Delivering Under Pressure: How Igor Smelyansky (MBA’05) Has Adapted Ukraine’s National Postal Service to the Chaos of War
A few months after Russia invaded Ukraine in February 2022, Igor Smelyansky (MBA’05), 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 of the women told Smelyansky that the money would allow her to buy her first real meal since the start of the shelling. Another handed him a request to call her daughter to let him know that she was alive.
“I can tell millions of those stories,” Smelyansky says. His work is increasingly vital, he knows, and the results tangible.
But as Ukraine continues to fight against the Russian invasion, the challenges are dire for Ukrposhta. They have lost seven employees in the conflicts and over $30 million.
And yet Smelyansky has produced remarkable results under these extreme conditions. He led the service to deliver 87% 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 Ukrposhta released that commemorated a now-iconic exchange between Russian sailors and Ukrainian defenders of Snake Island, who famously responded coarsely to an invitation to surrender.
“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 (“probably the most profitable business I’ve had”), he would later open a cafe and fall in love with business. He began reading the work of legendary marketing guru Philip Kotler and the autobiography of iconic American auto executive Lee Iacocca, dreaming of moving to New York City to see how Wall Street worked—and rebuffing invitations to join the young communist movement. “For me, freedom was a big thing,” says Smelyansky. “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 accounting with a minor in law at Pace University in NYC, 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 law degree at George Washington University and his MBA at Georgetown simultaneously.
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 totally different experiences—many from different countries—and have a truly unique class.”
His classmate, Andrew Favorov (MBA’05), who spent many hours studying with his fellow Ukrainian, remembers Smelyansky as a highly driven student who thoroughly enjoyed the work. “I don’t know if we could have gotten through it all without his tireless work ethic,” says Favorov.
Taking a job at Boston Consulting Group after Georgetown, Smelyansky almost immediately found himself working in his ideal field of M&A. “There was actually 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, which included a good deal of M&A consulting, 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 came up in 2016, he saw the chance to make his mark on a public sector organization with a very poor reputation for service. “If I can change the postal service, I thought, the entire country can see that you can do anything,” he says. “I did not have big plans. I thought, if I can do at least something, it would be a good example for investors, for companies, and for the people.”
But the challenges he encountered were deep-seated and numerous, with infrastructure and corruption key among them. Ukrposhta had 11,000 branches when Smelyansky took over, and only 20% 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 definitely worse than I expected.”
There was natural resistance to reforms, but social media was a revelation. “I understood that social media and Facebook were my tools—basically my armor, to fight them. Because from the first day I said, ‘You know what? You come to my office with the bribe, I will put you on Facebook.’”
Transparency, says former classmate Favorov, is a natural instinct. “You know where he stands,” he says “He has a view and a position, and I find it refreshing in the time when so often leadership is replaced by market testing—when being liked is valued more than being true.” Smelyansky also found useful connectivity through social media. He put out calls on Facebook and Telegram to report problems both external, fielding citizen observations and complaints, and internal, 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. “I told everyone that, yes, we work with a long-term perspective, but every day can be our last,” he says. “So let’s try to do something good today.” 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 (“now the average age of our fleet is six years old”) to ensure that they stayed on.
“Igor had to win the game for the best talent,” says Oleksandr Pertsovskyi, head of Ukrainian Railways’ passenger rail operations and Smelyanky’s former COO at Ukrposhta. “As one can
imagine, [Ukrposhta] wasn’t the most lucrative place for young Ukrainians to work, but he managed to create a culture that eventually made it one of the country’s most exciting employers,” with its technical specialists actively recruited by top private companies. “Igor succeeded in bringing talent to a state-owned enterprise. Many were coming personally because of him and his charisma.”
The results were significant and sweeping: 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. Former COO Pertsovskyi likes to hold up the example of a typical rural Ukrainian post office. “When Igor started, a typical post office would be a half-decayed old building—in winter, often without any means for heating,” he says. It would be open a few hours a day, a few days a week, and should that underemployed mail worker quit, it would leave the community without easy access to basic services. “After 4 to 5 years of Igor’s and his team’s efforts, this picture is practically gone. Today rural communities in many regions are served by modern, mobile post offices. They are staffed by full-time employees, they arrive on a specified schedule, and bring not only letters and pension payments, but also basic medicine and food supplies right to where people live.”
Smelyansky even defied his own family’s expectations for the position. “My wife gave me six months,” he says with a laugh.
But all of his efforts and all of his progress came to an abrupt halt in the early hours of February 24, 2022.
Smelyansky only sleeps about four hours a night, and he only got about one hour on February 24. He wrapped an investment committee meeting at 3 a.m., discussing plans for new sorting centers and trucks, and got home at 4 a.m. An hour later, he got the call that the war had started, and he headed back to the office.
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.”
Creative and fast. When Ukrposhta decided to return to using railways as part of its delivery system after more than two decades since last doing so, it allowed the operation to circumvent the nighttime curfews that applied to its trucks, and Smelyansky—working with his old friend and railroad executive Pertsovskyi—had the service up and running in just five days. “No papers, no memorandums, no agreements, nothing,” he says. “We just said, ‘We have to do it, let’s do it. Let’s find a way to do it.’”
He is driven in part by an innate preference for constant progress, no matter the obstacle. “I don’t like to lose. You know that famous quote by Nelson Mandela? ‘I never lose. I either win, or learn’? That’s exactly what I try to do.”Consider his idea for building new sorting centers during the midst of a Russian offensive. They would be a natural target of Russian rockets, but perhaps, Smelyansky posits, they could hide the operations in old garages, which would be imperceptible from air reconnaissance.
“We’ll put new equipment inside it and we’ll sort it there. We won’t advertise it, but we’ll do it,” Smelyansky says. “So you just find a way. Only death is forever, and everything else you can fix.
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.” Not that he’s watching the clock. “I mean, if you sleep four hours a day, you would not do a job you don’t like, right?’”
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.”
This story was originally featured in the Georgetown Business Fall 2022 Magazine.