An interview with our CEO not only on the topic of digitalization of the state administration is published both in the printed Hospodářské noviny and online on its website.
In the interview, you will read, for example, about the level of digitalization of the state administration in our country compared to the European Union, about our cooperation with Yaskawa, about our expansion into the international market with the VacayMyWay.com project and a little about our plans for the future.
You can read the article in Czech here, or the full transcript in English below.
You can put your name to good work, OKsystem reports in its campaign. The talented tennis players Linda Nosková and Jakub Menšík, who are supported by the IT company, sign the billboards for the company. It's not a coincidental connection: founder Martin Procházka is a big tennis fan and a champion not only of veteran tournaments.
OKsystem is one of the traditional Czech IT suppliers, its software can be found in many ministries, offices and private companies. And not only in the Czech Republic - in the United States, for example, it is the main software supplier of the VacayMyWay.com project, which is a portal for short-term accommodation and a competitor of Airbnb. The Prague-based company is also growing in the robotics sector, where it cooperates with Yaskawa, one of the largest manufacturers of industrial robots in the world.
The company has grown to more than 500 employees with a turnover of over CZK 800 million in almost 35 years of existence. "I believe that this year we will have over a billion for the first time," says Vítězslav Ciml, CEO and co-owner of OKsystem.
You are one of the largest suppliers of IT solutions for the state. What exactly do you do for it?
Primarily, we work for the Ministry of Labor and Social Affairs, ever since 1993. Initially, we developed a system for non-insurance social benefits and unemployment benefits, and we've maintained this expertise to this day. What clients encounter at labor offices flows through our systems. Over time, projects at the Czech Social Security Administration were added, specifically the collection of insurance premiums from self-employed persons.
But you haven't always had an easy position at the Ministry of Labor.
Yes, at one time there was a tendency to replace us. For a long time, the ministry was criticized as the department with the worst IT. For years, we offered ways to modernize it, but no one took notice. No one had the desire to do it. That has changed—or rather, it has completely turned around. The Ministry of Labor is now an exemplar in digitalization (a model for other institutions—ed. note). This is largely thanks to Deputy Minister Karel Trpkoš, who oversees it. He's an experienced manager who has worked in IT his whole life. The ministry has the portal Jenda, an acronym for "Jednoduše na dávky" ("Simply for Benefits"), where most tasks can be handled, much like in online banking. It finally looks like we're in the 21st century.
Last year, problems arose with delays in benefit payments. What happened?
Labor offices couldn't keep up with processing benefit applications. The bottleneck wasn't in the systems. Typically, it was the Prague branches, and it was related to the war in Ukraine—many refugees came to us, the state offered them benefits, and officials suddenly had a sharp increase in workload to process. Instead of managing to process them within the legal 30-day period, somewhere it took up to three months. The problem was largely eliminated by creating a backend system that can distribute individual applications according to capacity across the entire country. An application from Prague can easily be processed in Moravia.
What exactly are your solutions?
We supply large information systems—both the backend, meaning the invisible parts like databases and business logic, and the frontend, the part users interact with. These can be tens of thousands of users or even millions of people who visit the portal to apply for benefits, communicate with the office, or retrieve a payslip in our system. Our expertise ranges from project design and management through analysis, graphic processing, and actual development to subsequent aspects like testing and user experience. We cover the entire lifecycle of digitalization projects.
Is all of this custom software?
Not all of it; part of it uses our ready-made products. For example, OKbase, which is one of the largest personnel information systems on the Czech market, or Checkbot, which is a program for industrial robots. We actually have three business pillars: the first is software development, the second is a product portfolio of software solutions, and the third—and this isn't well known about us, even though OKsystem started with it in 1990—we operate an IT training center.
Where is your personnel information system used?
At the Ministries of Education, Transport, and Culture, as well as the State Agricultural and Intervention Fund, the Support and Guarantee Agricultural and Forestry Fund... there are many offices. However, there are even more customers among private companies: Billa, Penny, Linet, CSG, Omnipol, KFC... OKbase has nearly 400 clients, and almost 400,000 people are managed by our system.
What is good about it?
It has a whole range of functions, but I'll mention the shift planning module. This applies to operations like Costa Coffee or manufacturing companies. We've implemented machine learning that can replace the person tasked with planning shifts and resolving subsequent changes in an existing schedule. Our software offers employees the ability to set preferences for when they'd like to work or not; we have a shift exchange platform, and so on. Instead of someone constantly using Excel and calling around to see if John can cover for Paul, the program does it itself. We have it deployed, for example, at the General University Hospital on Karlovo náměstí, and they're thrilled.
Tell me something about Checkbot as well. Does it control robotic arms in factories?
No, we don't control them. Manufacturing companies handle robot control themselves; we manage their monitoring—we analyze enormous amounts of data from all the sensors they're equipped with in real time and visualize the data clearly. It has many functions; besides providing a current overview, it's also useful for predictive maintenance. In operation, they know in advance that the gearbox on a robot arm is starting to show a temperature change and that they should look at it during the next shutdown. This significantly reduces costs associated with unplanned production interruptions. That's always the worst thing that can happen to manufacturing companies.
Due to the unsuccessful digital building permit process, digitalization in public administration is a big topic. How do you think we are doing?
When implementing projects, we meet partners from the IT world all over the globe, and when we discuss digitalization projects in the Czech Republic, they're usually surprised by what can be handled remotely here. What we have in our country is certainly not the EU average. We're much higher.
But then there are also top performers like Estonia.
Sure, the Nordic countries are the furthest ahead. But Germany or Britain? For them, it's science fiction not to visit an office and handle things online. In this comparison, we're not doing badly at all. For example, how our cadastral map is processed—there's nothing better in Europe. Generally speaking, COVID harmed the economy a lot but brought significant progress in public administration digitalization. The issue with the digital building permit process saddens me because it revives the bad taste that anything launched in public administration related to digitalization is always a fiasco. That's not true. Successful projects are always talked about less than the unsuccessful ones.
And what's your opinion on that?
Many people have asked me, but I always reply that it's liberating not to have to have an opinion on it. It's a very complex case, and I'm not familiar with the details, so I won't proclaim anything offhand. It certainly could have been done better, but did they have the right conditions for it? I don't know.
Apart from IT, your company also engages in an unconventional business: importing Italian wine and oil. Why?
We are the majority owner of VinoDoc, which is a direct importer. It's a nice complementary activity to software, which you can't touch. It's nice to have a glass with someone. We operate several e-shops, including our own and, for example, HNvíno.
Please briefly describe the beginning of the OKsystem story.
The company was founded by four friends who decided to start a business after the revolution. Around 2016, the partners reached retirement age and wanted to sell their shares, so Martin Procházka bought out the others' shares. Since 2018, we have fulfilled the characteristics of a family business: Martin is the majority owner and has both his daughters here. They started at the bottom in the company and today are members of senior management. Last year, they also became minority co-owners.
How much is Mr. Procházka still involved in the management of the company?
He is the chairman of the board, participates in strategic management, and attends leadership meetings. We talk a lot; he's interested in it. He's also very often on the tennis court—at 71, he plays tournaments and always boasts about winning another trophy and beating some thirty-year-old in the final.
This year, you will surpass one billion crowns in turnover for the first time. Is ongoing digitalization driving you forward?
Yes. It's not just about new customers; existing ones also want to continue digitalizing processes and services. The most popular now is electronic document signing. We tell customers: paperless HR doesn't mean you'll have contracts as electronic documents but that information should have a different form. The fact that someone has reviewed it can now be beautifully audited using a token, and the goal is definitely not to have a PDF that someone will print out anyway.
Does your profit mirror your turnover development?
We have the advantage that we don't answer to any foreign parent company, so we don't feel the need to push and adjust things. It always depends on which year big projects fall into. Last year, we had a profit of 100 million crowns, but this year we'll do better because some revenues are carrying over from last year. We consistently maintain around 15 percent profitability.
Are you limited by the lack of people in IT?
It's true that for a long time, there weren't enough people. However, since the spring of this year, we've felt a big change in the IT labor market. Suddenly, people are available, and their demands aren't excessive. The years 2021 and 2022 were completely crazy in this regard.
How do you explain the change?
It could be due to layoffs in large tech companies. On the other hand, in Prague, others have opened their development centers in the meantime. Maybe we just have a better position because we are more active in the market and more visible in marketing. And people are happy with us; in the Atmoskop employee satisfaction index, we're at the very top.
Do you have a vision for what to do with the company next?
To offer value-added solutions and have satisfied employees. I know it's a "soft" answer, but many factors will influence the hard numbers, and projections can be completely derailed. I'm not shirking responsibility, and I don't think we should be motivated by the theory of degrowth, but at the same time, I don't want to draw endless "hockey sticks" on the upward path.
