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BUY YOURSELF SOME TAIGA

     Traditionally, information problems are very difficult to deal width in the Russian timber industry, one of the oldest, because its enterprises are strewn all over the vast country. New information technologies, however, are being successfully introduced in its timber industry. The latest development is called a “global information analytical trading system” (GIATS), and it is implemented via the Internet. This system and industry’s information policy are discussed below in an interview with VALERY SARAIKIN, general director of Roslesprom, an open joint-stock company.
Абстракт
Новые технологии
Применение информационных технологий на примере ГИАТС
Интервью с В.Г. Сарайкиным
Buy yourself some taiga
Лесосплав по виртуальным каналам
ГИАТС - торговая система
Информационные системы в лесном секторе Рынок леса на экране компьютера
Современные информационные технологии в лесном комплексе


     Why did your company take up the GIATS project?

     In the late `90s some positive tendencies became evident in the export of timber-a rise in return and profits. Nonetheless, the problem of finding potential partners remained, for competition on foreign markets is stiff. Besides, information on the related branches is vital-those supplying machines and spare parts, fuel and lubricants, and electric power.
     For the government to take decisions on various regulation measures-export duties, tariff rates, taxes, etc.-there must be an up-to-date information base. Today, it is still compiled in the old way-width data obtained either through the statistical bodies, or the customs committee, or the telecommunication enterprises. The purpose of GIATS is to provide up-to-the-minute information for any given period.
     Information is no longer an abstract notion: it has become a means of making money. Roslesprom and the system which we have created and are developing is a striking example of information technologies being actively introduced in the timber industry. Only ten years ago, the use of such traditional means of communication as the telephone, fax and postal service was perfectly justified. Today, new communication and information technologies are needed, and GIATS is designed to supply this need.

     What basic principles underlie GIATS?

     In elaborating the basic principles for this system we proceeded from the premise that what was necessary both for users, including our customers abroad, and for the integration of information streams needed in decision-making was a real live system. Widespread today are various systems used either in or out of commodity and stock exchanges. GIATS combines both of these aspects. There are established customs and traditions for the purchase and sale of equipment and for completing transactions on timber, round or sawn. We have therefore realized in GIATS a friendly interface which simulates real situations without violating any of the international rules or standards strictly observed during the conclusion of contracts.
     Similar to the principles underling the trading systems of electronic stock exchanges, the main criteria of the expediency of starting a transaction and completing it are either the cost or the price of a commodity. There are standard descriptions for all the other parameters, and there is a standard contract. It the buying price is greater than, or equal to, the selling price, the transaction will be completed automatically – because there is only one criterion here, and everything is clear. In selling timber it is difficult to draw up a single standard contract based on only one criterion for bargaining. Can sawn timber, for instance, be sold on the basis of only one parameter – the price? I don’t think so. We also ensure the security of the user’s information, including his own security as a participant in commercial dealings, which means an overall secrecy of bargaining. An important principle on which GIATS is based is independence of hardware support, which makes it possible to broaden our system and to adapt it to new hardware and software bases.

     What communication channels can your system use?

     Our system is operational on lines with a channel capacity of 1 Kb. Some users, who are located far away, may problems because of very bad communication channels. We offer them a simple solution: to buy a workstation and do the job-stacking through it. A user assembles and sends along a compressed information packet which becomes decompressed when we get it, acquiring its initial form, and it this form it goes to the server. Furthermore, if he has made a specific request, the user receives only the appropriate changes. For instance, if only two data fields have changed, he will receive only those two changes. The system has a high traffic stability: it operates even at 4 Kb, though slowly. In the absence of communication, requests may be stacked and stored by the hundred in the-line pending mode. The whole batch may be recorded on a diskette and send along to a place with access to the Internet.

     How are information traffics organized in GIATS?

     There is a close analogy between them and road signs: a driver cannot be told where to go exactly, but his progress can be controlled with the help of road signs, limiting his speed and warning him about possible dangers. Such signs must be useful to all drivers, and so there should be an information base adequately reflecting their requirements. It is difficult for an individual enterprise to compile such a base. We have suggested that all the necessary information be obtained through GIATS. With its help enterprises will be able to find out what is going on in Moscow and to regulate their intersectoral ties - and all via purchase and sale with the help of market instruments. Filing his request, a customer leaves information concerning the commodity he wants to sell: for instance, he has stocked up 3,000 cubic metres of timber the prime cost of which is lower then the price he has set. He plans profits and estimates the number of railway trucks he may need next month. Gathering all such information together, we become an organization which, by providing the necessary information for decision-making, can give concrete recommendations to the government and ensure a feedback.

     What has been the reaction to your system outside Russia? 

    A Finnish company Sonera, which is engaged in information sales, has shown a keen interest in GIATS. The company is working on large-scale projects in Russia: right now it is laying a 64 Gbit optical-fibre channel from Finland to Moscow. A channel like that is capable of providing Internet service to every corner of Russia. Some companies in Japan, China, South Korea, Italy, Britain and France have already purchased GIATS workstation.

     What are the prospects for the development of GIATS in Moscow?

     Right now we are studying the possibilities of applying GIATS in Moscow and the adjoining areas which are sources of the timber trade. A potential partner in such a project is Sberbank of the Russian Federation. Moscow consumes nearly four million cubic metres of round and sawn timber is purchased both on civilized and uncivilized markets, but always at priced higher than those it can be obtained at normally. It is rather expensive, on the one hand, to go to the Yaroslavl Region, for instance, and order timber there, but, on the other hand, buying it on the market in Moscow may involve considerable overpayment – as much as 30 percent. Certain interest and natural persons may not even let a potential seller cross the Moscow ring road. They will buy his timber up and sell it afterwards at their own price.
     On the basis of GIATS, we propose to set up in Moscow the following procedure: Anyone who wishes to buy timber, say, in order to build a summer cottage, deposits a certain sum, with which he plans to buy the construction material, at Sberbank. This will be a guarantee of payment for the future delivery. Naturally, Sberbank is interested in getting such a deposit and making money work. The customer does not worry because this is a completely reliable bank, and we know that there are ready-money orders in our system. As for the producer in Yaroslavl, he knows that he does not have to carry his 15 cubic metres of construction material anywhere or look for a customer: he has paid a hundred roubles, and this has made his request available to all. He can also hire a broker. Bargaining according to their own rules, brokers reach agreement, and the order from Yaroslavl is delivered straight to the customer. And after he signs a document confirming receipt of the timber the seller can get the money for it at any of the Sberbank offices.

     How do you train personnel for your system?

    That is still an outstanding and serious problem. In the future we would like to have staff workers who are real GIATS enthusiasts. Students of the Forest Academy, the Moscow University of Forest, the Krasnoyarsk and Khabarovsk universities already have access to our system and are learning to operate it. They will be self – taught specialists. There is a nuance to the game which many may like: you anticipate your opponent’s next move without actually seeing him. You may continue playing for as long as you like, but you must remember that your play may end at any moment. By changing the transaction parameters, however, you can compel your opponent to act in this or that way and thereby put him to a test. In the future, we shall provide our system with software which will enable one to take quick decisions after evaluating requests according to many parameters and criteria; to elaborate a dynamic strategy for changing these parameters (so as to complete a transaction as soon as possible), or to determine the criterion ensuring the maximum gain as a result of the transaction within a brief period of time. That means optimal management and planning. Those are the tools of decision – making which students are to learn. Then we shall be to make a lot of money, both on the domestic and foreign markets. I believe that the number of people who know how to use these tools, how to size up your opponent and how to “out-play” him will grow considerable in the near future.

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