We continue our Pentastock 2010 presentation with Frederic’s official speech held in Romanian, because, as he uses to say, he feels Romanian inside.

Don’t forget that the pictures taken at this event are available on our Picasa account.

Here we are, only 10 days away from Pentalog Romania’s 10-year anniversary and Pentalog Moldova’s 5-year anniversary. A project that began in the first days of January 2000… has turned into a beautiful human adventure.

Below you will find the PENTASTOCK programme!

Pentalog is used to participating each spring time in Jobshops, organized by an association of the 5 BEST Romanian university cities: Bucharest, Timisoara, Brasov, Cluj-Napoca and Iasi. Our goal is to communicate with students and graduates interested in career opportunities.

Our strong points are: the Pentalog training programme and our hundred available jobs. Those interested in our projects can talk directly with our local Branch managers.

We are presently looking to recruit new collaborators, including engineers in embedded IT for the new 3G Telecom project, that we have mentioned in previous articles.

In Bucharest, many students have come to meet with us and have submitted their CVs to become part of the Pentalog adventure.

In Timisoara we also have met other participating companies and continue to have a high number of candidates. We even went on local TV.

Come meet with us at our 3 other Jobshops which will soon be coming up in (Brasov – April 26-30 2010, Cluj-Napoca – April 19-23 2010 and Iasi – May 3-7 2010).

Elaborate your Offshore project with the European leader in Offshore Outsourcing!

The Wall-street.ro just published an analysis of outsourcing in Romania in 2010.

The representatives of Romanian companies were interviewed on the subject. Monica Jiman, our COO, has given her opinion on pressing issues to redress.

You will find the full analysis right here

10 minutes to answer 10 key questions and get a quotation!

Pentalog Group through its subsidiary Pentalog Technology just won a multi-year contract of $4,5 million per year for engineering services of the highest level. It is the largest contract in our history.

Additional information will follow in the coming weeks. A big thank you to all those, inside or outside the group, who contribute to our global exposure!

10 minutes to answer 10 key questions and get a quotation!

Here is an article that Livia Rusu asked me to publish:

“OPENi is a project organized to bring relevant and valuable impact on all its participants in terms of IT knowledge to which they don’t have access during their studies.
Professors, IT Companies and IT Experts have the opportunity to interact with each other and with students.

Aleth Delcenserie, our Quality Manager, had a presentation this morning on “Sensibilization to Quality in software development process”.

Don’t hesitate to follow also Monica Jiman, Pentalog COO – Vice President Business Development, online on http://www.privesc.eu/ at 4PM presenting “ITOO strategies for East Europe”.”

I do not often write in Romanian language on this blog but I have no Romanian blog, so… I would like to follow-up with an article published by the most important Romanian economic newspaper, about the 2009 performance of the IT sector.

“In 2009, estimarile PAC indicau piata de servicii IT la aproximativ 350 de milioane de euro, in scadere cu 5% fata de anul precedent.” (ZF.ro).

Pentalog reprezinta 0,75% al efectivului national din sectorul IT iar cifra de afaceri reprezinta 2,28% din PIB servicii IT. Cresterea, la nivel de grup, in 2009 a fost de 50%. Iar in Romania cresterea efectivului a fost de 44%.
Companiile romanesti, care au pus accent pe productivitate si pe ameliorarea continua a acesteia trebuie sa beneficieze de oportunitati generate de catre criza.
Ceea ce am sustinut de multa vreme incepe sa se adevereasca, anume ca sectorul servicii IT si software a devenit un sector matur si industrializat. Multumesc tuturor pentalogienilor care impart aceasta viziune si care demonstreaza in fiecare zi excelenta IT-ului romanesc si moldovenesc.

A few days ago, we have been interwied by Wall-Street in Romania. The article is about the main figures we released at the beginning of the year, the results of 2009 and the main thrusts of the 2010 Pentalog strategy:

http://www.wall-street.ro/articol/IT-C-Tehnologie/80236/Outsourcing-ul-si-criza-Cum-abordeaza-Pentalog-anul-2010.html

For non-Romanian speakers, in short, the main point we tried to emphasize is the attractiveness of Romania as an offshore/nearshore destination, that we need to maintain. Now the domestic market is still not big enough to create new business. The local IT services market significantly dropped in 2009 and for this year forecasts are directed at the same trend. The public sector used to be a good customer some time ago but now the budgetary deficit has turned the state into a question mark in the new business equation. And when I think of sectors such as embedded systems, I cannot imagine how a market without any strong production (I don’t even dare thinking of R&D) can provide work to thousands of engineers. Therefore let us keep our assets and continue to grow in the framework of international projects, where Pentalog is really successful, with over 50% growth rates our competitors are jealous of.

After developing an initial application for one of the leading French companies in social networking, tourism and entertainment on the Web, Pentalog followed up with an application for energy management and home automation before starting the development in regards to its own needs in the field of telecommunications. Pentalog has now turned towards real estate, recruitment and social networks. We also have opened discussions up with one of the most important publishers in the French press.

The momentum which started nearly a year ago has accelerated with several specific sales approches. Our latest newsletter has generated 3 leads which are presently being discussed. The NL prepared in Romania also surprised us, since it has generated a lead too, while we were just launching into the process of looking for new customers, in the style “we make iPhone applications, therefore we are cool…”

Pentalog seems to be in a position to become rapidly the leader in the Balkans in this area. The first application based on geo-location, is well known as it is one of the most downloaded Apps in France, found in the Appstore (Cityvox). Admittedly, it was a bit laborious in the development stage, but it’s now perfectly reliable and has been available for several months and is regularly used. I can say, as a user, it is absolutely wonderful. The next two that were developed did not give us any problems. Our friends from Wirecom Technologies asked us to transform the iPhone into a remote control device for the home which we were perfectly able to do and “on time”. Today it is a Skype-like application, merging an iPhone via WiFi with a Pentalog VoIP network that we are preparing to launch.

I won’t talk about the applications that have not yet entered into production, but let me say that we shouldn’t lack any work in this sector over the next two years. We are beginning to feel the interest in this market for Android, a system which is at least as powerful, portable and a lot less expensive. It’s simple, the Google platform will be in my opinion, present in this range of products along with 100% of the smartphone manufacturers in the next 18 months (except Apple of course) and in my opinion the app activities will continue to grow much stronger. The same thing could happen between Apple and Google which happened at the time of the first Windows OS in the 80’s. In the end, the one which is the most open wins… I think Jobs knew this.

From the production side, we should find the development of iPhone will continue to be present in the group, as it seems to have become a generic request. The Chisinau site also seems to be one step ahead of many others and could become the No. 1 Competence Center in this sector for the group. We will soon be making a decision concerning this subject.

I also wonder about the necessity or not, to develop a new generation of mobile platforms in the future Pentalog Labs, which has grown rapidly, thanks to an Executive Meeting with Aymeric Libeau (responsible for R & D, information systems and quality of the Group) held last weekend. I will try to get back to this subject of Pentalog Labs before the end of this week.

Pentalog is now working in 5 countries, which have different levels of practices and types of wage scales. Thus, in addition to the question of salaries, there is a genuine “large difference” between the gross annual salary in France and the salary in Vietnam which is very complex, incorporating a premium (bonus) of the New Year, which can change the monthly salary, from 1 to 3 or 4 times because of the additional earnings.

In Romania and Moldova, with patience, we succeeded, like most businesses, to impose a contractual gross wage scale. The constant changes of taxes and social charges have condemned our ability to establish fixed net wage scales.

The average remuneration scale in these 5 countries are very different, we should not hide this fact. A German company will pay a higher gross salary than that of a French company… but the net earnings are very similar, because of the impressive tax system in Germany. The Romanian wage scale varies greatly from what is established in the capital, to the different parts of the country, also if the employee has a specialty occupation or exceptional training using a specialty tool or program, if he is a junior or senior, and or if he acts as a consultant or is an “in house” employee. Thus, a BO developer in Bucharest, familiar with a leading business sector and after 7 to 8 years of experience will have a gross salary which would astonish a recruiter in Paris. I think I can say, in this case, the senior employee, working in direct interaction with customers, will reach a high pay scale equivalent to those of a provincial French city and often, could even reach the equivalent salary of Paris. In contrast, an unexperienced tester in a provincial town in Romania will make 10 to 15 times less. In Romania, in terms of what is happening in most other offshore countries there is this amazing difference between junior and senior employees, who are not in France, land of the minimum wages which have been contractually established. Thus, a German novice will often be paid less than his French counterpart, but his earnings will grow faster.

Furthermore, depending on the maturity of the IT market of each country, inflation operates differently. The offshore business may be defined as the science of differences, the companies most confident of their production model and project management are going to target these countries where new companies are coming into this sector and who will try to make rapid productivity gains. After an investment period of one or two years, they will seek to achieve the highest profitability. The consequence is obviously that the growth earning rate, will reach higher levels of profitability much faster than in countries with a high degree of maturity and where productivity gains are lower. For example, Pentalog knew very well, when it established itself in Vietnam that the wages would grow a little quicker than in Romania and even in Moldova. In contrast, as Vietnam “grew” very quickly, the interest in this country became more important in the minds of IT decision makers. The risk appears when, for marketing reasons (Romania during 2005-2007), or demographic (Ukraine-Moldova at the present time – emigration of the workforce), wages increase without being compensated with an increase in productivity.

This article is meant to reflect on the complex strategy phases of our company and in determining its fiscal policy. The crisis has shown us in 2009, with our 50% organic growth and our profitability in double digits, that Pentalog has made the right decisions. A profitable business is able to invest in its growth, in productivity gains and market share, when most others are in recession… which, in a service industry, often results in large economic losses and therefore, in productivity.

Pentalog can not build a unique wage budget model. However, we should seek to get closer to it, to facilitate the movement and adjustments in a group of soon to be 500 people. The concept of remuneration based on productivity and employee satisfaction should be the same everywhere. It remains to better integrate the issue of the Tet (New Year) in Vietnam, not to disqualify it but to integrate it into the Pentalog production card. Indeed, if we apply the same rules in other countries, by adding this supplementary payment this may force us out of a hyper competitive market.

So when my production management in preparing the Business Model for this year, asks me how much the salaries can evolve, I am particularly embarrassed. The future remains very uncertain. Recovery or no recovery? I have always believed in a quick recovery. But where are we in this first step to recovery? I feel the need to improve wages in countries where we are already established. But we must also continue to make good profits in order to invest in our business model, continuing to conduct more training, to seek better productivity gains above the average. Thus we can be more aggressive and continue to win more projects than the competition. The group’s growth has been the engine for everyone, in generating job opportunities. How many Pentalog employees have become executives within the group? How many, in offshore countries, are earning more than 1000 € (over $ 1450)? How many, in these same countries, earn over 2000 €? What does it matter to see wages rise by 20% when it comes to achieving a strong financial personal growth? To increase the salary of an employee when he confirms by his work and his intentions are to become an important element in our company?

I am going to answer the question that was asked of me. With several figures depending on the country. But more than ever, I believe in the remuneration by the effort of everyone who works for the survival and stability of the group and international social community that we comprise. This is the fairest way and most beneficial to everyone and this is ultimately the only common rule that we should adopt.

It seems that the month of December was an anniversary month for Pentalog. Frederic told us two stories: the history of the war against nature that the Pentalog Family had fought and won and the story of the birth of Pentalog in Romania, both in 1999. I should not forget to mention the pride I felt that my hometown had been chosen for this birth.

But Frederic forgot to mention that December celebrated also the birth of the first French and English versions of Pentablog http://blog.pentalog.fr and http://blog.pentalog.biz/ That’s how the Web 2.0 adventure began in December 2005. In December 2008 we launched the Pentablog.

I still remember some other dates related primarily to the use of Web 2.0 tools within the enterprise.

I read recently that companies are still reluctant to participate in the web community. The decision not to get involved is due to the lack of understanding of these tools and the lack of time. Yet Pentalog took the initiative to launch itself into the web. We understood the benefits of controlling our image on the net with the social networks and we’ve taken very seriously Linkedin, Viadeo, Xing, Facebook and Twitter, because the e-reputation of businesses also depends on their presence on these social networks, a marketing tool which is almost free and rich in possibilities.

March 2008: Pentalog began to make its presence known on Viadeo.
April 2008: Pentalog became visible on Twitter through the profile of Frederic.
May 2008: we started using more and more Linkedin to communicate in English.
From June 2008 we began to communicate in English on Xing and now we do it in German also.

For the past two years, very rich in experiences and challenges, Pentalog began using more and more Facebook, Youtube, Dailymotion, Plaxo, along with the tools already mentioned.

Another source of pride: this year the team that manages the image and communication on social networks has grown by 2 people, which means that Pentalog now has a team of the secret agents communicating in four languages (French, English, German, Romanian) and ensuring that the information concerning Pentalog is properly transmitted and the image of the company is impeccable.

The moving season of Branch offices has finished with the branch office in Iasi (Romania). Since Friday 08/01 (a bit before), everyone was ready to move into the Tudor Office Center. In one of my last posts I described moving the office in Hanoi; I quantified our relocations to 3 branches over the past 15 months. We have just completed a successful 4th move in 16 months.

Over the past 14 months in the previous premises, the growth of the branch permitted us to occupy space for 40 + people. Now it has been necessary to provide for larger premises to keep up with the branch growth. The Tudor Office Center quickly became our choice in relation to its quality according to our usual selection criteria (power, generator, location, Internet operators…). Besides its remarkable appearance which can be distinguished easily from the plane upon arrival at the airport (first time in the history of Pentalog branches). What we have lost in the view of the city (we probably had the best), we have gained in luminosity.

For the arrangement of these premises, it was the first time we called upon an architect. For 760 m² of overall space, we got an original proposal, different from a traditional division. The specifications consisted of the following: 2 adjoining and communicating meeting rooms, 2 discussion rooms (small meeting room), vast space-friendly open spaces for production, but yet separated. We were not disappointed with the results. After some adjustments, we got what we wanted for the moderate budget that we had provided for:

- The office design allows for the distribution of the workplace for up to 120 people in a friendly and modern arrangement.
- The 2 meeting rooms communicate, allowing for a larger space by simply pushing back the partition-walls.
- The discussion rooms are used for privacy for one to three people for discussions, follow-up meetings or phone calls.
- A designed floor (provided for upon construction) which provides great flexibility in organizing the offices spaces.
- The production areas are not completely segregated. They are segmented into work areas for 15 to 30 people.
- Even if the spaces are open, the temperature control system shows its effectiveness in the management of the work areas.
- User-friendliness was not ruled out with a reception area and a spacious kitchen sitting 15 people.
- In regards to IT there is a server room. The building is equipped with optical fiber by national operators who give each a connection of 50 Mbps.

It is also clear that our landlord is unusual in a country like Romania. He understood that his first priority was not to make us cough up a lot of money but rather to establish a relationship of trust and add value to his property.

The move was completed without difficulty and without damage. It must be said that it was assured by the super motivated employees of the branch and some of them had already participated in the previous move. The objective therefore was known to all: Production must continue Monday morning! The maturity level has increased. In addition, the team preparing the move under the supervision of Gregory [Constantin, Sebastian, Cosmina] did a very good job. This move started with the lowest risk ever in terms of the IT elements. Saturday at 12 am, the former office was empty. At 3 pm, everything was in place in the new-one. I would like to thank all those who participated in this successful move.

I would like to go back to the designed floor. The gain in flexibility is not immaterial. It also reduced the budget for wiring to around 4k euros. We will need to study whether the gain in flexibility and in the wiring and speed of implementation will not make this kind of floor a must-have in our next branches.

Several factors are at the origin of the low level of risk at the beginning of this move:

- We have internalized many services in 2009 which gave us greater autonomy than before: Management of the Level 3 network, Centrex. It had been systematically in changing the IP addresses (level 3) and the migration of the Centrex that deployment has not been realized on time.

- The move was anticipated so that we were able to negotiate costs and manage the unexpected. We realize that this cannot be done systematically.

Here is a quick video presentation of the branch. A further video commentary will be prepared in the coming days which will be given by the Branch director, Gregory.

Currently, there are no plans for further moves or openings in the first quarter of 2010. But things change quickly and we will adapt quickly.

Just a few words… to tell you about my recent trip to Chisinau, Iasi and Brasov. It’s been a while since I have had the opportunity to visit with my Eastern European colleagues. And I had not yet seen any snow in France this year (2009). Here, I was not disappointed.

It was an opportunity for me to discover the superb offices in Chisinau that I had not yet seen and got acquainted with a part of the friendly Marketing Team with whom I shared a delicious “Christstollen” brought by Pierre–Jean from Frankfurt. In Iasi, I attended for the first time a Romanian Pentalog Christmas party, full of laughter and emotions during the exchange of gifts… Meanwhile, the trip between the 2 countries had to be improvised in the Romanian style by car, in -15 ° C weather, in the snow, with lots of folklore and it was fun! And in Brasov, I finally met the mysterious team of secret agents with whom I have worked with the past few months, you know, those who hide behind the Pentablog press review, spying on our competitors and looking after the e-reputation of Pentalog. Thank you for the fur hat, I will think of you when I’m in Russia!

It was all very nice. The next time I try to stay longer.
Here is a selection of photos I took in Brasov, where I was inspired by the Christmas spirit: http://picasaweb.google.com/pentalog.ht/Brasov_122009

This is perhaps not the final version, but it is fairly complete. You can compare from last year’s version. This little exercise allows you to have a public record. Let’s say that for 2009, it is good. Pentalog gained more business than it lost. Only the pace of the new business has been slower, affecting the profit margin in 2010 rather than 2009. But we are now certain it will be again in double digits in the first quarter. At first we were a little alarmed by the weight of our first client, even when the eventual growth was reduced. For a moment, we thought it would reach 18-20% of our sales but it was finally reduced to about 13.

This version may still evolve a little before the final release. But for the reader of the blogs and social networking tools, it is normal to give them a sneak preview.

2009 annual report

- 50% growth in sales when the overall performance in IT services is -6%
- N° 1 of the French-speaking IT offshore / nearshore business in France
- N° 1 in Nearshore business in France
- N° 2 on the Romanian IT outsourcing market
- Among the top 10 of European nearshore companies
- EUR 13.5 M in sales
- 458th company in Europe and Middle East for positive growth in 2008, according to Deloitte Technology Fast 500
- double digit profitability ratio, up 50%
- Doubling of the overall profit margin
- Opening the Pentalog Vietnam offices in February, with over 40 employees in December
- First operations in digital television
- Rate of time & material operations reduced to 10% of the productive workforce in December
- 60% of actual sales came from competency divisions (in multi-year contracts), 20% in time & material, 10% in consulting, 10% fixed price.
- 80% of production staff is evaluated on a daily basis, using 25 to 40 criteria points
- Progressive deployment of production metrics on projects
- EUR 0,6 million spent on training
- 32 people trained on project management this year
- 169 people trained on quality awareness
- 152 people trained in French and English
- 541 people were trained (that is to say 100% of the permanent staff, + 100% of those in the Pentalog incubator)
- 77% for overall customer satisfaction (75% corresponding to “very good” and 85% “excellent”)
- Too low an index of internal satisfaction: 61% (66% = good and 50% = fair)
- The overall number rose from 290 to 430 employees
- 100 people were recruited in Romania and Moldova
- Specializing in Telecom: 40 engineer for ST-Ericsson mobile platforms (lower layers), 15 people for LHS-Ericsson billing system, 8 people in internet services for CityVox (Orange group), 3 BI consultants for Orange Romania, 6 people for the management of web services for Nordnet (Orange Group, web access control, management services and equipment).
- 26% of our Sales were signed outside of France (30% of foreign sales in Romania, 40% in Germany and 30% in Switzerland, Austria and Moldova).
- 128% German revenue growth to EUR 1.6 million
- 65 000 hits per month on Pentalog sites up till year end or 2200 hits / day! This figure does not include videos on web sharing sites
- 50 000 downloaded catalogs – Offshore prices for Pentalog services in Europe
- 12 new customers monthly
- Dependency ratio: the first customer represents 13.6% of sales. This figure is rising.

… Aymeric, Eric and I were preparing to spend Christmas with a charming family in Brasov, far from our own families. It was very cold and we were just starting our Romanian adventure. This led us to become one of the most powerful software companies in Romania. Some of the people who participated with us in those glorious days are still with us. I am bowing to them.

As vrea sa va transmit tuturor Craciun fericit alaturi de cei dragi, si un gand special pentru prietenii mei romani pe care nu i-am vazut de multa vreme.

To all others, I care for you, but I know Aymeric, Eric and I have a special thought for Romania tonight and especially for the family who welcomed us with such generosity 10 years ago.

It is clear where Pentalog has made the difference in comparison to the competition, it is by proposing, in addition to its software maintenance services (which everyone proposes), specialized offshore R & D. Our clients have entrusted us with at least 50% of their software development, in addition to their maintenance.

This has led frequently to several other business models and lots of creativity… Today, after having helped in the start-up of PeopleCentric, and including participating in the development of many other new products / concepts / solutions, we have noted that we have been missing something essential, a true innovation unit, which would help to improve and professionalize our services like what we have brought to PeopleCentric. Raluca has indeed benefited from the operational support of Eric and Monica, who also participated in the definition of the initial strategy. Similarly, I was able to help her find her a very talented person to become her French associate director.

In contrast, Pentalog has not yet been able to play the role of technological innovator that it could have expected to become. It has only been associated in the “realization”.

For this reason we are preparing to launch an incubator program that would create an innovation team that could actually be called Pentalog Labs (but we’re still open for a choice of names).

Concerning our incubator strategy: Yes, we are preparing to unveil a program included in the 30-2013 plan, which will include the acquisition of equity for Pentalog in start-up enterprises. Along with the first dossier of People Centric, we will address the needs of the software world and information technology. They will be in the world of social networking, recruitment, skill assessment and management, but also production management and software productivity.

I would like to appeal to all my Pentalog counterparts for ideas. We will qualify their ideas, evaluate them, and we will provide the means for development, management and marketing. In the future, we will help them find the appropriate financing for the development of their ideas and their businesses.

Similarly, we will call on people outside of the group, interested by an investment in their business through providing engineering capital. We envision three possible poles to host the Pentalog incubator: France (Orleans), Romania (Brasov and or Iasi) and Vietnam (Hanoi).

About Pentalog Labs: it will have at the starting point a group consisting of a financial advisor, a professional marketing, the Pentalog Chief Data Base Officer and Chief Software Architect Officer, the Network Guru Officer and one or two talented analysts. The headquarters will probably be in Romania, in Brasov or Iasi. I like the idea of Brasov, except for what continues to bother me is the damn problem of accessibility. But I love the environment and I hope this team can regularly enjoy the lovely countryside. Being chased by a bear regularly keeps you close to the realities of life Brasov is the logical place to create a Romanian Silicon Valley. It’s a shame there is still no airport to easily get to this magnificent city! This team will be there to offer the support to any truly innovative idea, whether from customers or from the group. It is under the direct responsibility of Aymeric, but it is possible that I will take an active role also in it.

December 08, in Iasi (Romania), December 09 in Bucharest and finally on the 15th of December in Orleans AFNOR auditors in charge of monitoring our ISO9001-2008 certification, which we acquired last year, came to make their first monitoring audit.

Development projects (our biggest one and 3 smaller ones), the Human resources process, Technical assistance services and facilities management but also the transversal processes (IS, sales ,..) were scrutinized. The findings were direct and unambiguous: 7 strong points, 0 sensitive issues, 0 non-compliance, and 4 process improvement tracks.

These results are very encouraging concerning our approach to quality. Our improvement loops (PDCA) will continue to monitor our development program to approach CMMI level 3.

This could not have been possible without the effort of everyone involved in executing the processes but also those who were audited and those who helped in the preparation. I would also like to note another key to this success: Aleth and her strong personal investment in her function as quality director.

The next set of guidelines has already been launched. I will soon write another note on a topic which I hold close to my heart: Change management and the training we will provide to Pentalog managers on this topic.

I received a few comments by letter, following my post concerning the aftermath of the presidential elections in Romania. I wish in particular to clarify that I do not condemn more Traian Basescu than the other politicians… as a Romanian politician. Simply he is the incumbent President and his record is what it is: inadequate or bad. The fact that he spent three-quarters of his term coexisting does not excuse everything. Concerning the subject on which he expressed himself the most, the fight against corruption, has not seen much progress neither. From the view point of the Romanian international audience, it has constantly worsened during his mandate and the management of the country’s stature abroad is far from adequate.

Companies have yet to find a viable interlocutor and corruption in public procurement is still prevalent.

I am not pronouncing in favor or against President Basescu, which would make no sense, but more concerning the political methods used by him as well as by the others. I wanted to see a President who could have profited during the past 5 years in power to gain stature and who would have worked for Romania. Alas, the Romanian President is a politician like all the other politicians in Romania and I can only regret having not seen him have a better understanding of the financial situation of his country.

The actual Pentalog strategy is to increase the development of a local customer base in our marketing plan. Let’s make it clear that we do not want to know and do not want to work under the table like so some many others. I realize to my regret that it is practically compulsory, but to bad… we are not obliged to do so… Our local private sector clients are professionals and with complete integrity. This being said, we will continue to work with them. As for public procurement, we’ll see what the new government will do in this area.

But don’t come to me and tell me this does not apply to all foreign companies. Pentalog, this year in Romania will pay taxes of 5 to 6 digits and which will fund many envelopes and from this point of view, Pentalog is like many other Romanian companies, without privileges.

Bucharest, Romania is still groggy, tired, and disgusted after the elections that have just finished. Everyone lost. Everyone? No, invariably there is someone who has not lost and that someone is the outgoing President, Traian Basescu. All the parties have lost, the business community has lost, and now the country is headed towards bankruptcy. 70% of the Romanian GDP, up to now has been based on consumption and shopping malls which sprouted like mushrooms and now are empty.

How did we get there? Why didn’t industry develop in medium sized cities? It’s very simple. In Romania, nobody (or almost nobody) made the necessary investments. Neither the state nor the local private equity funds. Everything HAD TO COME from the outside: from multinational investments, Europe… I was talking with industrialists the other evening at a gala of the French Chamber of Commere in Romania. The road infrastructure has utterly condemned all investment in Romania. No one wants to pay their income taxes: 40% of the economy remains informal! Those who protested the most against the corruption of power are the same people who are using these illicit means to make money. One of our friends, a business leader, told us the other day that at a public bid of several hundreds of thousands of euros, government officials requested kick backs representing close to 40% of the total bid… not bad for a country without money. Because of course, to pay 40% commission, you must first of all increase the market price. So it is the taxpayers and citizens who will pay. 40%… the enormity of the figure just blew me away!

The atmosphere is worse now than when I arrived in Romania ten years ago and at that time the country was teeming with energy and hope, despite the enormity of the task. Everyone is tired of the mediocrity of the political class. What excuses can you find for a president who refuses to make political compromises when the country could possibly sink into bankruptcy? Why can’t a head of state be held responsible for bankruptcy as it would be for a CEO of a company? Where is the difference? However, the actual situation is this: no government, no money from the IMF. But what about the political parties that are not longer able to come to terms with the president? Will they now play the politic of the worst case scenario? Basescu wanted to take this risk, so he must assume totally the responsibility! At the highest level of multinational companies that I have had the opportunity to rub shoulders with they acknowledge in secret the possibility of the following scenario, that we would leave the EU. I even believe that the EU must push hard on this subject. The Romanians will only move when they are pushed into a corner. 10 years of mismanagement. Sorry, my friends, it is only because I care for you that I say this!

During this time the Romanians in the diaspora who do not live with the local difficulties still support Basescu, who continues to embody in their eyes the normalization of the image of Romania. The following day after the elections, seeing how the diaspora voted for Basescu, one of the most important leaders of the Social Democratic Party, said, without laughing, that the voices of the Diaspora should be reduced by a certain percentage! I now see Romania has been divided in two, exhausted by its moral turpitude and I am extremely saddened by the spectacle it offers the world.

Of course I hope for a better tomorrow, but when will they come? It is legitimate to ask, in a country which will celebrate in a few weeks the end of the Ceausescu dictatorship… that no one will celebrate. But how, when Ion Iliescu is still the scourge of students in 1991… who continues cynically to pull the strings? Here, moreover, at a time when everyone is blaming Basescu that Uncle Ionut, who has left the political scene without even passing by prison can there be a solution? Could Mircea Geona have practically won this election if he had not supported in 90-91 this tyrant? Who knows?

I think it would be for the good of Romania, see the country turn the page and to forget the last of the communist era and the sinister foundations of the modern Romania.