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06.08.2014

“Development of Customer Relations as a Key Tool for Sales Management”, Vyacheslav Erkes, Sales Director

- Vyacheslav, I propose to start the interview with a discussion of CENTRAVIS key successes and current challenges in the context of sales…

Let me start form challenges. There are a lot of them but currently, Centravis is focused on two ones. The first challenge is absolute execution of the orders in time. Delays are the factor that may actually hinder our development. The second set of challenges relates to the situation in the East of the country making the issue of meeting the deadlines and order deliveries more relevant. We are actively working on these risks and are in constant contact with our customers to ensure quality management of their expectations.

Regarding achievements, I would like to touch upon three aspects: products, markets and services. Among major achievements is the introduction of very succesful products into the market, ensuring a breakthrough in automotive and furnace tube segments. We have been on our way for four years to reach this point. Being traditionally a strong player in steam generator tubes segment CENTRAVIS has also strengthened its position recently.

We have considerably revised our sales strategy for USA and Asia. As an example, the first half of 2014 ensured more shipments to USA y-o-y. I put this fact as a great success for Centravis. We are increasing the sales to Asian market as well and the plan is to double the growth by the end of the year.

Finally the third issue is development of relations with our customers, where I would like to emphasize on two major projects: Team America and Key Account Management.

- As reflected by title, Team America Project is focused on American market…

That's exactly right. In short, the Project assumes a certain dedicated team to provide comprehensive expert support of the Company’s business in USA. The time is a key factor to be considered in cooperation with the US customers. The time difference between the head office of CENTRAVIS in Ukraine and Sales Office in Houston (USA) is 8 hours. When working day in Ukraine is over – our US colleagues are just starting to work. What was our decision? We build up a team to provide support and interaction with American Sales Office for 4-5 hours. Thus, we have reduced the number of iterations, updates on inquiries and orders from customers and improved responsiveness. The project was launched in September, 2013 and according to customers’ feedback the Company has considerably improved its service and customer support within less than a year. This example demonstrates the opportunity to overcome any distances and time barriers due to apparently simple solutions.

The second major project is a Key Account Management (KAM) - a more comprehensive and long-term one. In fact, the project target is the same - to reduce distance between the Company and the customers. The relevance of this approach for CENTRAVIS is explained by our distance from the customers in Western Europe, America and Asia. KAM implementation will enable us to become closer to our customers as much as possible by means of a special partnership system.

- Development of customer relations - a time demanding task…

We do not expect quick project results. In this regard consistency is the key success factor. We have already made several attempts to implement KAM since 2007, but had a lack of experience. At the end of last year we initiated the project in a consistent manner.

- How is the consistency expressed?

Currently the Project is at the pilot stage. We chose three partner companies within the segments we are interested in. A team of Sales, Production and Technical Department managers is being formed for each customer. Team target is to provide the customer’s satisfaction with our service and products. Additionally we have started to develop uniform customer service standards. We expect the pilot stage to be completed by the end of the year. When the process of approaches and standards testing is over we expect to add another 30 customers in 2015. We want to be sure in the program high-quality performance providing added value for the interested parties.

- What is the meaning of the “added value”?

As mentioned above, KAM implementation provides building of a system of special relations. The target is development of a business in cooperation with customers based on joint vision for long-term partnership. We demonstrate our readiness to adapt technologies, business-processes, financial tools, standards, etc. for the customers’ needs.

- Don`t you think customers can be demotivated to participate in sort of projects like this? There are a lot of similar suppliers. Does it worth spending time and resources on development of "special relations” with a particular supplier?

Indeed there are plenty of suppliers. Customers are becoming more and more selective. By chosing the project partners we definitely try to estimate their interest and loyalty to Centravis. With respect to customers motivation, we do not expect them to refuse supplier diversification. We are confident that the customer will cooperate more eagerly with the supplier who is able to manage their time, expectations and demonstrate maximum flexibility regarding product and service requirements. For instance, Centravis has more than 10-year partnership relations with Dneprospetsstal, tube billets supplier. Certainly, we diversify suppliers and analyze the market but the priority is given to this particular company due to their flexibility, loyalty, readiness to offer a nonstandard service and solutions customized to our special needs. This is nice KAM example with relation to Centravis as a customer.

- What kind of departments are currently involved into the KAM Project?

Customers are assigned with Sales Account Managers. The Project also involves logistics, production, technical and marketing staff to ensure exceptional results.

- What are the possible risks of this Project, in your opinion?

I think there are two possible risks. The first risk is called overpromising. Our target is to fulfill all the promises given to our customers, even at lower pace. The second risk is a return on investments. The Company invests a lot into the Project. We should understand a special relations model may not be required by every customer. International practise shows that half of this type of investments are not returned. Therefore, we come to the process very carefully. Our objective is to ensure the Company’s growth in target products by becoming a part of and providing added value for our customers’ business.


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