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“Marine Industry of Russia”

Moscow, “Gostiny Dvor”
Exhibition Hall,
May 16-18, 2012

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October 12, 2010
“It is feasible to develop high-technology relying on domestic resources!”Interview with Lev S. Lazarev, Director General of “Muromsky Radiozavod

Interview with Lev S. Lazarev, Director General of “Muromsky Radiozavod

October 12, 2010

This year “Muromsky Radiozavod”has joined “Marine Industry of Russia” International Forum. Participation in the Forum coincides with the 65th anniversary of the Plant foundation that will be celebrated on May 21, 2011.

Since 1946 “Muromsky Radiozavod” has specialized on development and production of modern marine radio equipment for operational communication, signalling, announcing and warning. What achievements can the Plant boast on its 65th anniversary?

In the crises of 2009 OAO “Muromsky Radiozavod” managed to avoided production output drops, instead we had a 5% growth of production.

Now I would like to say why we did not “fall down” in 2009. We cut expenses and increased production.

Steps to reduce expenses were first taken by new owners in 2003.

The production was completely reorganized, the production area and office space were significantly cut – from 39 000 m2 in 2002 to 18 000 m2 in 2009 (the released buildings were sold off), that allowed us to reduce the expenses for heating, electricity, depreciation, property tax and land rent.

We reduced the amount of land from 33 hectares to 4 hectares by selling buildings and giving the land to the city.

In order to reduce expenses for compressed air production we removed the air compressor room fixing the compressors near the equipment.

Electroplating section and neutralizing station are being reconstructed. New lines have been installed. Electric steam generators enabled us to stop using steam from oil-fuelled boiler house.
Electroplating section building has been thermally insulated, which led to lower heat consumption.

We’ve installed an automated energy accounting system, that allows to control power usage at different stages of production.

In 2008 we started using counters and steered latches in the heating system. As a result heating expenses have reduced by 60%!!!

We also have water and drain counters. Individual valves in all sections of the production help to save up to 20% of water, especially used in electroplating.

In the late 2008 – early 2009 we reduced our staff by 172 employees, as a result salary expenses dropped by 18 billion roubles (Unified Social Tax payments also reduced) in 2009 as compared to 2008.

Loan Rates have been lowered to 16-17%, the amount of loans has reduced by 14 billion roubles during this year. We use note-backed landing with 6-8% rate.

Civil and military productions have been separated, that allowed to make liaison with the daughter companies much more efficient.

Energy efficiency in 2009 was 3.15 times higher then in 2003. Why do I compare to 2003? 2003 is the year when V.V. Putin, who hold Presidential Office at that time, called for doubling the Gross Domestic Product by 2010. Since then our GDP has grown 3.5 times higher, GDP per capita – 4.15 times higher. The objective set by Putin has been achieved.

How has your staff composition changed in the recent years?

Staff composition has definitely changed. Our staff became older. When we hire a graduate is it an outstanding event.

I think that our Government makes crucial mistakes in education and training system. Instead of building “Skolkovo” we should have better restored the system of education and assignment of young professionals that used to exist in the Soviet time. What graduate would like to work at our town of Murom? We will not grant a flat (One will have to buy it at the local price of 35 000 roubles per m2). The salary here is 10 times lower then in Moscow and 20 times – then at “Skolkovo”! Our education system is not as bad to prepare idiots. We have to count on the higher education institutions of Murom. Professionals from other places come to us only because of their tremendous love of the profession…

With all that we were lucky enough to open a design bureau. All devices produced by our Plant have been designed by our staff! However, to make international brands we obviously lack resources and capacity.

How does the Plant manage to keep 50% of the market of loud-speaker communications and announcing for the Russian Navy? What is your secret – lack of competitors or trust to your Plant as the oldest company on the market?

For the moment we keep not 50% but almost 100% of the market of laud speaker communications (LSC) for the Navy. Leaders of our great nation definitely realised that creating a single plant for development and production of LSC equipment means overall dependence on it. However, such decision was made.

Today’s Navy commanders are so much concerned about giving the Army and Navy a “new image”, that they are not able to foresee the consequences of free competition on our market. I can say for sure that if we have uncontrolled competition as a result of allowing to use foreign components that will lead to the transformation of our Navy to “Toy Fleet” of Peter’s I times.

Who are our competitors? Companies that buy LSC equipment from abroad or use “ideas and components of a potential enemy” (as the Soviet terminology put it) in their projects. The Motto of modern commanders – “There will be no actual war, only the war of technologies” – is another bluff. Have we ever thought of fighting with Georgia? If you want peace prepare for war! We have a very short memory!

Has the Plant been affected by the economic crises?

We’ve experienced crises since the Soviet Union collapse in 1991. Our life was and continues to be a constant fight. We have no one to count on. Our government, army and fleet, banks, tax and justice institutions – all let us down. “You have to survive! You are now the owners! And when in spite of Kudrin’s expectations the global financial crises did brake out, we had already been prepared for it! Our GDP had been 3.5 times higher that time. Power consumption was 4.5 times lower. In 2009 when our country was hit by the crises, our production output increased by 3-4% as compared to 2008. As a result of the staff reduction, the GDP per capita increased by 15%. In 2010 we plan to increase our production output by 30-35%.

What are the distinguished features of the devices you make for ships?

We use only domestically manufactured components in our devices. It is a hard task, but we do it! That makes us the only Plant in Russia that makes LSC equipment that fully meets all climate standards and radio durability and reliability requirements. We are the only enterprise in Russia that guarantees the production of spare parts and components for our devices during the next 20 years after the device itself is abandoned.

Such systems as “Kashtan” and “Listvennitsa” are no longer installed on new ships (except for export ships), while we continue to produce spare parts and components for them, as both “Kashtan” and “Listvennitsa” are used by the Navy.

What large-scale orders has your Plant recently received?

Our today’s customers.

Our main and priority orders for today are those coming from shipbuilding plants and the Navy. They order new devices along with the systems designed over 30 years ago. The main task is to transmit/receive a command/message under any circumstances. Sometimes that helps to save a ship and its crew. In all known emergency situations on ships or submarines our equipment proved its high reliability. Our devices are not only reliable and durable they are also easy to operate.

That may be the reason why the Chinese Navy prefers to buy ships with our somewhat out-of-date equipment instead of modern LSC systems. That is why there is a demand for our analog devices, which are made of domestically manufactured components and are based on proved military technologies and standards. It is not easy to keep producing them in the current situation. It is impossible to make high quality loud speakers without having an anechoic chamber. I think there are only a few chambers left in Russia today.

We have close connections with all civil and military shipbuilding institutes and design bureaus. We much value all proposals from shipbuilders giving them close attention.

Today all our military ships and submarines including those under construction have our Plant equipment. We hope that the Plant will keep these connections for the nest 65 years.

Offshore nuclear power plants, offshore oil platforms, coastal facilities of the Navy and civil fleet – all new projects include the equipment made at our Plant. The Plant is completing the delivery of communication equipment and general alarm systems to the ice-resistant oil platform “Prirazlomnaya”.

The communication equipment of our Plant enjoys good reputation at nuclear power stations. All Soviet nuclear power stations built in the country and abroad were equipped with our systems.
The Defence Ministry (the Strategic Missile Forces, the Aerospace Defence), departments of the Emergency Situations Ministry have traditionally been among our customers. Today our Plant supplies them with systems that have been designed with the use of microprocessor technology. By the way, we use domestically made microprocessors accepted by the military.

OAO “Muromsky Radiozavod” is carrying out a series of design and experimental works and pilot projects to develop modern communication systems. Under the order from OAOFNPC NNIIRT” (Primary Customer UROZ VKO) we have developed a digital LSC system KTS-01CS. The system is made of domestically made components and has been accepted “5”, the system software has also been designed at the Plant. Joints range is compatible with the existing means of communication and allows working in digital communication networks of the Air Defence single information field. Communications is available in loudspeaker and telephone modes. It also has command circulation and conference modes, LAN Ethernet connection, allows configuring, recording and has many other features. Time of establishing the connection is less then 0.1, without connection failures caused by traffic overloads. New joints are being developed. The device has already been used on many radars and approved for supplying to stationary military facilities.

Our scientific and technical capacity makes the basis for the development of integrated and unified digital system of interior communication. Our technological ideas were used in compounding materials of the pilot project “R-781MM” ordered by the Russian Navy. The use of advanced information technologies together with the know-how in LSC allow us to create a reliable communication system with high performance characteristics. The system can also be used at naval coastal facilities as part of a single military communication network.
The design bureau and technology services of the Plant are capable of meeting deadlines of modernisation and back fitting projects. We successfully carry out such projects with both design organizations and companies. For example, by the end of this year one of the sensitive military sites will receive our system of loud speaker operation communication and announcing via a two-wire line, which is meant for perimeter protection, line length is up to 30 kilometres.

We are resuming the works on the wireless shipboard communication system for a big anti-submarine ship of the Indian Navy. Close liaison with design organizations and customers is becoming usual for the Plant. Such approach helps to increase the number of orders.

What do you expect from your participation in “Marine Industry of Russia” Forum, which will be held in Moscow in May 2011?

We would like to demonstrate that “Muromsky Radiozavod” is alive and continues working. It even develops new high-technology devices using domestically manufactured components. We would like to say to all participants and visitors of the Exhibition: “It is feasible to develop high-technology relying on domestic resources!”

There is a modern trend to talk about new digital communication systems. D.A. Medvedev was the one to express his views on the issue: “The Army and Navy to be equipped with modern digital communication systems by 2012”. However, I would like to draw your attention to the fact that in order to achieve that goat by 2012 we will have to buy foreign components and equipment. At the same time many Russian manufactures, which come under the Defence Ministry’s ban on the use of foreign components in production, will stay idle.

Forum Press-Centre

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