Delivering under pressure
How Igor Smelyansky leveraged his Georgetown MBA to adapt Ukraine’s national postal service to the chaos of war
By Dan Morrell for Georgetown University’s McDonough School of Business
February 13, 2024
A few months after Russia invaded Ukraine in February 2022, Igor Smelyansky, the head of Ukraine’s national postal service, Ukrposhta, headed to the country’s eastern Donetsk region to help his workers make deliveries. He hadn’t told his wife, so as not to worry her, but the risks were real. The region had been shelled almost constantly for weeks by Russian forces, and Smelyansky and his colleagues sped through the area in an armored vehicle.
But the need was great: 3.5 million Ukrainians rely on regular, cash pension payments and a disruption in distribution could mean catastrophe.
In one of the towns Smelyansky stopped in that day, a group of 97 people gathered to collect their pension payments. One woman told Smelyansky the money would allow her to buy her first real meal since the start of the shelling. Another handed Smelyansky a request to call her daughter and let her know she was alive.
As Ukraine continues to fight against the Russian invasion, the challenges are dire for Ukrposhta. Within the first year, they lost seven employees in the conflict and over $30 million.
And yet Smelyansky has produced remarkable results under these extreme conditions. He led the service to deliver 87 percent of pensions by hand in March and has helped open 29 new physical branches and some 500 new mobile branches during the war. He even launched shops on eBay and Amazon, inspired in part by the global interest in a stamp commemorating an exchange between Russian sailors and Ukrainian defenders of Snake Island.
“There is no book about how to manage a company during the war,” says Smelyansky. “I hope no one writes it, because I hope no one else needs it. But we are learning it every day.”
Running Ukrposhta is not the natural culmination of Smelyansky’s career experience. An entrepreneur from an early age, selling ice cream as a 16-year-old on the beach in his native Odessa, he would later open a cafe and fall in love with business. He dreamt of moving to New York City to see how Wall Street worked — and rebuffed invitations to join the young communist movement. “For me, freedom was a big thing,” he says. “And having a business — having income, having freedom to do what you like to do, not what you’ve been told to do — was always very important.”
After earning his undergraduate degree in New York, a bit of Hollywood inspiration led him into mergers and acquisitions. “You know, you watch all those movies like ‘Wall Street,’ and you get engaged in how cool it is,” he says with a laugh. But to be a proficient dealmaker, he knew he needed a deeper background in both business and law, and pursued his MBA at Georgetown University’s McDonough School of Business concurrently with a law degree.
The Georgetown experience gave Smelyansky both the deep grounding in strategy he was looking for as well as a strong network.
“It’s one of the coolest things that Georgetown is able to do: to get together a group of people who seemingly have totally different backgrounds and experiences—many from different countries—and have a truly unique class.”
Taking a job in consulting after Georgetown, Smelyansky almost immediately found himself working in his ideal field of M&A. “There was a $1 billion deal in Ukraine that no one knew how to do,” he says. “And they said, ‘You are from Ukraine, and you have an MBA — let’s give it a try.’ In a weird way, that’s how my dream came true.”
But as his career progressed, the work started to lose its luster. “Consulting teaches you a lot, but oftentimes you don’t see the results,” he says. When he would talk to his two sons about his work, they would ask to see what exactly he had changed. “No, what I did was strategy,” he would tell them. “And oftentimes, strategies don’t get realized.”
When the opportunity to lead Ukrposhta arose in 2016, he saw the chance to make his mark on a public sector organization with a very poor reputation for service. But the challenges he encountered were deep-seated and numerous. Ukrposhta had 11,000 branches when Smelyansky took over, and only 20 percent of them had a computer — and more than half of those computers were over a decade old. The average age of the postal trucks was about 17 years old. Corruption impacted all levels. “Everyone was stealing, starting from the mail carrier, all the way up to the top management,” says Smelyansky. “The situation was worse than I expected.”
Smelyansky found useful connectivity through social media. He put out calls on Facebook and Telegram to report problems both external, such as fielding citizen observations and complaints; and internal, such as discovering and rooting out corruption. He estimates that the worst of the corruption was gone after just six months.
But the hard work of cultural change required more time. First there was a mindset change. He also incentivized the carriers, using feedback from “mystery shoppers” to dictate bonus pay and raised salaries to recruit younger workers, while updating IT and infrastructure to ensure that they stayed on.
The results were significant: When Smelyansky took over, Ukrposhta was delivering 46,000 express parcels per year. By early 2022, it was delivering 90,000 express parcels per day — about 700 times more.
But all of his efforts and all of his progress came to an abrupt halt in the early hours of Feb. 24, 2022.
Smelyansky is proud of the fact that Ukrposhta was only closed for one day before it resumed operations. But since the invasion, its operations have been continuously disrupted, with routes redrawn in reaction to events on the ground. Standard practices had to be redesigned ad hoc.
The delivery of pensions was a prime example. The payments are usually delivered by Ukrposhta in cash, but getting physical money in those early post-invasion days was impossible, as all of the banks had closed. “So we designed a system where we would get cash from local businesses, like a bakery,” says Smelyansky. “The bakery would give us cash, we would do an online transfer for them, and use the cash to pay pensions. You have to be creative.”
Sure, he could have a much easier life as a consultant. “But it’s cool to have the power to help millions of people,” he says. “And I’m sure I’ll enjoy my vacation, whenever that comes.”
Plus, there’s the satisfaction of having a deep impact. “Now, when I talk to my kids, they know exactly what I do. They see the results. Even before the war, when we would walk on the street, people would come to me and say thank you for the changes I’ve made. It’s the coolest thing you can have. You cannot buy it.”
To learn more about how Georgetown University’s McDonough School of Business can help you build your legacy, browse academic programs at msb.georgetown.edu.
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