EBRD boosts competitiveness of Kazakh small businesses

By Lucia Sconosciuto

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EBRD boosts competitiveness of Kazakh small businesses

The EBRD helped Kazakhstan’s Almaty Ventilation Plant improve production and start exporting.

Optimal air conditioning and ventilation are essential for maintaining a healthy environment and efficient use of energy. Producing quality ventilation and filtering systems is therefore not just hot air but a great business opportunity.

The EBRD helped a Kazakh ventilation manufacturer improving production and start exporting its products. This project is currently funded by the Government of Kazakhstan as a core donor, by the United States and BG Kazakhstan.

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Kazakh company Almaty Ventilation Plant (AVZ) seized this opportunity first in 2008, when the market in the region was dominated by foreign firms. Founded as a two-man operation working from an old car repair shop, AVZ has since grown and become an established producer of ventilation and climate control equipment in Kazakhstan.

“When I learned of AVZ from its understated advertising, its name suggested a large operation,” recalled Nazar Talibdjanov of the EBRD’s Small Business Support (SBS) team in Kazakhstan. “I imagined a recently privatised Soviet company going through restructuring and I thought they could use our expertise.”

What he found instead was a relatively small company with the ambitions of a serious competitor and great potential for export - and one indeed interested in guidance from an international industry adviser to make their plans a reality.

"We wanted to build a new factory to international standards so we turned to the EBRD to source an international adviser and introduce a new management system", said Kanat Beisbayev, the young General Director of AVZ.

The advisory project, funded by the United States,focussed on operational efficiency through the application of the Japanese principles of Kaizen, which means ‘improvement’. This methodology shapes every aspect of the enterprise, from processes to management, aiming at continuous optimisation of resources and results.

The principle of constant improvement is based on the inclusive participation of all 150 employees, each with her or his own expertise, in streamlining processes. Changes in small details such as more order in the display of utensils, better use of light or prompt cleaning of working surfaces, all make production smoother - more timely and less costly.

The adviser is an expert on Kaizen principles who had helped enterprises across Central Asia to introduce lean manufacturing techniques to their businesses. Thanks to this cooperation, AVZ established the optimal process flow for the four production lines in its new state of the art facilities under modern management.

“Production is up, costs are reduced, our products are cheaper to run and the quality is competitive for the international markets so we started with exports to Turkmenistan, Uzbekistan, Russian Federation and the Kyrgyz Republic,” explained Mr Beisbayev. “And in the future we are looking at Mongolia and Tajikistan.”

Since the project was completed, the company has doubled its turnover. Currently AVZ is partnering with industry giants like LG to develop new products. Not hot air indeed and a great example of how the EBRD helps local businesses realise their potential and adapt their products for export.

*The EBRD’s advisory work in Kazakhstan is currently funded by the Government of Kazakhstan as a core donor and by the United States, BG Kazakhstan and the EBRD Shareholder Special Fund

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