Annual report 2010

21. Business Planning and Financial ManagementThe key objective for the management of JSC IDGC Holding is to take systemic and target action to raise theefficiency of operations and optimize expense level.Top-priority areas for the cost management program implementation are identified based on the businessprocesses accounting for most costs and high potential of expense optimization. The principal areas forimplementing cost management program are as follows:Principal business processesCost reduction areasInvestment program planningand implementationIncrease in the percentage of high-performance facilitiesReduction of per-unit capital expensesElectricity transportand commercial meteringRevenue increaseReduction of above-standard lossesReduction of energy resource consumptionfor production and business needsOperation, maintenanceand repairReduction of per-unit repair costsOptimization of repair program scopeReduction of per-unit operating expensesPersonnel managementand organizational designOptimization of personnel costsIncrease in labor productivityFinancial flow managementReduction of the cost of borrowingSupporting processesOptimization of non-production expensesProperty managementReduction of costs associated with managingunused immovable propertyThe overall effect of activities aimed at reducing operating costs in 2010 for all SDCs of JSC IDGC Holdingwas RUB 11,910 million versus the planned RUB 7,263 million.201