VR Group to start restructuring programme

VR Group launches an extensive restructuring programme aiming to respond to the sudden and partially permanent changes in the market. The economic recession and structural changes in the industry have substantially cut freight volumes. In addition to this, the group structure is to be reshaped to support the restructuring programme.
– Structural changes in Finnish heavy industry, in particular the forest sector, have reduced demand for freight services. The industry's structural changes are thought to be permanent. We aim to better meet the new requirements of our customers, VR Group's President and CEO Mikael Aro says.

At first, the restructuring programme will focus at restructuring and improving the efficiency of logistics operations. Passenger services will also start several programmes aiming to improve the customer travel experience and meet different needs of passengers. The restructuring programme starts immediately and will take two to three years to complete. With the programme the company seeks a €100 million increase in Group profitability annually. Achieving the objective requires cost savings and new business growth opportunities.

– We need prompt actions to safeguard the whole transport system and ensure Finland's competitiveness. Therefore our aim is to develop VR Group responsibly on a long-term basis together with the employees and employee organisations. These measures aim to safeguard the future of the Group and assure growth opportunities, President and CEO Mikael Aro emphasizes.

Group organization streamlined
The VR Group will be reorganized to simplify the company structure and to support the restructuring programme. The new VR will be structured more clearly around the customer segments, which will support the transformation and enable future growth. The new VR Group consists of five divisions: Passenger Services, Logistics, Corporate Services, VR-Track Ltd and Russia and International Business.

VR Group's all logistics operations: VR Cargo, Transpoint Oy Ab, Transpoint Cargo Oy and Transpoint International will form the VR Group Logistics division. VR Cargo and Transpoint Oy Ab will continue to operate as common carriers. All Transpoint companies continue operations as separate companies. The bus services of Pohjolan Liikenne will become part of the Passenger Services division but continue to operate as separate companies.

In the near future, all finance, IT and human resource services will be provided at the Group level. The new organization takes effect on 1 January 2010 at the latest but the management system of the new organization will be implemented immediately.
– Even though the organization undergoes a transformation the cornerstones of VR's business operations remain the same. VR is a state-owned company whose main mission is to provide passenger and freight services and build and maintain the rail network. New processes and a customer-oriented approach are essential for future growth, President and CEO Mikael Aro says.

A streamlined and customer-oriented organization aims to improve the service level and facilitates finding new sources of revenue.

Changes to the board of management
VR Group Board of Management is reshaped to match the new Group structure. In addition to President and CEO Mikael Aro the Board includes Senior Vice President, Passenger Services Antti Jaatinen, Senior Vice President, Corporate Development Rolf Jansson, Senior Vice President, Human Resources Timo Koskinen, Senior Vice President, Russia and International Business Päivi Minkkinen, Senior Vice President, Finance Heli Ollila, Senior Vice President, Corporate Services Pertti Saarela, Managing Director, VR-Track Ltd Teuvo Sivunen, Senior Vice President, Logistics Erik Söderholm and Senior Vice President, Corporate Communications Hanna von Wendt. The new Management Board will commence its work on 20 August 2009.

Source: Transportweekly