Serhiy Detyuk: We Shifted Focus From Strategic Development To Business Operations Support

Serhiy Detyuk, CIO of Metinvest Group and CEO of Metinvest Digital, has told about Metinvest Digital's results by 2022, changes in the company's priorities since the outbreak of the war, and current plans of Metinvest Group's IT partner.

What was Metinvest Digital's status quo as it headed into 2022?

- Several aspects are worth mentioning. To start, it is the implementation of a Metinvest Group comprehensive digitalization program. We launched it in 12 areas and demonstrated 90% progress on the plans for the first year. In the meantime, as business orders grew by 40%, we implemented twice as many projects as last year.

The second aspect is the development of in-house expertise.  We built up expertise in the engineering, cybersecurity, project management, big data, technology scouting, and service support.  To date, more than 70% of projects are implemented using only in-house resources and expertise of Metinvest Digital. During the pandemic, we made significant headway and strengthened our capabilities to effectively support remote work. Thanks to cloud technologies, we became more flexible and faster in responding to emergencies and learnt to effectively align to the new reality and a rapidly changing external environment. As a result, we ensure 99.9% reliability of our infrastructure and services. 

And the third one is plans. Amid a rising trend in the steel market, the Group's requests for the implementation of comprehensive programs and projects increased. We headed into 2022 with an ambitious investment program. Its main focus was on the production and industrial automation:  creating enterprise data warehouses, rolling out a hot metal silicon prediction project, creating new AI-based optimization models, designing and implementing MES systems for steelmaking and mining, digitalization of the mine processing plants, and so on.

How has the war affected the company and what changes in operations and development plans has it entailed?

- Until the last moment, we did not want to believe that the war would start. However, we already had gone through a stress test with the corona virus pandemic and, technology-wise, we were prepared to face a "black swan".  Since the early days of the war, we have been carrying on our main task as an IT partner - ensuring the continuity of IT services for Group. Given the mass relocation of a large number of employees and a rise in the number of non-standard tasks, the support workload has increased significantly. For example, we have set up back-up control centers equipped with computer and telephone communication in 38 bomb shelters on our industrial sites. We have launched a Starlink system at eight enterprises to ensure continuous back-up communication. In addition, we have provided several enterprises with satellite communication. Despite regular damages, we continue to promptly restore communication channels and ensure the functionality of IT systems.

We have put special emphasis on business cyber security and increased the priority of this area. The aggressor has made more than 800 cyber-attacks at various sectors of the economy in the first 4 months of the war, according to the State Service of Special Communication. In our case, the number of attacks has increased by approximately 75%. We have increased personnel engaged in this area, and our Cyber Security Center has switched to the 24/7 operations, since almost half of attacks take place outside of the business hours. This enables us to timely detect and respond to potential cyber threats in a proactive way.

When it comes to the project portfolio, the war has dramatically changed our plans and made us revisit priorities.  We have shifted focus from strategic development to business operations support.  On the one hand, the loss of industrial sites has automatically reduced the number of projects. On the other hand, we have been faced with the question about the advisability of investments in our technology projects at the operations, which have quite a long investment period - over one year, on average.  As a result, we have left close to a one-third of 90 projects planned at the beginning of the year in the portfolio. Primarily, these are digital initiatives, which are essential to business operations support.

However, the other side of this uneasy decision to cut the number of projects is that the funding from Group has been curtailed, and funds have been re-directed to help Ukraine and Ukrainians. Since the early days of the war, Metinvest has been actively helping the country in its fight against the Russian aggression, donating more than UAH 1.5 billion for aid to the Ukrainian army and civilians. This includes personal protective gear for the Armed Forces of Ukraine, food and essential items for the affected people, medical equipment and medicines, and, of course, aid to the company's employees. Metinvest's enterprises have been actively engaged in producing and supplying the country with armour plates, anti-tank and anti-landing hedgehogs, and spiked strips against wheeled vehicles free of charge.

Also, in cooperating with key vendors, e.g., SAP and Microsoft, we have been maintaining a dialogue not only in the context of business tasks but also on the issue of the war against Russia, our partners pulling out of the aggressor country's market, and the necessity of supporting Ukraine in times of war.

What are the company's plans for the near future?

Two vectors are worth mentioning. The first one is the IT support of Metinvest Group's activities and ensuring the continuous operation of the company's complex technological landscape. We understand the level of responsibility and are strongly focused on the operational efficiency of our services. We are continuing to implement projects and discussing a number of new initiatives, including the strategic ones, such as the implementation of SAP ERP at Kamet-Steel and Metinvest Polska.  Aside from this, we are seeking out new ways of implementing them, since the old ways of implementing solutions based on "best practices" do not match the situation any more.

Another vector is keeping the acquired knowledge and skills. Metinvest Digital is a company with unique expertise. As one of the largest corporate integrators and IT partners of the Group, we have both the extensive IT expertise and a deep understanding of production and business processes in the mining and metals sectors, which took years to acquire.  Our company is responsible for not only implementing new technologies and supporting them in the future, but, primarily, for the result and, ultimately, benefit for the business customer. We must keep our competencies to the maximum extent to effectively work on future digital transformation projects.

How has the war affected Metinvest Digital's team?

 It might seem weird, but the war has improved our efficiency. Tough times provide an imperative to get rid of unnecessary things and keep the essential ones. Bureaucratic procedures take a back seat to effective communications. People are focused on achieving the overall result rather than on processes. Ultimately, it is a win-win both for the team and the client: this generates more trust and support and reduces the decision-making timeline and the time spent on meetings and discussions. We maintain a constant dialogue inside the team, openly discussing the current situation in Ukraine and inside the company on various internal platforms: town hall meetings with employees, meeting with the management, and online events in the corporate social network. All of these enable us to be in the common information space and facilitate the knowledge-sharing and new ideas. I am grateful to each employee and the team as a whole for their dedication and commitment to achieving the team goal.