaper for
ence ones, and potential A and B
reference scenario, EUR 22 bil-
the country than the alterna-
scenarios. The first one forecasts
lion in the current scenario and
tives, according to a RWEA
that the current share of renew-
EUR 25 billion in the potential B
& Deloitte study, Renewable
able energy will be maintained at
scenario,” the report says.
Bucharest to get free Wi-Fi in public spaces By Anca Alexe Bucharest City Hall has an-
was approved unanimously by the
nounced that citizens will be able
General Council. “Through this
to access free wireless internet
program’s implementation, people
in public spaces through the
living in Bucharest will have free
WiFi4EU program, which uses
access to Wi-Fi in public spaces
non-reimbursable funding from
like parks, public squares, public
the European Union. The project
buildings, libraries, museums,
Photo: Dreamstime
The municipality obtained nonreimbursable funds of EUR 15,000 in February to install Wi-Fi networks in public spaces
www.business-review.eu Business Review | May 2019
NEWS 5
Firms lease 105,000 sqm of Bucharest office space in Q1 Ovidiu Zaberca has been appointed senior business development manager at Deloitte Romania. He has experience in business development and marketing strategy for regional offices and has worked with business owners and top executives in the region. As senior business development manager, Zaberca will facilitate clients’ access to all types of services provided by Deloitte Romania experts based in regional offices in Cluj-Napoca and Timisoara, as well as in Bucharest.
By Anca Alexe The Bucharest office market made a brisk start to 2019: a gross take-up of 105,000 sqm, of which net take-up was 29,000 sqm, and 93,000 sqm of deliveries. Data from the real estate consultancy company Colliers International Romania show that demand came mostly from IT&C companies, despite the tight labor market. “At first glance, the start of 2019 was great for the Bucharest office market, with total take-up at 105,000 sqm, up some 54 percent year-on-year. Enthusiasm needs to be slightly
Sebastian Dragomir, Colliers International
toned down: although there is still very healthy demand
to about 29,000 sqm, which is
and professional services (a
for new or quality projects, we
still a decent level, while flexible
little over 10 percent). The start
have to peel away renewals
workspace operators accounted
of 2019 saw the delivery of sev-
and relocations from competi-
for over 20 percent of the figure,”
eral large projects in Bucharest:
tive stock to reach net take-up.
said Sebastian Dragomir, direc-
S Immo’s The Mark, near Piata
These relocations tend to cre-
tor of office advisory at Colliers
Victoriei; the second phase
ate vacancies and they stood at
International. By sector, IT&C
of The Bridge in Center West,
a sharp 54,000 sqm in Q1 2019
leasing was dominant, account-
developed by Forte Partners,
versus 102,000 sqm for all of
ing for nearly two thirds of total
but owned by Dedeman; and
2018. As a result, new demand
take-up, followed at a distance by
Renault’s new HQ, developed
decreased by over 20 percent,
financial & banking (16 percent)
by Globalworth.
Valeriu Binig is the new regulatory and antitrust affairs director of Enel Romania. He is a leading specialist on the Romanian energy market, with over 32 years of professional experience in the sector. In his new role, Binig will lead a highly qualified team whose main objectives will be defining, representing, and promoting the company’s position on regulatory and antitrust issues
etc., as the European Commission has accepted City Hall’s request to take part in the WiFi4EU program,” the City Hall said in a statement. The municipality obtained non-reimbursable funds of EUR 15,000 in February to install Wi-Fi networks in public spaces. Authorities will only have to cover the subscription-related costs. The Wi-Fi networks should be installed within 18 months of the date when the funding contract is signed. The networks will have no commercial ads and will not use personal data commercially.
Leon Stevens is the new chief revenue officer of FintechOS, a company specialized in accelerating digital transformation for financial institutions. Stevens has over 25 years of experience in software and holds a Bachelor’s Degree in Computer Science from the University of Bristol and a Master’s Degree in Artificial Intelligence, specializing in engineering and business applications. He has previously worked for Salesforce, Thunderhead, Workbooks and BMC.
www.business-review.eu Business Review | May 2019
6 REAL ESTATE
High-end homes get new concept: affordable luxury On the Romanian residential market a property has to be worth at least EUR 500,000 to be considered luxury. And the category runs from penthouses in northern Bucharest, to historical villas. The latest concept, say players, is affordable luxury. By Razvan Zamfir
Avalon Estate will bring 800 new apartments onto the luxury market
A
t the high end of the market, the
redeveloped Lake Floreasca area and the
around 800 apartments, Aviatiei Towers with
most significant delivery in 2018 was
Aurel Vlaicu underground station, close to
some 150 flats and Aviatiei Park with 352
One Charles de Gaulle, with 33 apart-
Promenada mall.
apartments.
ments. By the delivery date, 90 percent of the
This acquisition fits into Atenor’s devel-
Last year, Prime Kapital confirmed it
units were already sold.
opment strategy, which aims to promote
would start developing on two land plots in
In December, developer Atenor took its
projects with high architectural and environ-
the Pipera area (Avalon Estate) and in Bu-
first steps towards the high-end residential
mental quality across European cities with
curestii Noi (Marmura Residence). With ap-
sector in Bucharest, by acquiring a plot of
strong economic fundamentals.
proximately 800 residential units, including
7,150 sqm in the Floreasca/Barbu Vacarescu area. The site is located between the recently
Other at least premium or affordable luxury projects were Cloud 9 Residence with
houses and apartments, the Avalon Estate is scheduled for delivery this year.
www.business-review.eu Business Review | May 2019 2016
The amenities available include promenade areas, a private kindergarten, access to
COVER REALSTORY ESTATE14 7
are also in talks to acquire a large land plot in the north of the city,” says Azoitei.
sqm of retail and commercial spaces, Marmu-
remained constant during 2018. There was significant appetite for new developments
the Pipera Lake and commercial areas. With 5,000 sqm of green areas and 1,700
At the top end of the market, demand
THE ATTRACTION OF OLD BUILDINGS
located next to parks, especially in the main
With increasingly fewer land plots available
office hubs in the north of Bucharest.
ra Residence will bring a new modern touch in a neighborhood previously dominated by older buildings. Stretching over 1.5 hectares, Marmura Residence will consist of 458 apartments designed for young professionals and families and could fit into the affordable luxury concept spearheaded by the entrepreneur Lucian Azoitei, who owns the developer Forty Management. Forty Management specializes in developing projects under the Central District brand and is working now on Central District 4 Elemente projects, on a plot of around 4,500 sqm and worth around EUR 22 million. The company has completed 90 apartments and has 244 more under construction, as well as exclusive developments such as the Central District of Poland25 and the Central District Cuza99. The developer also owns a 2,200-sqm plot on Viitorul Street in Sector 2, near Stefan cel Mare, where, according to Azoitei, the development of the Central District Viitorului
in high-end areas, as is the case in markets
project will begin this autumn.
including London and Paris, older buildings
per month between July 2018 and January
situated downtown are being converted into
2019. Significant interest was registered
high-end boutique projects. For example,
in One Floreasca City’s one- and two-bed-
“With this project we are in an early stage, but we will have around 40 apartments, a
One United sold an average of 4.5 units
room apartments, but the project has been slammed by activists, who claim that it is breaking construction rules in the area. The company sold the most expensive apartment in 2018 at One Herastrau Park, for EUR 2.7 million. Several market commentators claimed in 2018 that the real estate market was heading towards a new crisis. However, data suggests that there is still growth space, and if changes were to occur, they would be in the form of shopping area and an office area of about
Hagag has launched H Victoriei 139, which
a price correction rather than a market col-
1,000 sqm. All areas adjacent to the blocks
will provide 33 high-end apartments on Calea
lapse. Demand is still greater than supply, es-
will be green areas for the promenade, all
Victoriei.
pecially at the top end of the market, where
cars will be underground and the resulting area will be green. The building will be certified green, which means approximately
This mixed-use project, with 236 apartments, is expected to be delivered in 2021. “We expect the same level of interest in
specialists say there is still room for growth. According to Knight Frank, a slight change in the profile of high-end buildings and
70 percent of the surface area will be green
the high-end market as long as there are
specifications will appear. Tower buildings
area. The height regime will be different with
similar levels of high-quality projects from
with glazed facades and unobstructed views
one block lined up at the GF + 5 +6 retreated
experienced developers,” said Knight Frank
will replace low-rise buildings in well-known
street and the other G + 4 + 5 secluded. We
agency consultants.
areas.
www.business-review.eu Business Review | May 2019
8 REAL ESTATE
Plotting expansion: Forte Partners flexes development muscles Geo Margescu may be the most relaxed executive in the Romanian real estate market. The CEO of Forte Partners has under his belt the EUR 200 million sale of The Bridge, the 80,000-sqm office building in the center-west of Bucharest acquired last summer by the Paval brothers, founders of the Dedeman chain, and is working on the other projects Forte Partners is now developing. By Razvan Zamfir Now he is concentrating on Forte Partners’ new projects. One such is a residential scheme, Aviatiei Park, featuring 352 apartments in the north of Bucharest, close to Herastrau Park, and requiring a EUR 37 million investment. “It is a special project for us, the first large residential scheme we are developing, so we are focused on making it attractive to buyers,” says Margescu. And it seems that the developer is succeeding, as the 176 apartments of the first phase of the project have already been sold. The project is unusual for the market, as only 3,700 sqm of the 15,000 sqm total surface area is to be covered by buildings while over 11,000 sqm will be dedicated to the piazza, pedestrian walkways, access roads and vegetation, with tree and perennial tree alignments, designed for harmony of the gardens each season. “We have analyzed every detail, from circulatory to space ergonomics, from the need for a lively lobby with a six-meter-high atrium
B
R sat down with Geo Margescu in the sumptuous, renaissance-style Ethos
up to the noise level and thermal comfort,” outlines Margescu. Margescu of his deal with the Pavals. Margescu was no stranger to real estate
PLOTTING TO REVIVE CENTRAL BUCHAREST
development before Forte Partners, having
In autumn 2017, Forte Partners bought from
pany headquarters, whose exterior contrasts
developed several landmark industrial, office
Telekom a 1,700 sqm plot of land between Ion
with The Bridge’s modern glass and steel. Not
and residential projects in Romania. Between
Campineanu and Matei Millo streets, and it
so with the interior, as Forte Partners HQ is
2003 and 2008, he developed Europolis Logis-
hasn’t stopped the search for land.
rather minimalist, in line with the period.
tics Park, featuring over 230,000 sqm of prime
House building in Floreasca, the com-
The firm intends to combine the plots and
Class A warehouse space, more than twice
develop several buildings near the Palatul
er Romanian entrepreneurs. From the start to
the size of the second largest development in
Telefoanelor area to create a hub and revital-
the end of negotiations for The Bridge it took
the country. 2007 saw the development of the
ize the center of Bucharest. It has already
only six weeks – a record, I would say. So, it is
Millennium Bank headquarters, and 2008 the
started the construction of the 9,000 sqm
not only the price, but the time to complete
Louis Blanc office building, which were sold
Matei Millo office building and areas for
the transaction was very short as well,” says
to both local and international investors.
future employees. “We believe in office de-
“I was very happy to do business with oth-
www.business-review.eu Business Review | May 2019 2016
COVER REALSTORY ESTATE14 9
area where we have a varied offer, where you can drink coffee, eat and work, obviously,” outlines Margescu.
STOCKING UP IN SERBAN VODA The developer also owns an 18,000-sqm plot just outside the Adesgo stocking factory, across the road from Tineretului Park. The project proposal for the land on Serban Voda Road reached the table of the Technical Urbanism Commission last autumn and Forte Partners wants to build here a mixed project of offices, apartments and commercial spaces with 14-storey high towers. The CEO says that he doesn’t think the company will make a lot of purchases this year. “We have thought about buying an office business, but I think we will go in another direction. We feel better when we are opening
The Bridge
new areas, developing things, and less in asset management. We are interested in buying, land especially, but I don’t think it will happen this year,“ he says. While moving ahead prudently, Forte Partners is one of the most active Romanian developers in the market. It has its quiver full with projects and is still looking for development opportunities on the office and residential markets. According to Margescu, the company will build homes in office hubs and offices in residential areas, in a bid to alleviate traffic
velopments in central and ultra-central areas
that there are some points of attraction, cafes
congestion in Bucharest, a city which will
and we rely on architecture, ergonomics,
for example, but very far from each other.
long remain the main development hub for
optimization and design thinking. The city
What we are trying to do is concentrate on an
the Romanian company.
center does not have a relevant class A office offer. We have a reputation and history of architectural quality and the ability to integrate development into the urban fabric, as well as the force of non-speculative developments, for which there are already concrete plans with our customers,” says the CEO. The company also plans to buy other land in the same area, given the trading opportunities. “We want to develop more buildings there, but we need to find plots that suit our purpose. I strongly believe in reviving the center. We complain about infrastructure, but we develop in the periphery and ignore the center where infrastructure exists. We’re trying alongside the Creative Quarter to redo the central area. The problem with the center is
Aviatiei Park
10 COVER STORY
WORKING ROMANIA Financial benefits are no longer the main pillar of an HR strategy, in Romania or worldwide. In the light of an increasingly competitive labor market, employers need to find new ways to attract and retain the best people. The challenge of the digitalization of jobs is increasing locally too, with both employers and employees needing to adapt fast to the new context. BR sat down with some of the most dynamic employers in terms of hiring in the last year and found out their strategies to hire and keep talents and how they are coping with the digitalization of the local workforce. By Anda Sebesi
www.business-review.eu Business Review | May 2019
www.business-review.eu Business Review | May 2019
COVER STORY 11
A
ccording to National Institute of Statistics (INS) data, Romania’s average net monthly earnings rose by 17.9 percent yearon-year in February, to RON 2,933 (EUR 617). The highest
wage increases were found in the public sector, while most private sector employees earned less during the first two months of this year compared with December, employers in Romania often pay end-year bonuses. In addition, the highest net monthly earnings in February were recorded in the IT sector (RON 6,683 or EUR 1,407), while the lowest were found in the textile industry (RON 1,728, or EUR 364). And the total number of employees in Bucharest reached over 1 million at the end of November 2018, up from 993,740 in the same period of 2017, according to the source. Romania still has the second lowest average wage among European Union member states, after Bulgaria. However, following rapid pay hikes over the last couple of years, Romania is now close to Hungary and Latvia in terms of average net earnings. Last but not least, the total amount of wages paid by Romanian bosses rose by 17 percent in 2018 compared with 2017, to EUR 80.3 billion – an all-time high, mainly due to minimum wage and public sector pay increases. The wage bill registered in 2018 is equivalent to 39.8 percent of GDP, much lower than the EU average of 47.7 percent of GDP. A recent BR analysis found that the highest wages in Romania are in Bucharest and four counties (Cluj, Sibiu, Ilfov and Timis), exceeding EUR 600 per month on average, while in almost half of the country, average net earnings are below EUR 500. But many economists expect wage hikes to slow down in 2019, due to fiscal constraints.
EMPLOYERS FOCUS ON RETENTION IN A HOT LABOR MARKET Continuous learning for skill development, leadership development and improving the employee experience are the most important and pressing trends identified by the Deloitte 2019 Global Human Capital Trends report for Romania. “The main concerns of Romanian employers are lifelong learning (90 percent of respondents) and developing leaders (84 percent), followed by improving the employee experience (78 percent). These results reflect the current challenges facing Romanian organizations: retention in a hot labor market and growing the right leaders to ensure such retention and bring businesses forward. Lifelong learning has evolved from a matter of career advancement to labor market survival in the context of the need to sustain longer careers and as part of the fact that every job is changing,” said Raluca Bontas, partner global employer services, Deloitte Romania. Developing leaders seems a perennial issue of our time, as this topic has been highlighted as one of the most relevant by the Global Human Capital Trends study since its 2013 edition. Some 75 percent of the global respondents believe leaders need to understand new technologies in order to be effective. Also, respondents consider the leadership development programs currently in place essentially ineffective. As far as the employee experience is concerned, organizations
www.business-review.eu Business Review | May 2019
12 COVER STORY
What professionals say about the local labor market
may reach specific objectives in this area by adopting a human focus, capturing the meaning of work that people are looking for, highlighting the impact the work has both on the organization and society as a whole, and ensuring effective leadership, underlines the report. Looking at rewards, the report underlines that this means more than money and organizations need to enhance the use of personalized reward systems as key to retain employees longer and keep them productive, such as flexible composition of pay, professional and personal development opportunities, and meaningful jobs. Some 63 percent of the local respondents consider this topic important or very important. In 2018, making rewards personal was also indicated as a very important topic on the HR agenda, together with well-being, as a driver for productivity.
GRANTING EQUITY IN THE COMPANY INCREASES LOYALTY
EMILIA STANCU, HR DIRECTOR, SAINT-GOBAIN ROMANIA
“IN GENERAL, ON THE LABOR MARKET WE CAN SAY THAT THERE IS A DISTANCE BETWEEN EMPLOYERS’ OFFER AND THE EXPECTATIONS OF THE NEW GENERATION OF CANDIDATES. FROM THE CONSTRUCTION MARKET PERSPECTIVE, AS WE ARE FACING AN INCREASED GAP IN THE SUPPLY AND DEMAND OF QUALIFIED WORKFORCE, WE ARE INTENSIFYING OUR EFFORTS TO SUPPORT EXCELLENCE IN EXECUTION, BY PROVIDING PARTNERS WITH A SERIES OF PROGRAMS TO TRAIN FUTURE CONSTRUCTION SPECIALISTS THROUGH THE SAINT-GOBAIN TECHNICAL ACADEMY.”
The long-term incentive plan known as a Stock Option Plan, based on which an employer grants equity in the company to its key employees, under certain conditions, is more favorable from a tax perspective than similar plans implemented in other countries in Central and Eastern Europe, according to Deloitte Romania analysis. Besides Romania, the analysis covers eight other countries in the region, namely Hungary, Poland, Czech Republic, Slovakia, Bulgaria, Croatia, Serbia and Latvia. “Granting company shares is a remuneration method based on which the employer connects the individual performance of top management employees with the business performance, generating increased loyalty and, at the same time, additional motivation. Even though the tax regime for such an instrument is definitely more favorable than usual salary elements, when deciding on whether the company should implement such an instrument, the employer should focus on the company’s growth strategy and the need to co-engage the employees in achieving it,” noted Bontas of Deloitte Romania. Tax incentives are the main benefits for equity plans (more specifically, the Stock Option Plan), since taxation is triggered when the employee sells the shares and thus obtains a capital gain, and not when he or she actually receives them, as in the case of other types of benefits. “The Stock Option Plan has two important elements: correlation between the remuneration received and the increase of the employer’s share value and, subsequently, the employee’s retention for a longer period, either to benefit from a higher value of the shares or to obtain the associated dividends,” said Elena Raileanu, manager,
RAMONA SALAGEAN, COUNTRY HR LEAD, ACCENTURE ROMANIA
“THE INDUSTRY OF SERVICES FOR THE BUSINESS SECTOR HAS BECOME ONE OF THE MOST DYNAMIC SECTORS IN ROMANIA. ITS POTENTIAL IS ABOUT SEVERAL HUNDRED THOUSAND EMPLOYEES, WHILE THE INDUSTRY HAS REACHED JUST HALF OF IT.”
global employer services, Deloitte Romania.
EUR
80.3
bln
is the total amount of wages paid by Romanian bosses in 2018
www.business-review.eu Business Review | May 2019
COVER STORY 13
OPINION
Adrian Cernat, CEO and co-founder of SmartDreamers
Finding the Right Candidate LILIANA SIMION, HR DIRECTOR, MARRIOTT COURTYARD FLOREASCA
“AS IN MANY OTHER CASES, IN THE HOSPITALITY INDUSTRY THERE IS AN IMBALANCE BETWEEN THE AVAILABLE WORKFORCE AND THE AVAILABLE SKILLS. HOSPITALITY IS ONE OF THOSE INDUSTRIES WHERE ONE CAN EASILY FIND A STARTING POINT AND BUILD A CAREER, EITHER LOCALLY OR ABROAD.”
Odds are, the perfect candidate for your latest open position is already out there, working for a different company. Luckily, there’s a good chance that any given candidate can be convinced to adjust course and switch to a position at your company – if you can offer something that her current employer doesn’t. This might be more prestige, better pay, more opportunity for advancement, a better location, or any of the other elements that traditionally make up a strong EVP (employee value proposition). If you really are a good fit for one another, the biggest obstacle standing between you and your ideal hire is awareness. If she doesn’t know you exist, or doesn’t immediately associate your business with your employer brand, then how will she make her way into your applicant funnel? Since your ideal employee isn’t actively seeking your company out, you need to go to them. This means avoiding places like Craigslist and Indeed that are only frequented by active job seekers. Instead, it’s time to focus your energies on the sites where candidates already spend their time online: Facebook, Twitter, Snapchat, YouTube, Reddit, etc. Again, it’s not enough to have accounts on these platforms that people can seek out (though you probably should have not just corporate accounts but separate career-focused accounts), you have to leverage paid posts and targeted advertisements to make sure that when your ideal job candidates are thinking about seeing what’s out there, they’ve heard of your company. Not just heard of it, but learned to associate it with all of the unique and exciting ways that your company provides growth opportunities, learning, and benefits to its employees.
ALINA RUSEI, CHIEF PEOPLE OPERATIONS, QUALITANCE
“LACK OF WORKFORCE IS ALREADY A CERTAINTY, THE MORE SO AS THE EMIGRATION PHENOMENON HAS INCREASED IN RECENT YEARS. FORTUNATELY, THE WORKFORCE CRISIS IN THE IT SECTOR IS NOT FELT AS STRONGLY AS IT IS FELT IN THE PUBLIC SPACE. THE FACT THAT WE ARE WORKING WITH EMERGING TECHNOLOGIES IS AN ADVANTAGE FOR US IN ATTRACTING WORKFORCE, ESPECIALLY BECAUSE FROM THIS PERSPECTIVE THERE IS NO OVERLAP WITH THE OFFERS COMING FROM THE PUBLIC SECTOR.”
www.business-review.eu Business Review | May 2019
14 COVER STORY
Workforce shortage versus workforce satisfaction Almost half of employees (42.5 percent) are planning to change jobs in the next three months, according to the latest study by eJobs, the online recruitment platform. This is due to their expectations of getting a better job, with higher wages and benefits. It is not easy for employers to find ways to keep workers from leaving, as we can see from the companies Business Review talked to, although the situation may not be as bad as it seems.
D
By Aurel Dragan
ifferent industries
percent over the same period
across the economy
last year, reaching almost 3.9
have different prob-
million.
lems in the human resources
The study also found the
field. Looking at the study
reasons why employees wish
conducted by eJobs (among
to stay in their current roles.
the platform’s online users),
The main thing keeping them
we can see that pay is the
in their job is the relationship
main concern of those looking
they have with colleagues,
to change jobs. “Salary is the
followed by the short distance
main reason Romanians want
between home and work. Sal-
to resign. The next thing that
ary comes only third, followed
dissatisfies them is the lack
by a flexible work schedule.
of opportunities for personal
Other reasons invoked by
and professional development.
employees are that they do
A large part of those who
not work overtime, have a
participated in the study say
good relationship with their
they want to change field or
direct manager, feel that their
that they need a job to balance
work has a positive impact on
their personal and professional
society, or work for a company
lives and reduce the number of
with a good reputation in the
hours worked throughout the
market.
week. What the study shows us is that it is issues of our
WAGES AND BENEFITS
comfort, our employees, our
The main benefits, apart from
wellbeing, and the creation of
the salary, that companies
a framework that motivates, rather than intrinsic aspects such as
give employees are meal tickets or co-paid meals in the cafeteria,
salary,” says Bogdan Badea, eJobs Romania CEO.
transport subsidies and bonuses for holidays or for children. If there
Apart from those who want to change job in the next three
is a difference between white-collar workers in urban offices it is
months, another 14.1 percent are keen to make this change in the
that big employers outside the major cities tend to organize events
next six months, which makes a total of 6 out of 10 employees who
for employees and their family throughout the year.
want another job. The platform compiles over 4 million CVs and is
“Overall, benefits include, but are not limited to, meal vouchers,
visited monthly by 2 million users, numbers that makes it signifi-
co-paid meals in the company’s cafeterias, subsidies for transpor-
cant for the workforce. The changes in the market seem to have
tation expenses, relocation bonuses, special bonuses or gifts for
been at a peak for recent years, since the total number of applica-
employees’ children, preventive medical services, co-paid sport
tions in the first quarter of 2019 on eJobs increased by more than 30
programs and internal competitions, free days for special family
www.business-review.eu Business Review | May 2019
COVER STORY 15
events, dedicated events for the whole team fully arranged by the
first to require more qualified staff in order to expand businesses.
company, etc. Personal and professional development programs
The situation has not changed, even if it is very specific to the
are fully supported by the company. Other benefits such as flexible
sector. “Globally, talents in the IT industry are still highly sought
working program (teleworking or short day) are applicable to those
after and insufficient in number and the social context in Romania
employees whose jobs allow
convinces many to choose to
it,” says Mihaela Popescu,
leave the country,” says Car-
president of TenarisSilcotub,
men Buruiana, enterprise HR
a company with 40 years of
Manager at Bitdefender.
history in the Romanian indus-
As for the benefits of-
try, employing almost 2,000
fered, the company is taking
people in Romania and around
advantage of the fact that it
20,000 worldwide.
is a leading player worldwide
From the white-collar side,
and has many development
a booming sector is the busi-
opportunities for employees.
ness services industry, one of
“Bitdefender security solu-
the most dynamic in Romania,
tions are fully developed in
with the industry potential
Romania in the five R&D
of several hundred thousand
centers. In total, the company
employees, although only
has 19 offices in 13 countries
half of this potential has been
across four continents. In this
reached. Accenture is one of
context, of a Romanian com-
the largest professional service
pany, the special benefits we
companies active in areas
give come from the advantages
such as consulting, digital
and limitations of the organi-
transformation, technology
zational structure. Position-
and operations worldwide.
ing Bitdefender as a thought
In Romania, it has more than
leader on specific technical
3,000 employees in Bucharest, Brasov, Cluj-Napoca, Targu Mures, Iasi and Timişoara. “Being a very large company with over 459,000 employees in 55
areas allows R&D specialists to be able to speak at various events, congresses, and international conferences, a highly motivating benefit to those who have career
countries, we offer local teams the chance to work in a very diverse
as a focal point for their development. Another special benefit that
and dynamic environment with colleagues and customers all over
Bitdefender offers according to business needs and employees’
the world. Career opportunities are extremely varied, and all of this
desire is relocation to areas where there are international offices,
can be accessed while living in
and the special benefit of reloca-
the city that suits you best. Also,
tion to the US is to support the
in Accenture, we emphasize the
Green Card for the employee and
balance between work and life, as
his or her family. The relocation
well as observing that more and
includes comp&ben packages in
more candidates prioritize this
those markets as well as medical
when they choose a new job. For
insurance. A third tremendous
example, our benefits portfolio
benefit that Bitdefender gives to
includes access to a network of
technical staff is regular training
sports halls, two additional days of
in courses and congresses and
legal leave from the first year, and
obtaining international certifica-
additional days of leave depending on professional development. But statistically speaking, meal
tions,” says Buruiana. The technology focus is what can help IT companies to find
vouchers, medical prepayment, transportation remittance, and
good employees. “The fact that we work with emerging technolo-
private pensions are the main extra-salary benefits that candidates
gies is also an asset in attracting workers, especially since there is
most often choose,” says Ramona Salagean, country HR lead at Ac-
no overlap with public offers in this respect. While we operate in
centure Romania.
a competitive market, we maintain standards of employment at a high level – something that helps us perform, and we allow our-
BUSY IN THE IT INDUSTRY
selves to be selective,” says Alina Rusei, chief people operations at
The workforce crisis started a few years ago in the IT industry, the
Qualitance. “We have a culture of continuous development, which
16 COVER STORY
www.business-review.eu Business Review | May 2019
has helped us to increase the employee retention rate from year to
has adopted several projects run by universities to educate young
year. There have been years in which we have lost people from the
students, offering them internships and jobs in the company. It has
company, but we have managed to bring back a great deal of them,
also supported communities of all sizes by opening offices in cities
because we have been concentrating on building contexts that
such as Iasi, Suceava, Baia Mare, Targu Mures and Arad, Budapest,
would make them feel worthwhile and create growth opportunities.
Chisinau and Belgrade. “We value people. Our company puts people
From a material perspective, we target at least the benefits level of
first; every employee matters,” says Oprean.
the market. The package we offer employees contains several health and comfort services.
HOSPITALITY INDUSTRY, THE BEST PLACE TO START A CAREER
At the same time, it is equally
It is not unusual to start
important for us to provide our
working at a young age in the
employees with an experience
HORECA industry. But this
that also fulfills them at the
doesn’t mean that hotels or
human level through learning
restaurants will not push to
and interaction opportunities
keep their employees. “As in
specifically created for them.
many other cases, in the hospi-
We value everyday experi-
tality industry there is a lack of
ences, small things that matter
balance between the available
and often make the difference,”
workforce (scarcer and scarcer)
says Rusei.
and the available skills. Still,
elements and covers personal
we are in the fortunate posi-
CLOSER TO THE EMPLOYEE
tion to walk the talk when we
According to Voicu Oprean,
say that we hire attitude and
owner and CEO of AROBS
train the skills. Hospitality is
Transilvania Software, the
one of those industries where
best way to keep talent in the
one can easily find a starting
company is to listen to them.
point and that build a career,
“Every month I have breakfast with every employee who wants to
either locally or abroad. It doesn’t mean we are not impacted by the
have an informal talk with me. Every good idea is put into action,”
same trends impacting the whole local market. It means that we
says Voicu. The firm’s headcount has grown by 100 people per year,
have to be more and more creative in finding ways to approach, at-
reaching 809 in 2019. The company doesn’t only “lure” profession-
tract and retain people at various stages in their professional lives,”
als with attractive salaries, but also creates a large range of programs
says Liliana Simion, HR director at Marriott Courtyard Floreasca.
and benefits like subscriptions to technical platforms in order to
She adds that the chief perks are specific to the industry. “The
enhance their desire to improve themselves professionally. And it
main benefits offered are directly linked either to the industry’s
facilitates access to proficiency programs and conferences.
specifics (special room rates available worldwide, free laundry, free
To support the next generation of employees, the company
cafeteria), or with the market’s trends (staff events, discounted rates
www.business-review.eu Business Review | May 2019
COVER STORY 17
for various public events, health club subscriptions, insurance etc),”
izations through exposure to important professional and casuistic
says Simion, adding that the company is looking to hire 100 em-
teams (many patients, interesting and complex cases), access to
ployees by the end of the year for a resort that will be open in sum-
the latest technologies, mentoring, and ongoing development
mer. “Usually, retention cannnot be linked with one factor only – in
programs are real advantages for those aiming to be very good. In
this case, learing and development opportunities. There is a wide
terms of material benefits, employees and their first degree relatives can access dental services at a low price. Our employees also benefit from meal vouchers with maximum electronic value. Both candidates and employees can apply for medical insurance, travel vouchers, and courses, and the company is open to improving the extra-wage benefits package,” says Leahu. Since its employee retention rate is very high, the Dr. Leahu clinic can say that it has found the right way to do it. “In 2019, retention in the company is 96 percent, and we want to keep it at that level or even go to 100 percent. Our domain requires stability to serve patient excellence and we make every effort to maintain team unity. We have reached 200 employees, constantly increasing our team as we develop our business, while at the same time managing not to lose
range of factors impacting the decision to stay and grow within
people. Team solidity is the most important element in the context
the company and this is why at Marriott we evaluate on a yearly
of accelerated business development and a 50 percent increase in
basis the engagement survey – an integral aspect of the company’s
employee numbers to support this expansion,” says Leahu.
culture. It is common knowledge that engaged employees are less
DIGITIZATION AGE Digitization is the next stage in the Industry 4.0 era. Companies that manage to keep their employees use the latest technologies available in order to stay connected and keep in touch with the future. “The company has undergone massive digital transformation over the last few years, so now about 60 percent of total global revenue comes from digital services, cloud and security, which we call The New. This transformation has contributed decisively to Accenture’s performance, so we have gained a significant market share, growing nearly three times as much as the market. I can likely to leave the organization, more likely to provide exceptional
say with certainty that technology is part of Accenture DNA,” says
customer service, and help drive the overall performance of the
Ramona Salagean.
business. This is how we identify specific, actionable areas and can better target our actions,” adds Simion.
“From an internal point of view, there are a number of global areas working on the creation of the foundation and improving the level of collaboration and productivity. For example, our col-
MIGRATION IN THE HEALTH SECTOR
leagues have a mobile app to provide feedback from anywhere in
The migration of medical doctors and nurses has been partially
our performance evaluation process. I am absolutely convinced
halted by the increased wages in the public sector. But this has
that adopting technology has turned business in a positive way,
created another problem: private clinics, such as those in dentistry,
helping it become more efficient. At the same time, it has given us
have discovered that many employees prefer working for state
the opportunity to provide our services at a higher quality, so it has
facilities, in the hope of higher wages. “By balancing the prospects
increased customer satisfaction and has greatly reduced the efforts
of a growing market, opportunities for professional development,
of our employees,” adds the Accenture representative.
access to advanced technologies and all that is needed to carry out
Robotic Process Automation, chatbots, and the upcoming 5G
activity at a high level, our specialization should be the choice,”
technology are just a few of the things that will soon need to be
says Ionut Leahu, CEO and founder at Clinicile Dentare Dr. Leahu.
implemented by pretty much all industries. And all are a challenge,
“We believe in motivating employees through issues that are not just about the material side. The ability to learn multiple special-
not only for companies, but for employees too. Keeping pace with change is one of the most important things in HR today.
www.business-review.eu Business Review | May 2019
18 COVER STORY
Moving toward an agile company Fragiski Melissa, HR Director at Vodafone Romania, tells Business Review about the company’s HR strategy in attracting and retaining its employees and the way the local labor market has changed. By Anda Sebesi How has the labor market changed in your industry over recent years?
-the-box benefits we provide to
The latest trends in the busi-
developing new non-monetary
ness arena have significantly
compensation models. Intrin-
influenced the labor market.
sic motivation mechanisms,
Most organizations are go-
such as recognition, are adapt-
ing through a major digital
ed to new generations of em-
transformation and the need
ployees. We start introducing
for new roles, skills and
specific reward mechanisms or
capabilities has considerably
`kudos’, which employees can
increased. Highly specialized
give to peers, independently of
professionals, mainly in IT,
their hierarchical relationship,
analytics or data scientists are
to recognize contributions to
in high demand, which leads to
joint projects. These rewards
a scarcity on the local market.
take the form of “points” or
Companies start exploring
bonuses.
our employees. In addition, we have started
alternative options for sourcing highly specialized experts from other countries. Another trend emerging from the need to accommodate the pro-
How do you keep talented employees with good professional perspectives in the company?
fessional particularities of the new specialists introduces flexibility
Exposure to international assignments from the very beginning of
around working contracts. A shift from traditional employment rela-
their career, job rotation opportunities to different positions within
tions to more flexible ways of working is already a reality. Start-ups,
the company, participation in highly specialized trainings and access
alumni networks, and freelancers have become options integrated
to a vast majority of courses in our Vodafone University platform are
alongside employees. Remote working even from different countries
some examples of actions that address young talented employees.
and the exchange of employees between organizations are some
Expatriation assignments for more senior employees and exposure
examples that indicate employers’ need to accommodate to the new
to challenging positions in different countries are other actions il-
labor reality.
lustrating our determination and commitment to support our talents throughout their employment lifecycle within the company.
What are the main benefits you offer to employees? Apart from the benefits related to the well-being of our employees, we have created a fast-paced learning environment by investing
What employment plans do you have for 2019 - how many employees and in what areas?
considerably in development programs carried out in the country
We are moving toward transforming our organization into an agile
and abroad. Short-term assignments, leadership programs, talent
one and this is a long process. Our focus will be on expanding our ag-
exchanges are some examples indicating the focus our company
ile model, getting diverse technical functions and professional com-
puts on our employees’ career development.
munities (marketing, IT, etc.) working together in a truly integrated
Personalizing benefits for different segments of our team is a
manner, and joining forces as a strong team to launch new innova-
new trend in our company, which ensures flexibility towards the
tive products and services. We are looking to resource new project
individual needs of our employees. Digital accelerator profession-
leaders or “product owners” and give them real decision-making au-
als, for example, put more emphasis on their personal development
thority, support their development, and redefine their rapport with
rather than monetary incentives. Participation in digital meetups,
peers and superiors. We will continue to implement our ambitious
exposure to different organizations that are advanced in their digital
insourcing strategy with the focus on digital natives, data analysts,
journey, and flexible working hours are some examples of out-of
software developers, architects and product designers, etc.
www.business-review.eu Business Review | May 2019
PARTNER CONTENT 19
Keez has all the ingredients to bring accounting services into the 21st Century: digital, cloud, mobile, machine learning, AI One year ago, Daniel Mateescu and two angel investors launched a product that revolutionised the accounting business from the very beginning: online accounting on mobile and desktop. What started as merely a bold idea has proven to be a profitable business that has more than half of a million euros in revenues and 400 clients, mostly small and medium-sized enterprises. approach their firm’s accounting. They have their
profile shows a young entrepreneur who is
entire company in their pocket, on their mobile
no more than 45 years old, has a strong digi-
phone: all the documents and all the reports are
tal footprint and a good understanding of
available to them real time via the Keez Mobile
the benefits or “real-time” information. The
App, which works on both Android and iOS.
company’s client profile consists mainly of micro-enterprises, but Keez is able to service
All it takes to benefit from Keez’s online account-
larger companies as well (Keez has several
ing services is taking a picture with a mobile
clients in its portfolio that are close to the
phone. However, turning a picture of an invoice
EUR 10 million turnover threshold).
or a receipt into an accounting document in just a few seconds involves the deployment of a
The complete online accounting services are
great deal of technology. Keez built a software
rendered via 4 standard monthly subscrip-
robot that uses a “pattern recognition” tool to
tion packages, with the majority of Keez
automatically process all the documents which it
clients having selected the “Start” package,
has been trained to recognise. Training the robot
which is dedicated to companies with 3
requires a lot of history and algorithm work. For
employees and 40 monthly documents. The
example, Keez is now able to automatically pro-
“Mini” package, dedicated to startups, has
cess fuel receipts from large retailers like OMV,
been popular as well – in this context, Keez
MOL or Rompetrol thanks to a history of almost
has set up a partnership with BCR/Erste, in
4,000 processed images. The same procedure is
which companies that have a contract ap-
followed with other documents that can fit in
proved by the bank thorugh the Start-Up Na-
a certain pattern. At the end of the process, the
tion programme can benefit from 6 months
accuracy of the data is verified by one of the ac-
of cost-free services.
countants at Keez. Keez’s partnerships with banks do not stop Until last year, accounting services were fro-
Daniel Mateescu, the CEO of Keez, says that “we
here. Recently, Libra Internet Bank has
zen in a “last century” paradigm. Entrepre-
managed to transform accounting from a chore
launched its first version of an open banking
neurs used to collect invoices and receipts in
into a management tool. Keez has eliminated
platform and Keez is the first accounting
a box, and then, early the following month,
the need for parallel reports because any man-
firm to use the bank’s platform to automati-
they would ship them all to their accountant
agement report is immediately available on the
cally take over its customers’ balances and
for processing. And that was only one part of
mobile phone. Furthermore, our quality control
transaction history.
the problem.
systems imply processes where at least two accountants check and validate every recording
Keez is a tech and accounting startup march-
Today, Keez brings accounting into the 21st
and all financial statements filed online with
ing on the right path: they made more than
century. CEO Daniel Mateescu and his team
the authorities are signed by “CECCAR” certified
500,000 EUR turnover in 2018, they are profit-
were able to add ingredients like digital,
accountants”.
able, and their client portfolio is growing at a sustainable pace. CEO Daniel Mateescu
cloud, mobile, machine learning, and AI to the accounting business. In fact, Keez deliv-
More than 400 entrepreneurs have found Keez’s
forecasts an EUR 800,000 turnover in 2019,
ers to the market a “service + technology”
business proposition attractive and have signed
possibly even reaching EUR 1 million if the
package that changes the way entrepreneurs
up for their online accounting services. The client
second round of financing goes as planned.
www.business-review.eu Business Review | May 2019
20 RETAIL
LaDoiPasi aims to keep things authentic through new image campaign Geanina Ghiculescu, head of retail marketing at Metro Cash & Carry Romania, and Ana-Maria Balan, creative director at Porter Novelli Romania, tell Business Review about the new image campaign for the LaDoiPasi retail chain and the retailer’s expectations from it businesswise. By Anda Sebesi Ghiculescu: This new approach aims to highlight the way in which entrepreneurs are invaluable to both the franchise and their community. All of our partners work hard to develop a healthy business, as well as building a long-lasting relationship with their clients. As such, their stores become community hubs where people connect. The relationship between entrepreneurs and community members is very important for us and fundamental in driving stronger customer loyalty.
Balan: The ambivalence of the brand gave us the first strategic clue. LaDoiPași means both a convenience store and a meeting place for members of the local community. The creative idea tells the brand’s story through a series of three TVCs that focus on the close relationship between LDP owners and comGeanina Ghiculescu
Ana-Maria Balan
munity members. “Suntem de-ai locului” showcases three stories in the life of the
What can you tell us about the new image campaign for the LaDoiPasi retail chain, “Suntem de-ai locului?” Why did you launch it and what are its messages? Geanina Ghiculescu: This campaign is the
Ana Balan: Keeping things authentic was
community. We captured everyday situations
the main goal throughout the entire creative
where the owner has a leading role in the
process. So, we visited several LaDoiPași
narrative. The owner knows everybody and
stores to immerse ourselves into the brand’s
shares their passions: movies, fishing or foot-
universe. We talked to the store owners,
ball. The physical space of the store becomes
next step of the LaDoiPași rebranding initia-
to the customers and observed how they
a mise-en-scène for all these daily stories to
tive we started in 2017. We established a new
interacted. One of the first things we noticed
unfold. It becomes a melting pot of human
brand positioning, launched the new logo
is that you could not tell the customer from
interactions, the heart of the community.
and turned the customer into the “hero” of
the store clerk. The entire mood was friendly
his or her home. At the time we focused on
and quite intimate. You could see they were
letting people know about the main attribute
close and knew each other very well. They all
of the LaDoiPasi network, its proximity, both
came together as a team, as a local collec-
What are your expectations for this campaign in terms of business? Ghiculescu: The campaign aims to at-
physical (close to their home) and emotional
tive. This is how we came up with the idea to
tract new entrepreneurs to grow their small
(paying close attention to the client’s needs).
present the store as a hub, where members of
businesses within the LaDoiPași network.
The “Suntem de-ai locului” campaign
the community come to socialize. In this new
Sharing our partners’ success stories is a way
scenario the owner becomes the host.
of showing how the franchise supports the
reveals the other side of the network and draws attention to the people behind it: what it really means to be a LaDoiPasi entrepreneur. We show how owners relate to locals and how they build up the familiar feeling in their stores.
local convenience stores. Through “Suntem
This new campaign brings an innovative approach to the market by showing how important entrepreneurs are for the franchise. Could you tell us more about this?
de-ai locului” we also want to grow loyalty and increase engagement with our brand, by bringing into the spotlight our partners and their efforts to create a familiar environment.
www.business-review.eu Business Review | May 2019
22
OPINION Lavinia Gheorghe, Associate NNDKP
(im)Balance between company security and employee privacy? law may require certain security measures, the
personal data processing (e.g., HR and IT
employers’ legitimate interests could deter-
procedures) that should also be provided to
mine others. When the employer relies upon its
the employees.
legitimate interests, a prior assessment must be
National Law No. 190/2018 on the applica-
carried out pursuant to the European Union’s
tion of GDPR sets additional requirements
General Data Protection Regulation (‘GDPR’), the
for monitoring employees in the workplace
guidelines issued by Working Party Art. 29 and
based on the employer’s legitimate interests.
other recommendations released by data protec-
The most sensitive of these requirements are
tion authorities.
that the employer must justify that less in-
Once the need for security measures (includ-
trusive measures were not effective and that
ing personal data processing activities involved),
the employer shall consult the labor union or
is assessed, the employer must analyze, inter alia
employees’ representatives before introduc-
Associate, Data Protection practice, NNDKP
the employees’ expectations, whether and how
ing the monitoring systems.
the security measures will affect them and must
The Romanian data protection authority
Employers are concerned to protect the com-
provide the employees with information on the
decided in a specific case that using biometric
pany’s assets, premises, clients, trade secrets,
processing activities and their rights, especially
data of the employees (fingerprints) for access
as well as the employees. For this reason,
on the right to object.
on the company’s premises is excessive since
> LAVINIA GHEORGHE <
The employer will also determine if it is
for the same purposes the employer has the
measures like badge access systems, CCTV
necessary to conduct a Data Protection Impact
possibility to implement less intrusive mea-
monitoring systems in the workplace, Data
Assessment (‘DPIA’) for the processing activities.
sures, such as the badge access systems. The
Loss Prevention or other systems of monitor-
Where certain types of processing activities
employer must justify and prove the necessity
ing the devices used by employees, GPS, drug
carried out following the security measures are
of a security measure on a case-by-case basis.
and alcohol testing policies.
likely to result in a high risk to the employees’
employers usually implement various security
Some employers set through their policies
rights and freedoms, especially when using new
as a security measure the possibility to ad-
safety usually represent a priority for the
technologies, the employer shall undertake
minister drug or alcohol tests to employees.
employer, and employee privacy should be
an assessment of the impact of the envisaged
There are additional actions the employer
on the front burner as well. Employers must
processing activities.
should consider in this case – e.g., whether
Both company security and employee
these measures involve special categories of
have a clear overview and understanding of
Working Party Art. 29’s guidelines on DPIA
the appropriate actions it must undertake to
included employees in the category of vulnerable
personal data and if one of the safeguards
comply with data protection rules and protect
data subjects. Both Working Party Art. 29’s guide-
provided by Art. 9 of GDPR applies.
the employee’s right to privacy.
lines and Romanian data protection authority’s
The European Court of Human Rights
decision on the list of processing operations
(‘ECHR’) assessed this measure in several
the balance between security measures and
which are subject to the requirement for a data
cases and decided that there was no violation
employee privacy? Is it necessary to compro-
protection impact assessment listed systematic
of the right to privacy where drug or alcohol
mise one in favor of the other or can employ-
monitoring of employees as a process that may
tests were administered to employees. ECHR
ers have both by striking a balance based on
trigger a DPIA. For example, CCTV, monitoring of
held that, inter alia, the employer has the
moderation and correct actions?
the workstations and internet activity is usually
right to control and manage work, such tests
an instance of systematic, rather than occasional
being set by the internal policies which were
monitoring.
communicated to the employees.
What should employers do in order to keep
Before implementing any security measure that may affect the employees’ privacy,
Employers shall inform the employees on
A fair balance shall be struck between
the intended security measures; the legal
the security measures implemented and on how
company security and employee privacy even
grounds for personal data processing activi-
their personal data is processed. They should
if there are actions which employers will
ties involved and whether it is likely to affect
also set clear and comprehensive procedures
undertake before implementing control or
the employees’ rights and freedoms. While the
defining the security measures and details on
security measures.
companies should first analyze the need for
www.business-review.eu Business Review | May 2019
24 INFRASTRUCTURE
Road to nowhere: transport infrastructure crawls along Romanian infrastructure will continue to develop slowly this year as major projects are crowded out by other types of public spending, despite the poor state of the country’s road and rail networks, say pundits. By Sorin Melenciuc motorway by 2020, CNAIR manager Narcis Neaga recently told reporters. Such new pledges come after a year of poor results. Despite the target to launch at least 100 km of new motorway in 2018, only around 60 km was really completed. The independent NGO Pro Infrastructura (API) estimates that 43 km of new motorways will be opened this year in a moderate scenario. “The realistic scenario is 43.28 km of new motorway this year and 69.18 km in a very optimistic scenario. The rest is just promises to the naive, gross misinformation and lies,” API recently said. The NGO, which monitors infrastructure projects in Romania, has repeatedly criticized the government’s administrators of motorway projects. If the new 43 km of new motorway materializes, the total network will reach 850 km at the end of this year. But this depends on the funds the government is ready to spend on infrastructure in such a complicated political period, with two By 2020, a new motorway (the A10) will connect southern and northern Transylvania
R
in 2020. Analysts doubt the government will make
omanian transport infrastructure
politically unstable position of minister of
ranks among the least developed in
transport.
the European Union. The motorway
rounds of elections this year – and two more
In 2018, the management of all major
infrastructure projects a priority in 2019. “Infrastructure projects will continue to be crowded out by other types of public
network consists of just over 800 kilometers
state-owned infrastructure companies was
spending,” Dan Bucsa, UniCredit’s chief CEE
following the opening of three small sections
changed, and the position of minister of
economist, said in a recent report.
of road at the end of last year, but still looks
transport has been held by three different
like a puzzle with many missing pieces and
individuals during the last two years – even
the government to speed up infrastructure
will remain in this state for most of the next
if few remember their names or noticeable
projects. A recent movement that started
decade, according to experts.
achievements.
in Moldova, Romania’s poorest region, has
However, public pressure is increasing on
spread across the country and gained unex-
One of the main reasons for the slow advancement of major motorway projects
MISSED TARGETS
in Romania is the poor management of the
Despite the scant progress, the promises keep
state-owned road company, CNAIR, and the
on coming. Romania will have 1,000 km of
pected support. The movement, called #șîeu, was initiated by an entrepreneur in Suceava who built
www.business-review.eu Business Review | May 2019 2016
INFRASTRUCTURE COVER STORY 14 25
1 meter of motorway on his land – the first
government to begin the construction of the
management and lack of investment that
meter of motorway in Moldova.
Iasi-Targu Mures motorway, aiming to end
many experts fear a tragedy due to the poor
the historical isolation of the province, the
maintenance.
The move was followed by a 15-minute work break that was observed in many major
government is ignoring the new bill as it has
cities around the country – suggesting that
no money to finance such expensive new
proper sense, from lack of maintenance,” Pro
many Romanians consider poor infrastruc-
projects.
Infrastructura cautions.
DEADLIEST ROADS IN THE EU
have occurred on the Romanian railways but
who warn that poor infrastructure is con-
The poor state of roads in Romania has a
fortunately with little consequences for pas-
tributing to growing regional disparities in
huge cost in terms of lost lives. In 2018, the
sengers.
Romania.
EU countries with
In the past few months, several incidents
ture a major burden in their day-to-day lives. Their appeal is supported by many experts
“The railways are disintegrating, in the
This is mainly
the highest fatality
because trains are
should be a major policy focus, as it would
rates were Romania
forced to travel very
contribute the most to reducing regional
(96 road deaths per 1
slowly – in some
disparities while also allowing businesses
million inhabitants),
cases, 10-15 km per
to access underutilized labor resources – a
Bulgaria (88), Latvia
hour – to avoid inci-
particularly welcome development in today’s
(78) and Croatia
dents.
tight labor market,” central bank governor
(77), according to
Mugur Isarescu recently said.
the latest European
rotten or broken
Commission data.
sleepers, silted
“In Romania, infrastructure investment
POOR PERSPECTIVES
“Worn-out rails,
embankments. Some
Meanwhile, the
However, despite the growing public pressure
member states with the best road safety
70 percent of the lines and 50 percent of the
and generous EU funds, the government is
scores were the United Kingdom (28), Den-
bridges are dilapidated and must be repaired
making slow progress with infrastructure
mark (30) and Ireland (31).
or replaced. It won’t be long before people
projects. The few motorway sections to be com-
But experts say the figures disguise a bleaker picture. “In fact, the situation is much
are killed or injured in an accident,” the NGO warns.
pleted this year will be of little comfort to the
worse because the resident population is at
Experts estimate that the Romanian
local and foreign drivers traveling through
least a million inhabitants below the figure
government must allocate at least RON 500
used by Eurostat
million per year for the maintenance of the
By 2020, a new
(19.7 million),” Pro
railways alone, but only a fraction of this sum
motorway (the A10)
Infrastructura said
is actually spent.
will connect south-
of the EU data.
Romania.
“Statistics show
ern and northern
Despite all these warnings, the Romanian authorities have done little to solve the problem.
Transylvania, but
that although the
this big Romanian
construction of mo-
province will still be
torways is crucial,
Transport Ministry, Romania needs to invest
cut off from the rest
without radically
EUR 6.2 billion in the next ten years in order
of Europe by a 13 km
improving safety
to upgrade its obsolete rail network. The
interruption – a miss-
across the existing
document indicates that 8,245 km of railroad
According to a strategy drawn up by the
ing link between Banat and Transylvania that
infrastructure, especially in places where
must be modernized. The rail network in
will not be finished before 2023, according to
people live (the construction of bypasses, the
Romania is in such a poor state that the aver-
most independent experts.
elimination of black spots and pedestrian and
age speed of rolling stock is close to 40 km
cyclist protection measures), Romania will
per hour and today there are over 500 speed
Wallachia and Transylvania – the Sibiu-Pitesti
remain in last place in Europe in terms of road
restrictions on the country’s railways.
section – has even poorer perspectives: there
safety,” the NGO added.
The other major missing link, between
are no works, no contracts for the major subsections and no deadline. The Sibiu-Pitesti section is a difficult job
The European Commission estimates the
Some limited advances have been made recently thanks to EU funds. Last year, the
socio-economic cost of road deaths in Roma-
state-owned railway operator CFR started
nia at EUR 3 billion a year.
operations on the railway segment Sighisoara – Coslariu and Arc Bridge, crossing the river
as it crosses mountains, and experts forecast
ROMANIA’S RAIL NETWORK: ON TRACK FOR TRAGEDY
Tarnava Mare.
If the roads in Romania are bad, the rail
developed on this route are the first newly
frastructure is in Moldova. Despite the fact
network is even worse. In fact, the situa-
built in Romania since the fall of Communism
that Parliament passed a law obliging the
tion is so critical following decades of poor
in 1989.
that this major project has little chance of being completed by 2030. But the worst situation in terms of in-
The two railway tunnels and the bridge
www.business-review.eu Business Review | May 2019
26 ENTREPRENEURSHIP
Local entrepreneurs looking for fresh approach in energy industry With the Romanian energy sector dominated by large state-owned enterprises and international utility groups, entrepreneurs are looking to give the sector a shot in the arm through innovative solutions that can cut costs and safeguard the environment. By Ovidiu Posirca
With the growing demand in mobility solutions, talented individuals can market and sell their solutions worldwide
S
emerging in Romania despite the
dominated by public and large international
sources industry leader at Deloitte Romania,
production and consumption of gas, oil
companies, with few local entrepreneurs
the professional services firm, told BR.
and electricity having been falling for more
having managed to develop their businesses
Some of the startups created by Roma-
than a decade. Romania’s primary energy
in this field, and without reaching consistent
nians are targeting the development of cities
consumption fell by 1.9 percent between 2006
profits compared to their turnover. Entre-
based on smart principles, ranging from mo-
and 2016, according to the BP Statistical Re-
preneurs would benefit tremendously from
bility to energy consumption of households
view. Both oil and gas production fell by more
supportive public policies and, ultimately, the
and storage systems.
than 2 percent in this period.
entire local energy sector would win on the
tartups in the energy sector have been
“The Romanian energy sector is still
long term,” Razvan Nicolescu, energy and re-
“We see that there are more and more
www.business-review.eu Business Review | May 2019 2016
ENTREPRENEURSHIP COVER STORY 14 27
startups coming to life in the CEE region. In
of new startups in this field. According to BP’s
this will give drivers the power to generate
recent years we have observed that after the
Energy Outlook, electricity consumption in
safe, breathable air by simply driving their
boom of internet-based service startups, the
the EU-based transport sector will grow by
car.
areas of energy, mobility, clean air, heat-
around 700 percent over 2017-2040.
“Across the world, public transport and
ing, cleantech, and smart technologies are
“Traditionally, Romania has its strengths
more and more attractive to young people
in the energy sector, not only being the rich-
one had a solution to reduce pollution, but
who want to get into the startup world. This
est in the region in oil and gas, but also taking
nobody was able to purify already polluted
tendency is also helped by the development
into account its hydroelectrical output and
air. This is how we came up with the idea for
of computer technology; now really complex
the fact that lately, new renewable energy
the product,” Vladimir-Cristian Sabo, CEO and
solutions can be designed and manufac-
projects have emerged both in wind and in
co-founder of the startup, said in an interview
tured by very small companies,” Vlad Suteu,
solar energy. It is therefore easier for Roma-
published on changeneers.ro.
managing partner at Digital Transformers, the
nian startups than for startups in some other
Romanian hub for InnoEnergy, told BR.
CEE countries
bicycles are becoming more popular. Every-
the deployment of innovative ideas in this
potential by
UTILITIES HAVE A DATA PROBLEM
field is one of the main challenges faced by
partnering with
Some startups
startups.
larger energy
are bridging the
companies or
gap between
this respect, being the owner of some of the
simply offering
utility firms
largest players in the energy sector, which
their technol-
and customers
would represent some of these startups’
ogy solutions
by cleaning up
primary clients,” he said.
to those larger
and analyzing
companies,”
energy usage
tion companies are state-owned, while the
Marius Ghenea,
data, accord-
electricity transmission and interconnection
partner at 3TS Capital, the private equity and
ing to Meghna Rao, intelligence analyst at CB
system with neighboring countries is also
venture capital firm, told BR.
Insights. She suggested that blockchain-based
Nicolescu of Deloitte Romanian adds that
“The state could play an important part in
Locally, the main electricity genera-
to tap into this
operated by the state. Meanwhile, the private
solutions can make the energy market more
sector has a strong presence in the oil & gas
POWERING ROMANIAN IDEAS
sector
A low-cost electricity storage technology
“The market potential is very promising.
has been drawn up by the Romanian startup
transparent. For instance, peer-to-peer energy trading cuts middleman fees and decentralizes power
This is the core
OLPHES. The
from grids. This is where smart contracts on a
reason why
company has
blockchain could be used. Agreements for the
we support
developed a
transfer of energy can be easily included on
and invest in
single-reser-
smart contracts that are placed on a decen-
innovation.
voir, modular
tralized, basic code that runs on blockchain
With the rise
and scalable
technology.
of sustainable
pumped-hydro
energy solutions
technology that
ground in the energy field. Startup Stem,
and growing
can be installed
which has secured USD 374 million in funding
demand in clean
in gulfs, mining
to date, has developed an AI algorithm that
energy and mo-
pit lakes, as well
tracks behavioral data like peak demand and
bility solutions,
as in reservoirs
lows to figure out how fast its battery should
talented individuals truly have the possibility to market and sell their solutions on a
and off-shore. Elsewhere, Tresoil Biofuel is another
Artificial Intelligence (AI) is also gaining
charge, when it should dispatch energy and how much it should store. AI can also allow
national and international level. Through our
Romanian startup working on a solution that
network of industry professionals and part-
turns landfill waste into road-quality bio-fuel,
ners, we build connections across Europe,
using a gasifier reactor. In support of smart
plan to expand their range of smart devices,
bringing inventors and industry, graduates
cities development, DeviceHub is a vendor-
including speakers and thermostats, to har-
and employers, researchers and entrepre-
agnostic next-generation platform for energy
ness data on personal energy use in homes.
neurs, businesses and markets together,” said
and utilities that aims to become the engine
In the US, spending on home-energy devices
Suteu.
for future cities.
exceeded USD 40 billion in 2018 and is set
The use of electricity for transport is set to
the automation of grids. Elsewhere, Alphabet’s Google and Amazon
A device for air purification that can be
to double in the next five years, according to
become a booming industry in the next few
embedded into vehicles has been designed by
consulting firm Wood Mackenzie, quoted by
decades, which could also spark a generation
the Romanian startup VASK. Its creators say
the Wall Street Journal.
www.business-review.eu Business Review | May 2019
28 STARTUP
Smaller cities getting on the startup investment radar Bucharest remains the most active entrepreneurial city, with regional hubs such as ClujNapoca, Iasi and Timisoara also home to a burgeoning startup scene. However, startup investors say that smaller cities can become attractive for would-be entrepreneurs, and having the right infrastructure and a large enough workforce in place might be a good starting point. By Ovidiu Posirca
E
Bucharest is the most active entrepreneurial city with about 20 percent of all Romanian entrepreneurial companies
ntrepreneurs can spring up from any
there are other cities where young people are
or infrastructure,” representatives of Instant
corner of the country, but starting a
opening new businesses – Cluj (6.1 percent),
Factoring, the Romanian online factoring
company in a city that has a technical
Timis (4.3 percent), Constanta (4 percent)
fintech, told BR.
university and good transport links, espe-
and Ilfov (3,9 percent). In total, the top five
cially airports, could give small businesses a
counties accounted for 200,000 of all entre-
growth impetus, say commentators.
preneurial companies, i.e. 39 percent of all
LEADING STARTUPS CAN START FROM PROVINCIAL TOWNS
active firms. Smaller cities can compete only
In Romania, large metropolitan areas are still
neurial city with about 20 percent of all
through quality of life expressed in educa-
the most attractive, “but this does not mean
Romanian entrepreneurial companies, but
tion, health system, proximity to large cities
that small entrepreneurs cannot operate
“Bucharest is the most active entrepre-
www.business-review.eu Business Review | May 2019 2016
COVER STARTUP STORY 29 14
outside these areas,” adds Dinu Bumbacea,
(San Francisco and the Valley, New York and
of human capital and additionally, the cost
consulting partner-in-charge at Deloitte Ro-
maybe a couple of other cities).
of living is highest in these two cities, with
mania, the professional services firms.
One of the private equity funds looking to
Cluj having maybe a slight edge as quality
invest outside Bucharest is Morphosis Capi-
of life overall is said to be statistically better
EUR 22,400 in 2017, more than double the
tal. Andrei Gemeneanu, managing partner of
there than in Bucharest, based on most of the
national average, and well above the Euro-
the fund, says that cities and regions outside
recent annual international surveys on the
pean Union average. According to Romania’s
the Romanian capital have valuable compa-
quality of life in various EU cities. So I believe
economic forecast body (CNSP), eight out of
nies “with the potential to become national
we should already be looking at ‘tertiary’
41 counties (excluding Bucharest) exceeded
or even international champions”.
cities or towns, still in the 100-200k range
Bucharest had a GDP per inhabitant of
“Although the
the EUR 10,000
population, but less crowded and with a
threshold last year:
situation differs
relatively low cost of living and stress factors,
Timis (EUR 12,897),
from one sector to
such as Sibiu, Oradea or Targu Mures,” says
Constanta (EUR
another, one of the
Ghenea of 3TS Capital.
12,699), Cluj (EUR
strategic advan-
11,937), Brasov (EUR
tages of Romania at
is a “hidden diamond” which is attracting a
11,164), Ilfov (EUR
international level
growing number of investors, while Timiso-
10,797), Alba (EUR
is the relatively low
ara and Cluj already have communities of
10,629), Sibiu (EUR
cost of labor. This is
young software developers and IT engineers
10,552), and Prahova
especially visible in
with higher purchasing power. He says that
(EUR 10,009).
smaller cities and I
there is room for development in northern
hope that in the next
Moldova, where a skilled workforce is still
Already, some startups that have secured funding have
few years we will see accelerated develop-
emerged from secondary cities. Smart Bill,
ment, especially in the manufacturing sec-
the largest player in the online invoicing
tor,” Gemeneanu told BR.
For Gemeneanu of Morphosis Capital, Iasi
available at an accessible cost. “Let’s not forget that there are 4 million Romanians living abroad whose purchasing
market, was founded in Sibiu, while Smart-
Some of the cities with emerging entre-
power is higher than the ‘richest’ 4 million
Dreamers, the early stage HRTech business,
preneurial scenes are Oradea, Brasov, Ploiesti
Romanians inside the country,” says Geme-
was created in Targu Mures. Both startups
and Craiova, according to Instant Factoring,
neanu.
are backed by venture capital and private
based on the funding requests received from
equity fund 3TS Capital.
small companies, alongside the larger cities.
Meanwhile, local authorities could also make the smaller cities more attractive to would-be entrepreneurs. Providing free co-
“Obviously, not any town can transform
TERTIARY CITIES BECOMING INTERESTING
working spaces and easing access to funding
this can be done, while Iasi has also become
While Bucharest and secondary cities such
are some of the steps that public authorities
connected to cities in Western Europe since
as Cluj-Napoca and Iasi already have several
can take to boost the entrepreneurial culture,
the launch of its new airport terminals.
accelerators and large co-working facilities
say representatives of Instant Factoring.
into an entrepreneurial or startup hub; some of the prerequisites are size, infrastructure and the education ecosystem. What we have noticed is that in particular those cities and towns with vibrant university centers and well connected airports have a clear tendency to grow much faster as entrepreneurial hubs. So it seems like the simple recipe for success at this: municipalities and local authorities have to consider supporting the development of universities, particularly in the technology fields, and also supporting infrastructural development, particularly airports,” Marius Ghenea, partner at 3TS Capital, told BR. He says that Cluj-Napoca has proved
Ghenea adds that the important question
that cater to the entrepreneurial community,
is whether a distributed hub development is
there is potential for development in smaller
small businesses can a region hope to have a
better than large, central hubs, like we see in
cities as well.
more developed economic environment and
the UK (London), Germany (Berlin) or France
“Already cities like Bucharest and Cluj of-
“Only by supporting the development of
job opportunities, attracting talent and keep-
(Paris), or a concentration in just a few cities
fer a lot of things for entrepreneurs, but they
ing people in their communities,” say the
of most of the startup activity as in the US
have also become quite competitive in terms
fintech representatives.
30 INTERVIEW
Carrefour: ‘Digital culture among employees is crucial to digitizing a company’ Alex Matei, IT director at Carrefour Romania, tells Business Review the reasons for introducing ChatBot to Facebook Messenger for both its current and potential employees, and the connection between their ability to adapt to changes and the process of digitizing a company. By Aurel Dragan How do you see the future of the retail market as online gets more and more sales, including daily consumer goods? How will traditional retail digitalization change? Traditional but digitized retail and ecommerce will coexist in a new ecosystem that will center on the customer and his or her needs. Customers can choose between traditional, but digitized, retail in store, e-commerce, or express delivery, based on time, experience, product availability, and commercial offer.
How does Carrefour approach digitization? What changes has digitalization brought to its services? We try to bring our products and services as close as possible to our customers and strive to create as simple as possible a way through the technology. Using the self-scan functionality of Carrefour Pay, customers scan their own products in the store, add them to a virtual basket, and scan a single barcode, at the self-service checkouts. Waiting time is cut, and the shopping experience is quick and enjoyable.
Carrefour recently introduced ChatBot to Facebook Messenger, for employees and prospective candidates. How does the app work, both technically and as a user interface?
conversation with Carrefour Romania, and re-
In May last year we launched the first Chatbot
Also, in order to improve the shopping
ceives a Chabot message guiding him or her to
experience, we’re working on a fingerprint
choose one of the options displayed: Careers,
payment solution that we want to bring to our
Reports, or Stores. We recently implemented
customers. This type of payment is safe and
the Pricing option for customers who want to
natural; the customer will no longer have to
use the Carrefour Pay app for shopping in our
use card, mobile phone or other equipment
of a Romanian retailer, a decision which came
stores. With one click, the user is guided by
to pay for products. At the e-commerce level,
as a result of the many messages we received
the Chatbot in the conversation, according to
through the carrefour.ro platform, customers
about Carrefour career opportunities. With
his or her needs: to send us feedback, reach
in Bucharest, Ploiesti and neighboring areas
Chatbot Carrefour, everyone who wants to
stores through Google Maps or apply for one
can order food at home, and those in the rest
join our teams can now easily apply for one of
of the available positions in the Carrefour
of the country can buy non-food products.
the available posts directly on Facebook Mes-
team. Chatbot was developed with Centrade
In addition, our range of food and consumer
senger. Later, our recruiters contact the candi-
Cheil and operates 24/7, in a bid to streamline
goods products is also available in the Bringo
date, in order to find out more about his or her
interaction with future colleagues and Car-
platform, with a delivery time of 90 minutes
experience. The user taps on “Get Started”, in
refour customers.
in 18 cities across the country.
www.business-review.eu Business Review | May 2016
COVER INTERVIEW STORY 31 14
replaced, others upgraded, balancing custommade open-source applications with those on the shelf. We have also been very focused on the internal mobile area, for our colleagues, in order to simplify and optimize internal processes. I strongly believe that digitization needs a strong cultural base, openness to the new, a collaborative approach, flexibility, multiple attempts, acceptance of failure, but also flexible systems, real-time integration and rapid adoption of new technologies. There is a very nice journey ahead of us, where the mix of digital culture, Cloud and 5G will completely change the way we think about business, but also everyday life. The level of investments varies depending on the chosen road, maturity reached, and lessons learned.
How has the Bringo platform been received by customers? How many orders are made daily or periodically through the online platform?
What is the investment needed for digitization and how much has been invested so far (not only for digitization but also for investments in general)?
Bringo has had really good customer reviews
The first step we have made in digital
from the beginning, being able to offer a
transformation has been investing in raising
The self-pay service has been introduced for some time now. How has it been received by customers and how much is it used?
autonomy, the key to a quality service. Bringo
our colleagues’ digital awareness. We firmly
The self-scan service from the Carrefour
collaborators and suppliers are supported to
believe that a company cannot truly digitize
Pay app has been well-received by custom-
grow, become entrepreneurs on this segment,
if its employees do not have a digital culture,
ers, beyond expectations, since its launch
and customers, in their personal interaction
agile and adapted to change. That is why we
in November last year. So far it has been
with Bringo, have a conversation with an
invested in internal platforms for innovation
used over 20,000 times, although it has not
entrepreneur who cares about every point in
and collaboration. Digitizing is a bottom-up,
been communicated aggressively, because
the business.
continuous process for us, in which all col-
we considered organic adoption to be the
leagues are invited to participate.
best barometer. Through these innovations,
genuine “Personal Shopper” experience, but also to meet brand promises (quality, diversity, interaction, fast delivery, the same prices as in offline stores). For us, every order ending with positive feedback is proof that the customer has found in Bringo a solution to a real-life problem, whether we are talking about traffic or lack of time on certain days. Even though we started with a completely new service on the Romanian market, the customers have noticed since the first order that the “Personal Shopper” is not just a slogan – so we could clearly differentiate ourselves from a traditional e-commerce service. For us, an important pillar of the brand is
Bringo has managed to go, in just two years, from an innovative start-up on the Ro-
The next step was to transform the IT
Carrefour wishes to provide consumers
manian market, to the only delivery service
architecture so that it was ready for real-time
with a complete, modern digital shopping
available in 18 cities in the country. We ended
integration, scalability and parallel process-
ecosystem, with perfect integration between
2018 with over 400 percent more orders and
ing. Through the strategic partnership with
many offline formats, online and digital-
more than 2.5 million products delivered,
Google, we are exploring the Cloud area,
based services. So the combination of offline
and for the current year we want to expand
which allows us to quickly move forward
and online becomes a natural one, in which
the service to as many cities as possible and
into new projects. Last but not least, we have
human interaction between customers and
deliver more and more orders.
optimized core applications – some have been
in-store specialists continues to be relevant.
www.business-review.eu Business Review | May 2019
32 ADVERTISING
Consultancy firms taking over advertising agencies – who will win? In April, Accenture entered into an agreement to acquire Droga5, one of the world’s most innovative and influential creative agencies. The New York-based agency will become part of Accenture Interactive, boosting its capabilities as an “experience agency” able to design, build and run customer experiences that grow brands and businesses, say officials. By Romanita Oprea
Dana Nae Popa, pastel
Irina Pencea, Jazz
A
Serban Alexandrescu, Headvertising
ccording to company officials, the
largest agency companies in the world.
and services. There is always a push in-push
acquisition will give Accenture
With combined revenue of USD 13.2 billion,
out movement within the advertising world,
Interactive a distinct marketplace
the marketing services units of Accenture,
a flux and reflux,” said Blanaru. Moreover,
position, further enabling it to lead brands
PwC, IBM and Deloitte sat just below WPP,
she believes that the “new agency” in the
into the future, and represents an evolution
Omnicom, Publicis Groupe, Interpublic and
East must follow more the West’s path,
in Accenture Interactive’s journey to build
Dentsu.
where egos are kept under control, advertis-
a new agency model — one with the power
ing is a business where cash matters for both
to engineer transformative brand experi-
THE TAKEOVER
the company and employees and where ideas
ences, and infuse those experiences with the
After watching the industry closely for so
are used for the benefit of the client first and
emotional and inspirational power of brand
many years, Cristina Blanaru, freelance
foremost, and only in last place for shiny
thinking and creativity.
consultant for international companies and
trinkets.
But what does the move say about what
agencies, believes the “new agency model”
In her turn, Irina Pencea, managing part-
the agency of the future will look like? Is the
isn’t new at all, but more of a reoccurring
ner and co-founder of Jazz, one of the most
agency model changing in a world where
pattern – every five to ten years or so. “First,
successful Romanian independent agencies
more and more big consultancy firms are
there is a move of concentrating all compe-
on the market at the moment, argues that
looking towards investing in advertising com-
tencies in the same place, hence an agency
agencies as business models should em-
panies? And what does that say about where
that does everything and anything, followed
brace constant change. Agility and resilience
the creative journey will take us in the future?
by a movement of specialization, where de-
are key in today’s market tensions such as:
partments or small groups launch specialized
demand for real impact and talent tension.
shops that offer only certain competencies
“Brands need to prove their worth to share-
In 2016, for the first time, four consultancies cracked Ad Age’s ranking of the ten
www.business-review.eu Business Review | May 2019
ADVERTISING 33
holders and consumers alike. They need to
opens cans with the operating knife),” said
nies cannot accommodate chaos,” argued the
deliver bottom-line impact while positively
Alexandrescu. Still, the acquired agencies
Jazz representative.
impacting consumers’ lives and societies
will need some experienced staff, people that
alike. People no longer accept being manipu-
can interact and think closer to consultants’
managing director because, at the end of
lated into buying products, they are more
“cruise ship altitude”.
the day, to know how to interpret and use
And her point is supported by pastel’s
knowledgeable and discerning and they can
Dana Nae Popa considers this a normal
spot instantly when brand are not behaving
move, just as normal as the advertising agen-
needed in any field and creativity as we know
with authenticity,” said Pencea. Sharehold-
cies that developed business consultancy, at
it, as advertising agencies’ prerogative, will
ers, meanwhile, are no longer willing to bet
a smaller or bigger scale.
transform and evolve as well,” added Dana
data you need to be creative. “Creativity is
Nae Popa.
their money on complex agency structures
“Creativity is creativity for a reason.
with fancy titles and offices, but rather on
DATA VERSUS CREATIVITY
agile strategies and creative executions that
As the market evolves, another concern is the
Of course, it might seem sometimes that
build fast results, to the extent that there is
possible creativity lost. As companies push
creativity is under heavy attack or sidelined
understood and heard, while employees
more and more towards business results,
by standardized communication and models.
want to work for companies and people that
efficiency and sometimes safety, what will
The truth is that creativity will always shine
leave something behind. “The market has
happen to the creative drive and energy for
through, eventually, but the challenge is to
changed and continues to change, and that
which advertising agencies are so loved and
let creativity be real and genuine, and use
brings about the changing of the agencies as
sought after? Will data take over creativity?
it to help and elevate and not for bragging
well,” concluded pastel’s representative.
Pencea doesn’t believe so, but says they will
and purposes serving only certain types (and
need to work in harmony. “That’s prob-
their egos),” said Blanaru.
an increasing trend for in-house agencies for top global brands. But, according to Serban Alexandrescu, managing partner at Headvertising, an independent Romanian advertising agency with more than 20 years on the market, there will never be just one model, but tens of models. He believes that the “platform agency” is still much needed, with people “on the floor” (working from the office) who will communicate “meat & potatoes”, and not superspecialized pieces. Meanwhile, Dana Nae Popa, managing director at pastel, a Romanian independent agency that has just celebrated 13 years on the market, thinks that the model of agencies doing creativity just for the sake of creativity is no longer sustainable. More than that, clients want results, consumers want to be
So where does this movement of consultancy companies taking over creative
ably why the announcement of the Droga5
Moreover, according to Alexandrescu,
agencies lead the market? Straight forward.
takeover feels right. We’re talking about a
consultants know they will never be able to
Alexandrescu says that Droga5 is not the
new age consultancy and a new age agency.
do creativity alone. And this is the reason
first agency to have sold itself to the “con-
It’s not the Big 4 acquiring an agency, and it’s
they pay so much money for it. “Robots,
sumed ones” and it will not be the last. This
not one of the top advertising groups acquir-
data and digital transformation they knew
is because consultancy firms are also under
ing a consultancy. It should be a marriage
how to do themselves, they haven’t needed
pressure from clients to take care of “the last
of equals that will probably succeed only
agencies. But, ‘emotional transformation’ is
mile”, carry out the concrete implementa-
if they nurture each other’s gifts. To me, it
something they don’t know how to create,
tion of the advice they offer and, if there is
proves again that independent creativity will
but they are better than the agencies at post-
some extra money involved in the equation,
never get to be as big as strategy and busi-
rationalizing it and ‘selling it’ to clients. They
why not do it? “The agencies will be really
ness consultancy. I honestly believe that size
realized it was lacking from their portfolio
happy to be taken under a more ‘strategic’
and creativity are divergent. As size grows,
and they decided to buy it, being flush with
wing, with C-suite access, not only to the
creativity shrinks. Creativity needs a certain
cash,” concluded the Headvertising manag-
marketing department (which mostly only
level of fluid chaos to bloom. And big compa-
ing partner.
www.business-review.eu Business Review | May 2019
34 MARKETING
Brain gain: neuromarketing opens up new avenues Neuromarketing is a new field of marketing which uses medical technologies such as functional Magnetic Resonance Imaging (fMRI) to study the brain’s responses to marketing stimuli. Researchers use fMRI to measure changes in activity in parts of the brain and to learn why consumers make the decisions they do, and what part of the brain is telling them to do it. By Romanita Oprea managers don’t realize that being the first to use a certain technique is not a disadvantage. On the contrary, it will give you a big advantage, because you will learn insights about the consumers and the market, ones that the competition doesn’t have. The development rate of neuromarketing in Romania is still low, probably due to the big reluctance of decision makers. And the reason for that is the strong aversion towards the risks it might involve,” said Iorga in the article. Photo: Dreamstime
Adina Nica, research & strategy consultant at Open-I Research, added, “Market research is a domain in continuous development, using techniques from various sciences, as marketers are looking for more depth and An advertising campaign is a set of stimuli detected by human senses
M
precision to understand how people react to different stimuli, how they respond to communication, creativity, design, products,
arketing analysts use neuro-
its potential to create value for marketers,”
and multi-sensory experience.” That’s why
marketing to better measure a
Eben Harrell wrote in the Harvard Business
researchers came up with the idea of using
consumer’s preference, and the
Review.
neuroscience in marketing. Moreover, Nica
information gathered will help marketers
That said, neuromarketing has happily
points out that knowing how the brain func-
create products and services that are designed
been making steps in the Romanian market as
tions, and using fMRI, EEG and dedicated
more effectively and marketing campaigns
well, due to some pioneers who stand ready
software, we can find out what is appreciated
that are more focused on the brain’s response,
to teach us more about the concept and how
by consumers and what they really need.
say industry players. Therefore, neuromarket-
it can influence for the good the marketing
“Therefore, following testing with neuromar-
ing will tell the marketer what the consumer
of today and tomorrow. Over 100 people pas-
keting, decisions are taken more efficiently.
reacts to, whether it was the color of the pack-
sionate about communication and marketing
I consider neuromarketing the next level in
aging, the sound the box makes when shaken,
took part in the Cluj conference “Inside Your
market research,” added the Open-I Research
or the idea that they will have something their
Brain. Neuromarketing”, organized by IAA
representative.
co-consumers do not.
Young Professionals Cluj in February, which
Moreover, as Lluis Martinez-Ribes, brain-
had as guest Ana Iorga, specialist in the field
pleasing marketing catalyst at ESADE and
known as consumer neuroscience – stud-
in London for more than seven years, and also
m+f=!, points out, neuroscience provides top
ies the brain to predict and potentially even
founder of the Buyer Brain laboratory, the
managers with science to run their business
manipulate consumer behavior and decision
first of its kind in Romania.
at a higher orbit. “They can have a sound
“The field of neuromarketing – sometimes
making. Until recently considered an extrava-
According to Iorga, speaking in an inter-
base to conceive products, services, brands
gant ‘frontier science’, neuromarketing has
view with Smark.ro, things have changed a
and customer experiences in such a way that
been bolstered over the past five years by sev-
little since 2012 in Romania, but we still can-
can please customers’ brains. If the methods
eral groundbreaking studies that demonstrate
not talk about a major advance. “Romanian
coming from neuroscience are well-applied,
www.business-review.eu Business Review | May 2019 2016
top managers can use them to foster in their customers a positive sentiment towards their brand and what they sell,” said the special-
COVER MARKETING STORY 35 14
Top tips for marketers that want to use neuromarketing in Romania
ist. With extensive experience in the field, Martinez-Ribes is fascinated by innovation in marketing and retail, a specialization pursued
Adina Nica
in 31 countries. He combines his part-time • Don’t believe what others tell you, test it and see how it can help you.
work at ESADE as Associate Professor with selective activity as marketing catalyst (m+f=!).
• Start with simpler studies and continue with more sophisticated ones.
MYTHS AND REALITY When it comes to the true and false of neuro-
• Read the latest neuromarketing studies and experiments; sometimes you can find answers or generate hypotheses without jumping to a research project.
marketing, Nica says that it is associated with machines like MRI and EEG, but sometimes you don’t need to use them, you only need
• Always combine neuromarketing with direct interaction with the people you are targeting.
to understand how the brain functions and what other studies have already proven and integrate that in the work you do. “Many marketers put neuromarketing in opposition to traditional market research. I believe the two
Lluis Martinez-Ribes
instruments should be used together, each having its contribution to the overall under-
• To reduce the risk of failure when making decisions about packaging A versus packaging B, or commercial A versus commercial B, I strongly recommend calling Romanian specialists to use this very powerful marketing research tool.
standing of an issue. I don’t believe in looking at neuromarketing reports without talking face to face with people, observing them, being in contact with them,” outlined Nica.
• If senior Romanian managers want to conceive a new product, a new selling method, a new brand or a new customer experience, they can use “brain-pleasing marketing” methods to guide the creation of concepts – new ones or modified ones – in a way that can please people’s brains. This discipline is also based on solid neuroscience. Companies like Orange have been pioneers of brain-pleasing marketing in Romania.
What about the myths that surround this popular and exciting word? Do people know what they are talking about? According to Martinez-Ribes, some people may think that neuromarketing uses conclusions from neuroscience to manipulate people’s perception or behavior. And this is totally inaccurate. “The ‘buying button’ – the alleged key which
• As a summary, use neuromarketing when you want to test something that already exists, but use brain-pleasing marketing when you want to change the game in your sector or industry.
you can press and make customers buy like robots – does not exist. Customers’ freedom of choice is respected in this type of marketing,” said Martinez-Ribes. Neuromarketing has been proven to help improve an adver-
positive or negative. Later on, the video can
proof that the outcome is brain-pleasing. Then
tising campaign, as Nica says, from simply
be edited, reducing the parts that generate a
the purchase is highly probable. But to jump
“having more precision about which route
negative outcome,” he added.
from the initial project phases to the way to
to choose”, to sometimes helping you refine
With so much science involved, one might
shape a brain-pleasing outcome, creativity is
the communication, by adding or removing a
ask if there is still room for creativity and, if
simply crucial. Every project is different from
small but crucial detail. Moreover, it can also
so, when does it enter this process? Accord-
the others and we never know what the result
help you make a communication brief much
ing to Martinez-Ribes, at his agency, in all the
will be, since there is no pre-cooked recipe,”
more down to earth. Also, as Martinez-Ribes
marketing projects co-created with clients,
he concluded.
puts it, technically speaking, an advertising
neuroscience-based methods are the starting
campaign is a set of stimuli detected by hu-
point. It is the basis of their work, and it re-
accurate about how people react to stimuli
man senses (usually hearing and sight). Using
ally helps to understand customers in depth,
does not limit creativity, but can actually fuel
neuromarketing techniques, researchers de-
including their pain point. “We know that
it. “Knowing more about the brain is knowing
tect how these stimuli create a reaction in the
when a person purchases something there is
more about human beings, and this should
body. “For example, they can see the strength
the anticipation of a future gratification, so a
give you more options and more ideas, not
of the triggered emotions as well as if they are
release of phasic dopamine appears. This is
fewer,” said Nica.
Meanwhile, Nica considers that being more
www.business-review.eu Business Review | May 2019
36 SUSTAINABILITY
Packaging problems: helping firms cope with new environmental rules Romanian legislation has recently undergone a series of changes designed to improve national recycling targets, for better compliance with European legislation and standards. Given that quantifying all the legal changes may pose difficulties for companies, BR sought the perspective of Global Innovation Solution (GIS), an experienced environmental consultancy. By Aurel Dragan and products must respect a number of obligations, to comply with traceability and recycling conditions. They have to maintain quantitative evidence of the packaging put on the national market, depending on the type of material (paper / cardboard, plastic, metal, wood, glass) and packaging type (primary, secondary, transportation packaging). From 2019, they have to meet new recovery targets, (according to Law No. 249/2015 and subsequent amendments), as follows: global recovery target: 65 percent; global recycling target: 60 percent; paper-cardboard recycling target: 70 percent; plastics recycling target (including PET): 45 percent; from the plastic recycling target, PET must be recycled at least: 55 percent; glass recycling target: 65 percent; steel recycling target: 70 percent; Photo: Dreamstime
aluminum recycling target: 30 percent; wood recycling target: 50 percent. A company can properly achieve its objective for recovering packaging waste by one of In 2015, the European Commission adopted a new waste plan, called the “Circular Economy Package”
the following options: by signing a contract with an organization that implements the extended producer responsibility for the quantities of packaging put on the national
WHAT HAS CHANGED IN THE ENVIRONMENTAL LEGISLATION
the extended responsibility regime, and must
market, depending on the type of packaging
bear financial and organizational responsibil-
and type of material; individually – by taking
Romania, as part of the European Union, has
ity for managing the waste in the life cycle of
off the national market its own packaging
to introduce into the national legislation the
a product.
waste and ensuring that waste is recovered in
provisions of European Directives in accor-
In addition, Law no. 245/2015 stipulates
accordance with the legal requirements. After determining how the recovery
dance with EU requirements and standards.
that economic operators who put on the
Since 2011, the fundamental environmental
national market packaged products, eco-
objectives will be met, producers of packaged
protection law in Romania (Law no. 211/2011),
nomic operators that import / purchase intra-
products must declare on a monthly basis to
based on EC Directive no. 2008/98, has been
Community packaged products, or those that
the Environmental Fund Administration the
in force.
individually package their products, putting
quantities of packaging released onto and
on the Romanian market packaging (or rent-
recovered from the national market (either
2008/98, transposed into the Romanian leg-
ing packaging in any form), are responsible
individually or through a contract with an
islation, introduced the concept of “extended
for the withdrawal from the market and
organization that implements EPR).
producer responsibility”, or EPR, whereby
recycling of all packaging waste.
The provisions of EC Directive no.
any producer of packaged goods is subject to
Producers / importers of packaged goods
Producers of packaged products / importers of packaged products also have several
www.business-review.eu Business Review | May 2019 2016
SUSTAINABILITY COVER STORY 14 37
obligations regarding waste management. First, they need to keep track of the waste generated from their own activity (either office activity or commercial / production activity), regardless of the quantity and type of waste generated (for example waste paper, electric and electronic equipment waste, used toners, household waste from production. etc.). Second, all waste quantities must be handed over to authorized economic operators. Waste generators must keep monthly records of waste and report annually to the Environmental Protection Agency the quantities of waste managed in accordance with Law no. 211/2011. Last but not least, if the economic operator has an Environmental Authorization, it must nominate a person from its own employees, or delegate this obligation to a third party organization who ensures the fulfillment of the legal obligations. The person must be trained in the field of waste management (including hazardous waste). Economic operators who release reusable packaging onto the national market must respect the fiscal legislation in force, namely Tax Code - Law no. 227/2015 and Law no. 82/1991 (setting out accountability procedures). As of March 2019, companies that put on the national market products packaged in reusable packaging, with volumes ranging from 0.1 liters to 3 liters, must introduce a financial
the obligation to inform consumers of the
nance no. 74/2018) which aims to improve
guarantee of RON 0.5 / pack. They also have
value of the cash guarantee and to provide
waste management, conserve resources, and
the obligation to obtain a return rate of at
information concerning the return system.
improve the quality of the environment and
least 80 percent of the total quantity placed
They must receive in return reusable packag-
the public wellbeing.
on the national market. If this obligation is
ing in a proper condition and return the value
not respected, the competent authorities
of the cash guarantee at the consumer’s
was also introduced, as a payment principle
may apply fines ranging from RON 20,000 to
request, on the basis of the fiscal receipt.
based on the amount of waste generated by
RON 40,000. Notably for the beverage industry (pro-
If a certain type of reusable packaging is withdrawn from the Romanian market,
The “pay as you throw” economic tool
each economic operator. Starting from 1 January 2019, the imple-
ducers of beer, alcoholic beverages, cider,
producers / importers must inform traders
mentation of the “pay as you throw” instru-
other fermented beverages, juices, nectars,
and / or consumers about the changes and
ment, established the following elements in
soft drinks, mineral water and drinking water
ensure they accept that packaging for at least
the development of any charging strategy:
of all kinds, wines and spirits) companies
another six months.
the amount of generated waste, the fre-
In 2015, the European Commission ad-
quency of waste collection, the weight of the
aging must, from January 1, 2020, put on
opted a new waste plan, called the “Circular
produced waste, and the providing of collec-
the national market a minimum of 5 percent
Economy Package”, to stimulate Europe’s
tion bags to citizens.
reusable packaging from the total packaging
transition to a circular economy with benefits
who sell products in reusable primary pack-
An EPR scheme established that product
released onto the national market. This per-
in terms of global competitiveness, boosting
manufacturers have to cover all the costs
centage must increase by another 5 percent-
sustainable economic growth, and creating
needed to meet waste recycling targets,
age points per year until 2025 inclusive.
new jobs. In 2018, Romania transposed into
and also other specific objectives including
All economic operators who sell/retail
national legislation the provisions of Direc-
awareness campaigns and preventing waste
products in reusable primary packaging have
tive no. 851/2018 (through Emergency Ordi-
generation.
www.business-review.eu Business Review | May 2019
38 TELECOM
Telecom industry threatened by rising costs and new taxes The telecommunication industry is one of the most developed and mature in Romania, thanks to investments made in the past by companies and light-tough regulation in the early years. Today, however, the industry is under rising pressure from legislators, increasing expenses, and a shrinking pool of workers. By Aurel Dragan tunities for telecommunication companies, according to the 18th edition of Deloitte’s Technology, Media & Telecommunications Predictions. According to recent studies, mobile operators expect to see 5G implementation investment close to current 4G spending, mainly as a result of prior investments in network development. Considering that 72 operators worldwide tested 5G technology in 2018, Deloitte estimates approximately 50 operators will launch 5G by 2020 at least in some areas, typically urban ones. In terms of 5G handsets, Deloitte expects about 20 vendors to launch 5G-ready handsets in 2019 and sell around 1 million units. Internet-connected speakers with integrated digital voice assistants will see the most rapid expansion of any connected device category at global level in 2019, with more Photo: Dreamstime
than 164 million smart speakers forecast to be sold worldwide by the end of this year. This growth will bring the total number of units available globally to 250 million, turning this Mobile operators expect to see 5G implementation investment close to current 4G spending
T
into a USD 7 billion industry. The study also predicts an increase in the usage of cloud-based artificial intelligence (AI) software and services. In 2019, 70 percent
he most important event for the
nications industry has to face are: infla-
of companies around the globe will have AI
telecom industry worldwide in this
tionary pressure (wage increases, energy
capabilities via cloud-based software and
period should be the implementation
costs, rents, equipment), devaluation of the
65 percent will create AI applications using
of 5G technology. And it is being researched
national currency, increased competition
cloud-based development services. By 2020,
and tested all around the world; 72 operators
and acceleration of technological progress,”
the penetration rate of AI-based enterprise
tested 5G technology in 2018 and it is expect-
says Serghei Bulgac, president and general
software will reach an estimated 87 percent,
ed that, by 2020, around 50 will launch 5G at
manager of Digi Group RCS & RDS.
while cloud-based AI development services will reach 83 percent.
least in some areas, probably cities. But on
“This year, artificial intelligence is ex-
the Romanian market, the testing and launch
5G IS COMING
of 5G is being overshadowed by changes in
The long awaited fifth-generation (5G)
pected to reach larger scale also in Romania,
the legislation, the imposition of new taxes,
networks are due to arrive in scale, providing
with more advanced techniques becoming
increasing wages and a workforce shortage.
better connectivity for consumers and enter-
available to more organizations. Some of our
“The challenges that the electronic commu-
prises, while opening up new revenue oppor-
clients are working to gain access to the best
www.business-review.eu Business Review | May 2019
TELECOM 39
innovative software features of the AI revolu-
5G and 3G licenses and progressively invest
manians working abroad increases pressure
tion, which continues to change radically
in 5G networks (from EUR 50 million in 2020
on companies to find qualified employees
the way we live, do business, work, travel,
to EUR 125 million in 2025, a total of EUR
and also to keep hold of the ones they have.
communicate and even entertain ourselves,”
500 million), Orange and Vodafone would
“Regarding the recruitment and retention
said Dinu Bumbacea, consulting partner-in-
have a peak of EUR 800 million in 2020 and a
of employees, the prolongation of the labor
charge, Deloitte Romania.
slightly better distributed payload (2020 and
market crisis and an increase in labor mobil-
2022) for RCS & RDS and Telekom,” telecom-
ity is predictable. Fortunately, Digi | RCS &
munication specialist Nicolae Oaca wrote on
RDS has one of the best retention rates and
his blog.
we can meet our human resources needs
ARE WE READY? The government seems to be ready, at least to take the licensing money. The National Authority for Administration and Regulation in Communications (ANCOM) announced a 5G spectrum auction this year, but it decided to change the calculation method. So, instead of EUR/Mhz/ inhabitant, ANCOM will use accounting methods. The target is EUR 1 billion for the state budget from 5G licenses, considering Italy recently banked EUR 6.5 billion, although other European countries got a lot less. “Preparing for the 5G auction brings to the forefront the dialogue with authorities on
with internal mobility,” says Bulgac.
issues that concern the entire industry: sim-
Operators have already increased tariffs
plifying authorization procedures for network
RISING EXPENSES
construction and development, non-dis-
The level of indebtedness of each operator
for customers to find resources to pay the
criminatory access to public property, more
has grown with each licensing, meaning 3G
newly-imposed taxes and rising costs. But in
predictability in legislation. The international
and 4G. Data show that, at the end of 2017,
order to keep the telecommunication market
controversy over the presence of certain sup-
Orange and Vodafone had debts worth just
close to the latest technologies, the govern-
pliers of equipment on the European market
under 60 percent of total assets, while for
ment must help the industry. “To preserve
can also lead to a price change in the procure-
RCS & RDS it was 88 percent and Telekom
the competition, the bidding documenta-
ment of equipment and technologies in an
140 percent. This means that financing the
tion should provide limitations to spectrum
important context – the leap to a new technol-
licenses and 5G investment will not
ogy. There is additional pressure on electronic
be easy and may require a capi-
communications operators who will have to
tal increase from sharehold-
make important business model decisions
ers. And all while they
for the upcoming 5G technology – developing
are still trying to recover
later. High license fees
their own infrastructure or sharing networks
their investments in 4G
will affect the develop-
with other operators,” says Bulgac.
technology and are al-
ment of networks and
Romania expects to collect 2 percent of
ready providing services
will shift to retail prices,
telecom operators’ revenues. The average will
that can also be achieved
be EUR 250 million per operator, payable in
with 5G technology.
2020. But the telecom companies must also
acquisition, especially in bands below 1GHz, so operators who do not buy 5G spectrum this year will be able to do so
hampering adoption, at least in the beginning, and digital transformation.
This is why telecom opera-
The telecom provisions in OUG
renew their 3G licenses. Orange Romania and
tors have said that they have not
Vodafone Romania will have to renew the 2.1
yet decided whether to bid for 5G. They
GHz band for 3G in 2020, and RCS & RDS and
are being hit by increasing power bills due
profoundly damaging to Romania’s digital
Telekom Mobile in 2022. The 3G licenses are
to OUG 114, which also imposed a tax on the
transformation process, to the country’s
estimated to bring EUR 2 billion to the budget
revenues of telecom companies.
development! And ANCOM should be al-
in total, an average of EUR 500 million for each telecom operator. “Assuming that all four operators acquire
Wages are on the rise, driven by increases
114 / 2018 should be abrogated, being
lowed to determine starting prices based on
in public sector pay and a shortage of work-
the EUR / MHz / inhabitant cost in Europe,”
force. The absence of the 3 to 4 million Ro-
argued Oaca.
www.business-review.eu Business Review | May 2019
40 FESTIVALS
Cash for culture: sponsoring summer festivals Summer is just around the corner and culture vultures have already booked their tickets to the top festivals held in Romania. This year, more events with more international artists are to be staged for the first time here, with new names joining the fray. But on whose dime? Business Review talked to representatives of several major local festivals to find out. By Oana Vasiliu said Andi Vanca, communication manager of Electric Castle.
BETTING ON UNIQUENESS For one of the most unusual festivals in Romania, Anonimul Film Festival, which is held in Sfantu Gheorghe, Tulcea county, sponsorship is likely to last for more than one event. “We are in the position where sponsorship mainly means a long-term relationship for us. And we are incredibly fortunate for that matter, not only financially speaking, but also in the quality of these relationships. We know what they want, they know what we deliver (…) We are of course interested in attracting Open air cinema just in the heart of Cluj city
O
more partners, but this is not a purpose in itself; we are really looking for partners for a longer run, not for sponsors,” Miruna Berescu,
ne of the biggest questions regarding
and private sponsorship. “We need to make
president of Anonimul Film Festival, told
the numerous festivals in Romania –
sure that the potential partner truly under-
BR. At this point, the festival’s budget is EUR
especially those featuring live music
stands our philosophy, the way we approach
150,000, most of which goes on the trans-
and DJ gigs – is how much money it all costs
our event and all our core values. We are not
portation of everything required for movie
both organizers and festival goers. While, for
just a music festival but a unique experi-
screenings. Some 30-35 percent comes from
the second category, the sum is relatively easy
ence that involves music, arts, educational
public sponsorship, while the rest is covered
to calculate because you only have to add
activities and much more. So the conversa-
from private sponsorship, because festival at-
tickets, accommodation, transportation, food
tion is about what we can create together
tendance is free of charge for the public.
and drink on site and perhaps some memo-
for a truly unforgettable experience. Brands
rabilia, the staging of a festival is a costly
have learned to adapt their presence in this
A STAGE FOR SPONSORS
business and may not have a predictable
unique environment, a special place marked
For Sibiu International Theatre Festival (FITS),
relationship with ticket sales and refreshment
by history turned into a five-day escape from
which enjoys a high profile internationally,
takings.
the world for thousands of people. There is a
the situation is a bit different. Its 2018 budget
lot of potential for creative and direct contact
was almost EUR 13 million, out of which 26.5
private or public sponsorship – through direct
with the public that companies do not have
percent came from public sponsorship, and
funds from the municipalities or the county
through traditional advertising channels. As
the rest from private sponsors. RON 8 million
councils, or programs directly financed by the
long as brands can add value to this experi-
was allocated by Sibiu City Hall, RON 600,000
Ministry of Culture.
ence, the partnership becomes a success.
from the Ministry of Education and RON 4
Fortunately, so far, there has been no problem
million from the Ministry of Culture. “FITS
THE ELECTRIC AVENUE
in finding companies who embrace our way
is an event with which major companies
In 2018, the total revenue of Electric Castle
of working and are just as enthusiastic about
in all areas like to be associated and we are
was EUR 5 million, raised entirely from tickets
a new edition of Electric Castle as we are,”
generally honored to receive more offers of
Festivals may be funded by ticket sales,
www.business-review.eu Business Review | May 2019
FESTIVALS 41
A glimpse of Enescu Festival held in the Romanian Athenaeum
Chill mood at Cluj’s Jazz in the Park
new partnership deals than we try to bring
consists of a balance between our values and
or we are approached by companies with such
to the festival. (…) A partnership with FITS is
the quality of services. On one hand, sponsors
an interest. There are situations when the
also a promise of engagement with the Sibiu
want to associate with us because we promote
approach is also based on pragmatic issues
community and guests arriving at the festival.
a good set of values for the community, we
such as specific services we need and which
We enjoy the mutual trust of our partners
promote normality/common sense and our
the companies provide as part of their regular
and together we find the best strategic solu-
public is cool, diverse and very receptive. On
activity, such as catering or legal services
tions that reflect both interests and common
the other hand, we try to carry out as profes-
or communication. In this respect we make
values,” said Cristian Radu, executive director
sionally as we can what we promise in terms
agreements which allow us to save some cash
of the festival.
of visibility and services. (…) The process of
to pay other logistic and administrative ex-
getting a sponsor can last days if your pitch is
penses,” said Mihai Constantinescu, executive
JAZZING UP THE BUDGET
good, but also months if the bureaucracy of
director of the George Enescu Festival.
Moving west, BR found out that JazzTM is a
the sponsor is complicated. We try to be pre-
coproduction between the City Hall of Timiso-
pared for this, because it affects the cash-flow
ara and PLAI Cultural Centre, with the budget
and predictions of growth. But it’s something
THE GREENBACKS BEHIND THE SILVER SCREEN
split between the two organizations, 66.7
that we can’t control, only adapt to,” said
Transylvania International Film Festival
percent (public funding) and 33.3 percent (pri-
festival director Alin Vaida.
(TIFF) gets about 45 percent of its budget
vate sponsorship). The event is free to attend
from non-reimbursable grants from public au-
so generates no ticket sales. “We have at least
CLASSIC IS FANTASTIC
thorities. Sponsors and partners cover about
two periods when we fly to Bucharest and
The biggest local event is probably the George
40 percent of the budget and the remaining 15
have meetings with different companies. We
Enescu Festival. The festival features over
percent comes from ticket sales. About 90,000
do this for all our projects: PLAI - the festival,
3,000 top international musicians and has an
tickets have been sold, an impressive tally
BEGA!, JazzTM & Ambasada. We aim to sign
immense logistical effort behind it. Behind
given overall cinema attendance in Romania.
only long-term partnerships (minimum three
the scenes, the bill, besides the fees, includes
“TIFF is a festival that has grown organically
years) so that we can have financial security
over 9,000 accommodation nights, rent for
and naturally, and this is felt in all its aspects.
and the sponsors can have a more detailed
84 days at four concert halls, over 50 tons
Over 70 percent of the sponsors that the fes-
and custom-made involvement. Convincing
of equipment transportation and handling,
tival has today are companies that have been
a sponsor is mainly based on the organization
6 full charter planes and over 2,500 travel
with us for many years, some on their 12th
and event’s track record but also the spon-
tickets, 18 trucks of instruments, handling
year. We have been able to develop long-term
sor’s field of communication,” Norbert Tako,
and much more. Last time, the money came
strategies and relationships that have proved
founder of PLAI Cultural Center, told BR.
from the Ministry of Culture (65.4 percent),
healthy and effective. For this reason, I believe
Another jazz festival, which takes place in
Bucharest City Hall (1.33 percent), ticket sales
that the main aspect that helps us convince
Cluj-Napoca, Jazz in the Park, gets its fund-
(19.7 percent), sponsorship (9.57 percent) and
new sponsors is the relevance and impact of
ing from three main categories: marketing
services and products in barter, partnerships,
our project as well as the authenticity of how
services & corporate sponsorship (55 percent),
and discounts. “Usually there are several ways
we work with them. (…) We do not just limit
public finance (30 percent) and revenue
to approach the partnerships. The two main
our partner packages, we develop each part-
directly generated by the festival (tickets, bar
ones: either we present the festival to spon-
nership in our own style: organic and natural
takings, commercial contracts – the remain-
sors we know have an interest in supporting
so that branding and visions are authentic,”
ing 15 percent). “Our pitch to new sponsors
culture, music, cultural legacy and education,
added Cristian Hordila, festival manager.
www.business-review.eu Business Review | May 2019
42 CALENDAR
Summer Festivals Music festival season will be here before you know it. Business Review sum up your schedule for the hottest fests of this summer so break out your tie-dye and bandanas. By Oana Vasiliu
The incredible public of Electric Castle Festival
JUNE
Next in line is Sibiu International Theater
More movies, this time in Bucharest, at
As has happened for several years now, Tran-
Festival (FITS), where the performing arts are
the Bucharest International Film Festival.
sylvania International Film Festival (TIFF),
brought together, with an impressive agenda
Another iconic date in the Romanian cinema
held in Cluj-Napoca, kicks off the summer
for theater lovers and contemporary dance
calendar is this year included in the La Rou-
festival agenda. This year it turns 18. Expect
connoisseurs, including industry debates,
manie en France / La France en Roumanie
new box office records, sold-out opening
street art and music, plus much more. June
program, so a special section will be dedi-
and closing screenings that are the talk of
14-23.
cated to a major French filmmaker who will be present in Bucharest. June 24-30.
the town, and eclectic hot-ticket film-based events. Plus the parties. May 31-June 9.
For debates and movies about the environment, try Pelicam Film Festival. Held in Tul-
JULY
Street Delivery Bucharest will this year
cea, on the shores of the Danube, the event
Jazz is definitely in the air in July. It starts
showcase poetry, with the theme of the capi-
channels good vibes and a good mood in an
with Jazz in the Park in the Transylvanian
tal city and the stories behind it. June 14-16.
attempt to promote and protect the environ-
city of Cluj (July 1-7), then moves west for
ment. June 20-23.
Timisoaraâ&#x20AC;&#x2122;s JazzTM (July 5-7), which overlaps
www.business-review.eu Business Review | May 2019
CALENDAR 43
August starts with probably the best-known music festival in Romania: Untold. Held in Cluj-Napoca over August 1-4, the celebration of EDM music will bring together Bastille, David Guetta, Dimitri Vegas, Martin Garrix and many others for four days of nonstop partying. Another special festival experience is Anonimul Film Festival, held in Sfantu Gheorghe, Tulcea county, at the furthest reaches of Romania, just between the Danube and the Black Sea. Paradise. August 5-11. Closer to Bucharest, Summer Well (August 10-11) and Fall in Love (August 31 - September 1) will allow those still at home to chill out with good live music. Meanwhile, Iasi’s Afterhills offers two weekends packed with EDM music (August 23-25 and August 30-September 1) with Don Diablo, Rita Ora, Morcheeba,
EDM fans enjoying Untold
Faithless and many more on the bill. with the Bucharest Jazz Festival (July 1-7).
But if you don’t want to travel outside Bucha-
And the summer festivals end with the
Later on, the 23rd Garana Jazz Festival (July
rest, don’t worry. July brings Rock the City,
greatest name of them all, the classical music
11-14) awaits fans in the picturesque Semenic
featuring The Cure and Editors. July 22.
journey of the George Enescu International Festival, which will be held in several loca-
Mountains. If you are not in the mood for jazz, don’t
AUGUST
tions and venues all over Romania. August 31-September 22.
worry. Electro-dance Neversea (July 4-7) brings Afrojack, Jessie J, Los Frequencies and Steve Aoki, among others, to Constanta city, right on the beach, for four days of continuous parties. Electric Castle will also have an electric line-up this year. The Castle of Bontida (Cluj county) will host Florence and The Machine, Limp Bizkit, Nils Frahm, Thirty Seconds to Mars, and Bring me the Horizon, among many others. July 17-22. Meanwhile, Open Air Blues Festival in Brezoi, Valcea county, will welcome blues greats, from headliner Beth Hart to Oscar Benton, Diana Rein and others. July 18-21. Sibiu will also host two events this month. Sibiu International Street Art Festival will color the Transylvania city with an impressive selection of internationally famous urban artists over July 1-7. And ART Mania presents a series of concerts headlined by Dream Theater. July 26-27.
Open air cinema just in the heart of Cluj city
www.business-review.eu Business Review | May 2019
44 EXPAT EYE
Food for thought: chowing down on Romanian cuisine In BR’s monthly take on life here through the eyes of a foreigner, BR’s resident Brit ponders the local food as she prepares for the calorie bomb that is Easter in Romania. By Debbie Stowe will not endear you.
VERDICT: SOUPS CAN SHOWCASE THE LOCAL CUISINE AT ITS BEST, EXCEPT… CIORBA DE BURTA There’s a reason that “tripe” in English also means rubbish. This yellowy tripe soup is – I am told – a reliable “morning after” treatment for hungover Romanians, but I can see little other reason to partake of this strange substance.
E
VERDICT: ONE FOR HARDCORE FANS OF ROMANIAN FOOD ONLY.
aster is upon us, and if you have
MICI
Romanian relatives, this means eat-
Literally meaning “littles”, these are small
DRINKS TUICA
ing enough food to last you through
sausages that make an appearance at most
My introduction to tuica, or plum brandy,
any mini-apocalypse. For those newcomers
outdoor events, from family barbecues to
was a baptism of fire. Handed a spirit in a shot
uninitiated in the ways of Romanian cuisine, I
large summer festivals in the park. They are
glass, at a work event in my first few weeks in
present the expat’s guide to the staples of the
eaten with mustard, and it seems almost as
Romania, I instinctively necked it, only to feel
“specific”.
essential to accompany them with a large
a burning sensation of paint stripper searing
glass of beer. Mici sizzling on the grill are
down my throat. “Wow,” said an impressed
SARMALE
the olfactory background to Bucharest in
colleague, “So it’s true what they say about
The quintessential Romanian dish of rice and
summer. Culturally, they’re the Romanian
the British!” The proper way is to sip it slowly,
meat wrapped in cabbage leaves, these tasty
equivalent of the hotdog.
when you are less likely to feel as if your in-
rolls are busted out on every special occa-
VERDICT: Quite good, especially on a hot
sides are on fire (although, on the downside,
sion. Sarmale are always made in far greater
day washed down with a cold beer, although
you will taste it for longer).
numbers than can possibly be consumed, so
you’re never quite sure what’s in them.
VERDICT: MORE PALATABLE IF NOT DOWNED IN ONE. WARMS YOU UP ON A COLD DAY, BUT NOT FOR THE FAINT-HEARTED.
you will be given some to take home in an ice cream box (with the ice cream taken out, of
SALATE DE VINETE / ZACUSCA
course – sarmale can be mixed with yoghurt
Two lovely sandwich spreads, the first green
or sour cream, but would taste a bit weird
with aubergine/eggplant, the second red with
covered in raspberry ripple or vanilla). The
aubergine/eggplant, as well as beans and pep-
VISINATA
leftovers will last you for several days.
pers. Appetizing and – unusually for Roma-
One for the ladies! Cherry spirit which is more
TIP 1: when discussing sarmale with Roma-
nian cuisine – healthy and vegetarian to boot!
drinkable than tuica, it’s perhaps the Roma-
nians, it’s better not to point out that a similar
Enjoy them with fresh bread, and sliced onion
nian cultural equivalent of sherry.
dish is eaten across the Balkans. Those sar-
and tomatoes. They make a great lunch, and
VERDICT: PLEASANT!
male fans of more nationalist proclivities are
one which won’t be followed by a food coma.
adamant that this is a specifically Romanian
Win!
Whatever food or drink comes your way in
dish, and if other Balkan nations do make it as
VERDICT: YUM!
Romania, you’ll be expected to consume
well, they simply must have copied the local
a large amount of it. Initial refusals will be
version!
SOUPS
taken as politeness, and if you ask for a little
TIP 2: whichever person you happen to be
Romanians have two kinds of soups: ciorba,
bit, you may wonder how much you would
eating sarmale with, that person’s mother
the thin kind with chunks floating in it, and
have got had you asked for a lot! Expect meals
makes the best sarmale in Romania. Some
supa – what in English is the “cream of”
to be taken amid lively chat, and to last long
even turn up their noses at sarmale made by
type of soup. Popular flavors include bean,
into the afternoon/evening/night.
people who didn’t give birth to them.
vegetable and meat – all fairly traditional, so
VERDICT: DELICIOUS!
asking for “butternut squash and parsnip”
Pofta buna!
www.business-review.eu Business Review | May 2019
46 RESTAURANT REVIEW
A CONCEPT THAT WORKS
I
>>> Maison Des Chefs, Agora Building, 113 Floreasca <<<
f I tell you that you can eat main
counter, this penalty is an act of both craven
ditional beef cheeseburger and mixed salad
courses at around RON 35 in a top
greed and manifest commercial lunacy. It is a
for RON 35. It was unexciting and it was
restaurant in one of the best locations
decision that will cost them dearly finan-
precisely what it said it was on the menu.
cially.
Suffice it to say, if you go for burgers (and I
in town, you may think I am either mad, or prone to exaggeration. Well, one of those two descriptions may be true. So let’s go to Maison Des Chefs, a new concept chophouse. The concept is a retail food store in which you can dine, or vice
I asked them if I could buy my wine outside, bring it to my table and accept their
do not) you will undoubtedly approve of it. We passed on chicken with baked beet-
corkage charge. Predictably, they refused. It
root in a mango and mustard dressing at
was blatant hypocrisy on behalf of the House.
RON 35, a veggie pasta with goat’s cheese,
But let’s eat. The menu prices are a
spinach and sundried tomatoes at RON 39
versa. But before we get down to the food, it
bargain. So for a starter, Blondie ordered a
and a pasta with mascarpone and truffle
is worth looking the place over. It is owned
fat, creamy burrata cheese on toast, topped
sauce at RON 49. But for me, the crown-
by Mega Image, who are un-
with pine nuts together with
apologetically using it to
cherry toma-
showcase their food
ing glory of the House was their cheese boards, the best in town. There are four,
toes
each priced be-
products, which
tween RON 20-
of course you
35 depending
may dine
on the size of
upon in-
your selec-
house.
tion. I died
They
and went
have a huge
to heaven
‘fromag-
when I chose the Ital-
erie’ – a
ian and French
large chilled room sporting
boards. They
a hermetically
came with lashings
sealed display of international chesses, all flagged with their country
of soft blue cheese,
and zucchini with a side dip of olive paste. At
eccentric Occelli aged in whisky, cheeses fabulously smell-
of origin. It is a true representation of all the
RON 30 it was extraordinary value, and at
ing of truffles, accompanied by slices of foie
great cheeses of Europe, with a selection
such a size she thought it was a main, rather
gras, Parma ham and even Iberico. Go for it.
of two or three cheeses from each cheese-
than a starter.
making country.
Although she was full, she had to punish
And now for all you ladies who love chocolate, cream and fruit desserts, you
me for all the beastly cruel things I said about
will die for their selection of 15 desserts,
ing over 150 different brands of fine wines
vegetarians in last month’s issue, so she
each one priced around RON 15. But check
from across the world, and with average
ordered a veggie burger with the ‘meat’ made
yourself in your mirror before you go there,
prices of around RON 100, this is serious
from lentils. I had to mooch off her plate, and
and see if chocolate, cream and fruit treats
drinking with brands that are generally not
I hate to admit it was quite delightful with
love YOU equally. If so, go and indulge
sold in Mega Image retail outlets. But wait,
the veggie lentil filling having a thick meaty
yourself in their sinful calorie heaven. The
for here comes a big problem: if you buy
texture with a slight BBQ hint. It came with
sweets are on display.
the wine of your choice, and take the bottle
a goat’s cheese sauce with salad, beetroot
to your table to drink whilst you dine, they
and avocado along with baked potatoes. I
inevitably raise their prices. But beware
raise the price of the wine by a further 20
didn’t believe they were baked as everything
that if you take your eye off the menu, your
percent as a ‘corkage charge’.
pointed to small wedges of pan fries. But at
beverages will cost far more than your food.
Away to their ‘winery’ – a room display-
When you consider that they have made a full profit by selling you the wine over the
RON 35, it was great value. I countered her veggie burger with a tra-
I truly recommend this place before they
Michael Barclay Mab.media@dnt.r