Martin Schneider (MS): What are your main business values?
Maksim Klochai (МК): The reputation of our company is key. It is important what other people think about our company.
Maintaining traditions is one of our values. Our slogan is “we are proud of the past, we appreciate the present, we look to the future with confidence - together we create a strong Russia“. Our plant is in the heart of a small town, as people say, a one-company town. Therefore, the main business value is our people working with our equipment. We appreciate the best practices of old stagers, we build on their experience. We put high stakes in our talented youth, who will help us meet our current and future challenges.
MS: How do you motivate yourself?
MK: First of all, I am trying to keep up with my father's high level of competence and professionalism. Secondly, I want to retain the strong business reputation of our company regarding its modern economic conditions. It is a family business, anyhow.
MS: Your father is a well-known person in the Nizhniy Novgorod region and in the country. Now you are in charge of the company. Is it difficult to work under the supervision of Viktor Klochai?
MK: It is not difficult to work under my father’s supervision. However, repeating my previous statement, that it is challenging to match his high-level demands and to meet the high expectations of other people. People are expecting from me the same level of skills as my father’s. This is a challenge which motivates me.
MS: What distinguishes your personality from your father’s?
MK: It is difficult to evaluate and judge oneself. My employees can talk about this much better – what do you think, Svetlana? (Svetlana Serdechnaya, Head of Department for corporate communications PJSC “Ruspolymet”)
SS: Maxim Klochai has been working at our company for more than ten years in different positions. As people say, he grew up on the plant. He knows the entire production process; he studied the technology process from the ground up. It allows him to take proper managerial decisions, and to assign clear objectives for his staff. The main part of our company’s investment program for the modernization of its production has been realized successfully under his leadership. The strategy for “Ruspolymet” for the short- and long-term has been worked out under his supervision as well.
Thus, he deserves our trust. What is trust? – It is the confidence in a person who never steps one somebody’s feet. Maxim Klochai is similar to his father in many ways. While he has a more easy-going personality compared with Viktor Vladimirovich, he demands a lot from himself and from his staff. Planning and goal-setting are very important to him. You can believe me as I have been working in the company since 1989.
Maxim Klochai adds: My father, Viktor Klochai is a true global leader based on his tremendous experience. He defines general goals and objectives. Most important for him is the result. I prefer to sit down with people in order to understand their needs and problems and to identify the root cause of problems together.
MS: How would you describe your management style?
MK: I prefer to listen to employees about problems that occur, and to give them the opportunity to solve them. I interfere only in critical situations when I see things going the wrong direction or towards a dead-end. For me, it is quite similar to the European management style where every manager is responsible for his results. If employees are given the opportunity to solve problems by themselves, they develop an attitude for being responsible for their own decisions and with that they become more creative.
MS: Normally, Russian employees are used to receiving orders, to behave according to hierarchy. Now you introduce a new, European-like management style. How do people respond to it?
MK: Indeed, people are adapting to my new management style with certain difficulties. It is difficult for them to assume a higher level of responsibility. I am trying to convince them that everyone at the company has the power to enhance our business processes. The ability to make decisions is a major criterion when hiring new managers. If a person still does not understand this new approach, he or she is the wrong person for our company.
MS: It appears that your management style works. The second consecutive year you got the highest ratings for three basic categories in the ranking “CEO of the Year Russia”. What does this award mean to you?
MK: Firstly, it gives us the understanding of where we are situated today in comparison not only with Russian companies but also with foreign competitors. We present ourselves as a steel producer of international level. It is very important for us to be included in the ranking “CEO of the Year Russia 2017”, especially in the current situation. During the last ten years, the Russian economy has been suffering some crises, and many companies stopped their development plans or closed down. However, we are expanding and developing further.
We have completed a remarkable modernization in recent years. We invested more than 200 MEUR! This gave us new impulses. We had no other choice than to invest in modernization, despite difficult times. I am sure, if we had stopped the push for modernization, our company would not exist anymore.
MS: It is remarkable that you managed to obtain such large funds during the current difficult times.
MK: Well, we did have problems to secure the investment. Initially, we had planned to accomplish the modernization 2-3 years earlier but were delayed due to financial problems. From the beginning, we received financial support from the state for our modernization program on preferable terms. Initially, the financing from “Sberbank of Russia” broke down due to the crisis situation in Russia. It took us almost three years to find another bank. Finally, we secured the VTB24 Bank as our financial partner. The main part of our modernization programme was completed by the end of 2017.
MS: You announced in another interview, that “Ruspolymet” pretends to be the best company not only in Russia but also in Europe. What does it mean?
MK: First of all, we must become more competitive in the steel sector. It is not only about money, but it is also about management. Everything we do should meet high standards: from accounting systems to business processes. Russia is moving into this direction fast, but we are still lagging behind some European and American companies.
MS: What is your international strategy in a nutshell?
MK: We move from simple to complicated things.
Our goal is to obtain a significant market share for our niche products. With them, we like to penetrate industries like aerospace, oil, and gas, shipbuilding, atomic and general machinery as these industries are related to us traditionally.
Our main challenge is to win European customers. While we lack experience in supplying our goods to Europe, in turn, we feel a lack of trust by the European companies. Therefore, we must develop individual approaches for each potential customer. This, for example, may mean to start with a small order in the low-cost product range and then moving up to premium products based on good delivery and quality performance.
For achieving this, we opened our European representative office in Dusseldorf last summer. We believe that it will help us enter into the European market for general machinery.
MS: What is the strategy of "Ruspolymet" for the next 10 years, what is the next big milestone besides the expansion to Europe?
MK: We have two main goals.
The first one is related to our production – it is the broadening of our value-added: to produce finished goods, not only semi-finished goods as of today. We started the implementation of this strategy in 2017. In other words, we are planning to move from a metallurgy plant to a machine-building company. We do not want to be the cheapest (semi-finished) product producer, we want to be the most expensive product producer providing high-quality products to our clients!
The second goal is the improvement of our internal business processes. We have got the best equipment for production. Now, we have to upgrade our technical competence, our people’s competence, in order to match the top equipment standard.
MS: How do you make decisions?
MK: Better to make a decision, even a wrong one, than to not make a decision at all.
MS: How do you spend your spare time?
MK: I like extreme sports. For example, I enjoy driving off-road vehicles such as motorbikes, cars, or four-wheelers in the forest. As a vacation activity, I would mention skiing and underwater hunting. And of course, I like to spend as much time as possible with my family.
MS: What makes you most happy?
MK: My children. I have two children: a daughter and a son - 3 and 2 years old.