| ALSO IN THE 2/2011 ISSUE OF PRIMA: | |
| • | There is still time to prevent the spread of the grey economy |
| • | Pentti Mäkinen, Director of SME Affairs: Growth entrepreneurship should be the number one goal for the Government |
| • |
Jukka Ahtela, Director at EK: Objektives can be set for well-being at work |
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• Mikko Pukkinen, Director General of the Confederation of Finnish Industries (EK):
A WAGE-PRICE CYCLE MUST NOT BE LAUNCHED
Mikko Pukkinen, Director General of the Confederation of Finnish Industries (EK), warns Finns against destroying their competitiveness by willingly gathering various burdening costs on top of each other. The situation has become constantly worse, Pukkinen says in the issue of EK’s Prima magazine to be published on Thursday.
“Competitiveness and new growth must now be built patiently and with consideration of all their constituents,” Pukkinen says.
“The entire competitiveness of industry and trade can be broken down and converted to euros. Competitiveness in terms of taxation has been lost during the past ten years, logistics costs are rising, wage claims are going off the scale, and the price of energy is burdened more and more,” Pukkinen explains.
The Director General of EK points out that Finland is several steps behind in the quest for new growth. In 2009, the national product decreased by eight percent. In terms of money, the loss was EUR 13 billion. At the time, the profitability of companies was cut by EUR 11 billion, which means that they sustained most of the damage. However, the total amount of wages and salaries only decreased by EUR 1.5 billion.
The pay settlements in 2008–2009 were clearly oversized. Real earnings increased by no less than seven percent. This makes it justified to keep pay rises moderate in 2011.
The pay settlements should also contribute to curbing inflation. A temporary increase of inflation, caused mainly by increased import prices, is not a justifiable reason for pay rises, and the pay settlements must not launch a cycle of wage and price increases.
“This road leads to a weakening employment situation,” Pukkinen says.
• Nokia’s Erkki Ormala:
FINNS MUST COLLABORATE WITH TOP COMPANIES
“Based on the strategic choices of international top companies, we can deduce in which direction the world is going. Because of this, collaboration with those companies is essential,” Erkki Ormala, Director for Technology Policy at Nokia, says in an interview with EK’s Prima magazine.
Ormala emphasises that knowledge must be searched for where it can best be found in each case.
“For instance, the best knowledge in software development is currently found in the United States and Asia. If European companies do not wish to be restricted to the role of a subcontractor, they must seek collaboration with American or Asian companies creating future technologies and applications,” Ormala says.
It is no longer enough for Finnish companies to collaborate with top international universities. Like Nokia, they must also join forces in R&D with the best companies available. Collaboration arrangements within development work among top international companies have taken centre stage.
According to Ormala, the choices of business partners increasingly require extending the development of core competence abroad.
“Time will show how Nokia and Microsoft will share their development responsibilities. In any case, Finland will benefit from American software knowledge in the future.”
According to Ormala, knowledge in digital solutions will continue to offer huge possibilities in Finland for both Nokia and other companies, including small and medium-sized companies.
“For instance, small and medium-sized Israeli high-tech companies have been very successful after integrating themselves in the product development processes of global companies. They can see in advance what kind of ecosystem is being developed, and are able to offer the missing piece in the whole.”
When developing the Finnish innovation system, this new way of thinking should also be taken into account.
“We no longer live in the old cluster model where companies built their business in their home country and then expanded abroad,” Ormala says.
• Kesko’s Matti Halmesmäki:
LAND USE PLANNING MUST SERVE THE CONSUMER
According to Matti Halmesmäki, President and CEO of Kesko and Vice Chairman of EK, regulation is to some extent preventing the trade industry from doing its job. Halmesmäki proposes increasing the area limit of large commercial units.
“The different shopping needs of customers should be taken into account in land use planning. We would like to offer versatile and broad product selections at low prices, and be located at a reasonable distance from customers. Local services for daily groceries and large commercial units for weekly purchases are both needed. Through the appropriate placement of shops, the environmental load caused by shopping trips can be decreased,” Halmesmäki says in Prima magazine.
“If the area limit for large commercial units was raised from 2,000 square metres to at least 3,500 square metres, commerce would be more efficient, the product selections would be wider, and the prices would be lower.”
To be able to respond to the consumers' expectations, the trade industry should be able to see early on what the land use planners’ intentions are.
“As the bureaucracy increases in land use planning, it becomes more difficult for us to estimate the increase in population in suburbs. This prevents us from responding to demand in time, and customers will have to settle for poorer product selections and higher prices. Another option for the customer is to travel to another commercial centre further away for shopping, which would increase the environmental load.”
Matti Halmesmäki understands those that wish for more store area in the city centres, but finds this wish rather hard to fulfil.
“Of course, customers would have access to a wider product selection, but because of the price of land alone, the costs for the trade industry are higher in the centres than elsewhere. It is not easy to organise trade logistics during the night in city centres.
Creating parking lots for customers may require large investments. All this would be reflected in the product prices. In any case, nearby services and specialist shops will always be found in city centres, as is the case now.”
• THE SERIAL ENTREPRENEUR IS A SIGNIFICANT EMPLOYER
Serial entrepreneurs, involved in several enterprises, boost the industry and trade, especially in the provinces. The significance of serial entrepreneurs as creators of growing enterprises and new jobs is properly displayed when viewing the ownerships of serial and portfolio entrepreneurs in total.
“An entrepreneur owning several enterprises may be excluded from the definitions of growth entrepreneurship even though the total impact of his or her enterprises in terms of employment may be quite significant in a small town,” says Jari Huovinen, EK's expert who created a report on serial entrepreneurship.
According to the report, the majority of entrepreneurs belonging to this group are rather traditional enterprising individuals, depending on their own professional expertise in a certain field. They speed up their career as an entrepreneur through establishing new enterprises either along with or in place of their original enterprise.
Portfolio entrepreneurs are simultaneously involved in more than one enterprise. In Finland, all serial and portfolio entrepreneurs are often referred to as serial entrepreneurs.
Serial and portfolio entrepreneurs represent a minority among Finnish entrepreneurs. Even of the serial entrepreneurs, only a few have experience of more than two enterprises.
“On average, every third entrepreneur has experience of more than one enterprise. For most, this experience is based on two separate enterprises, but, on the other hand, approximately ten percent have been involved in more than five enterprises,” Huovinen explains.
A WAGE-PRICE CYCLE MUST NOT BE LAUNCHED
Mikko Pukkinen, Director General of the Confederation of Finnish Industries (EK), warns Finns against destroying their competitiveness by willingly gathering various burdening costs on top of each other. The situation has become constantly worse, Pukkinen says in the issue of EK’s Prima magazine to be published on Thursday.
“Competitiveness and new growth must now be built patiently and with consideration of all their constituents,” Pukkinen says.
“The entire competitiveness of industry and trade can be broken down and converted to euros. Competitiveness in terms of taxation has been lost during the past ten years, logistics costs are rising, wage claims are going off the scale, and the price of energy is burdened more and more,” Pukkinen explains.
The Director General of EK points out that Finland is several steps behind in the quest for new growth. In 2009, the national product decreased by eight percent. In terms of money, the loss was EUR 13 billion. At the time, the profitability of companies was cut by EUR 11 billion, which means that they sustained most of the damage. However, the total amount of wages and salaries only decreased by EUR 1.5 billion.
The pay settlements in 2008–2009 were clearly oversized. Real earnings increased by no less than seven percent. This makes it justified to keep pay rises moderate in 2011.
The pay settlements should also contribute to curbing inflation. A temporary increase of inflation, caused mainly by increased import prices, is not a justifiable reason for pay rises, and the pay settlements must not launch a cycle of wage and price increases.
“This road leads to a weakening employment situation,” Pukkinen says.
• Nokia’s Erkki Ormala:
FINNS MUST COLLABORATE WITH TOP COMPANIES
“Based on the strategic choices of international top companies, we can deduce in which direction the world is going. Because of this, collaboration with those companies is essential,” Erkki Ormala, Director for Technology Policy at Nokia, says in an interview with EK’s Prima magazine.
Ormala emphasises that knowledge must be searched for where it can best be found in each case.
“For instance, the best knowledge in software development is currently found in the United States and Asia. If European companies do not wish to be restricted to the role of a subcontractor, they must seek collaboration with American or Asian companies creating future technologies and applications,” Ormala says.
It is no longer enough for Finnish companies to collaborate with top international universities. Like Nokia, they must also join forces in R&D with the best companies available. Collaboration arrangements within development work among top international companies have taken centre stage.
According to Ormala, the choices of business partners increasingly require extending the development of core competence abroad.
“Time will show how Nokia and Microsoft will share their development responsibilities. In any case, Finland will benefit from American software knowledge in the future.”
According to Ormala, knowledge in digital solutions will continue to offer huge possibilities in Finland for both Nokia and other companies, including small and medium-sized companies.
“For instance, small and medium-sized Israeli high-tech companies have been very successful after integrating themselves in the product development processes of global companies. They can see in advance what kind of ecosystem is being developed, and are able to offer the missing piece in the whole.”
When developing the Finnish innovation system, this new way of thinking should also be taken into account.
“We no longer live in the old cluster model where companies built their business in their home country and then expanded abroad,” Ormala says.
• Kesko’s Matti Halmesmäki:
LAND USE PLANNING MUST SERVE THE CONSUMER
According to Matti Halmesmäki, President and CEO of Kesko and Vice Chairman of EK, regulation is to some extent preventing the trade industry from doing its job. Halmesmäki proposes increasing the area limit of large commercial units.
“The different shopping needs of customers should be taken into account in land use planning. We would like to offer versatile and broad product selections at low prices, and be located at a reasonable distance from customers. Local services for daily groceries and large commercial units for weekly purchases are both needed. Through the appropriate placement of shops, the environmental load caused by shopping trips can be decreased,” Halmesmäki says in Prima magazine.
“If the area limit for large commercial units was raised from 2,000 square metres to at least 3,500 square metres, commerce would be more efficient, the product selections would be wider, and the prices would be lower.”
To be able to respond to the consumers' expectations, the trade industry should be able to see early on what the land use planners’ intentions are.
“As the bureaucracy increases in land use planning, it becomes more difficult for us to estimate the increase in population in suburbs. This prevents us from responding to demand in time, and customers will have to settle for poorer product selections and higher prices. Another option for the customer is to travel to another commercial centre further away for shopping, which would increase the environmental load.”
Matti Halmesmäki understands those that wish for more store area in the city centres, but finds this wish rather hard to fulfil.
“Of course, customers would have access to a wider product selection, but because of the price of land alone, the costs for the trade industry are higher in the centres than elsewhere. It is not easy to organise trade logistics during the night in city centres.
Creating parking lots for customers may require large investments. All this would be reflected in the product prices. In any case, nearby services and specialist shops will always be found in city centres, as is the case now.”
• THE SERIAL ENTREPRENEUR IS A SIGNIFICANT EMPLOYER
Serial entrepreneurs, involved in several enterprises, boost the industry and trade, especially in the provinces. The significance of serial entrepreneurs as creators of growing enterprises and new jobs is properly displayed when viewing the ownerships of serial and portfolio entrepreneurs in total.
“An entrepreneur owning several enterprises may be excluded from the definitions of growth entrepreneurship even though the total impact of his or her enterprises in terms of employment may be quite significant in a small town,” says Jari Huovinen, EK's expert who created a report on serial entrepreneurship.
According to the report, the majority of entrepreneurs belonging to this group are rather traditional enterprising individuals, depending on their own professional expertise in a certain field. They speed up their career as an entrepreneur through establishing new enterprises either along with or in place of their original enterprise.
Portfolio entrepreneurs are simultaneously involved in more than one enterprise. In Finland, all serial and portfolio entrepreneurs are often referred to as serial entrepreneurs.
Serial and portfolio entrepreneurs represent a minority among Finnish entrepreneurs. Even of the serial entrepreneurs, only a few have experience of more than two enterprises.
“On average, every third entrepreneur has experience of more than one enterprise. For most, this experience is based on two separate enterprises, but, on the other hand, approximately ten percent have been involved in more than five enterprises,” Huovinen explains.