Croatia: Downsizing in HEP DSO company

, SEE Energy News

According to the project for the restructuring of Croatian electricity distribution system operator HEP ODS, a subsidiary of state-owned power utility HEP, which was jointly designed by the international consulting firm PricewaterhouseCoopers and the management of HEP, some 1,300 employees will leave HEP ODS by the end of 2017, mostly through early retirement, while another 200 employees would be transferred in the new company for public supply.

The statement from HEP said that the rights of their employees are guaranteed by the collective agreement and that in the next few years, HEP ODS will have 20 to 25 % less staff, which would allow considerably savings on labour costs. The current number of employees at the company is about 7,500.

Instead of current dominantly geographical model, the new organizational structure of HEP ODS will be based on functional model of governance, which would reduce the stratification and the complexity of the organization and standardize business processes. The consequence of the new organizational structure will be raising the technical competence and management at the level of four distribution units, which will coordinate the operation of the existing 21 electricity supply units. The focus of the electricity supply units will primarily be on the field operations and network management.

The focus of the reorganization of the company will be to reduce the complexity of organizational structure in order to achieve the strengthening of the core business of the company, better and more efficient organization of field operations and better management of assets and capital investments, which amount to up to 130 million euros per year.

The management of HEP ODS expects that all these changes will result in a total net saving in excess of 80 million euros over the next five years, transmits

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