At the end of 2021, the Kazakh company Datanomix, specializing in risk analysis in public procurement, became the winner of the international World Commerce & Contracting Innovation & Excellence Awards.
“We, as an international platform, see our task in analyzing the best practices around the world. The market of IT products for monitoring public procurement is developing quite actively, and we help in their implementation if we see an initiative on the part of government agencies,” explains Vladimir Tarnay, OCP Manager for Eastern Europe and Central Asia.
“The concept of our company is aimed at increasing the efficiency and competitiveness of public procurement, at bringing them out of a non-competitive field into a competitive one, which ultimately allows the state to save a lot of money,” explains the founder and CEO of Datanomix, 36-year-old resident of the capital, Vitaliy Trenkenshu.
“At that time, we had the largest vocabulary base. We hired proofreaders, typesetters, and paid a team of Ukrainian developers. However, it soon became clear that the students were able to develop a promising project, but did not have a very good idea of how to build a business: we spent the grant in the first year, but didn’t create a ready-to-use product,” says the interlocutor.
“At first, we worked as a subcontractor for large companies, then self-confidence came and we started working as the first number. The first orders came from the Agency for Combating Economic and Corruption Crime (financial police), then our team, like a relay baton, was transferred from one government agency to another. This is understandable: the market is small, people change jobs, and besides us, there were practically no other teams involved in identifying corruption risks based on data and having good expertise in this area. Professional investigators and operatives knew what to do, but they worked with old methods. We, as IT specialists, had the opportunity to look at the problem from a different angle, for example, we understood the value of government databases,” Vitaly explains.
“We collected about fifty databases, on the basis of which we calculated hundreds of risks, helped initiate several hundred criminal cases and return billions of tenge to the budget. Many cases were identified when companies through which billions of dollars were transferred registered, for example, for people without a fixed place of residence. Analysis of the database of family ties helped to identify cases where tenders were given to relatives. We were preparing to “roll out” the data to several knees, but it turned out that everything is much simpler in the regions - it is not uncommon for the akim’s wife’s company to win the tender,” recalls Vitaly.
“The main focus of Keremet IT's activities was still not related to analytics, but to the development of databases for information systems of government agencies. A few years ago, I did not see any serious prospects in this direction, and in recent years the market has been monopolized, and it has become increasingly difficult to work. I believed much more in Qlik, the platform for automating analytics and reporting, on the basis of which Datanomix works today,” the interlocutor explains.
“Our system is a symbiosis of a person and a computer, it shows risks, the so-called red flags, draws the attention of inspectors to them, but does not label them, because often the cause of violations is not malicious intent, but the human factor - a mistake, inattention or elementary laziness" Vitaly says.
“We update the chips common to all customers almost every month, but some structures have confidential data, some do not have access to certain databases by law, so the principle of information security is in the first place for us. The data does not leave the customer's servers, but there is a public part that assesses risks based on open data. This is enough to understand what assets a particular company has and cut off fly-by-night companies,” Vitaly explains.
“Working out some risks remains outside the coverage area of state structures, since it is not within the scope of their powers,” says Vitaly. – On the other hand, public organizations may pay attention to these risks and even initiate the adoption of systemic measures to discourage other violators. So, the public is an important part of our history. We work with two groups - risk management and investigative journalism. Each of the groups is assigned our consultants who train users, and we hope that cooperation with the public will bring good results.”
“For them, this is a good opportunity to gain new knowledge in order to introduce it into the educational process later. Cooperation between business and educational institutions will help convey to officials the idea that the correct collection and use of data ensures the effective use of budget funds, and this ultimately determines the quality of products and services that citizens use,” Tarnay is sure. In Mariupol, for example, he says, by changing the approach to public procurement, they managed to save about $40 million.
“I see two directions for Datanomix development. On the one hand, we can replicate our experience in public procurement to other countries, on the other hand, we see that private companies are purchasing similar solutions, which means that there is a market for our product,” says Vitaly.