Irkutskenergoremont: Market Adaptation

Irkutskenergoremont: Market Adaptation

Irkutskenergoremont was created in 1965. In 2002 it was transformed to 100 % affiliated company of Irkutskenergo. The staff consists of more than 2.2 thousand people.

The company's main activity is repair and assembling works at many enterprises of the Irkutsk area.

A unique power complex was created in the Angarski Krai long time ago, in the soviet times. Cascade of hydroelectric power stations successfully located on the Angara River and a wide network of large thermal power stations became a base for a lot of the power-consuming enterprises of the Irkutsk area. The area within two decades turned from backward semi-agricultural region to a center of the aluminum, cellulose-and-paper, chemical, and petrochemical industry of Siberia. And the power system of Irkutskenergo became a powerful branched enterprise with the labour force of thousands of people. Thus, non-specialized enterprises were created for realization of the rhythmical and uninterrupted scheduled activity of Irkutskenergo. They performed service, repair and construction work within the system. In short, all necessary actions peculiar to the norms of the planned economy dominating in the Soviet Union were carried out. The state defined tariffs for heat and energy.

Time went by. The Soviet Union broke up; the planned economy was replaced by the market one. There came the times of rigid competition. It was necessary to learn to count money. Necessity of optimization of productive and economic process in Irkutskenergo became obvious. Non-specialised enterprises were burdensome to the prime cost of developed thermal and electric energy. This influenced tariffs greatly. The market dictates its terms, and the consumer (first of all, large enterprises) is not going to purchase power products without bargaining; he searches for alternative energy sources, etc.

One of the ways of decrease in prime cost of power products or, at least, decrease in its growth, became spinning-off of non-specialised divisions of Irkutskenergo into independent branches. Thus, Irkutskenergostroy, Irkutskenergoremont, ATSK, and other companies were created. At the same time, creation of 100% affiliated companies does not mean that Irkutskenergo simply frees itself from the burden. On the contrary, economy and production activities of all these enterprises and Irkutskenergo are closely connected, their business is coordinated by the Administration; orders are made, contracts are concluded, etc.

Let's discuss Irkutskenergoremont in more detail. It is headed by Vladimir Georgievich Tarasevich. It was spun off in 100 % affiliated company in 2002, and since that times it has been constantly increasing the volume of works by expanding both the geographic position of facilities, and kinds of repair work. Irkutskenergoremont is a specialised enterprise, which is engaged mainly in complex repairs. There are not so many enterprises of this kind in the region, therefore the company has a great potential in this direction. Highly skilled personnel of the enterprise can conduct installation of any facilities, including turnkey works.

Irkutskenergoremont proved its right to carry out such works to Gosstroy (RF State Construction and Architecture Committee) by receiving the corresponding licenses. Today it has the right to work in the petrochemical, gas, aluminum, and cellulose industries.

So, for example, a big team (about 180 people) works for the Bratsk Aluminum Plant, which is also engaged in servicing of the process equipment of the Bratsk Aluminum Plant. Serious repair and installation works are performed at cellulose plants in Baikalsk and Selenginsk. Irkutskenergoremont is occupied there with technological boilers. Irkutskenergoremont belongs today to the Angarsk Petrochemical Company.

When the enterprise worked in the structure of Irkutskenergo, it practically was not engaged in non-specialised works. For example, repair of engines for washing machines was out of the question. Today not only enterprise, but also an individual person can turn to the company for any service.

Another direction of the company: Irkutskenergoremont restores cutting equipment for many industrial enterprises of the area. Small groups of experts are formed in the company which are engaged in repair of own machinery equipment. Having restored it, Irkutskenergo today uses this machinery and employees' skills for realization of repair of machine tools at the Plant of Polimeric Materials, the Angarsk Electrolysis Chemical Factory and other enterprises.

There are large customers who build long-term relations with Irkutskenergoremont. Framework agreements were concluded with them: the customer buys up outwear machine-tools, and Irkutskenergoremont restores them for the agreed payment; and the customer then sales them. Machine tools, which were restored and consequently, have become much cheaper than new ones, sell successfully. Thus, the new direction has a great potential.

Expansion of the market of services directly leads to stabilization of the prices in the basic general direction of repair work, i.e. works, which are carried out directly within Irkutskenergo system. It should be noted that since 2002 the price level of the works performed in this direction has not changed. There is no growth in prices, despite inflation, constant going up of prices for resources, materials, tools, etc.

Moreover, financial independence means also the whole volume of responsibility of management to their employees both concerning the wage fund, and the social component. Today Irkutskenergoremont gives the whole set of social guarantees to its staff, these guarantees are the same as those provided by Irkutskenergo. Today the total sum of the company's charges for social programs equal RUR 14.5 million a year. And there is no any rise in prices for the basic kinds of works in spite of such expenditures for social programs!

Naturally, independence also makes look for additional internal reserves and reduce expenses. So-called "brain center" of the enterprises is effectively engaged: the engineering team, laboratories, etc. Universal engineering development allows to apply the same methods of construction and repair work to various facilities that considerably reduces their prime cost. In order to keep a competitive price level and to amplify the demand in the region, Irkutskenergoremont introduced and successfully carries out the Program of decrease in expenses of the enterprise.

In conclusion it should be emphasized once again that Irkutskenergoremont employees have learned not only to serve Irkutskenergo divisions in a quality manner, but also to earn additional money successfully in the Angarski Krai market. Certainly, the business of the company is not always smooth. There sometimes occur failures in the manufacturing process. It is not that simple for the company to develop dynamically during the period of the market economy formation. However, Irkutskenergoremont approaches arising problems with optimism. Effective work of such enterprises is a recipe for optimization of activity of the whole Irkutskenergo system. This means that it is also a keystone of tariffs growth slowing down (and their further decrease) for energy. It is this we are interested in.

View printable page