The audit was conducted in the framework of agreement on technical support and technology between Severstal and Arcelor Consultants, signed to assure supplying Severgal with quality substrate.

Arcelor Consultants aspired to evaluate the company’s present ability to produce substrate for hot dip galvanizing sheets for the automotive industry. This ability was evaluated both in terms of technical expertise and management. In the course of the TQM audit, a group of experts evaluated company’s TQM, based on the EFQM model. The technical audit involved evaluating of the manufacturing process, its level of automation, the make up and condition of the production facilities. The quality controls in the converter shop, the sheet rolling plant #2 and the cold rolling shop, which are the main units for substrate production for Severgal were also studied.

Philip Pulye, expert of the Arcelor Consultants auditing group on IF steel production technology, said, “We have reached the goal of the audit by receiving complete information on all technical and technological aspects of Severstal.”

Domenic Lemeer, TQM expert, stressed that during the first week of audit, over half of Severstal’s employees, who were supposed to meet with Arcelor Consultants, were interviewed. “We have interviewed managers of all levels to get a complete picture. They were very well informed and open,” he said. According to experts, the company had made major improvements in its quality management system, since their last visit to Severstal several years ago.

TQM experts gave high marks to Severstal receiving the ISO 9001:2000 certificate, its efforts to prepare for receiving a TS automotive certificate and the Balanced Score Card.

Final results of the technical audit will be presented at the end of March. It will allow Severstal to develop a program of activities, important to next stages of the Severgal project. One of the steps is to further develop and master the IF steel making technology. These grades of steel are used in the production of hot dip galvanizing sheets for the automotive industry at Severgal galvanizing line making use of the French technology and experience. To get the technology up and going workers of all specialties of the three production units will be trained at Arcelor.

Besides that, technical and TQM audits will help specify the agenda for workshops in France, held for top-managers of Severstal, various level managers and line employees of some company departments and shops.

14 March 2003