Title pageInterview with TOP Management
GRI:

Interview with TOP Management

Maria Armand
Director for Organization Development

Director for Organization Development

— What is transformation of the Engineering Division?

Transformation of the Division started in 2018 in order to ensure the Engineering Division’s readiness to manage the NPP projects portfolio in full scope and within the established deadlines. For the second year running the Division delivered to its Customers 3 power units and carried out the first concreting of three more power units, which is an unprecedented scale of the Company’s works. Just to compare, we used to commission one power unit and make one concreting annually.

In 2018 the Division’s portfolio included 31 power units. At the same time, new contracts are being concluded — the nuclear power industry is definitely attractive for the customers.

All this prompts us a decision to search for new management approaches, use digital technologies in designing and construction, improve the quality of management (reduce the time and cost, standardize the purchase of equipment, implement new software).

The Division’s transformation embraces all main areas of activities ranging from production to organizational and IT lines of work. The transformation aims to ensure the Division’s growing competitiveness on the global market and to enhance its business efficiency.

At the same time, the absolute commitment to timely implementation of the portfolio projects at the established cost is our top target.

The transformation program is focused on generation of a new organizational model of the Engineering Division. In 2018, the main management functions were divided into three key areas:

  • management of NPP construction projects portfolio at the design stage;
  • management of NPP construction projects portfolio at the construction stage;
  • support of NPP construction projects — corporate functions.

At the same time, according to the new line of thinking, the supporting services (purchase and procurement, financial, corporate ones etc.) should ensure that managers of NPP construction projects are given maximum support and relieved from routine tasks.

The changed organizational model is mainly focused on a project-oriented organization where the NPP construction project is a key management center and the project manager is a Company’s chief executive having all necessary powers and resources to implement the project objectives.

Besides the changes in the organizational model, we are also implementing “Team to support changes in the key industry’s focus areas” project that is a basis for developing the Division’s full-scale system to pool and communicate experiences accumulated through NPP construction projects. It aims to extend the experience from lessons learned and best practices of NPP construction projects and preclude recurrence of earlier detected mistakes during implementation of current and future projects.

Deadlinesand cost1. Organizationalchart6. Projectmanagement2. Design5. Digitalization3. Construction4.Personnel andmotivation

As I have already said, the renovation of the management structure and system will allow us to get prepared for the main challenge of tomorrow, i.e. the scale of construction, while NPP customers will be offered a flexible customized proposal.

— How does the transformation influence the project management and design?

In the end of 2018, the Unified Design Institute was founded to consolidate the experience and competence of St. Petersburg, Moscow and Nizhny Novgorod key design institutes of the Division. We are confident that unified design engineering will allow efficient resource management, facilitate a unified engineering policy and unified engineering solutions and their follow-up at all stages of NPP construction projects. In order to strengthen the project management, the director of the Joint design institute was entrusted with a number of authorities in the area of engineering and construction project management at the stage of designing that earlier were the responsibility of JSC ASE EC president.

In order to enhance the efficiency of designing and consolidate the resources in the key areas of design operations, the “Program for development of VVER reactor designing” was launched at the end of the year. The program includes 12 projects consolidated in two areas, namely “Designing and Technologies” and “Design Management”. The projects include, among others things, standardization of engineering solutions and unification of equipment, calendar network planning, resource and quality management. The program draws much attention to reference books and data in order to provide the digital design systems with the updated and reliable information to take prompt and grounded management decisions. The important feature is the Program’s applicability as a prompt mirroring of the results on the portfolio’s projects. The key result of the Program shall be the final establishment of the joint design institute as a smooth conveyor for producing design products of proper quality ensuring an absolute implementation of the orders portfolio and new projects based on the Customers’ most advanced requirements.

These changes are expected to result in compulsory fulfillment of the licensing deadlines for our projects, replenishment of each project with qualified designers, sufficiency of the project-based information models and documentation for the respective construction stage.

80%
the weight of the index in terms of deadlines and costs in the KPI map

— What changes are underway in NPP construction processes and equipment procurement?

The construction management portfolio has also witnessed significant changes of the organizational model. At the stage of construction, the project portfolio manager now has an immediate authority over construction project managers whose status has been promoted to the position of vice-presidents — construction project directors, with their authorities and responsibilities amplified and excessive management levels liquidated.

As to the logistical support, such as procurement, we have started standardizing the tender process for package lots as part of the transformation process. The concept of transition to procurement based on package lots has already been approved and implemented in pilot projects. The list of NPP facilities subcontracted in the form of package lots has been approved. It is important for us to collect a pool of suppliers and contractors that ensure timely and proper performance of works in their respective areas.

We are currently synchronizing construction schedules of all NPPs in the Division’s portfolio which will allow synchronization of all processes. We enlarge the information base of foreign projects, information about local markets, we develop the system of inter-project experience and knowledge sharing. This is an industry-wide program that is successfully implemented in our division. This program aims to use efficiently the knowledge accumulated during implementation of the construction projects.

— How does the transformation process impact the personnel? Are there any new undertakings in this area?

The Division keeps improving the KPI system, the follow-up of activities. This year the focus has remained to be shifted to the employees’ utmost motivation to meet the deadlines and cost requirements. KPIs related to implementation of the construction projects have been established for employees of all divisions including supporting functions. In this year, the weight of the index has been raised to 80% in terms of deadlines and costs in the KPI map. By comparison, in 2017 the weight of this index was 55%. Our task is to ensure complete supervision over implementation of the NPP construction program which has been contracted rather than planned only.

Active work is underway to optimize the resource planning processes. The task of this area is to establish in sufficient detail and understand the demand for resources and competences in all areas, to understand the amount of external resources to be used, the amount of internal resources and competences to be used inside the division. Proceeding from this, we develop detailed resource plans with account of redistribution of resources between projects since as part of the project management we look closely at the possibility to balance the resources, we manage risks as a whole in the projects portfolio including the resource economy.

The generation of the unifiedcorporate culture facilitating the smooth processes of changes during the transformation is aimed at creating an environment when all the Company’s employees understand their goals, tasks and strategy of its development, when they are aware of their role in these processes and act based on the logic of partnership and efficient horizontal interface making a focus on common goals. This work is implemented as part of the philosophy of changes carried out by the State Corporation in the industry.

A meeting between A.E. Likhachev, Director General of Rosatom State Corporation and the staff members, multi-stage Director Days, “Open dialogue”, KPI project have been held over the past year. A new communication channel, such as “Open dialogue between the management and the staff” has been established. The cycle of horizontal interface sessions has been launched, the corporate functions customer focus assessment has been implemented. A new communication channel has been created: HRHelpASE@ase-ec.ru.

As part of the mid-term planning, we plan to increase by 30% the amount of information materials (news, articles, interviews and others) dedicated to the topic of transformation, introduce new columns dedicated to new career opportunities and continuity, training management and personnel development.

We envisage to launch the Company’s renewed internal portal, involve the personnel into building of new internal communication channels primarily through the work of the Team for support of changes for the “Improvement of internal communication system” project.

The transformation aims to ensure the Division’s growing competitiveness on the global market and to enhance its business efficiency. At the same time, the absolute commitment to timely implementation of the portfolio projects at the established cost is our top target”

— Is the digitalization process underway in the Company? What is the difference between the digital transformation and the division’s transformation as a whole?

Part of reply to this question is implicated in the question itself. The digital transformation is one of the components of the global process of the division’s reset.

The digitalization topic was covered in much detail in the division’s annual report in 2017 that is why I’m not going to dwell upon this sector for long. I’d like to point out some of the digitalization areas, such as synchronization of the division’s information systems and the main industry’s participants of NPP construction processes which embrace a common IT-architecture, digitalization of processes, NPP information models (a ready basis for the NPP digital counterpart). A large industry program has been developed which includes about 50 projects in the “Digitalization of NPP construction process” area. It is aimed at providing the maximum tool support of our projects. Here we work over verification of the data and elaboration of model IT-architectures for all construction projects, over integration of the systems inside our division and formation of the NPP complex information model to be handed-over to the Customer.

As a result we plan to reach a state when the analytical data for all processes is automatically downloaded from the systems, the information systems are synchronized, simple operations, such as translation, standards control and others are automated.

Moreover, it is essential for us to ensure synchronization with other divisions in this and other areas. This program has a discipline such as integration of intradivisional information chains. Since an NPP construction project involves about twelve organizations of the nuclear industry, we have to foster efficient interface, also at the level of information systems, with other organizations.

As a summary I can say that we are aware of the economic and social significance of the Division’s business and we set a task for ourselves such as to ensure the business sustainability; we are involved in the process of change in order to offer to our Customers the best price on the NPP design and construction market.

Nikolay Podorov
Senior Vice President for Corporate Functions

Senior Vice President for Corporate Functions

— How would you evaluate the main results of the last financial year?

I am glad to say that the consolidated revenue of the Division reached 202 billion rubles, which is 15.2% higher than the last year value. The share of overseas revenue for 2018 increased and amounted to 80% of the total value. We are the global leaders in the NPP construction, in 2018 our project portfolio amounted to 77 billion USD.

The Company’s development is going on, we have been recognized on the global market due to state-of-the-art technologies and high quality of our products. In 2018, the amount of investments was 7.7 billion rubles, which exceeds the value of 2017 three times. The main areas of investment are mechanization of Russian and the CIS sites (Kursk NPP, Belarus NPP), overseas sites (first of all, Rooppur NPP) and infrastructure development (the one of head and branch offices).

By 2017, we managed to achieve growth in terms of one of the most important indicators of operations — EBITDA, which was possible thanks to efficient cost management processes and restraining of management expenses. In 2018, the positive dynamics was also observed for another indicator of operating efficiency, which is labor productivity.

— What is the impact of the Division’s transformation on the Company’s operating efficiency?

Transformation is a program which is aimed, first of all, at the enhancement of the Division’s competitiveness and enhancement of the internal efficiency is an important part of it. From the point of financial results, this program influences such indicators of the Division, as: adjusted free cash flow, compliance with the timeframe and cost of NPP construction in Russia and abroad, consolidated marginality of NPP construction project portfolio, labor productivity.

It is planned to achieve results within the transformation program due to the following measures: reduction of process time, digitalization, improvement of the organizational structure and management system. Meanwhile, the main focus of the program is on reduction of the NPP construction time and cost.

Financial capital is a reserve of resources that is employed by the Company for the use during production of goods (rendering of services) that are produced as a result of commercial and investment activities and received through financing (debt or stock capital). Financial capital management is an efficient use of all financial tools to implement the Division’s strategic goals”
Ruben Topchiyan
First Vice President — Director of Joint Design Institute

First Vice President — Director of Joint Design Institute

— What are the objectives and tasks of Joint Design Institute establishment? What are the results of the Institute’s activity and prospects of its development?

First of all, establishment of the Joint Design Institute is a response to current challenges that the Engineering Divisions of Rosatom State Corporation faces. Considering the need for parallel execution of several orders simultaneously, possibility of labor resources operative management is essential. It should be possible to redistribute the work and involve the necessary experts quickly. In this regard, establishment of the Joint Institute enhances efficiency and removes barriers compared with the situation when all design institutes are separate legal entities. Apart from the formal side, Joint Design Institute means a different philosophy, uniform rules and standards which, in essence, make smooth redistribution of the scope of work possible. Among other things, this is, if you like, a restoration of historical records when in the Soviet Union we, the designers, worked in a single big institute.

— How would you evaluate the influence of digital technologies, including Multi-D, on designing in the mid- and long-term?

It is obvious now that digital technologies are changing our lives. This, in particular, makes efficient work in one team possible, despite the location of the project participants. Working in the unified information space is a trend. And, in the mid-term, we will see a several-fold increase in the efficiency of interaction both with our contractors and customers. As for the long-term perspective, I think that, first of all, we are talking about various auxiliary systems for the designers and computer-aided design systems which will allow using the accumulated experience in the most efficient way and enhancing the labor productivity by means of standard solutions application.

— What is the competitive advantage of the Engineering Division in NPP designing?

This is a blend of experience and drive to be on the advance, using state-of-the-art technologies. It is our designers who became the authors of the first power unit of Generation III+ in the world. Besides, when a customer signs a contract with us, it will get all the advantages that the Russian Rosatom State Corporation can provide. This is establishment of the entire nuclear infrastructure, if necessary, provision of fuel for the whole lifecycle of NPP, plant maintenance and repair.

The intellectual capital includes intangible assets, such as knowledge, technologies and intellectual property and has a primary importance for innovation and achievement of the Division’s strategic goals. The intellectual capital management describes contribution to the development of new technologies and upgrading of the existing ones, preservation and accumulation of the cumulative professional knowledge, innovation solutions, R&D and licensing of R&D products”
Sergei Egorov
Director for Science and Innovations

Director for Science and Innovations

— Which areas of advanced research and development are relevant for the Engineering Division now?

First, there are system-related works in the management of complex engineering facilities construction projects to form an aspect-oriented approach which is a blend of technologies for information management of NPP construction and system engineering;

Second, it is a systematic elaboration and forming of process clusters which ensure increased quality of construction and provide for optimization of the most important project parameters: time and cost.

Third, applied avant-projects and investment projects aimed at solving specific applied tasks of the Division and the industry are being implemented.

— What is the impact of transformation and digitalization process on the science and innovation unit?

The science and innovation subdivisions became part of Design Unit in the organizational structure, thus, research and break-through technologies will be significantly closer to direct design production.

As regards digitalization of production processes and digital economy products, we are working on activity systematization aspects, forming the standards for NPP information models creation.

As regards digitalization of production processes and digital economy products, we are working on activity systematization aspects, forming the standards for NPP information models creation”
Nikolay Vikhansky
Vice President for Capital Construction

Vice President for Capital Construction

— What is the difference between the requirements for NPP construction process, set by the customers on different markets? Are they getting more stringent?

The trends and problems related to the Customers’ requirements for NPP construction process on overseas markets can be conventionally divided into two types: organizational and technical ones.

Among the main organizational problems, I can distinguish the current sanctions regime for the RF, which shall be taken into account when preparing and concluding contracts for NPP construction.

The basic trends for change of organizational requirements differ in principle for the countries already having the experience of NPP construction and for the newcomer countries:

  • the primary trend in the organization of NPP construction process in the countries having the construction experience is a significant reduction in the scope of Russian party’s obligations. Thus, for NPPs in China and India the scope of the Contractor’s obligations is limited to design and supply of equipment for the NPP, for Chinese NPP project it is in essence the nuclear island only. Therefore, the primary task for implementation of such contracts is optimization of NPP costs.

The basic trends for implementation of NPP construction projects in the newcomer countries are as follows:

  • transfer of all responsibility for the construction process to the Contractor, including responsibility for creation of the external infrastructure necessary for the NPP construction, as well as design and construction of physical protection system;
  • requesting the maximum involvement of local construction and erection companies in the construction process (requirement for initial level of localization is 25-30%).

Such requirements with the Contractor’s general responsibility for the NPP construction result in the necessity of a detailed study of the Customer’s country market prior to concluding a contract, analysis of potential vendors’ experience and qualification, analysis of construction materials and equipment market in the Customer’s country.

The general trend in the change of technical requirements for NPP is more stringent requirements for the NPP safety, including requirements for consideration of Fukushima lessons and a large commercial aircraft crash in the NPP design.

In this respect, several groups of countries where the above trend is manifested in a different way can be distinguished:

  • the first group includes European countries already having the construction experience and guided by the EUR requirements. Among the main problems for implementation of new projects in such countries (e.g. Hungary, Finland), one can point out differences in the requirements for classification, which results in the necessity to adapt the equipment manufacturing process in the RF enterprises to these requirements. In its turn, it affects significantly the processes of equipment engineering, manufacturing and acceptance at manufacturing plants;
  • the second group may refer to newcomer countries, this is the primary NPP construction market nowadays, these countries start implementing the nuclear power program. They are guided by the EUR requirements (as a rule, they hire consultants guided by these requirements). Such countries may include Egypt, Uzbekistan;
  • the third group may refer to countries with the developed nuclear infrastructure (e.g. China, India), setting their own requirements for safety from the internal regulator, which are more or less different from the EUR requirements (e.g. regarding the requirements for aircraft parameters, equipment classification, etc.).

— What is the impact of the Engineering Division’s transformation on the processes related to capital construction?

The Division’s transformation is in its active phase and this is proven by my transfer from Rosatom State Corporation to JSC ASE EC and concentration of capital construction functions under my control.

At the end of 2018, we proceeded with implementation of the Integrated Cost and Time Management System for NPP Construction Projects (TCM NC) in the Engineering Division. The system objectives are to increase the planning accuracy and effectiveness of NF construction and operation time and cost control, as well as reduction of risks related to exceeding of the target cost of the facilities construction. First of all, capital construction processes are changing in terms of monitoring resources in the countries of construction, project cost estimate and budgeting, which will allow generating the budget for each construction project in the shortest time possible. Such budget will make it possible to evaluate the decisions made and their impact on the project timeframe and cost upon its completion dynamically.

In the course of transformation, Center of Technology Transfer in Nuclear Facilities Capital Construction was incorporated in the Engineering Division. This is an active efficient tool for the search, selection of global innovative solutions at the phase of high technological availability and their fast promotion in capital construction projects. Use of such solutions at an early phase of new construction projects development minimizes technological risks and ensures reduction of construction costs.

— How would you evaluate the importance of safety culture for safety assurance of processes related to the NPP construction and upgrade?

The importance of safety culture cannot be overestimated. This is an unconditional priority. The safety culture is an inseparable element of personal qualities of managers at any level and processes within their scope of responsibility. A manager of any rank who is related to the NPP construction and upgrade is a leader in safety aspects.

The direct impact of high safety culture on the NPP construction consists in identification of problems directly reducing the power unit safety in the course of analysis of the results of adjustment, start-up and trial commercial operation. One of the key tasks is prevention of identified problems replication in the NPPs under construction, which is solved by means of improving the system of NPP construction and operation experience consideration in TCM NC Program.

The manufactured capital is a value reserve that the Company has for using in the production of goods/services, the main components of which are buildings, equipment, infrastructure. Manufactured capital management is an efficient use of all productive assets to implement the Division’s strategic goals”
Andrey Medvedev
Vice President for Procurement and Supply

Vice President for Procurement and Supply

— What should one do to become a nuclear industry supplier?

To become our supplier, first of all, you should have a high-quality product demanded on the market of nuclear industry equipment and services.

There is a uniform and transparent system of regulated procurement procedures built in Rosatom State Corporation, which are aimed at extension of the range of suppliers and establishment of fair competition: all information on procurements in the industry is published on the specialized procurement website: zakupki.rosatom.ru. There you can also study the basic document on procurement in the nuclear industry — Unified Industry Procurement Standard (Procurement Regulations) of Rosatom State Corporation (hereinafter — UIPS).

The absolute majority of procurements is currently held on the following electronic trading platforms (hereinafter — ETP):

This implies registration of all bidders on these ETP.

To get feedback from the suppliers, forums are held regularly, e.g. Atomexpo, where everyone who wishes to do so can ask their questions addressing the booth of a relevant company directly.

We are open for cooperation and welcome the suppliers’ initiative for maximum development of competitive environment.

— Are there any differences in the procurement procedure for Russian and overseas suppliers? Are there any preferences?

One of the primary purposes of the Engineering Division’s procurement activities is to expand the opportunity to participate in procurement for the maximum number of bidders and to develop competition.

The procurement activities are regulated by Federal Law No. 223-FZ dd. 18.07.2011 “On Procurement of Goods, Works, Services by Certain Legal Entities” and UIPS.

During the procurements, which are followed by contracts executed on the territory of a foreign state, the Division’s companies also apply UIPS provisions in the part not contradicting the national legislation requirements of the state, on the territory of which products supplied under the contract will be used.

Procurement procedures are conducted in accordance with the procedure established by the law, UIPS, taking into account provisions of general contracts signed with foreign customers and imply for participation of both the residents of the Russian Federation and non-residents (foreign bidders/suppliers).

Documentation on procurements where participation of foreign bidders is anticipated is published in two languages (Russian and English).

Draft contracts stipulate terms and conditions both for the residents and non-residents of the Russian Federation. Bidders’ applications may be accepted in a foreign language if the published procurement documentation provides for it.

To confirm compliance with the requirements established in the procurement documentation, foreign bidders shall submit documents similar to the ones established for Russian bidders, provided that there are no contradictions with the legislation provisions of such bidder’s country of registration.

The Division does not provide any preferences to suppliers depending on the supplier’s locality in respect of the region of operations. The choice of suppliers can be decided upon only by the supplier’s meeting requirements and criteria stipulated in the procurement documentation.

Companies of the Engineering Division, which are guided by Law No. 223-FZ, apply in their procurement activity the RF Government Resolution No. 925 dd. 16.09.2016 “On the Priority of Goods of Russian Origin, Works and Services Performed and Rendered by Russian Entities in Relation to Goods Originating from a Foreign Country, Works, Services Performed and Rendered by Foreign Entities”.

— In what areas will the procurement activities be improved due to the Division’s transformation?

First, it is suggested to create the Unified Functional Service as regards procurement activities planning, arrangement of procurement procedures, signing and administration of contracts concluded within the framework of implementation of general contracts for NPP construction.

Second, it is suggested to introduce a new approach to contract operations administration based on the principle Full Contract Management Lifecycle, including development of draft contracts, their administration and closure.

Implementation of these proposals, among other things, will make the following possible:

  • Bringing the contractual work to a new level complying with the best global practice, using the contractual mechanisms which allow minimizing the Company’s risks and forming commercially reasonable terms and conditions of contracts.
  • Ensuring interrelation of the parties’ contractual obligations with systematic contract administration of their proper fulfillment, which will allow reducing risks of a negative change in the time and cost significantly, preventing occurrence of disputes (mitigation), obtaining trustworthy information and responding to changes expediently.
One of the primary purposes of the Engineering Division’s procurement activities is to expand the opportunity to participate in procurement for the maximum number of bidders and to develop competition”
Natalia Shafalovich
Vice President for HR and Internal Communications

Vice President for HR and Internal Communications

— How does certification of employees help solve the tasks of safety assurance at the facilities under construction?

In the nearest 10 years, ASE is to build dozens of power units in different parts of the world: Bangladesh, Egypt, Hungary, China and many other countries. Naturally, we have to solve this large-scale task extending the existing “boundaries” of the Company, involving more experts (designers, BIM-managers, engineers, as well as highly skilled foremen and workers) and subcontracting part of the works to reliable partner companies. That is why the Company not only certifies its employees but also conducts integrated audits of subcontractor companies — we set the highest requirements for the quality of all types of works. Meanwhile, it is well known that real quality can be ensured by highly skilled personnel only. Comprehensive quality audits of suppliers are within the quality unit’s scope of responsibility while I will talk about the personnel certification in more detail.

There are mandatory requirements for professional and technical knowledge and skills (PTKS) for all categories of employees, so the abbreviation of PTKS is familiar both to the experts of HR unit and all employees who are undergoing the assessment. PTKS assessment of the Engineering Division’s employees is made on a regular basis, it is conducted by industry Qualification Assessment Centers (QAC) at least once a year or in accordance with the requirements of local regulatory acts. For instance, employees of HR unit are assessed on the basis of HR-scale of Rosatom State Corporation. Thus, in 2018, 11 managers and experts of HR management unit of JSC ASE EC and our subsidiary companies received certificates of completion of the HR-school course. Besides, all the Division’s employees are assessed under the annual assessment system RECORD, which has been used in Rosatom State Corporation and at enterprises within its scope of management for more than 8 years. 100% of JSC ASE EC and JSC ASE personnel undergo RECORD assessment annually.

In addition, we single out several special categories of highly skilled employees in the Division, e.g. they include designers. Experts of Design Unit undergo not only the PTKS assessment but also certification confirming compliance with the occupied position. In total, 3 439 experts involved in designing took part in assessment procedures in 2018. The certification procedure was completed by 2019 designers, 2002 of them defended their status successfully. Based on its results, the average score is 94.2 points out of 100 possible. I consider this result as quite deserved. And if during the certification in 2017 we checked the knowledge of Russian regulations in the field of nuclear facilities (NF) design and construction, then in 2018 we tested how well the employees of design institutes know relevant foreign codes and standards, in particular, IAEA guides and foreign customers’ requirements.

Speaking of how the certification of designers influences the safety of facilities under construction, there is a direct relation: the NPP design of III+ generation consolidated the best active and passive safety systems. But life does not stand still, codes and standards in the countries of Rosatom State Corporation presence are updated and revised quite often, so it is essential for any designer and builder to stay on alert, and the expression “Knowledge is power” is still relevant.

Human capital means the Company employees’ competences, their skills and experience. Human (HR) capital management includes: contributions to enhancing the employees’ skills, work with the candidates pool and the labor market, programs of personnel incentive and support programs. HR management system of the Engineering Division is based on the Company’s strategic goals and business priorities”

— What is the employees’ attitude to changes stipulated by transformation of the Engineering Division?

The significantly increased scale of project portfolio defined the necessity to build a new structure for the Division and revise the key processes related to design, project time and cost management, procurement quality assurance and other aspects important for observance of construction schedules.

When changes are implemented, companies always face resistance to the necessity of change. So we adopted a model of sequential actions regarding transformation. First, we deem essential to involve the employees in discussion of complicated tasks and problematic issues we are solving nowadays in order to seek and find the optimum solutions. With this purpose, various working groups are set up in the Company and intradivisional meetings are held, which present an opportunity to exchange experience with other industry companies already having similar experience. We get a lot of support from CST — change support teams. This is a new initiative which emerged in Rosatom State Corporation and was actively supported by the Engineering Division: there are 10 change support teams formed in JSC ASE EC and subsidiary structures and about 100 persons involved therein. Generally, they are young employees who are ready to become agents of transformation, leaders of change, primary mediators on this subject.

Second, we place a stake on open communication with employees as we are convinced that an open dialogue, detailed clarification of work objectives and plans will facilitate enhancement of the Company’s activities efficiency in general. We practice such formats understandable for setting and clarifying the objectives as KPI sessions. The events of Information Day and Director Day cover 3–3.5 thousand employees (totally there were 4 of them in 2018) and we held multi-stage Information Days and Director Days in the subsidiaries. We arrange regular meetings between the heads of NPP construction projects and functional units. In addition, we have a new communication format which appeared thanks to the KPI creativity — this is a format of meetings with the heads of functional units, “Open Dialogue”. In 2018, we held the first “Open Dialogue” with Nikolay Vikhansky, Vice President for Capital Construction of JSC ASE EC. All of these events are aimed at building up optimum horizontal relations in the Division — this is the only way to actually increase our efficiency.

In general, I would point out that the entire year of 2018 passed under the sign of transformation. We held an extensive clarification campaign. All of this allowed us to reduce the risk of misunderstanding and distrust in the team and, on the opposite, to increase the employees’ involvement in transformation processes. Now we are fine-tuning all processes — from the construction management to corporation functions.

And a lot of specific steps are estimated by the employees in a very positive way. For instance, this is the transformation program, where new tools for motivation of the designers and builders emerged from. They are aimed to focus all the attention of employees on the result, so that the employees understand clearly that the more effectiveness they achieve, the higher their level of salary is.

— How does transformation of the Engineering Division influence the key priorities in HR management?

Undoubtedly, the HR management unit is one of the primary agents of transformation. For instance, there is a new function singled out in the HR management which appeared in 2018. This is resource planning. Considering the scale of our portfolio and diversity of projects, our planning horizon is at least 10 years. For the correct forecasting, we analyze in detail which production capacities are required at every phase of project implementation (from design documentation development to putting the unit into commercial operation) and calculate the number of employees necessary for them, their qualification and competence. One of the key tasks in this area is to forecast how the external resources and resources inside the Division will be used.

Another priority in the work of HR unit in 2018 was recruitment — we hired 1,903 highly skilled experts and managers. Due to the deployment of NPP construction projects, the number of staff in NPP construction project directorates and branch offices shall grow by 60%, so we are enhancing internal competencies in terms of recruitment, including use of the best international practices and headhunting platforms.

Definitely, we go on working on various personnel motivation and training programs. An important component of the motivation is non-material incentives, e.g. assurance of training and development. Here we intend to pay a lot of attention to the development of continuity in our Division, use different sorts of career “elevators” — for instance, use such a tool as contests more widely. The primary purpose is to open the talents of our employees as much as possible, to create a favorable environment for accelerated development of professional and management skills. As we are planning that a lot of new people will join the Company in next few years, we highlight the task of their correct adaptation, so that they would absorb the corporate culture of Rosatom State Corporation rather quickly, start sharing our values sincerely, feel as a part of the large and versatile nuclear industry where the absolute priority is safety.

Meanwhile, it is well known that real quality can be ensured by highly skilled personnel only”
Konstantin Ilyinsky
Director of Saint-Petersburg Design Institute

Director of Saint-Petersburg Design Institute

— What can be improved at the design stage to reduce the future amount of radioactive waste from an NPP?

Designing is exactly the stage when solutions are taken that are aimed at mitigating the impact on the environment. Each design solution is based on strict compliance with the regulatory and technical documentation, each decision is properly justified and submitted to design supervision group for approval.

As an example of such solutions one can mention minimization of primary circuit leaks that are processed, i.e. removal of “clean” leaks and their return to the primary circuit without processing. More examples — primary circuit water chemistry, very strict requirements to materials that contact with radioactive media.

— Is an NPP impact on the environment really relatively insignificant?

An NPP impact on the environment, like the impact of any other nuclear facility, is limited by the relevant regulatory and sanitary rules. These documents regulate the values of maximal releases and impact on the environment. These parameters are complied with during designing. At the stage of the design review by the regulatory authorities the compliance is checked, making sure that the values are not exceeded. Assessment of the impact on the environment can and shall be performed by comparing the values of such impact for different types of power plants (thermal and hydro). Relevant numbers can be find in open sources.

— What is the influence of the Engineering Division transformation on design institutes, in particular on JSC ATOMPROEKT?

The Engineering Division transformation in relation to design institutes is aimed at restoration of their status, full-scale interfaces with all the participants of designing process, unprecedented support of the General Designer’s functions. In terms of designing, transformation will result in establishment of a Joint Design Institute which will comprise JSC ATOMPROEKT, JSC “Atomenergoproekt” and Nizhny Novgorod Design Institute. This will allow bringing together the efforts of all the designers in development of design documentation, improving quality and meeting the deadlines of our contractual obligations performance.

Natural capital means all renewable or non-renewable natural resources which, this way or another, are used by the Company during manufacture of goods/rendering of services. Natural capital includes air, water, land, subsoil, forests, biological diversity and ecosystem health. Natural capital management means friendliness to the environment and unconditional compliance with all the necessary standards and requirements in ecology and nuclear and radiation safety”
Sergey Streltsov
Director for Quality of Equipment, Construction and Erection Works

Director for Quality of Equipment, Construction and Erection Works

— What does safety culture mean for the Engineering Division?

The notion of safety culture was for the first time introduced during the analysis of the consequences of Chernobyl accident, in IAEA INSAG-1 report. According to the conclusion, one of the main reasons of Chernobyl accident, like of all THE other accidents before, was a low level of safety culture. Later the safety culture concept was expanded and described in other IAEA standards, WANO recommendations and Russian and foreign legislation.

In my understanding, safety culture is primarily the attitude of each employee to safety. In their activities, employees shall assess any action or inaction in terms of how it will influence safety in general. It shall be a priority both for the company and every employee. For the nuclear industry, safety is one of the main management mechanisms. Safety culture must be developed, introduced and improved. Of course, this is not a goal in itself. It is a tool for the company to reach its goals.

— What are the goals of the Engineering Division in this field?

First of all, bringing home to every employee that any activity that he/she undertakes shall not result in any detriment to safety, even the smallest one. The next goal is a s follows. We are building nuclear power plants. We must ensure such quality level of our work that guarantees future safe operation. These are our main goals.

To implement safety culture, we have introduced a policy which is applied to all the companies of the Division. In this policy we declare our commitment to safety culture. The companies of the Division have their own regulatory documents in this field; there are also specific documents for NPP construction projects as our customers have different requirements. All the above mentioned documents comply with the requirements of the policy. All the employees are familiarized with the policy which is downloaded on the company’s web-site.

A Safety Culture Council has been established in the company for the implementation of the policy. It is supreme body in the division in this field and we can even call it a legislative body. The composition of the Council has already changed twice. Within the current transformation of the Division we are planning to modify the composition of the Council once again.

— What other changes in the field of safety culture are implemented in the Division due to transformation?

There are plenty of changes, e.g., we have introduced the position of director — general inspector for nuclear, radiation, industrial, occupational safety and environmental protection.

Last year I was director for quality and was in charge of those issues. Now these functions have been delegated to general inspector. I believe that a specialist who is directly responsible for safety will strengthen our position in this field.

Coordinators of safety culture have been appointed in the key companies of the division — JSC ASE EC, JSC ASE, JSC “Atomenergoproekt” and JSC ATOMPROEKT. In the future, coordinators will be appointed in all the companies of the management scope.

The coordinators interact with authorized representatives for safety culture in departments. The main functions of the authorized representatives is getting feedback from all the employees, ensuring information provision upstream and downstream, improvement of communication, increasing the level of involvement of all the employees in safety culture development. Vertical interaction on safety culture is regulated by the internal standard.

Safety Culture Management System of the Engineering Division
Management representativeCoordinatorsAuthorized personsAll employees of the company

— Are there any programs and measures on safety culture that have already been developed and introduced?

We have been involved in safety culture issues for three years. We are at the beginning of this journey. We are working in accordance with the programs. The “Safety Culture Improvement Program” has been approved for 2018-2019. It describes the measures, the responsible parties and the deadlines. All the activities planned for 2018 were implemented.

Besides, we perform regular training of our employees. In 2018 we invited external couches to train our specialists in the field of inspection, occupational safety, quality management system and safety culture. 

— What methods for assessment of safety culture level are used in the Division?

One of the methods is questionnaires. We have developed questionnaires and have performed surveys for a number of projects, e.g. Paks-II NPP construction project. On the one hand I was happy with the results because we reached an acceptable (medium) level. However, this is only one side. On the other hand, we must realize that the survey was performed among the best prepared employees of our companies, i.e. among the specialists who were involved in European projects and who are most advanced in this field. Firstly. Secondly, we have not reached a high level in any parameter. This is our goal. We have a lot more to achieve.

The next method of monitoring and assessment of safety culture level are audits. Within our internal audits of quality management integrated system we perform safety culture analysis. We have developed criteria, requirements and plans for the audits. Last year an internal audit of Paks-II construction project was performed in terms of compliance of the process with safety culture requirements. We check the employees’ knowledge of the policy, their level of involvement, the documents that departments are guided by, compliance with the requirements of these documents.

— The level of an employee’s involvement in safety culture development is assessed. What steps are taken by the division to enhance such level of involvement?

We are planning to implement a project within the framework of modifications support team. This is a safety culture project, it will be aimed at receiving information “from below” and involvement of all the employees. The project team includes both employees of the central office and specialists from subsidiary companies. We hope that under this project we will be able to involve the maximal number of our specialists and draw their attention to the necessity of ensuring the safety of our activities.

We work on many construction sites abroad, and taking into account the wishes of our customers, we have developed and translated into English booklets and posters on safety culture. Booklets and posters are distributed at NPP construction sites to draw attention to safety culture of both our employees and our partners, the companies who participate in NPP construction together with us.

In conclusion I would like to sum up what I have said. I have mentioned only the main areas of our development. We have a unified understanding or safety culture principles. We are planning to follow them by means of appointment of authorized representatives in all the departments, training and dissemination of information on safety culture.

Leadership development. Leadership development, as I have mentioned, is primarily training of management personnel. We have a plan for management training in safety culture and we are planning to do more in this field.

Effective communication within the framework of safety culture development. The project that I mentioned earlier is dedicated to development of this focus area. Providing information on safety culture to contractors and subcontractors. We started putting safety culture requirements into contracts with our contractors and subcontractors that we conclude at various construction sites. We make sure that these requirements are reflected in safety assurance programs that all the contractors performing safety related works shall have.

We realize that we are at the beginning of a long journey, there is still plenty of work to be done. We have done a lot, and we are planning to do more in the nearest future.

Nina Dementsova
Head of Communications Division

Head of Communications Division

— Which communication events held in 2018 by the Engineering Division had an impact on image enhancement of the nuclear industry?

Rosatom State Corporation Engineering Division is the global leader in NPP designing and construction. The development of nuclear power engineering largely depends on public acceptance, that is why one of the main goals of communications division is shaping a positive public opinion of the activities of our company and the nuclear power industry in general. Special attention is paid to events aimed at combating radiological phobia and protests in newcomer countries of the “global nuclear club” in South and South-East Asia, Middle East and North Africa.

Activities for enhancement of public acceptance of the nuclear industry are permanently carried out in every country of operation in accordance with the communication plans jointly developed with representatives of local authorities and International Business Department of Rosatom State Corporation. Besides information support of NPP construction, these activities include implementation of special projects in Russian Federation and abroad, among them sports and cultural events.

In 2018, the communications division jointly with the colleagues from Rosatom state corporation and with assistance of local authorities organized a number of high-level events.

In August 2018, “Green Square” project was implemented in the city of Ostrovets, where the Engineering Division builds the first nuclear power in the Republic of Belarus. It coincided with the 550th anniversary of the city and was dedicated to promotion of carbon-free types of power generation. “Green Square” interactive program with 4 zones (water, sun, wind, atom) was attended by over 9000 local residents and visitors.

Rosatom Festival of Science held in New Delhi was dedicated to the 30th anniversary of cooperation between Russia and India. The activities held during the Festival included scientific and educational events in the field of nuclear science and technology, presentation of a Nuclear ABC in English and Hindi and a children’s drawing competition.

A “Week of Nuclear Power and Science – 2018” was held in Bangladesh in the cities of Ishvardi, Kushtia, Rajshahi and Dhaka. Students and schoolchildren of Bangladesh could listen to over 20 lectures in physics, mathematics, ecology, participate in educational, scientific and entertainment programs and receive plenty of materials telling in easy language about the advantages and safety of nuclear power.

Within the framework of Nuclear Industry Suppliers Forum in Cairo, gala concert of opera signers of Moscow and St. Petersburg “High Art — High Technologies” was held. The film “Wild Edens: Russia” was shown at the Tenth All-Arab Forum of Russian and Soviet University Graduates. The event drew the public attention to global heating problem and the necessity to apply low carbon solutions in power industry.

As far as our activities in Russia are concerned, we certainly could not overlook such an important event as the World Football Cup. In Nizhny Novgorod we launched educational and entertainment project “The Champions”. The largest radio stations broadcast mini-programs about nuclear power engineering and football.

The commissioning of Rostov NPP Unit 4 with capacity of 1000 MW was marked by production of a new film telling about the largest power generation source in the South of our country. Besides, in 2018 experts of the communications division organized a number of press-tours of public representatives, mass media and bloggers to nuclear facilities. They also supported the work of foreign Information Centers of the nuclear industry and Public Counseling Offices at nuclear power plants.

Social and relationship capital includes: promoting constructive cooperation with the main stakeholders, public acceptability of nuclear technologies, brand management, contribution to the development of the areas of operations, charity activities, etc.”

— How does the Company work with stakeholders, what was done in 2018?

Fostering a dialogue with the stakeholders, we always follow the principle of information transparency. Due to our information activities, our stakeholders obtain full and reliable information about production and social activities of our Division, its strategic goals, its short-term and long-term plans. In accordance with the information policy of Rosatom State Corporation, the Company pursues the policy of information transparency; all the materials issued by the communication division are regularly updated on the official external web-site, accounts, social networks and other information resources. In their presentations, interviews, when talking to the public, representatives of the Division follow such approach. We are fostering efficient bilateral communication with all the stakeholders. In particular, when preparing the annual reports, we have regular meetings and dialogues with public representatives. It is our tradition to take our stakeholders to our NPPs, to organize round-table discussions for the population devoted to safety of nuclear power, environment and sustainable development. In 2018, in Belarus alone the Division organized several large events for the stakeholders: Panel discussion “Nuclear power of Belarus: Environment and Safety”, round-table discussion: “Environmental and social aspects of nuclear power development” within the framework of the 23rd Belorussian power and environmental forum, exhibition and congress “Power. Environment. Energy saving”. Our stakeholders received full information upon the results of international ecological expedition of Oka LLC and Belorussian environmental organizations to the Belarus NPP and the results of international forum “Trade unions and “green” work places”.

In 2019, we will continue our work with all the stakeholders and we hope to receive active feedback.

As for social responsibility, the division ensures stable salaries and decent working conditions to over 23.5 thousand own employees and over 10 thousand employees of contractors”

— What UN goals in the field of sustainable development are reflected in the activities of the Division?

Engineering Division is committed to the goals of sustainable development declared by the UN. The main field of activities — NPP construction — pursues the following main goals: Affordable and Clean Energy (No. 7), Decent Work and Economic Growth (No. 8), Climate Action (No. 13).

Power start-up of unit 1 of Leningrad NPP-2, handover to industrial operation of Unit 4 of Rostov NPP and two power units of Tianwan NPP in 2018 were a significant contribution to supply of energy to the relevant regions and their population with safe power which will stay competitive in terms of price for a very long time. Besides, with impact on climatic change being one of the important factors in decision about the source of power generation, nuclear power plants are an important tool in struggle for the environment. NPPswith VVER-type reactors are designed in such a way that they emit almost no carbon dioxide into the atmosphere. Releases of pollutants into atmospheric air are also comparatively low. E.g., the annual volume of sulfur dioxide emissions from an NPP with VVER-1200 reactor is almost 63 times less than from a thermal power plant.

As for social responsibility, the division ensures stable salaries and decent working conditions to over 23.5 thousand own employees and over 10 thousand employees of contractors. At the same time, it is worth mentioning that almost seven thousand new jobs were created in the Division in 2018.

NPP construction activities have a positive effect on the sustainable development of the areas of operation: development of infrastructure, the economy of the regions, to say nothing about the support of social and charity initiatives, volunteer activities, etc. In conclusion I would like to point out that the long time-period of NPP operation, improvement of design properties, technologies of designing and construction, increase of the contribution of nuclear generation to the growing global power needs — all of it guarantees that nuclear power will be available to the current and the future generations, including the population of developing countries.