Severstal North America LLC will not alter its marketing and
sales strategy despite a change at the top of the Russian-owned
steelmakers commercial division, according to the
companys newest vice president, Sachin Shivaram.
"In terms of strategy,
nothing is going to change. I think we have a great strategy in
place, particularly with an excellent position in the
automotive market," he told AMM in an interview.
"Were absolutely committed to that and were also
committed to our customers. Nothing changes. This is just a
change in people and not a change in commercial strategy."
In the past three
weeks, the Dearborn, Mich.-based company has announced new
appointments in its highest executive positions, including
Saikat K. Dey as chief executive officer (
amm.com, Sept. 3) and Olga Petrova as chief
financial officer (
, Sept. 16). Shivaram was named vice president of
commercial Sept. 24 (
amm.com, Sept. 24).
Within hours of the
news, customers of Severstals Columbus, Miss., and
Dearborn mills expressed concern that their relationship with
the company may change, particularly given the exit of Thomas
Marchak, Shivarams predecessor, from his former role.
Marchak has been appointed a special advisor to Dey for an
unspecified period of time. Shivaram insists, however, that
those fears are unfounded.
"From my perspective,
the fear is that customers have had a relationship, obviously a
very personal one, with us and theres a history of things
that are talked about and not written down anywherejust
understood. The fear is that it just all disappears and
thats absolutely not the case here," Shivaram said. "Tom
(Marchak) and I have a good relationship and hes not
going anywhere. All that knowledge will pass on and stay within
the relationship. And the entire sales team is still here. I
dont think there will be more changes on the commercial
Shivaram likely faces
a steep climb ahead. Not only has he been appointed to arguably
one of the more difficult positions within the steel
worldselling steel at a time when the market is
oversupplied and under duressbut his experience to date
is rooted in the long products and raw materials sector.
Severstal in December 2012 as general manager of metallics,
having previously worked at Luxembourg-based ArcelorMittal
SAs Long Carbon Americas division as head of strategy and
marketing. He is convinced, however, that the lack of
experience may prove to his benefit.
"Im going to
have to embrace that Im not from within that part of the
industry. Hopefully, I can work that to my favor and bring some
different thinking," he said. "It also gives me a chance to ask
dumb questions and sometimes you get good answers. Before I
started on the scrap side, I hadnt done anything in scrap
and I enjoyed the learning process. I imagine that to be the
same in flat-rolled. Its the most complex aspect of the
The leadership change
at the top of Severstals commercial unit comes at a time
when contract negotiations for 2014 are under way, leading some
observers to question the companys decision to replace a
top commercial leader at such a critical juncture. Marchak
affirmed, however, that the companys previous pledge to
move away from "CRU minus" deals and its guidelines on contract
negotiations will stand as is (
amm.com, Aug. 22).
"I dont think
this changes anything," Marchak told AMM. "Were
going to walk through this period together. We have a few
things were working on from the 2013 operating plan,
which were almost two-thirds of the year through.
Well continue to go through that plan and forecast for
the balance of the year. Were also going through our 2014
operating plan session and well be holding hands on that.
From an approach standpoint, what weve said were
going to do wont change."
Starting next week,
Marchak and Shivaram will begin calling on customers and
assuring the market that dealings with the steel producer will
remain "business as usual."
companies Ive worked for, everyone here genuinely cares,"
Shivaram told AMM. "Tom has brought that attitude not
just to the sales organization but all of Severstal and
thats going to continue. More than just saying it, our
customers will see it."