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What does “Dalzavod” have in common with Toyota?

“Dalzavod” Ship Repair Center” is the oldest company in Primorye, which turned 132 in October. The company took an important place not only in the region history, but also in the whole country history, and became a part of the working life of several generations of Primorye residents. Nowadays “Dalzavod” is a visiting card of Vladivostok, same as the right-hand drive Japanese Toyota brand, which is loved by the Far Easterners, and is known far beyond the Far Eastern Federal District.

bespalov 1 — What does “Dalzavod” have in common with Toyota?

Like the Japanese company, the Primorsky enterprise has experienced dizzying ups and swift downs on its production path. Yuri Bespalov, Executive Director of JSC “Dalzavod” Ship Repair Center”, told the business weekly “Konkurent” what other things connect the shipyard with the automobile concern.

– “Dalzavod” has a rather complicated post-Soviet history – in the 90s the territory of the company was split up, the enterprise was in private hands, returned to the state, even went through bankruptcy. Yuri Vyacheslavovich, what problems did the company inherit?

– “Dalzavod” isanold company. For a long time, there were no investments into its fixed assets, but today we have quite ambitious development plans, which imply the renewal of the “Dalzavod” quay wall, construction of a synchrolift to ensure repairs of Navy ships and construction of civil vessels, the modernization and repair of dry docks No. 2 and No. 3. One of them was laid by Tsarevich Nikolai in 1891 during his visit to Vladivostok;and also other projects to modernize the enterprise. Some of these plans have already been implemented: a modular compressor station has been put into operation, the first stage of the berth repair has been completed. Thanks to “Rosneft” company and the “Far Eastern Shipbuilding and Ship Repair Center” management company, additional funds were allocated to “Dalzavod” last year, which allow implementing our plans.

In new conditions of competition

– What large-scale projects does “Dalzavod” have in the priority area of work – repair and maintenance of ships and vessels of the Pacific Navy (PN)?

– We are currently completing the largest project on deep modernization of the large anti-submarine warfare ship(ASWS) “Marshal Shaposhnikov”, which came to “Dalzavod” in 2015. Due to the work carried out, the ASWSwill completely change its purpose and appearance. Soon we will take “Marshal Shaposhnikov” to sea trials. TheASWS“Marshal Shaposhnikov” project may signify the beginning of the re-equipment history. And if the experience is recognized as successful, we are counting on new orders for many years ahead – not only for the PN, but also for the Navy as a whole.

– The President of Russia gave instructions to increase the percentage of civilian and dual-use products in the military-industrial complex (MIC) production to at least 50% by 2030. Howdoyouplantoachievethisgoal?

– We see ourselves not only as a ship repair, but also as a shipbuilding company. The enterprise already has relevant experience. During the Great Patriotic War, a third of the USSR submarine flotilla was built by the hands of the “Dalzavod” workers: 85 submarines were born at “Dalzavod”. In recent times, “Dalzavod” has also proved itself as a shipyard, taking part in the construction of an ice-class tanker. A promising direction is cooperation with the “Zvezda”SBC: at the moment, the shipyard has 39 vessels in its orders portfolio, the program until 2035 includes 178 vessels. We plan to participate in the construction of hull sections and the supply of all necessary equipment to the ships produced by “Zvezda”.

– What difficulties does the defense industry complex enterprise face, repairing civil vessels?

– With non-competitive price setting. The “Dalzavod” Ship Repair Center” bears huge indirect expenses for maintaining the technical infrastructure that ensures the PN combat readiness. We work to reduce indirect expenses to ensure competitive cost. Currently, the “Dalzavod” specialists are developing this direction. Technically, the Company has no restrictions on working with civil vessels, since military orders are more complex and specific, requiring high qualification and discipline of the personnel.

The most complex type of production

– Large-scale optimization entails creation of a new planning model. Are there ready-made solutions in the field of military ship repair?

– In my opinion, military ship repair is the most difficult production type for planning. Ship repair, unlike shipbuilding, does not work in series; a wide range of problems accompanies it. Therefore, there are no universal models – you need to create your own. And at “Dalzavod” this process has to start from point zero.

– Planning is not only production processes, but, first of all – the system thinking of the management staff. In the USSR, the top managers were not traineden masse, no one was taught a system approach, and then a new era – era of the market – came. Howdoes “Dalzavod” solve the management issue?

– It is impossible to live according to Soviet principles in the modern dynamic world. However, it is very difficult to convince people of the need for change – this means involving the team, showing that a change in approach to work is inevitable. In order to launch this process, I organized training for the directorate as part of the Russian Presidential Academy of National Economy and Public Administration under the President of the Russian Federation(RANEPA) management courses. The heads of the workshops also started the educational process. At one time, I myself was trained in management and I know how the gained knowledge can change not only the approach to work, but also the worldview. In part due to this, the managers began to look at business processes in a different way, as well as to apply the knowledge gained in production practice.

I have often quoted Jeffrey Liker’s book, “Toyota Tao”, to employees. At first, they were skeptical: where is the Toyota car concern, and where is the ship repair? However, there are similarities. Toyota’s experience is an example of the successful struggle of system thinking and desire for transformation with the desire to remain static: history is full of examples when global giants left the markets because the top management did not want to improve. And the experience of the Japanese company can be applied in any area. I believe that “Dalzavod” succeeds in doing this, because the managers have learned to approach problems in a system way. But the most important thing is that the managers’ eyes begin to shine, and they gradually inspire the entire team, involving every employee of the company in the improvement process.


Yuri Bespalov – Executive Director of JSC “Dalzavod” Ship Repair Center”. Was born in Sevastopol. In 1995, he graduated from the Higher Naval School named after F.E. Dzerzhinsky in St. Petersburg, then he did military service. In 2005 he graduated from the Naval Academy named after Navy Admiral of the Soviet Union N.G. Kuznetsov in St. Petersburg, in the field of management. He received additional education in the Institute for Economic Strategies in Moscow, in the Graduate School of Management in St. Petersburg. Married, a father of three children.

Press service of JSC “Dalzavod” Ship Repair Center”

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