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September/October 2017

A magazine for clients and friends of KPMG Česká republika

From discounts to trust


You only trust what you see with your own eyes One more reason to look properly.

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© 2017 KPMG Česká republika, s. r. o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative International”), a Swiss rights reserved. © 2017 KPMG Česká republika, s.r.o., a Czech(“KPMG limited liability company and a member firm of entity. the KPMGAll network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


editorial

Fair play What are Czech customers like? What are their preferences? What captures their heart when they shop? What is most important to them? Our analysis of over 60,000 customer testimonies brings good news. No longer focused on price alone, Czechs care about the overall value they are getting. What they appreciate most is fair treatment and the speedy correction of mistakes.     For firms to become customer favourites they have to be open in their dealings: honouring promises, meeting expectations, practising personalised communication, understanding clients and saving their time. The key finding from the data collected in Czechia, however, is that Czech customers are keenest on teams that win fair play awards. These are brands that stick to their defined tactics, play to the rules and are quick to apologise without quibbling when they commit a foul. That’s why the first study of customer experiences in Czechia is called Fair Play.      This issue of Marwick, which has been given a design revamp for its third season, features an in-depth article on the study’s conclusions. We also spoke to German economist Matthias Fifka. In another interview, bespoke shoemaker Radek Zachariáš shares his thoughts on outstanding customer experiences. I hope that you will both provide and benefit from outstanding customer experiences. Tomáš Potměšil Head of Customer Centre of Excellence, Management Consulting KPMG Česká republika tpotmesil@kpmg.cz

Marwick – a magazine for clients and friends of KPMG Česká republika. Published six times a year by KPMG Česká republika, Pobrežní 1a, Praha 8. MK CR E 22213. On-line subscriptions available at www.marwick.cz. Editor in chief: Michaela Raková, Art director: Štěpán Prokop, Photoeditor: Barbora Mráčková, Copy-editor: Edita Bláhová, Cover illustration: Václav Havlíček, Content and production: Boomerang Communication. KPMG Česká republika’s offices are located in Prague, Brno, Ostrava and České Budějovice. www.kpmg.cz © 2017 KPMG Česká republika, s. r. o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. © 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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customer experience

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


customer experience Text: Pavla Francová

From discounts to trust

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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t’s not just discounts any more. Czechs appreciate other things as well. Firms who want to stand out from their rivals and achieve long-term success have to target good relationships and do more for the customer than other firms.

Czechs appreciate when companies tell the truth

In the Czech Republic there is a notorious saying: “I don’t want a discount for free.” Most people smile when they hear it. But fewer people realise just how apt this comment on Czech shopping habits is. In total, half the goods Czechs buy are on special offer. That is a huge difference from western Europe. Why are Czechs so obsessed with discounts and what’s wrong with that? One thing that’s certain is that this distinctive characteristic is slowly changing, with Czechs giving more weight to other considerations like excellent service. Fair Play, the new KPMG study about customer experience, sought to learn what Czech customers are happy to pay a bit extra for and what makes them angry.      The origins of the Czech discount madness stretch back to the 1990s. “At a time when the population’s purchasing power was very weak, a number of foreign brands came to Czechia. Suddenly there were a lot of goods on the market, but most customers couldn’t afford them,” explains KPMG’s Michal Pobuda, the author of the study. Facing strong competition, retailers resorted to discounts to persuade people to buy. Big discounts. The simple tactic worked and Czechs truly began to shop. Goods with lurid red and yellow tags are what got put in their shopping baskets. The development might appear idyllic at first glance, but it had and still has major shortcomings. THE RUBBISH BIN OF EUROPE The strong price pressure led to pressure on suppliers, manufacturers and the retailers themselves, who had to make up for lower margins with economies elsewhere. Efficiency was the watchword of the day. “As a result, the quality of products and services on offer suffered,” the study explains. Retailers started to complain just a few years later, when customers got used to letting special-offer brochures inform them what to buy and knew they simply had to wait a couple of days and the goods they wanted would be on special offer again. They started saying “the discounts spiral is suicidal” and similar complaints openly and out loud. But they didn’t how to break out of the vicious circle.      Although customers were contentedly shopping with special-offer brochures in their hands, they also came to realise that the quality of goods and services was going down or was generally worse than they would wish. This did not only apply to food or fast-moving consumer goods. People coming back from abroad were outraged at the poor standard of services in Czechia. The motto “The customer is always right” rarely applied. What’s more, reports began to emerge that the quality of some food products sold in Czechia was worse than in western Europe.     The number of scandals 6

concerning the poor quality of food products or the use of various substitute ingredients in their composition increased. For a while, customers’ anger and outrage was mainly directed against food products imported from Poland and some people, especially the better-off, began to seek out domestic or organic food products. Farmers’ markets became a phenomenon and food products and their quality became a hot topic. But the debate was not confined to this segment. As in the West, although several years later, people started to pay more attention to the provenance of other products, the environment and complementary services. Discounts alone gradually stopped being enough for some people. What’s more, people started to realise that a big discount does not necessarily mean the best price. “People think in relative terms. If something costs 200 koruna and only 100 elsewhere, they will happily go to the cheaper shop. But if they are going to buy a car for 200,000 and could get a 10,000 discount elsewhere, they are less likely to care because it’s ‘only’ five per cent,” says behavioural economist Vojtěch Zíka, explaining the standard thought process of shoppers. It works similarly with smaller purchases as well – discounts have become such a ubiquitous part of retail that today it’s often no longer possible to say what a “normal price” is.      After years of price wars, declining quality of goods and services and a wide variety of “small print” and conditions governing when the discount applies and when not, it was not only the customers who were fed up; firms in many areas also began to realise that they must do more to stand out from their rivals than just offer discounts. “To a great extent this evolution applies particularly to fast-moving consumer goods, but it impacts on other segments as well,” KPMG experts point out. LOOKING FOR THE BEST VALUE FOR MONEY Slowly but surely, the Czech market and customer behaviour began to change. At the same time, the economic situation in Czechia has been improving recently, unemployment is low and so people aren’t as reluctant to spend. After the scandals with poor-quality food products or bad experiences with services, they want something extra for their cash. And, increasingly, they don’t mind paying a bit extra for it.      Price is no longer the sole decision-making criterion. For many people, the price is no longer just the amount they have to pay: it is a signifier of the value for money they are getting. Travel or study abroad has shown them that the standard of services can be a lot higher than we are (have been) used to in Czechia. This shortcoming has been picked up on by various new players on the market, who have decided that they will distinguish themselves from the competition by more than just price.      The young Air Bank could be a typical example of this ongoing transformation. “Because the firm was new, we had the chance to set it up in the way we wanted,” says Jakub Petřina, Air Bank’s marketing director. The company found out that although Czechs trust banks not to go bust, they

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


also expect banks to behave in a way that benefits only themselves and not their customers. For that reason the company decided that it would stand out by generating positive emotions and prove that even banking can be done “nicely”.     “Czechs a priori expect that there will be some hidden catch, some strings attached. You have to be on the level for them to genuinely trust you,” Petřina explains. And that is precisely what KPMG’s extensive survey of customer experience in Czechia has demonstrated. It is also borne out by comparison with western markets: Czechs are much more appreciative than people in other countries when companies act fairly and tell them the truth. THE CUSTOMER IS STARTING TO BE KING Other companies that have scored well in rankings of outstanding customer experience in Czechia confirm the same experience as Air Bank. What’s more, there are more and more firms foregrounding this formerly overlooked issue of customer experience, taking an interest in it and investing in it. The combination of excellent services and high product quality at a good price is slowly gaining in importance and eating into the market share of those who still put all their eggs in the lowest price basket, whatever the cost.      “It is still the case, though, that the average Czech customer is almost shocked when his complaint about goods is accepted without fuss and he doesn’t have to feel like a criminal. Even today, Czechs are a priori prepared for conflict in these situations,” Michal Pobuda, the author of the Fair Play study, points out. That is backed up by the experiences of Tomáš Čupr, who founded and runs the online supermarket Rohlík.cz. In his view, the fundamental thing is that a firm should genuinely trust its customers. “The default mode is that the customer is not making stuff up: he is right. Just because a few people are dishonest, you don’t base your customer service on the exception to the rule,” says Tomáš Čupr, adding that the response to this kind of approach has more, firms are been excellent.     What’s  finding out in practice that investing in the development of excellent customer experience pays off and that the gains derived from an accommodating approach far outweigh the potential losses. The gain in the form of a loyal customer who is happy to recommend a particular service to others and keeps coming back to the firm and its services or products is priceless. In other words, this is a route to long-term success.      “It’s not altruism. We are confident that this route will lead us to very good profitability, which is moreover far more sustainable because everyone benefits,” Petřina from Air Bank adds. This has been confirmed by earlier customer experience research done by KPMG in the USA and Great Britain.

I SHARE, YOU SHARE AND WE ALL RATE Modern technologies, and most notably social networks, are playing a fundamental role in transforming the approach to customers and the greater focus on quality of services. Recommendations and criticism are no longer confined to a narrow group of friends and family: modern communication tools mean they can reach anyone. For many people, evaluating various outlets, branches or entire companies has become a standard part of their life as consumers and even more people monitor these ratings and often take them into account when deciding where to spend their money and what on. In western Europe, too, the boom in customer experience management is linked to the rapid growth of experience and satisfaction sharing.     This is ultimately positive for firms, because it gives them quick access to their customers’ honest opinions, i.e. much-needed feedback. What’s more, firms are themselves trying to contact customers and ask how satisfied or not they were. Student Agency, for example, motivates its customers to give feedback through various competitions. “People’s reactions and suggestions are then genuinely reflected in new services or adjustments to existing ones. RegioJet has recently added separate compartments for women in sleeping cars on night trains, for example,” the Fair Play study mentions.     Consequently, the customer’s standing and power on the Czech market are gradually changing. A lot has changed since the 1990s, when the customer had much less purchasing power and simultaneously had to contend with shortages of all kinds of goods and services and could basically only decide on price. People have more money and are better informed and more experienced. They want to get value for money, emotions and a sense of wellbeing. After their earlier bad experiences they can appreciate it when someone offers them something extra and trusts them. That is the path that more and more companies are going down in the Czech Republic. And although a large portion of the population still shops according to special-offer brochures, it is obvious that the Czech market is changing: customers and firms are trying to become equal partners. Because that kind of relationship will be a win-win. ◆ 6 PILLARS OF CUSTOMER EXPERIENCE Every great customer experience can be described with a universal set of six characteristics, or pillars. That has been demonstrated by an analysis of almost two million customer testimonies collected around the world by the Customer Experience Excellence Centre, a global think tank of KPMG Nunwood. 1. Integrity 2. Time and effort 3. Personalisation 4. Empathy 5. Expectations 6. Resolution

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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Firms that are good at CX have higher profits than their rivals


customer experience Text: Anna Batistová, photo: Marek Matuštík

CUSTOMERS AREN’T STUPID 8

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


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ocial responsibility, sustainability and ethical business. The topics covered in lectures given by Professor Matthias Fifka from the University of Erlangen-Nuremberg are not just theoretical models that only look good on paper. As the last ten years have shown, these concepts, when properly handled by strategic management, can generate financial gains for companies. We spoke to Matthias Fifka about how to achieve this at the international Meltingpot forum held in parallel with the Colours of Ostrava Festival in Vítkovice. Data collected by KPMG in Czechia in 2017 revealed that Czech customers like fair play. Popular brands are the ones that stick to the defined tactics, play to the rules and apologise when they make a mistake. Is this kind of conduct advantageous for firms as well as customers? What you have mentioned is a trend we’ve only been able to observe in the last ten years or so. Previously, in both Germany and the Czech Republic firms took little interest in working conditions, environmental protection and similar issues. Things are different today, and that is because customers’ attitudes have changed. More and more of them appreciate it when firms play fair, treat their workers appropriately, try to protect the environment and so on. And fair play certainly pays off for firms. Our research shows that customers are increasingly willing to punish companies who act dishonestly, by boycotting their products, for example. In this context I must mention social media, which play a central role both in the exchange of information and in the form of protests and boycotts. It’s no coincidence that the birth of social media and the change in customers’ attitudes were contemporaneous. When firms treat their employees better or pay more attention to environmental protection, this can benefit not just the business itself, but society as a whole. KPMG’s data also showed that corporate integrity is one of the most important aspects of good customer experience. Why do you think that is? That is again linked to the attitude change I mentioned. Customers aren’t stupid, you know. They are very quick to spot when a company says one thing and does another. And again there are social media that help customers detect when firms aren’t doing what they should and thus if they are deceiving them. Nobody wants to be cheated. Thanks to the social media culture we live in today, it is much easier for customers to differentiate between firms that have integrity and those that merely pretend to care about certain values. Building integrity is a pretty complicated discipline, though. How can firms do this successfully? If you want your firm to have integrity, the most important thing is to have integrity in the firm’s management. That has been confirmed

in several studies. If the firm’s management does not act with integrity, nobody else in the firm will either. When employees see management flouting the rules, they say to themselves: why shouldn’t we do the same? Firms also have to understand their purpose. Why are we here? Why do we exist as a firm? What are we trying to achieve? If they don’t have this kind of purpose it is very difficult to act with integrity. For that reason, firms should not only declare and define their purpose, they should pass this on to their employees. Firms often have value statements but their employees have no idea about them. Do you have any examples of firms for which this strategy has paid off? Yes, there are very many firms who work on their values. The first very well-known company that did it was Ben & Jerry’s, the ice cream makers. Its two founders decided to donate a quarter of its revenues to charity. They built this pillar into the firm’s code of ethics and every employee knew about it. Another example is Patagonia, makers of outdoor equipment, which always paid attention to environmental protection and strived to be as environmentally friendly as possible. But today even big traditional firms are taking this path. Siemens, for example, which suffered a huge corruption scandal 15 years ago – it was punished with very stringent fines by both the USA and European Union for giving bribes. It realised it had to change. It was a very difficult change for the firm, but Siemens employees tried hard and developed very clear value foundations. Now the company builds all its visions and strategies on these values. Have these changes in attitudes and value systems also been reflected in big firms’ profits? Yes, most certainly. Siemens, for example, today makes 40% of its profits on technologies that are environmentally friendly. So the change in its value system also impacted on the way it has reshaped its portfolio. It’s very important to understand that concepts like social responsibility, sustainability or ethical business can generate financial gain for companies. When we talk to firms about social responsibility, they often say: “Stop going on about social responsibility – it only costs money. Why should we spend money without good commercial reason?” But that’s not true. Social responsibility and sustainability should benefit both society as a whole and the firm itself. Of course we can’t expect firms to act like that without profiting from it. That is simply unrealistic in free market economics. When a company does something good, it also has the right to benefit financially from it. Let’s get back to the topic of customer experience. Ten years ago managers still regarded it as a marginal issue, while today they invest massively in it. What’s your take on that?

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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Integrity starts with purpose. Why do we exist as a firm? Then you need to engage employees.


Firms should engage their customers wherever possible, literally at every step. They are already integrating customers into research and development today: they ask them how they would imagine the resultant product; they make use of what is known as open-source innovation; or they let customers take part in marketing campaigns. And that is precisely what we can observe with social media: people want you to involve them. When you write to some firm on Facebook, you don’t want it to reply after two or three days. You want it to reply straightaway. This must genuinely involve active dialogue, which is something numerous firms are still learning. Some companies still use social media 10

the way they used classic media. They put an ad up on Facebook and think that’s all there is to it. But that is completely at odds with the nature of social media. Firms should have real dialogue with their customers here. A customer wants to see that the firm is interested in him and he is not simply one of millions of people the firm is addressing. Apart from the rise of social media, what else has changed in the past ten years to bring about this kind of shift in customers’ attitudes? We are much more aware of threats like climate change. Even if you’re not interested in science you are bound to have heard of climate change. More and more people are realising that natural

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


resources are running out and we cannot carry on the way we lived in the past. We are also witnessing a very interesting factor that I observe every day at university: that is the rise of generations Y and Z. Here we have young people for whom a career is not the most important thing in life. They grew up in a different value system where family, friends and free time are just as important as a career. That certainly wasn’t the case 20 or 30 years ago: previous generations were much more career-oriented. That is a major challenge for firms, because they have to recruit differently. You can no longer attract employees by offering higher pay than your rivals. Giving them a company car doesn’t work either. If you want them to work 70 hours a week in return for promotion, they’ll tell you that’s not what they’re looking for. Of course, there are still young people who are career-focused, that’s not in dispute. But the proportion of them who have no desire to become managers is growing. And that also contributes to the attitude change in customers. You’re right, the younger generations are relatively happy to work in smaller companies or for themselves, partly because they don’t feel so meaningful in big corporations. How are corporations responding to this trend? I recently spoke to the head of human resources at Deutsche Telekom. He admitted they were having big difficulties because they couldn’t recruit people in the way they were used to. They have to emphasise other aspects to attract new employees: flexible working time, the option of working from home etc. Young employees also want to see some value in what they are doing. They don’t want to be just a cog in the machine carrying out one specific task. They want to understand what they are contributing. And that is the advantage of small firms, because there it is much easier to see how you are contributing than in a company where fifty thousand people work. In any case, it is a real challenge for large firms today, especially because the people in charge of recruitment are usually in their fifties, meaning they come from a generation that had completely different attitudes. Your research also deals with ethical business. What are your recommendations? There are many tools you can use if you want to do business ethically. Of great importance is awareness, for example, meaning that employees know they are working in a firm that has certain values that are a guideline for everything they do in the firm. You should also not leave employees in the lurch when they have ethical dilemmas. Some firms have launched helplines, for example, which you can call and ask: “A supplier offered me this gift – can I accept it or not?” Companies operating on the international market are a big challenge in this regard. A practice that may be accepted in one country is not acceptable in another. Talking

of gifts, in Europe today you can happily turn down gifts on the grounds that it goes against the firm’s code of conduct, and partners will understand that. If you do the same thing in the Middle East or China, it will be taken as a gross insult. While we’re on the subject of cultural differences, to what extent do business ethics differ from country to country? In business, too, there is certainly some process of cultural convergence taking place, but on the other hand there are still major differences from country to country. In Central Europe all the states are relatively equal. If we take the corruption index, the differences here are not big. But as soon as you look at other parts of the world, you find that corruption is seen as a standard and acceptable part of business in many countries. Or child labour. If a German or Czech firm got caught up in a child labour scandal, it would be finished. In other parts of the world they’d say it’s necessary, children have to work, so why should it be unethical. Can you already see trends today that will shape the future evolution of customer experience and business ethics? The trends we are seeing today will certainly continue, and for several reasons. Customer awareness will not go away, because the problems which we are facing and I’ve mentioned, like global warming, resource depletion, environmental pollution etc., will get bigger, not smaller. Global interconnectedness via social media will also grow. When some scandal occurs – let’s say a textile factory collapses somewhere in Bangladesh – you don’t need journalists, you don’t need newspapers or television. All you need is someone with a smartphone who takes a picture of the collapsed factory, uploads the pictures on Facebook or Twitter, and the news spreads around the world in seconds. If your firm is caught up in that, you’ve got a problem. Firms must keep in mind that customers will be much better informed than ever before. You have to act fairly, otherwise you risk reputation damage. What’s more, there are lots of competitors in a globalised world. If you look at it from the perspective of a German or Czech firm, it’s very hard, especially in certain manufacturing areas, to compete on price with firms from China or India. So how can you compete with them? Through quality and integrity. Fortunately, more and more customers understand that and are willing to pay extra for these values. ◆

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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If the management in a firm does not abide by the rules, nobody else will either


Matthias Fifka is professor of economics and ethics at the University of Erlangen-Nuremberg. In his research and tuition he focuses on sustainability and responsible economic management. He has published over 40 articles in renowned specialist publications. He also lectures at the University of Dallas in the US, the Nanjing University of Finance and Economics and Shanghai Jiao Tong University in China, at the École Supérieure des Sciences Commerciales d’Angers in France and the Maastricht School of Management in the Netherlands.

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


There are new competitors with a fresh vision Is your company agile enough to outpace them?

Using innovative tools, thinking and frameworks, KPMG can help adapt your business in the face of constant disruption. Learn more at KPMG.com Anticipate tomorrow. Deliver today.

© 2017 KPMG Česká republika, s. r. o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


customer experience Text: Richard Valoušek, photo: Barbora Mráčková

Czechs refuse to stand out

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


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t is only a slight exaggeration to say that bespoke shoes from Radek Zachariáš are an essential item for everyone who cares about originality and the personal touch. Your first pair will come to CZK 60,000, but your next pair will cost roughly half that. How did the most famous Czech shoemaker manage to build up a brand whose products Czech customers are willing to wait more than six months for? You’re living your dream making bespoke shoes and garnering admiration from customers. Was becoming a shoemaker a dream you’d had for a long time? When I was growing up I had no idea that shoemakers even existed. As a child I lived in a world of my own, like my contemporaries did. Nobody cared about dreams and the future. The time and the regime were not conducive to big plans in life. You are acclaimed for your high-quality madeto-measure shoes. Did you have any role models around you from a young age? My parents bought ordinary mass-produced footwear – there was no other choice. We didn’t even bother getting shoes repaired. My parents may have occasionally replaced a heel, but that was about it. Where did you get your first experience with shoe repair, which was ultimately your gateway to the shoemaking trade? In the factory where I worked as a mechanic. Women who wanted a metal heel repaired would keep coming to see my colleagues who had access to a lathe. I remember that the heels used to make an awful racket, but on the other hand they lasted a long time. That’s what people were after at the time. Was that inspiring for you? I liked the way women would come and see them. I had trouble getting to know women and, what’s more, there weren’t many women in my circle. It seemed like a great opportunity, so I learnt how to repair shoes. After a while I realised I needed to repair other parts of shoes as well, so I gradually taught myself. The other lads didn’t want to, because it was too much work for too little reward. The women’s visits weren’t enough for them? I guess it stopped being enough after a while, and I too found out that they only wanted their shoes repaired and it wasn’t getting me anywhere. I didn’t get to know a single one properly. So it wasn’t your shoe repair skills that made an impression on your wife? No, we met on a kind of organised outdoor weekend for schoolchildren. There were no shoes involved. So you started out “secretly” repairing shoes in a factory. How did your story continue? The revolution was a major factor. Up to then I had been educating myself and was swamped

with repair work. I’d almost stopped doing my official work in the factory. November 1989 changed everything. Did your career as a shoemaker begin? There was still time for that. In the meantime I rented a cellar in our building in Žižkov, knocked through a window at pavement level and opened a shoe repair shop. At the time I thought it would make me rich. I thought it was a brilliant idea. Only in time did I realise how much work it was for little money. Right from the start I was very honest: I made sure everything was legal, I did all the paperwork, I got all the permits exactly as required. The work took up most of my time. I was hardly ever at home, I neglected my daughter’s childhood, but in my mind I had the idea that I was doing everything properly and honestly. Were you disabused of that notion? Two middle-aged women came for an inspection. They spent hours there, checking every possible document and permit. I said that I had everything in order. They sarcastically replied that they believed me but they were from the sanction inspection department and had to find something. They were evidently responding to a tip-off. Did they find what they needed? On the price list I had on display, which was compulsory at the time but I must have been the only person in all of Prague to have one, there was a maximum and minimum price bracket for the “gluing” item, because some gluing jobs were always harder than others. They gave me a fine for that. What did you say? I got angry and called their boss. I couldn’t just accept it. When he, too, had a go at me, saying how dare I and I should be glad that’s all I was fined for, that was a wake-up call for me. I think it pretty much broke me. I haven’t been so honest since then. Your first shoemaking work was in a theatre. How did that come about? At the time I couldn’t imagine making shoes – it seemed too complicated. My colleague was a trained shoemaker, and he occasionally showed or explained something to me. That’s where I did my first attempts. And did that lead to making historic shoes? It was my colleague who got me into that, because historic military boots basically don’t exist but are needed. What’s more, it’s not the zenith of the craft, which is ideal for getting started. Did you leave your cellar? Staying there would have been unbearable: the cramped space was damp, with mould on the walls, and my customers started to depress me. They didn’t understand why I wanted so much money for my work, they were used to everything costing the same. They didn’t understand why I was only open at the specified time.

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

15


I tried in vain to explain to them that I need time to actually repair the shoes so I only took orders once a week. I couldn’t bear it any more. Did you move away? We bought an old cottage in the country near Hořovice. I thought I would quit the repair business, as I didn’t think I’d find any customers for the prices I charged. Then an acquaintance came and got me making fencing shoes and I also gained experience working on orthopaedic footwear. Let’s get back to the present day – you have your shop, where you have dozens of pairs of shoes on display and also models of customers’ shoe lasts. Are you living your dream? I’d like to say yes, but there’s still some way to go. While you still have to worry about earning enough to pay your staff and your rent it’s more like the pursuit of income than the pursuit of happiness. You’ve started working in a team and now have colleagues. Was it tough to accept that shoes bearing your name would be made by someone else? At first I couldn’t imagine it. I was labouring under the impression that I was better at it than everyone else. A pretty mistaken impression, as my current colleague who is better than I am demonstrates. You worked with orthopaedic shoes, now you make shoes to measure. What’s your view on the medical aspect of footwear? 16

That is a major issue that everyone has his own view on. It’s hard to say where the truth lies. The fact is that every shoe that isn’t made to measure deforms the foot in some way. Every mass-produced shoe is too tight somewhere or other and leads to calluses or bent bones. The foot then suffers in any shoes because it’s already deformed. Do you often visit shoe shops – for inspiration or to curse? I go to Italian shoe shops for inspiration and to study their design. But when I see how many shoe shops there are, I get the feeling that my work is redundant. When I look around in your workshop, I see pairs of shoes ready for customers, dozens of shoe lasts ready for more work – it’s certainly not redundant. Where will your next steps take you? I’d like to make creative shoes, not to be as conservative as the majority of my customers. To forget that I’m doing it so I can pay my staff and rent, and to derive greater pleasure from my creations. Maybe to make a couple of pieces for an exhibition, just to get a kick out of it. Do you get the feeling that Czech customers are conservative? Most of their wishes are down-to-earth. They wear the shoes to work and there they don’t want to stand out or be different – that’s a constraint on their imagination. When I’m talking to them about their dreams and desires, it’s

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


RADEK ZACHARIÁŠ SINCE THE REVOLUTION 1991 → Opened a shoe repair workshop. 2000 → Gained knowledge and skills by collaborating on theatrical and fencing footwear. 2003 → Experience with making orthopaedic footwear to order. 2005 → Started making hand-stitched footwear. 2011 → First hand-dyed crocodile-skin shoes. difficult to get them to break out of traditional pigeonholes. When you look at your current business, what phase is it in? I’d call it a critical period. I’ve been in Prague for two years. Before that I had my workshop at home, so I’ve decided to take it up another level. I’m trying to broaden my business, but I’m not succeeding. I sense a certain disappointment, maybe even a new beginning, when the time comes to re-evaluate the current situation. I had to let two colleagues go – we weren’t making enough money. We’re cutting costs and working as a two-man team. I can also sense some hope there, so let’s end on a positive note. There’s always a positive note: this autumn, for example, we’re planning a non-profit project, an auction I’m entering one article in. I can’t tell you any more, but you’ll soon find out more. I’m looking forward to it! ◆

HOW ZACHARIÁŠ SHOES ARE MADE “The first time a customer gets in touch with us he already has an idea what we do and all he does is get the final information and arrange a personal meeting. That’s one reason I don’t have opening hours: everything is by personal agreement. At the meeting I try to find out about the customer’s specific ideas. Then his foot is measured, which takes around an hour. Using these measurements we make a shoe last and prepare a trial pair. It takes six months before the new customer gets his shoes. During that time there are a number of processes ensuring the shoes fit him perfectly.”

2013 → Third place in the Hospodářské noviny “Tradesman of the Year 2013” awards. 2014 → Founded the company ZACHARIAS s.r.o. 2016 → Beautiful new workshop and showroom for receiving customers, with the stylish name: ZACHARIAS House.

PRICE OF MADE-TO-MEASURE SHOES “The price of a pair of shoes ranges from CZK 30,000 upwards (the first pair costs around CZK 60,000 because we have to make a model and shoe lasts), but I can imagine them being even more expensive. We make sure we use the highest-quality techniques and materials: there is no part of the shoe we cut corners on. The customer automatically gets a lifelong guarantee. I give the shoes my name, I guarantee them and they are my advertisement.”

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

2012 → New workshop in Felbabka.

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case study

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


case study Text: Pavla Francová

WHAT’S REALLY GOING ON IN A FIRM P

eople have been talking about data mining for a long time now, and many firms make everyday use of this modern method of processing information. Now, however, the talk will shift to process mining, which can help firms both save money and get a real competitive advantage. What is it and who can it benefit? Process mining is still a great unknown for many firms. “It’s a way to use the data and digital information a firm possesses to show the reality of what is really going on in the firm,” explains Peter Zborník from KPMG Česká republika Management Consulting. For large firms, what might at first sound complicated is a gateway to seeing reality. On the one hand there are processes and rules that have been put in place, but on the other hand there is reality, which may be a world away from the official procedures.     The design, functioning and effectiveness of processes was previously scrutinised analogically. Consultants came to a firm and monitored the work of a selected sample of employees, interviewing them and spending some time

observing how they go about their work. They then drew up a report on processes in the firm. But this kind of approach has several disadvantages: for one thing it takes quite a long time; it is also costly and, most importantly, its results can never be as precise and comprehensive as modern process mining can deliver. “Interviewing employees can only give us a few alternative scenarios of possible processes. We can never talk to everyone and we can’t rely on employees to tell us the whole truth,” points out Petr Václav, head of the Advanced Analytics team at KPMG Česká republika.     By contrast, if a process is logged digitally somehow, it can be analysed very swiftly and precisely. In this way firms can find out, for example, where inefficiencies exist or how much time individual employees or entire teams spend on particular tasks; they can also detect any processes that follow an unapproved route. “We discovered in one bank, for example, that in the department that had a backlog of mortgages to process the employees were sending applications back a step at the end of the month to gain time. They were doing that even though the applications

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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Analysis of processes revealed that in 70% of cases mortgage applications were processed in ten different ways and two thousand different processes were used in 30% of cases

were absolutely fine – they simply didn’t have time to process them. Instead of saying they had a problem, they made up errors in applications and sent them back,” Petr Václav recalls a case where KPMG was helping a Czech bank analyse mortgage processes.     However, process mining makes it possible to expose far more interesting things the company management usually has no idea about. In another case where KPMG was helping analyse another bank’s process data, it became clear how many alternative processes existed. “You would have thought that processing a mortgage is always pretty much the same process from start to finish. But our analysis showed that in approximately 70 per cent of cases mortgage applications were processed using roughly ten different processes. For the remaining 30 per cent of the applications it turned out that there were almost two thousand other alternative flows and processes,” Petr Václav says, adding that not all the alternatives were correct and permitted, of course. And this is not some idiosyncrasy confined to one bank: similar cases come to light in other large companies as well. And the management usually has no idea how many alternatives there are and that employees are using them. Process mining can also uncover various types of fraud and underhand dealings in firms, though that is not the primary goal. The overriding objective is to provide a precise picture of reality and identify problems. With this reliable foundation in place, KPMG can then issue sound recommendations for the firm: what to change, how to make processes more effective, how to help certain employees or how to improve their motivation. “Clients are often most interested in finding ways to improve performance in the firm. Process mining opens up a new world in this regard, giving the company a competitive advantage,” Peter Zborník says. Process mining allows them to identify room for improvement and optimise processes. Unlike the classic “analogue” approach, process mining also makes it possible to measure the impact of changes and thus identify any improvements.     Who is process mining ideal for? “It can be used everywhere processes take place and are logged electronically,” Peter Zborník says. That makes it particularly relevant to large firms using some kind of system that records processes and workflow. It is generally ideal for the financial sector, insurance, energy industries, FMCG, EU regulation, software development or, say, for the diagnosing of patients and their transfer between doctors. In the Czech Republic we first have to wait until the healthcare system is digitalised, however. In other fields it is substantially easier – all that’s required is that firms keep digital records of their processes. This can be done in Excel, some work flow system, SAP or a company’s in-house systems. “Often it doesn’t have to be in a database, the data just has to be saved in some file. Our experts can then purge this unstructured or semi-structured data and convert it into the form we need to be able to analyse the various process 20

steps and represent them clearly in a chart,” Peter Zborník explains.     Process mining can also be used for internal audits, which are then no longer merely random – automation makes it possible to scrutinise everything in a firm in the space of a few days. What’s more, companies that have fully digitalised data and process flows can use process mining in real time and thus keep continuous track of what is going on in the firm. For Czech firms this is still a new topic, but they are realising very fast how beneficial it can be for them from the perspective of planning capacities, for example, or managing people’s workloads,” Petr Václav adds, going on to say that process mining is one of the steps down the road to robotisation or, if you like, automation in firms. That is because mapping existing processes is essential for companies all over the world trying to see which activities robots can replace people in. The firms first have to know precisely who does what, what problems there are and what activities people carry out, so that they can subsequently decide what parts of the work can be fully automated.      “Anyone wanting to wake up to reality should use process mining,” Peter Zborník says with a smile. He adds that the usual first reaction of the management in firms KPMG has already provided this service to tends to be one of genuine amazement. “They shake their heads, unable to believe it. In the end they acknowledge, though, that the reality is probably different from what they thought,” Zborník concludes. This kind of awakening is the first step firms must undergo to be able to ensure the prescribed procedures are complied with in the firm and performance is improved. ◆

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


Customers are hiding in your data Do you have the insight to uncover them?

Using analytics you can trust, KPMG can help you identify new opportunities that will accelerate growth for your company. Learn more at KPMG.com/data Anticipate tomorrow. Deliver today.

© 2017 KPMG Česká republika, s. r. o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


E

energy

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


energy Text: Ivo Půr

ENERGY EFFICIENT INDUSTRY C

zech industry is consuming less and less energy but remains three times as energy intensive as the average in EU founder members. Has the recently stipulated energy audit helped reduce consumption? KPMG’s research maps how Czech firms are doing. The purpose of KPMG’s research was to describe energy efficiency in Czech industry and outline the future in the field of energy savings and compliance with the obligations laid down by the amended Act on Energy Management. The Act requires any firms exceeding the energy consumption prescribed in Implementing Decree No. 480/2012 Coll. to perform repeated energy audits or, where appropriate, to introduce and certify an energy or environmental management system or both.     Firms view energy savings positively and are increasingly favourable to implementing energy efficiency measures. Approximately 10% of companies believe that energy saving should operate on a purely voluntary basis, however. Most respondents do not regard a duty to perform repeated energy audits as an effective way to achieve savings. They nevertheless state that audits showed them what direction to take with efficiency measures or confirmed they were moving in the right direction.     “Views on the effectiveness of regulation in the form of energy audits differ considerably from company to company. Some see it merely as an administrative matter and some as

a pointless inconvenience, but for others an audit has opened their eyes. The same applies to the two systems of energy and environmental management. In the case of these systems, too, the respondents spoke of a burdensome paperwork formality,” says Petr Lux, a manager at KPMG Česká republika. “Most firms address the issue of energy savings themselves. Sometimes they manage to cut costs, and in some cases increased efficiency is automatically reckoned with in the case of new investments. In other companies, particularly multinationals, energy savings are an integral part of the continuous optimisation of manufacturing processes and of their corporate culture, irrespective of the current regulation,” he adds.     The research showed that 70% of respondents decided to meet the minimal requirement of the amended Act, i.e. to perform an energy audit. The remaining 30% decided to comply with the regulation by introducing and certifying environmental management (19%) or energy management (11%). ◆ More than 200 firms from the CR took part in the KPMG research. The quantitative part of the research took place online in 2016, with the qualitative part taking the form of face-to-face and telephone interviews. You can find the research conclusions at www.usporyprumysl.cz.

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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CZECH INDUSTRY CAN CUT ELECTRICITY CONSUMPTION BY 14% Companies see the greatest potential for energy savings in electricity at 14%. They estimate the potential savings in natural gas consumption at 10%. As regards “energy appliances”, buildings have the greatest saving potential at 16%, followed by operating technologies at 12%. Companies can save as much as 6% of the energy consumption of other technologies.

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22% OF FIRMS ARE PLANNING TO OVERHAUL THEIR LIGHTING SYSTEMS IN THE COMING YEARS According to the research findings, most firms are planning to overhaul their lighting systems in the coming years (22%), with a further 18% planning to invest in more efficient production technologies. 17% want to make better use of waste heat; 14% plan to insulate buildings; 12% plan to introduce automatic regulation of energy apparatus; and just 5.5% of firms are planning to invest in their own renewables.

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


3 WAYS OTHERS ARE TACKLING ENERGY CONSUMPTION WE DON’T USE ENERGY SAVINGS SUBSIDIES GREINER PERFOAM, S.R.O. Auto components manufacturer Greiner Perfoam looks at the issue of energy savings in terms of financial return. The company has adopted a number of energy saving measures such as high-speed door and gate systems etc. The company does not have a detailed plan but tries to monitor consumption internally. There are many ways this company could save energy costs and also improve its energy security. Consumption is measured mainly at the base of buildings or large-scale machinery, and utilisation of machines’ capacity is paramount. They do not use energy savings subsidies because these involve a lot of paperwork, the company has had bad experiences in the past and insufficient information is provided by state administration. There is room for improvement in more detailed measuring and offgrid systems. The company has considered installing co-generation units. They have a positive view of energy savings per se and are aware that greater efficiency could give them a competitive advantage in future. WE PUT WASTE HEAT TO USE LINET SPOL. S R.O.

sufficient evidence of the potential for savings and possible measures. The company has approved funding under the Operational Programme Enterprise and Innovation for Competitiveness for projects to install LED lighting, exploit waste heat generated by compressors and furnaces, distribute residual heat to the various manufacturing rooms and is also planning to implement an EnMS. THE ENVIRONMENT IS PART OF OUR CULTURE INDET SAFETY SYSTEMS, A.S. The company has for long taken a systematic approach to energy saving projects. It has introduced and certified an EnMS and consideration for the environment is part of its corporate culture. Four years ago it replaced its lighting systems with LED lights and it regularly insulates older buildings at the plant. It makes use of compressor or cooling-circuit heat recuperation. It funds the measures out of its own pocket because of negative experience with subsidies in the past. Its energy saving measures have allowed the plant to increase its performance without increasing energy consumption. The firm cooperates on energy savings with local firms it has good experiences with.

Savings-wise, the hospital bed manufacturer is constrained by its manufacturing spaces, which grew organically as the company expanded. Their diversity and the plant’s location at the end of an electricity line place completely different requirements on the company. The responsible employees are very focused on the recuperation of waste heat and other manufacturing synergies, which they try to exploit wherever possible. Savings are naturally taken into account when they build new manufacturing spaces. An energy audit gave the company © 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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infographics Text: Luděk Vokáč

THE VALUE OF FOOTBALL CLUBS

Real Madrid CF €2,976 million Spain

Manchester United FC €3,095 million England

Borussia Dortmund €971 million Germany

SL Benfica €340 million Portugal

AS Roma €453 million Italy

AC Milan €547 million Italy

FC Barcelona €2,765 million Spain

Manchester City FC €1,979 million England

SS Lazio Valencia CF Beşiktaş JK €227 million €235 million €219 million © 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative Italy Spain Turkey (“KPMG International”), a Swiss entity. All rights reserved.


T

he most valuable European football club Manchester last year was England’s United, according to the KPMG Football Benchmark. The club beat the previous year’s rankings topper Real Madrid even though its sporting results were poor in the 2015/2016 season referenced by the research. KPMG’S Sports Advisory Practice compiles a ranking of the most valuable football clubs in Europe based on publicly available financial statements as at 1  January 2017. The research showed that Manchester United became the first club in history to exceed a value of three billion euros. The “Red Devils” managed to increase their value year-onyear by 7%, which may be less than the overall

average of 14% but outstrips the growth achieved by other clubs at the very top. Despite a poor showing on the pitch, Manchester United’s success points to the huge commercial strength of England’s Premier League. That league has six clubs in the top ten of the ranking of 32 clubs. English teams mainly benefit from the high revenues from broadcasting rights both at home and abroad. The Premier League is also the most active European league as regards audiences in faraway countries. Spain’s La Liga, Italy’s Serie A, France’s Ligue 1 and the German Bundesliga are now trying to emulate the Premier League’s success. Other factors influencing the rankings are the size of a club’s fan base, its economic performance and stadium ownership.

Part of the value of English clubs likes in the high revenues from broadcasting rights

PSV Eindhoven, €210 million The Netherlands

Arsenal FC €1,956 million England

Fenerbahçe SK €347 million Turkey

Olympique Lyonnais €317 million France

Athletic Club Bilbao €300 million Spain

Paris Saint-Germain FC €998 million France

Chelsea FC €1,599 million England

FC Bayern München €2,445 million Germany Sevilla FC €261 million Spain

SSC Napoli €409 million Italy Tottenham Hotspur FC €1,011 million England

AFC Ajax €274 million The Netherlands

Galatasaray SK €377 million Turkey

Atlético de Madrid €793 million Spain

Leicester City FC €462 million England

Liverpool FC €1,330 million England

FC Internazionale Milano €429 million Italy

Juventus FC €1,218 million Italy

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Everton FC €457 million England

FC Schalke 04 €691 million Germany


R revue

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


revue Text: Anna Batistová

THE EUROPEAN SCENE

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he autumn art show season is officially underway. Whether you are heading to one of the European capitals on business or for a long weekend, the following exhibitions are not to be missed. Our culture picks include the Biennale in Venice, Art Week in Berlin and a contemporary art show in Amsterdam. LA BIENNALE Venice, Italy, till 26 November 2017 The Venice Biennale is the most visited art show in the world. The works, which this year highlight craftsmanship or generally work with colour and sound, were chosen for the main exposition by the curator of Paris’s Centre Pompidou, Christine Macel. BERLIN ART WEEK Berlin, Germany, from 13 to 17 September 2017 In its sixth year, Berlin Art Week brings the best contemporary art to the German capital. Visitors in 2017 can look forward to big shows of established names like Monica Bonvicini, Danny Lyon and Willem de Rooij, as well as an endless line-up of artists working in all kinds of genres. NEU NOW Amsterdam, the Netherlands, from 14 to 17 September 2017 The Neu Now festival held in Westergasfabriek in Amsterdam showcases up-and-coming stars of the European art scene. For the show’s 9th year, the jury has chosen the exhibitors solely from the most talented graduates of Europe’s art schools.

MARC CHAGALL Basel, Switzerland, from 16 September 2017 Basel’s Kunstmuseum is putting on a large-scale exhibition called Marc Chagall – The Breakthrough Years 1911–19, documenting Chagall’s key works from the time of his first years in Paris where, in the heart of the avant-garde, he remembered his childhood in Russia, to his return to his homeland. RAFFAEL Vienna, Austria, from 29 September 2017 The Raffael exhibition in the Albertinum offers 140 of the most beautiful drawings, prints and paintings by one of the leading lights of the Italian Renaissance. Besides painting, graphic art and tapestry design, Raffael (1483-1520) was also an architect and was a major influence on Rubens, Manet and others. BONNARD–MATISSE Frankfurt am Main, Germany, from 13 September 2017 More than 100 paintings, drawings and sculptures by two lifelong friends and pioneers of modern figural painting, Henri Matisse (1869-1954) and Pierre Bonnard (1867-1947), will be on display at Frankfurt’s Städel Museum. Both artists had a major influence on the evolution of the European avant-garde.

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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revue Text: Richard Valoušek, photo: Barbora Mráčková

WHEN THE BRAIN COMES UNDER ATTACK

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


W

e talked to scientist Zuzana Libá about her research into autoimmune diseases in children.

Zuzana Libá’s life changed eight months ago when she gave birth to a son. She herself has been trying to change the lives of all children through her patient research into their immune system. “With every sample, I hope I’ll find an answer to the questions that arise during the research,” the thirty-eight year old doctor says modestly. As a neurologist she wants to contribute to more accurate diagnosis and help discover the causes of inflammations in the brain or spinal cord. Winning the Neuron Impuls grant competition in 2014 gave her access to a grant of one million koruna for her project from the Neuron endowment fund. “It helped me develop further in this field,” she says as, before launching into an explanation of the differences in the way men’s and women’s bodies defend themselves and how she tracks children’s immune cells. Zuzana Libá gained her master’s degree in general medicine in 2003 at the 2nd Medical Faculty of Charles University in Prague and completed her doctorate in immunology five years later. In 2009 she completed her specialisation in children’s medicine and in 2011 in children’s neurology. From 2003 to 2006 she worked at the Paediatric Clinic of the 2nd Medical Faculty of Charles University and at Motol University Hospital. Since October 2006 she has worked at the two institutions’ Children’s Neurology Clinic. Her work deals with neuroimmunology, inflammations of the nervous system and autoimmune disorders of the central nervous system and their treatment in children. When did your passion for science emerge? The first time that kind of idea struck me was in seventh grade, when I was twelve. But it was a pretty superficial wish. I had no idea what that kind of occupation actually involved. I would imagine a laboratory full of smoking flasks, protective goggles and clothing. That’s roughly what my idea was like, I guess. I was fond of chemistry. I liked molecules and their phases, chemical reactions. I kept wondering how things are assembled and why. Your teachers must have loved you, but what about your parents and people who had no understanding of it? That’s just it, I had lots of questions and got very few answers, and that annoyed me. Maybe that’s where my desire for answers came from. When did you first get an insight into medicine? At school? It was a few years earlier, but it was only a brief glimpse. I worked as a cleaner at the Brno University Hospital in Bohunice. That’s some way to launch a medical career. Don’t tell me you got noticed while working as a cleaner.

No, there was no room for that, and I didn’t have the necessary education. But it was the first time I realised I cared about sick people. Did you worry that patients’ conditions and illnesses could be an obstacle for you? Until you come into direct contact with sick and injured people you have no idea how you will react, how you’ll deal with it. During this temporary job I at least found out how I would feel in contact with them, if nothing else. Did you try to look over the doctors’ shoulders and watch their work? That wouldn’t have been appropriate, but it grabs you, of course. I worked in the surgical department. That was never the direction I was going to take, but I saw all sorts of new things and understood how it might work out. But I didn’t really watch them at work. Then the time came for you to choose a university. Did you always want to go to the 2nd Medical Faculty? I think so. I liked the concept of the faculty, the environment and the fact that children’s issues are dealt with at a high level. I didn’t take long to make up my mind. Almost twelve years have passed since you started your studies – how has your view changed on the work you want to do? When I was a student I earned some extra money by working in an advertising agency and a travel agency, and for a while I wasn’t sure if medicine would be right for me. Then I took a liking to paediatrics and, what’s more, when I was taking my school-leaving exams I was asked if I wanted to do research. I said yes. That’s where it all began. Were you working in paediatrics? For three years, followed by children’s neurology. At first I tried to find my feet, and from 2009 I started to systematically collect samples with autoimmune diseases of the nervous system in children. It took a while to get together both the money and a sufficient quantity of samples. I began to focus much more on research about five years ago. Diabetes research got in the way, though. That was linked to my paediatric work and it was part of my postgraduate study of immunology. Type 1 diabetes, which is common among children, is an autoimmune disease. I enjoyed it and was surprised at how interesting I found it. Wasn’t it depressing for your day-to-day work that diabetes is incurable? Yes, it’s true that it’s incurable, but I saw that as a challenge, because here too there are answers to find and progress to make. I was part of a comprehensive programme under which we studied the relatives of children with diabetes and looked for possible correlations. Did you try to discover the disease in its first stages, because that’s not the forte of observation-based medicinal research?

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We took samples from high-risk patients and checked them over time. We hoped to notice any changes, even the smallest changes, in the event of the onset of the disease. It was about predicting diabetes, and these marked my first steps towards tracking children’s immune systems. When I read your profile, I wasn’t sure at first what exactly you do. By that I mean your current immune system research. My work deals with children whose immune system attacks their brain, which should be protected under normal circumstances. Thank you. It seems you’ve learnt how to sum up your scientific focus in a nutshell. When my friends and family ask me, I have to explain it in a way they’ll understand. I get a lot of practice, so I’m glad it makes sense. Your husband is a neurosurgeon. Can you talk to him about your research? He doesn’t understand my research, like most people. He’s closer to a number of things, but I don’t reckon he could explain it in place of me. Let’s get back to your research. Can you say why the immune system attacks the brain which should be protected? My research won’t find an answer to the question “why”. It monitors the gradual development of this disease: how the cells got there, what they produce there. Put simply, I track their movement and communication. I read somewhere that women’s bodies are more prone to immune system disorders. 32

That’s true, and we ascribe a large part of that to women’s hormonal activity. The highest-risk periods in this regard are puberty and then pregnancy. Is it fair to say that the body is at its most weakened at those times? It’s more that the setup of the immune system changes under the influence of hormones. The immune system reacts to the new situation, and every change carries a risk that an error might occur, though you can never know for sure beforehand. You’ve already mentioned that there are differences between children and adults as well as between male and female bodies. Your work deals with the smallest patients. What’s it like for children? The child’s brain and immune system are a special area and a very demanding one, because both develop and change as the child grows and both have to learn to respect one another. During the child’s development, various genes appear in various places in the brain tissue. These are potential targets for immune cells, so every age category is more vulnerable to something different and the disease spectrum differs in children and adults. The development of the immune system itself also leads to different reactions in children and thus to a different course of the same diseases when compared to adults. Have you made rapid progress? There are no amazing leaps forward. The research is very demanding, especially in terms

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of time, because these are very rare diseases and it’s not so easy to put together a group of patients. Every single sample from patients is very valuable. We monitor some patients with chronic diseases for years and keep their samples during treatment so that we can assess them in the full context. I am always impatient to know what we will discover when we study them. Can it be euphoric? Not that often, unfortunately. Instead of answers we get other questions, but that too is a challenge for me to keep working on it. So you have lots of questions – such as? Why diseases come back to the body or why they can’t be controlled or in what way cells react differently. Above all, I observe changes and differences between various patients. That is one reason why research has to be long-term and samples need to be collected for a number of years. In Czechia you’re just a small team – how many people are helping you? I have colleague from my postgraduate studies, and she helps me a lot. I can also turn to experts from the lab, because there are lots of instruments I’ve never worked with myself. If you don’t have allies in Czechia, where do you find them abroad? Barcelona, Oxford… there are big teams there. There is also a lot of work being done in Australia and America. You now do a lot of work from home, partly because of maternity leave. I guess your son takes up a lot of your time. Do you have more time for research?

As I’m not with patients but at home, I have time for research as well as my maternal duties. At last I can devote more time to it. But I’d like to get back to my patients again soon. It’s said that people who are knowledgeable about medicine are more anxious about raising children. Does that apply to you? I think that is generally the case, because we know more about that than others. But we mustn’t let it get to us, otherwise we’d go crazy. So I hope I’m a normal mum. ◆

RESEARCH The immune system protects us against threats from the external environment, but it sometimes happens that it turns against our own tissue for some, often unknown, reason and autoimmune diseases develop. Although the brain and spinal cord are protected more than other organs, they can also be targeted by the immune system, such as in multiple sclerosis. Autoimmune diseases of the nervous system are relatively rare but serious. “Recognising them and applying targeted treatment as early as possible is often very difficult, so I want my work to contribute to better diagnosis and help discover the causes of inflammations of the brain or spinal cord,” says MUDr. Zuzana Libá, Ph.D., who received CZK 960,000 from the Neuron endowment fund for her research.

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revue Text: Ondřej Krynek, editor in chief DesignMagazin.cz

DESIGN NEWS THE STREETS OF PRAGUE BECOME A PUBLIC SCULPTURE GALLERY Until September 30, a total of 21 sculptures will be on display in various places in the centre of Prague as part of the third year of the Sculpture Line festival. The works of art on free public display were made by Czech and international artists. Perhaps the most interesting exhibit is František Skála’s controversial work called Prastánek in Malostranské náměstí. A TREETOP PATH IN THE KRKONOŠE MOUNTAINS A new Treetop Path has opened near Janské Lázně in the Krkonoše mountains. It comprises a nature trail 1,300 metres long and a viewing tower 45 metres high, from where you can ride a dry toboggan down a 50-metre track. The path was designed by German architect Josef Ströger and is made entirely of wood. WERICH VILLA REOPENS AFTER 15 YEARS The Werich Villa in Prague’s Kampa park has been renovated to a design by TAK architects and reopened to the public. From 1945 to 1980 actor Jan Werich lived in the house that had been used by craftsmen in the 16th century and was a skittle alley in the 17th century. Now you can visit a café on the ground floor, visit exhibitions or take part in smallscale cultural events there. PILSEN STAGES AN EXHIBITION OF NOMADS’ DWELLINGS The DEPO2015 cultural centre in Pilsen is showcasing the nomadic style of travel and living till the end of October. Called Nomads, the exhibition presents creations by fifteen Czech and international designers, artists or schools that are linked to innovative sleeping arrangements. You can make advance reservations to sleep in some of the designs on show and try out the modern nomadic lifestyle for yourself.

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Text: Lukáš Rozmajzl, editor in chief CityBee.cz

TOP 3 WOMEN’S ESTABLISHMENTS

TWO-GIRL GRILL In September the Ambiente restaurant chain is opening its new Grils bistro in Prague. The name alludes both to the main product, which are flamegrilled chickens sourced from a family farm, and to the fact that the staff cooking and serving on the site of a former florist’s will be led by two women, Markéta Libánská and Dominika Flecková. At the beginning of summer, the management and head chef duo raised CZK 5 million for the new project through an online crowd-funding campaign. The meat at Grils will be served with various sides, homemade sauces and desserts; cider and wine will be on tap. Extra tip: If a portion of barbecued chicken isn’t enough for you, try the next-door Lokál Hamburk restaurant. “We cook without waste. We prepare our potatoes with the grease from cooking the chicken and any chicken that isn’t sold immediately is used in sandwiches. We take the bones to our neighbours Lokál, where they make broth from it,” Markéta Libánská describes their zero-waste approach. FEMALE HEAD CHEF INSPIRED BY COLOURS London is currently riding a Mexican wave, apparently. This autumn will bring a tsunami in the form of the new Ella Canta restaurant. The woman behind the concept is acclaimed chef Martha Ortiz, whose restaurant in Mexico City ranks among the top 50 establishments in Latin America. Her new restaurant close to Buckingham Palace will be based on a woman’s touch. “The dishes will be like paintings, with the emphasis on colours and contrasts that are typical of Mexico,”

the chef said in an interview for the Foodism website. She has said in the past that she is inspired by paintings by Mexican artist Frida Kahlo and by her mother, artist Martha Chapa. Extra tip: Martha Ortiz’s favourite food is spicy mole sauce made from chiluacle negro, a special variety of chilli that is an aristocrat among spicy chillies. “When you eat our black mole, it’s like you’re tasting the night,” the chef confided. TWO WOMEN AND NO PACKAGING It is no exaggeration to say that a new store in Hradec Králové was inspired by a 10-kilogram sack of baking soda. When two local women tried to buy raw materials without packaging they came up against hurdles – the goods were either not available in the city or had to be ordered online in large quantities. That sparked the idea behind the Bez obalu (“No packaging”) store that opens in September. Customers will be able to buy rice, flour or washing powder in any quantity they need. And without unnecessary packaging and waste. “We want our shop to offer high-quality raw materials and foodstuffs from Czech suppliers, mostly in organic quality. From some raw materials we will mill fresh flour and make fresh muesli. A Czech eco-drugstore will be an integral part of the range,” explain Marta Dolanová and Petra Lorencová. Extra tip: The Bez obalu shop will be more than just a bricks-and-mortar shop: it will also be a meeting-place. The owners play to hold workshops on healthy nutrition, eco-cleaning, using cloth nappies, alternative hygiene aids, sewing cloth bags etc.

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revue Text: Luděk Vokáč, photo: LMC

FROM MINING TO PROGRAMMING

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M

iners from the discontinued Paskov Mine have swapped hard manual labour for programming. The Blazing A Trail retraining course helped them turn their careers around. The four men have one thing in common: drive and a desire to do all they can to succeed in a new career.

They are living proof of the saying “Where there’s a will, there’s a way”. Four former miners at Paskov Mine in Ostrava set off down a difficult road to retrain from mining to programming. This time, though, unlike in their former work below ground, they didn’t have to carve out a path through the rock face themselves. The Blazing A Trail retraining programme was initiated by LMC, the operator of the Jobs.cz website and other career-related enrolled with the mines in services.     “I  1989 to avoid military service,” Jaroslav Muta, one of the participants in the retraining programme, explains how he became a miner. When he then learnt that he would make only a fraction of the money if he worked elsewhere, he stuck with the demanding job even when his compulsory service ended. He finished school, took two extra one-year courses, learnt English and then, after being transferred to work above ground for medical reasons and at half pay, he completed a university course. Tomáš Hisem had originally intended to study at the military medical faculty in Hradec Králové, but family complications compelled him to work down the mines. He completed his miner’s school-leaving exams and, even though he could not possibly imagine going down a mine, he got used to and became fond of the work. “You never go back to the same place. Every day you cut away the coal; each time you advance, sometimes by as much as six metres,” Hisem says, explaining that he liked the diversity of his work and his fellow miners. “The public thinks they’re idiots. But these lads would give their life to get the coal onto the conveyor, to hit their targets,” he explained. At the end of March, he and the others all had to leave, because extraction in Paskov Mine ceased.      It was certain that numerous people in North Moravia would lose their jobs, it just wasn’t certain when. Persuading people that the project was meaningful thus had to start at OKD, which was preparing to shut down Paskov Mine and whose employees at the time might not have shown much interest in this somewhat “crazy” career change. If only because they, like many members of the public, regarded the idea of retraining miners into programmers as hopelessly ambitious. But the endeavour has been successful. “When our employees leave the mines,

they usually go into manufacturing, joining other industrial firms. Nevertheless, the chance of steering them into a field like IT seemed like such a wonderful dream that we were happy to support the idea,” declared Markéta Klopcová from the New Shift programme, under which OKD helps its employees find new work. The initial course organised by Czechitas in November last year ultimately attracted 17 employees; in February this year it was repeated for 22 more OKD employees. Seven graduates from the course also undertook intensive self-study and preparation for the tough exams that will enable them to join a retraining course at the Lifelong Learning Centre of the Ostrava University of Mining and Technology. The course focuses on the C# and Java programming languages and work with databases and website programming. Four participants have already joined the course. If everything has gone to plan, they are about now starting an internship at the Ostrava branch of LMC or in one of the partner firms. The three who completed the second round of initial training should have their turn in autumn.      It was the quartet of “finalists” from the project’s initial round who in the end became living proof that this ambitious idea is not at all utopian. According to reports from the courses, these participants are on the same level as the other retraining students. One even excelled, and the lecturers had no doubt he would pass right from the start. All of them went about training for a new career in programming with drive and hard work, though. It would have been impossible without these qualities. “We spoke to all of them, so we learnt about their lives. They kept learning all their lives. And they’re no quitters. Tomáš Hisem’s notebook broke, so he had to do all his preparation for the exams on a smartphone. Courage and willingness to learn are evidently excellent prerequisites for a career change at any age,” says LMC’s Tomáš Ervín Dombrovský. While they were still at OKD they worked hard on themselves and kept learning, which is one of the fundamental preconditions for any future career.      Referring to the current crop of course graduates, Dombrovský describes how necessary it is to prepare for possible career changes, even for people whose job seems secure today. “None of us can be sure that we will spend our entire working life in the field we studied years ago. Many professions and activities are dying out, some are being overtaken by new technologies, while other occupations are constantly being born. Even ostensibly stable professions are gradually being transformed in terms of the work involved. The trend is clear. We don’t need as many miners today, whereas there is a big shortage of people in IT. We

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One of the miners’ notebooks broke, so he prepared for the exam entirely on a smartphone


want to show that a move in this direction is possibly at practically any age and from any previous career. Almost everyone with the necessary desire and stamina can completely revamp their career,” he explains.     And this change brings major opportunities. There are hundreds of IT vacancies in the Moravian-Silesian Region alone and there is a critical shortage of candidates. Every IT job ad gets just nine responses on average. The Lifelong Learning Centre’s figures show that graduates from its courses find it very easy to get a job, partly because of this shortage of qualified candidates. Many of them find a job while still on the course, while the network administrator course boasts a ninety per cent success rate in finding work after completing 38

the course. The Blazing A Trail course has thus done a lot to highlight the reality of these opportunities. That is why the course has caught the attention of the media and young filmmakers. FAMU student Jindřich Andrš is making a documentary tracking the progress of four participants. The film should also help convince the general public that “Where there’s a will, there’s a way”. ◆

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ORGANIZED BY &

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revue Text: Anna Batistová

MARWICK’S PICKS NUTSHELL (IAN MCEWAN) Ian McEwan, British author, holder of the Order of the British Empire, winner of the prestigious Man Booker prize and author of The Cement Garden and Atonement, is bringing out his fourteenth novel this October. With the title Nutshell, the novel is a variation on the theme of Hamlet. The narrator is a nine-month-old embryo who describes from the womb how his mother Trudy and her lover Claude, the embryo’s uncle, are planning to murder the husband John. McEwan is one of the few authors whose entire oeuvre has been translated into Czech. Nutshell was translated by Ladislav Šenkyřík for the Odeon publishing house. GARDENING – THE DESERTER (JAN HŘEBEJK) The Deserter hits Czech cinemas at the end of September. The film is the second chapter in the family saga called Gardening, written by Petr Jarchovský and set against the backdrop of the turbulent events of 1947 to 1953. The main character is Otto Bock, the owner of Valentino, a luxury hairdressing salon in the centre of Prague (Jiří Macháček). After returning from a concentration camp, Otto opens his salon, employing his wife (Gabriela Míčová) and her sisters (Klára Melíšková and Aňa Geislerová). Then 1948 arrives: Otto’s firm is nationalised and for the second time in his life he loses everything… DVOŘÁK’S PRAGUE From September 7 to 23, Prague will host world-famous Czech and international musicians at the tenth Dvořák’s Prague classical music festival. The festival opens on September 7 with Dvořák’s Stabat Mater oratorio, featuring four outstanding soloists: Kristine Opolais, Piotr Beczala, René Pape (all from the Metropolitan Opera) and Slovak Jana Kurucová (Deutsche Oper). The following days will offer performances by ensembles such as the London Philharmonic Orchestra and the Essener Philharmoniker with conductor Tomáš Netopil. Netopil will also conduct the closing concert featuring the Vienna Symphony Orchestra and soloists Adam Plachetka and Simona Šaturová. 40

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FOCUS: KALFAŘ OF BOHEMIA W

hen twenty-nine year old author Jaroslav Kalfař completed his debut novel Spaceman of Bohemia in New York, he spent a year looking for an agent. He survived on bananas, rice and tinned food. Just when he was about to give up, Mary Spence took a shine to his manuscript, and soon afterwards publishing houses began to fight over the rights to it. Kalfař received 400,000 dollars for his novel and, even more importantly, favourable reviews came out in prestigious newspapers like the New York Times and Wall Street Journal and also in the Financial Times and The Guardian in the UK.

INTERNATIONAL REACTIONS: Financial Times: “A Czech astronaut searching for a dust cloud stars in an ironic debut about national identity.” (Ken Kalfus) New York Times: “Jaroslav Kalfař’s Spaceman of Bohemia is a frenetically imaginative first effort booming with vitality and originality… His voice is distinct enough to leave tread marks… He has a great snout for the absurd.” (Jennifer Senior) The Guardian: “Kalfař emigrated to the US as a teenager. He writes in English and lives in Brooklyn, but you wouldn’t glean that from the text. It feels more like a superbly translated Czech novel. There are nods to Bohumil Hrabal and Josef Škvorecký. The relentlessly inventive style made me think of the zaniness of Karel Čapek’s War with the Newts and his classic sci-fi play about Rossum’s Universal Robots, R.U.R.” (Tibor Fischer) WHO IS JAROSLAV KALFAŘ? Author Jaroslav Kalfař (* 1988) was born and grew up in Prague but has lived in the USA since he was fifteen. He studied at New York University, where he attended lectures by renowned American author Jonathan Safran Foer, and won a prestigious E. L. Doctorow Fellowship. His literary debut Spaceman of Bohemia was published by Little, Brown and Company in 2017.

WHAT IS SPACEMAN OF BOHEMIA ABOUT? A strange cloud has appeared in the solar system, promising to reveal many secrets of the universe. A small country in the middle of Europe, the Czech Republic, decides to send its astronaut to Venus. Will Jakub Procházka become the most famous man on Earth or is the entire project doomed to fail, either due to the unknown nature of the cloud or because Jakub carries with him the burden of the past in addition to his scientific experience? Jakub’s father had been a secret policeman before the Velvet Revolution. Astrophysicist Jakub Procházka wants to rehabilitate his family’s name and win fame for his native country – that is why he leaves his wife Lenka and heads for the stars in 2018. While in space, though, he loses both his wife and, seemingly, his mind when an extra-terrestrial called Hanuš becomes his companion on board the rocket named Jan Hus 1. Every day I continued to receive emails from Petr outlining the detailed schedule of tasks to complete before reaching my target. Filter testing, sensor cleaning, a more rigid exercise program to prepare me for possible emergency protocols, video chat events to satisfy the sense of ownership and pride of the taxpayers. I performed these tasks dutifully but without much excitement. All I could think about was the creature, its weight, its voice defying sound waves; or Lenka, Central’s inability to find her, the silence, my resentment building up against her despite my best efforts. The pursuit of Chopra seemed ill-timed, perhaps even no longer worth the time and currency in the face of terrestrial intelligent life. From the book “Spaceman of Bohemia” by Jaroslav Kalfař

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revue Text: Anna Batistová, photo: Juliana Vlčková

To the ends of the Earth

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flight dispatched to wherever you fancy within three hours, pilots in RAF uniform, and complete discretion. Welcome to the world of bizjet, or flights on private jets. When we meet Richard Santus, pilot and director of the Aeropartner airline, at Prague Airport, we joke that the interview might have to take place in the air. A few minutes before the photographer and I arrived, the entrepreneur and champion of Czech aviation found out he would be flying to Moscow. “That’s the way it goes here,” smiles the owner of a firm that rents out small jets and, besides standard private flights, is one of the few Czech companies that operates an air ambulance service. And business is booming. “Next year we plan to step up to a higher class of aircraft and expect our turnover to jump to as much as CZK 300 million,” Santus says. Richard Santus was born into an aviation family in Pardubice. He studied at the Secondary Machinery and Industrial School in Hradec Králové and the Faculty of Physical Education and Sport of Charles University in Prague. He founded the Aeropartner airline in 2001. In addition to running his own business, he still performs test flights and demonstration flights and works as a flying instructor. He took part in an expedition to the North Pole, which he and Petr Bold reached in a historic L­200 Morava plane from the 1950s. One of his long-term endeavours is to promote the legacy of Czechoslovak pilots who flew for the RAF during World War II. You’ve flown all kinds of aircraft since you were fourteen – first gliders, then sports aircraft, ultra-lights, passenger and also historic planes, balloons and helicopters… But what motivated you to found the firm we’re now sitting in? The first impulse came when I was just five. I refused to listen when people told me what to do. It’s not that I didn’t respect authority. It’s just that the person above you in the hierarchy is often not a natural authority. At the age of five I ran away from home, and things carried on from there: I was a terrible rebel at school, on military service and at work, so I decided to stand on my own two feet. I went into business in 1996 and founded Aeropartner five years later. What vision did you have when you founded the company? If you’d asked me eight years ago, I would have said that my vision was the situation where I am today. Honestly, during the crisis period I couldn’t imagine being able to build up a relatively flourishing business. Flying passengers by jet plane from airport to airport is pretty standard. Since we acquired a helicopter, however, we genuinely fly people to the very ends of the earth. Of course I know that there is room for further expansion through

improving services, flying longer distances or having greater transport capacities. And I personally am very interested in continuing to work on our air ambulance service. That, too, is commercially interesting, but for me it also has a human dimension. We’re helping people who are in a condition where only air transport is possible. This mainly involves newborn babies with a congenital defect. Because we’ve been able to offer our aircraft for ambulance purposes, we have made it possible for many families to get treatment in specialised cardio centres. Before, this service was either not available at all or was so expensive that the local insurance companies did not allow it. Are transfers of newborn babies covered by insurance? Yes, transfers of babies are always paid for by a foreign insurance company. We have a stateof-the-art children’s cardio centre in Czechia that is one of the three best specialised care centres for newborn babies in Europe. In countries that don’t have this kind of cardio centre it is much more complicated, of course. You can’t transport the newborn babies by road: it has to be much faster. So our airline transports foreign newborn babies, with their mother or both parents, to either Motol Hospital in Prague or, if Motol is full, to Germany or Italy. Having said that you couldn’t have imagined eight years ago where you are today, could you express the firm’s rapid growth in figures? Today we employ twenty-five people and our turnover is roughly CZK 160 million. The trend is one of growth, though, so if we are talking about 2018 we should have two more airplanes and one more helicopter. We are planning to make the step up to a higher category of “midsize aircraft” and will have around thirty-five employees. That will make our turnover jump to as much as CZK 300 million. Is there some service you would in future like to add to the ones you already provide today? There are three basic segments in air transport: passenger flights, ambulance services and cargo – and we already do all of that today. Naturally, one future development that is no longer remote is unpiloted flights. Who knows what the world will be like in thirty years’ time? First and foremost, military aircraft will largely be unpiloted, because that is the direction we are clearly heading. Attacks from the air will be controlled by someone on the ground. The profession of fighter pilot may disappear completely in the next thirty years, replaced by drones or ground-to-air missiles. That’s more effective and incomparably cheaper. There is only a psychological boundary, not a technological one. Will people be willing to board a passenger plane that has no humans in the cockpit? We’ll see. But in this field, which is experiencing rapid development, we have to go with the times – there’s no choice.

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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Let’s come back to the present. Let’s imagine I am your client and I call you to say I want you to fly me to Dubrovnik, say. How long do you need before we can take off? You’re on board the plane within three hours after confirming the order. And that applies to the majority of European destinations, not just Dubrovnik. As far as ambulance flights are concerned, when time is obviously the overriding concern, we can get a plane off the ground in less than three hours. How much does that kind of private flight cost? A return flight to the Mediterranean, since you mentioned Dubrovnik, will cost you approximately CZK 185,000. How many Czech clients do you have? For our passenger flights, which make up about 80% of all our flights, we have a higher proportion of local clients than any Czech charter firm. I’d say it’s around fifty-fifty. What would persuade me to choose your firm? With us you fly when you want and where you want. If you’re late, the plane waits for you. If you decide you want to then fly on somewhere else, that’s possible too. We also try to ensure that nobody knows who flies with us, or who has flown or is planning to fly with us. You won’t find us in airport flight schedules. We lose out on advertising in this way because we appear not to exist, but discretion is our priority. And, last but not least, you’ll enjoy much 44

greater comfort with us than in a passenger plane. The passengers’ cabin is roomier, we have leather seats and we offer customised catering to serve you precisely what you are used to or feel like at the given moment. On your website you say you are able to fly people anywhere. Are there really no limits? There are limits, and the first is the weather. If there’s thick fog at the airport that prevents landing even by instruments, we wait until the weather improves or offer an alternative airport. The second obvious limitation is the runway. We can’t land at an airport whose runway is only 900 metres long, say. On the other hand we can land on much shorter runways than big passenger planes, so it is easier for us to fly passengers as close to their final destination as possible, and since we acquired a helicopter we can basically take you exactly where you want to end up. Are there countries you don’t fly to for security reasons? Definitely. But the geopolitical situation does not change things much in our branch. For years and years the Middle East has been a dangerous destination. In Syria the restrictions are relatively new. Flying there was relatively safe until the war started. There are certain restrictions in Pakistan and, obviously, Iraq. In Africa, the Congo or the Central African Republic are problematic. But if someone needs to fly there,

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


the geopolitical risk at that particular moment has to be considered. Even if we say that a specific airport is safe in operational terms, we still consult with an insurance company and then either offer the flight or say it’s not possible. You use Cessna aircraft. Can you tell us a bit about them? I have eight Cessna Citation jet aircraft, from the smallest, which is for two to four passengers, to the biggest, which is for two to seven passengers. Of course, the bigger the plane, the faster it is, the longer its range and the more comfortable it is. The aircraft are made in America and it is the most popular “bizjet” (private flights) brand in the world. We have very good experience with Cessna and they have excellent service centres. Replaceability is also important for us. Having aircraft from a single family makes it easy for us to replace an airplane that is not available for some reason with another. You lease all the aircraft. How does that work? Usually, the person who owns a private jet has it for his own requirements but does not make full use of the aircraft’s capacity, because he only needs it once or twice a month. And an aircraft on the ground becomes terribly expensive. That’s why we use the aircraft’s idle capacity on the charter market. When we sell a flight, we make money on it, of course, and pay rent to the jet’s owner. Do you still have time for test flying or giving lessons? Yes, because I still enjoy it and because it makes me feel useful. There aren’t many people with the necessary qualifications and, most importantly, experience. Every aircraft manufacturer will confirm that, especially those in Czechia. The pilots who have devoted their whole lives to it are today at any age when they should be taking it easy and we don’t have new ones, because flying passenger aircraft is more appealing to young boys and girls and they have little interest in flying small aircraft and crop dusters or giving lessons in flying schools. But above all I’m a patriot in this regard. If we talk about Zlín, which is the parent factory of our well-known brand from 1934, that is a tradition we can be proud of. They have made thousands and thousands of aircraft that fly all over the world. Today they have a renewed manufacturing programme and there is demand around the world for their aircraft, but like in every industrial sector they suffer from a shortage of qualified personnel, both in manufacturing and in our area of product testing. I’m really glad to help Zlín get back into the spotlight and to help their aircraft sell. They are never going to make and sell dozens a month, as they used to. But if we can help the factory increase its output to four to six units a month, I’ll consider that a huge success.

You said an interesting thing: that young girls also fly. What is the percentage of female pilots? It’s still small. I’d say that’s because most women or girls can’t see themselves in this profession and opt for an occupation that is more typical for women. But there’s no real reason for that, because there are no gender-based barriers for women even in passenger airlines and they have exactly the same qualities as men. And my experience from giving flying lessons has shown me that women and girls are much more disciplined during training. They do what they are told without trying to come up with something better when there’s nothing new under the sun. That’s a typical male quality. If you tell a fifty-year-old businessman learning to fly that he has to fly in a certain way, he will deliberately do it slightly differently because he’ll say to himself that it’s all nonsense. But then he finds out that it’s not nonsense and his training takes longer. Women really behave exactly as instructed: they don’t try to come up with stupid ideas, which is a very valuable thing in passenger aviation. Discipline is a huge advantage. Let’s move away from flying as your occupation to flying as your hobby. Which aircraft you fly are you fondest of and feel best in? Historic aircraft are my passion. I am fortunate to be able to fly an aircraft from 1939 that Czech pilots in England used to train in. For one thing, I enjoy that because it gives me, let’s say, professional satisfaction, and for another it’s a good opportunity to stress the legacy of Czech RAF pilots. In my free time, whenever I can, I try to demonstrate the aircraft at air shows, get some photographs taken or make it available it for filmmakers. One reason I do this is because, at a time when there is only one pilot who served in the Czechoslovak RAF squadron in Britain still alive, I don’t want the legacy of the Czechoslovak pilots to be completely forgotten. Do your pilots still fly in RAF uniforms, then? Yes. That is my contribution to the company. I’m a bit obsessed with this and I don’t know whether the other pilots share my obsession, but they are all aware of the historic legacy of Czechoslovak RAF pilots. Most of the pilots are proud to wear the RAF uniform. I have to mention, though, that our uniforms are based on the service apparel of the time but are made from lighter, airier materials. Even people who are ignorant of Czechoslovak history can tell they are historic uniforms, and when they ask what the uniforms are they usually say they’ve heard of that or seen it somewhere. And when someone comes and says straight out, “Wow, your uniforms are like those worn by our pilots in England!” that’s a good thing, I think. ◆

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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revue

KLÁRA SPILKOVÁ ON HER TRAVELS / CHICAGO W

here you can get a good meal, what various courses are like… Klára Spilková, the Czech Republic’s best female golfer, shares her tips and experiences from her golfing travels around the world with readers of Marwick.

America again this year! The first time I played there was thanks to an invitation from KPMG and my first tournament was a major. That was repeated this year, and I’d like to express my gratitude for that. That’s why I headed off to Chicago at the start of summer. A short way from there, on the Olympia Fields course, I played in the KPMG Women’s PGA Championship. It’s a huge golfing event involving the best players in the world. I made the cut, which was my primary goal. I gained lots of experience there. I flew in to Chicago on a Sunday and the tournament began on Thursday, so this time I had more time to check out the area. We stayed a halfhour drive or so south of the city. We went into the centre twice, and once to the oldest baseball stadium in America, the home of the legendary Cubs. Being inside the stadium was a great experience even though there wasn’t a game on that day. At least we took some photos of ourselves in the empty stands. The centre of Chicago reminded me of New York – skyscrapers, lots of people in the streets, everywhere the hustle and bustle of the big city. One counterpoint to that was a walk on the shore of Lake Michigan, whose size makes it resemble a sea. And, being in the USA, we couldn’t miss trying a genuine American restaurant, where we ordered a huge chunk of meat. I hope I’ll return to America for the LPGA some time soon.

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


KLÁRA SPILKOVÁ TRAVELS THE WORLD WITH MARWICK READERS

Chicago Sitges

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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revue Text: Pavla Čechová, photo: Tomáš Hercog

iKID: KIDS IN THE WORLD OF START-UPS

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© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


C

an primary-school kids be innovative and capable of coming up with viable business ideas? That is being tested by the iKid project, which inspires children to have a go in collaboration with teachers and mentors. They are given six months to present their ideas and make a prototype. An application that makes learning fun for kids and also more effective because you only need to take a photo of some text and underline important concepts for it to generate questions for you. A folding ramp that helps wheelchair users climb two steps. A special backstop making it possible to rock on a chair in complete safety. Those are just some of the children’s ideas to emerge from the second year of the iKid competition project. The man behind the idea was Kenneth Ryan, managing partner at KPMG Slovakia, who wanted to innovate traditional tuition methods. KPMG Česká republika then brought iKid into the Czech environment.     The tuition is indeed untraditional. Over five stages, children learn what it means to found their own start-up and set it in motion. They have just six months to come up with their own project, present it and build a product prototype. In each phase they are helped by two people: a teacher and a mentor. This year’s winning team comes from the 3rd Primary School in Slaný; coincidentally, that is the school that triumphed last year, in the competition’s first year. Then it was a team of sixth-graders, led by

maths teacher Pavla Nečasová, whose idea for a powerbank on a bicycle called iCharge won over the jury. “After our victory we contacted several Czech firms that make bicycles. There was also a meeting with Jiří Salivar from the firm Amulet. He is now working on developing the product and is in touch with the kids,” Pavla Nečasová says, describing the current state of play and adding that it’s not yet certain whether iCharge will successfully be put on the market.      When KPMG offered her the chance to be a mentor, the main factor in her decision to accept was that the children had had a lot of fun with the competition and she wanted another group of children from her school to be able to enjoy it. This time the team’s leader was Czech language teacher Soňa Hamzová. “We had a lot of very smart kids in sixth grade and my colleagues thought the project should continue and I should lead their work. The idea seemed absurd to me. I’m not the technical type and I don’t see myself as practical at all,” Soňa Hamzová admits.     In the end, though, taking part in the competition was highly enriching for her and for the kids. “The Easy Eating meals set that won the kids the prize was invented by Lucka, one of three girls in our team. She had a grandmother who had long been bed-ridden and had trouble taking in food. Lucka’s grandmother died several years ago, but the memory of the end of her life has stayed with the girl to this day,” Soňa Hamzová says. As Lucie often spoke about not being able to help her grandmother, she came up with the idea GET INVOLVED IN IKID KPMG is gearing up for the third year of the successful competition that gives valuable experiences to both schoolchildren and their teachers and mentors. Do you want to become a part of this adventure and guide children through the world of innovations and start-ups? Don’t forget to register as a mentor or partner at www.ikid.cz.

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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of Easy Eating – a set of crockery with a tilted base, an ergonomic grip and an anti-slip and thermo-regulatory layer. The kids made it with a 3D printer and now they want to develop it further. Most of the ideas the kids came up with were linked to helping others.     “We worked closely with the teacher,” their mentor says. “The children had a huge number of ideas. Some were brilliant but hard to execute. Our task was to set them off in the right direction so they didn’t lose time. In the next phase we had to find a firm to make the prototype with a 3D printer and to recommend a program to the kids for creating a logo,” Pavla Nečasová says, describing the tasks she faced.      The winning team and their teacher gained a lot of valuable experience from the competition. “On the school premises the kids got the opportunity to enter a world of imagination, fun, creativity and limitless possibilities, a world where they could come up with and realise their ideas, make them a reality and watch their ideas take shape,” recalls Soňa Hamzová. In her view, the children will now have more confidence in being able to do anything they put their minds to, as 50

long as they are willing to make sacrifices for their ideas. “Now they have a better understanding than other kids of their age that things just aren’t possible without effort – and that is doubly true in real life. We have to put our hearts into everything,” says Soňa Hamzová.     It’s  not sure yet whether the winning team from Slaný will take their idea further. “The kids are delighted and really do have lots of ideas. They’ve already added an ergonomically shaped tray to the set. It was made in a garage in Slaný and has lots of practical design features. We’ll see what the start of the academic year brings,” says Soňa Hamzová.     One thing is certain, though. In the autumn the kids will go to Ireland. That is because the Česká spořitelna prize for the winning team, like last year, is an excursion to the Irish branches of Facebook and Google. The trip was an unforgettable experience for last year’s winners. “The trip to Ireland was amazing, everything from our host to the programme itself. The kids came back delighted and enthusiastic. Now that they’ve visited Facebook and Google, they know where they want to work one day,” Pavla Nečasová adds. ◆

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


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The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we

endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. The views and opinions expressed herein are those of the interviewees/survey respondents/authors and do not necessarily represent the

views and opinions of KPMG in the Czech Republic.

© 2017 KPMG Česká republika, s.r.o., a Czech limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Marwick September/October 2017  
Marwick September/October 2017  

A magazine for clients and friends of KPMG Czech Republic.