Jorma Eloranta, President and CEO, Metso Corporation at VaikuttajaForum 2006 for machine and equipment manufacturers
FINNISH SME SECTOR MUST FOSTER ITS INTERNATIONAL COMPETITIVENESS
”In a global marketplace, a company’s competitiveness is dependent on the competitiveness of its entire network. In recent years, Metso has shifted more responsibility to its external partners. Correspondingly, the quality of their operations and networks must be internationally competitive”, said Jorma Eloranta, President and CEO, Metso Corporation, speaking today at the VaikuttajaForum seminar, a Finnish decision-makers’ forum for machine and equipment manufacturers. One way to improve competitiveness, he suggests, is through cooperation between the Technology Industries of Finland’s TRIO Program and Excellence Finland.
Metso is one of the Finnish engineering and technology industry’s most international companies. In 2005, Metso had customers in nearly 150 countries. ”For Metso, a strong and competent network of partners is important for competitiveness, flexibility and local presence,” Eloranta described in his speech.
Since 2002, Metso has outsourced about 20 percent of the manufacturing capacity it had at that time. Eloranta points out that renewing the business model has brought clear benefits. ”Outsourcing operations increases flexibility in different demand situations and shortens response times, thus boosting customer service efficiency. Having a clear division of work in the business network makes it possible for each company’s investments to be targeted feasibly. Asset management also improves when inventory and the related expenses that don’t produce customer value can be removed from the chain. Successful outsourcing requires seamless cooperation and a high standard of operations from all parties.”
Metso’s purchasing and business network have become more globalized in recent years. In addition to lower labor and transport costs, the development has been driven also by the aim to operate closer to customers. Currency and financing issues as well as customs duties have also contributed to the globalization of procurements. ”The way I see it, the internationalization trend is more of an opportunity for our Finnish partners than a threat. I would urge the Finnish small and medium-size industries to continuously develop their operational quality and thus their competitiveness so that they can internationalize along with their big customers,” Eloranta noted.
An example of a suitable development program for Finnish SMEs, says Eloranta, is the Technology Industries of Finland’s TRIO Program, which is Finland’s biggest technology and business know-how development program for sector-specific networks. The program also brings together providers of public support.
”The development program provides a good foundation, but it doesn’t yet indicate actual competitiveness. As a board member of the Technology Industries of Finland and chairman of the advisory board of Excellence Finland, the Finnish quality association, I have proposed that the small and medium-size companies in the TRIO Program participate also in the Finnish Quality Award competition. The competition provides companies with feedback that is comparable across industry and national borders,” stated Eloranta.
Metso is a global engineering and technology corporation with 2005 net sales of approximately EUR 4.2 billion. Its 22 000 employees in more than 50 countries serve customers in the pulp and paper industry, rock and minerals processing, the energy industry and selected other industries.
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