Interview with the Chief information officer Severstal Yury Shekhovtsov

Yury Shekhovtsov: Strategy is expected five-year term. In 2016 its first cycle comes to an end. The main areas which are affected by strategy is the organization of IT process, architecture of applications and data, and the third - IT infrastructure.

If to speak about the current results, then regarding the organization of IT processes it is possible to refer consolidation of IT service to them. In 2014 we completed process of its transfer in separate subsidiary company – Infocomm. Our own center for SAP which was earlier internal division of Severstal was transferred to it. Now Infocomm is the uniform company of providing IT services and implementations of IT projects in Severstal.

Regarding replication of processes at all our enterprises, we already have unified processes both in support, and in rendering IT services, in basic IT services. Now we have a uniform centralized HelpDesk and ServiceDesk, and any infrastructure services appear from one point and in an identical type.

Now in the IT organization improvement of business processes which began in 2014 is conducted and will continue in 2015. We want to implement improvement as the permanent tool working in the IT organization. It gives us performance improvement and qualities of service.

On architecture of applications and data at us from large projects – transfer of all company on SAP ERP platform. We practically completed its replication, finally it will end this year. Also we keep large projects directly in industrial areas. One of them – implementation of the integrated planning in the metallurgical sector. Here implementation of a MES system belongs, it is the project of shop level. Besides, we start the project on intershop optimization, so-called Optimizer.

In the field of infrastructure – we transferred most services to our DPCs which are in Cherepovets. Two of them are the main and one – rather logistic. At the same time we as much as possible virtualized services which it was possible, and in a server part, and regarding DWH. These are projects of 2013-2014. Now, when all foundation is laid, in 2015 we will be engaged in improvement of services. As for databases, we made the decision to migrate ERP on the HANA platform, this project will begin in 2015.

Yury Shekhovtsov: By this moment we from 40 percent virtualization passed practically to 70 percent. The purpose – whenever possible to reach an indicator in 90% of the virtualized servers. In total at us in the company 923 physical servers, virtual – around 1200 units are now used.

Regarding the server hardware at us two main vendors – IBM and HP, and the telecom equipment – is generally provided by solutions Cisco. Here it would be desirable to note that the question multi - or monovendornost in terms of the equipment for us became unimportant for the reason that, for example, in the systems of DWH we can buy solutions practically of any producer thanks to virtualization of a basic layer, and we can just select the equipment, proceeding from an optimal ratio of its characteristics and the price.

Yury Shekhovtsov: To the key systems as I already mentioned, it is possible to carry the SAP platform, and actually all components which we add, work at this platform. In the company there are about 9,600 users of ERP – nearly 18% of the total number of employees. It is rather good practice across Russia in general where the indicator already in 10% of the total number of employees is considered good. In turn,PC users in the company there are about 19 thousand people.

Yury Shekhovtsov: In the nearest future we expect to complete the project of the integrated planning, we will also continue deployment of MES in all workshops - it is the project for two years. Absolutely new project – the system of tracking metal (SSM) which will allow to provide high degree of traceability of metal and to increase the level of automatic data acquisition from the equipment. What solutions of suppliers we will use for this system, we did not solve yet. I think that assessment and the choice of the supplier will take about 2-3 months.

Also we are going to implement a number of the systems of transport logistics based on SAP which will cover, generally an external circuit: it both rolling train, and motor transport. In 2015 we are also going to begin the project on implementation of a SRM system – procurement management. We have an electronic marketplace, but a new system will be made based on SAP too.

In addition, we are going to carry out a number of improvements in a part of CRM. Most likely, we will select some solution combining B2C and B2B for our small wholesale solutions i.e. for trading structure. Now we use the CRM system of SAP, and we are going to supplement its interface part, what is unrolled to the client. At the same time we look also at SAP solutions for this purpose, in particular, on the solutions Hybris which SAP purchased earlier.

Also we plan circulation on production of the SAP solution on management of repairs and maintenance. In the pilot mode we began to use it in two workshops in 2013. Still we actually made the decision on change of an electronic document management system which was implemented based on MS SharePoint earlier. We are going to transfer it to SAP.

It is also possible to refer to the important plans concerning IT relocation of our team of specialists in SAP from Moscow to Voronezh as there more attractive labor market. In Voronezh we already open office, now a little more than 50 employees work there. In total in the direction of SAP 155 people, part of them – in Moscow, a part – in Cherepovets work for us.

Yury Shekhovtsov: "Classical Itshnikov", i.e., apart from technology linear coupling at the plants, at us is 568 people, including a command on SAP now. And if to consider with cablemen-submachine gunners, then about 620 people. In the course of centralization of the IT state and its transfer to separate company – Infocomm – we optimized its total number approximately for 30%. Optimization affected those areas where we had a surplus of personnel. Now the main optimization is directed to how to increase even more IT personnel performance.

Yury Shekhovtsov: For the last few years our expenses on IT were cut down approximately for 50%. First, Severstal reduced the general investments, it concerns not only IT. And secondly, we performed expense optimization. Including, due to centralization and optimization of number of IT personnel what I spoke above about.

In addition, we reviewed and renewed contracts with the main IT suppliers, including – with Microsoft, with provider of mobile communication – with MegaFon, having received eventually the best prices. Now review of agreements and with other suppliers continues. In this case the speech also goes about establishing order regarding software licenses: we got rid of a number of licenses for products which were installed on the PC of users by default, however upon it were not necessary.