Company’s Approach to Innovation
During the reporting period, Metalloinvest entered into the active phase of an ambitious initiative to transform its entire business for which it formulated a unified approach to the introduction of innovations as well as new production and management solutions.
The comprehensive digital transformation programme is a large-scale initiative to automate core business processes as well as to find technological solutions that enhance production efficiency and safety while also reducing environmental risks. The programme encompasses 18 functional areas, including the management of production, procurements and inventory, maintenance and repair, sales, personnel and contract management, volume planning, and budgeting.
For more details on the objectives of the Programme, see the Metalloinvest 2017 Corporate Social Responsibility Report (pp. 20-21).
An innovative approach means
- the digitalizsation of production;
- a policy of improving the efficiency and safety of business processes through research and introducing the best available technologies;
- improving planning accuracy through the continuous monitoring of activities, automation of analytics, and improved forecasting;
- implementing an energy efficiency strategy that creates opportunities to scale up production while reducing resource expenses and humans’ impact on the environment;
- increasing employees’ expertise and knowledge in matters concerning Industry 4.0 in order to participate in the transformation processes;
- continuous engagement with stakeholders and collaboration to promote digitalisation and technological modernisation.
Implementing the programme is a strategic priority for Metalloinvest. The Strategy and Transformation Directorate is in charge of managing the process, with different tasks distributed among four departments responsible for strategic development, risk management, transformation, and the immediate introduction of the Industry 4.0 agenda. All the leaders of the functional areas encompassed by the programme are involved in its implementation.
Results of digital transformation as of the end of 2018
18 functional areas covered
over 30,000 organisational changes made
- Starting development of a unified information space for all the Group’s enterprises supported by an ERP system to replace 100 local systems.
- Launching an integrated management system for financial and economic activities for more than 4,000 users at Lebedinsky GOK and Mikhailovsky GOK to replace more than 100 production and management systems.
- Initiating the second wave of Industry 4.0, which involves OEMK and Ural Steel, and is scheduled for completion in mid-2019.
- The Company continued to implement the SAP S/4HANA system – an intelligent ERP system that is able to provide full information in real time about all business processes at the Company. The solution consolidates all the trends of Industry 4.0: hyper-connectivity and the ability to work with In-memory technologies and big data in real time, which makes it possible to implement the concept of Real Time Enterprise.
For more details on the results of digital transformation, see the section Industry 4.0 Programme of the 2018 Annual Report (pp. 42–43).
For more details on innovation and digital transformation in specific segments of operations, see the relevant sections of the Report.
