REPORT: Norilsk Nickel might eliminate first deputy CEO position
MOSCOW. July 17 (Interfax) - Billionaire Vladimir Potanin has been chief executive for Norilsk Nickel for just eight months, but in this time the Russian mining giant has already gone through three rounds of management changes. In the latest round, Norilsk Nickel could eliminate the position of first deputy CEO, a source close to the company told Interfax.
While the first two rounds only affected members of the team of former CEO Vladimir Strzhalkovsky, now the axe has come down on Yevgeny Yakovlev, a Potanin associate since the mid-1990s who joined Norilsk Nickel in January as first deputy CEO.
Norilsk Nickel attributes the management changes to the optimization of its business amid a difficult market environment and the achievement of a target organizational structure "aimed at efficiency, horizontal work of the management team and active transfer of authority to the local level."
Former Norilsk Nickel employees say the departure of Yakovlev, who played the role of crisis manager, was to be expected. One of them attributes it to a battle for influence at the company and does not rule out further reshuffling.
Mission accomplished
Yakovlev, who previously headed Power Machines and Remputmash, has not been working at Norilsk Nickel since Tuesday. The order on his dismissal has not been signed yet, but his receptionist said Yakovlev has already vacated his office. One source told Interfax that Yakovlev might return to Remputmash.
Yakovlev has left because he has carried out the job he was supposed to do, a source close to Norilsk Nickel said. After Potanin took the reins as CEO in mid-December 2012, Yakovlev became responsible for ensuring the company's continuous operation and achieving quick results in finding reserves of efficiency.
"Yakovlev is one of the best managers in the country, a person who has worked with Potanin for a long time. He did his job very effectively, and there aren't any people at Norilsk Nickel who are not grateful to him for this," the source said.
"But as high-priority problems were resolved, Norilsk Nickel turned to tackling other challenges, particularly since the team was joined by industry specialists who were not easy to find quickly," the source said.
Yakovlev's responsibilities have already been distributed among deputy CEOs.
Handover
Yakovlev was in charge of issues related to analysing the efficiency of operations and management of investment. He also oversaw the position of deputy CEO for strategic projects, which since the end of January has been held by Maxim Naumchenko, a former colleague of Yakovlev from Remputmash.
The position of Yakovlev and Naumchenko was instrumental in decisions such as using the principle of "minimum IRR of 20%" for selecting priority projects in the investment program for 2013 (which could by cut by 20% from the approved 75.4 billion rubles), the possible five-year postponement of a project to build a mine and processing plant at the Bugdainskoye molybdenum deposit in Trans-Baikal Territory and the decision to not mothball Tati Nickel in Botswana.
Following the mid-April departure of deputy CEO for production Yevgeny Muravyev, who was responsible for the environment under Strzhalkovsky, Yakovlev also took over all production issues. Meanwhile, a number of other senior members of Strzhalkovsky's team left the company in March-April and it was announced that the management restructuring was completed.
However, in early June there were reports that Sergei Dyachenko, COO of Kazakhmys and a former manager at Rio Tinto and De Beers, would join Norilsk Nickel's senior management. Norilsk Nickel officially announced Dyachenko's appointment as chief operating officer on Monday.
The appointment of Dyachenko, a 30-year veteran of the mining industry, demonstrates the focus on hiring managers with the most specialized competencies in the industry, a source close to Norilsk Nickel said.
Infighting?
It was no accident that Dyachenko's appointment coincided with Yakovlev's departure, the former will replace the latter, the former head of Norilsk Nickel production division said. Production was one of Yakovlev's key areas of responsibility, and without it he would not have been left with enough responsibilities for the rank of first deputy CEO, the source said.
But the main reason for Yakovlev's departure, he believes, is a lost battle for influence with Norilsk Nickel deputy CEO for strategy and business development, Pavel Fyodorov. Fyodorov, formerly senior vice president for strategy at oil major Rosneft and a deputy federal energy minister, joined Norilsk Nickel in the middle of April.
The source said that deputy CEO Naumchenko and Alexander Perov, the director of the department for implementation of strategic projects, who are members of Yakovlev's team, could also leave the company.
Two sources at Norilsk Nickel denied that these two managers would leave the company. Naumchenko is currently on vacation, but will return to work next Monday, one of his acquaintances told Interfax.
Another former senior manager at Norilsk Nickel told Interfax that Yakovlev's departure was foreseen as early as the spring. "Such a possible turn of events was mentioned by both Potanin and Yakovlev himself. Only the timing changes - this was expected to happen even earlier," he said.
He did not rule out a possible rivalry between Yakovlev and Fyodorov, but believes this was not the reason for the management change. "As for a battle for influence, it exists in any team. But I wouldn't say that someone defeated someone. You don't win that quickly," the former Norilsk Nickel senior manager said.
Yakovlev's departure from Norilsk Nickel is logical, because the scope of his responsibilities narrowed considerably recently, a source at one of Norilsk Nickel's principle shareholders said. In any case, personnel decisions are up to Potanin, he recalled.
One of many
Yakovlev's departure and Dyachenko's appointment were not the only major personnel changes at Norilsk Nickel this summer. The director of foreign production assets, Roman Panov left the company in June to become head of state company Rosgeologia. Panov was considered loyal to former Norilsk Nickel CEO Strzhalkovsky, who stayed on at the company as vice president for development of foreign assets until July this year.
A source familiar with the activities of Norilsk Nickel's foreign assets department told Interfax that a large number of specialists from this department - geologists, financial experts and lawyers - followed Panov to Rosgeologia.
Since the beginning of this year, Norilsk Nickel's management board has lost former CFO Dmitry Kostoyev and former deputy CEO for IR and GR Vyacheslav Poltavtsev, who became advisers to Potanin, and former deputy CEO for production Yevgeny Muravyev. The latter's predecessor in the post of deputy CEO for production, Yury Filippov is now also an adviser to Potanin.
All of the management changes at Norilsk Nickel have left only one senior executive on the management board who was appointed under Strzhalkovsky - Yelena Bezdenezhnykh, deputy chief executive for corporate governance, asset management and legal.
