Koskisen Group’s new strategy was created in difficult market conditions. The poor profitability of recent years has burdened the Group’s balance sheet and resulted in a weak equity ratio.
The renewed strategy focuses on bringing the Group’s financial position to a sustainable level. Profitable results are necessary to secure the company’s continuity and future development.
“The company must generate more revenue in order to have capital to develop the business and carry out investments. At the moment, settling debts eating up even minor revenues, the company has been unable to pay dividends for several years, and investments have been essentially on hold. In this tight economic situation, we have cut corners everywhere” says Managing Director Markku Koskinen bluntly.
The strategy aims at full capacity utilisation rates in each unit in a cost-effective and competitive manner. This is to be achieved in close co-operation with our customers. Operations and products will be developed at all levels. Better co-operation between sales, planning and production should result in growing sales volumes at competitive prices. The well-being, initiative and responsibility of the personnel are seen as key success factors in the strategy. Continuous improvement and effective initiatives will be highlighted as part of everyday work.
“There will be no free rides in this effort to increase revenues. Improved profitability will also make everyone’s job more secure,” says Koskinen.
A significant increase in both turnover and production volumes is necessary to achieve the set profit target. Each business unit needs to improve its profits. In practice, this requires more effective and efficient work from all departments, teams and employees. Progress must be made, even in units already showing good results. Each business unit and function is required to draw up a clear-cut action plan to improve its profitability, and the implementation of these plans will be closely monitored.
Investments are also possible and even recommended to develop operations, as long as the payback period is no longer than a year. Profitable investments will improve the equity ratio and decrease debt. Focus on customers has always been a cornerstone for Koskisen – and it will stay that way. Products will be developed in close co-operation with customers, based on genuine needs.
Both the Board of Directors and Executive Board are strongly committed to carry out the new strategy. There is no point in moaning and gnashing of teeth; each and everyone of us must tackle the challenge and get to work. Surely there is untapped potential and areas to be developed throughout the Group.
“The market situation is not easy, but with good co-operation there is no doubt that we can make it better,” Koskinen sums up.
- Increasing the Group’s turnover
- Lowering sick-leave rates
- Increasing the business units’ production volumes
- Improving the equity ratio
- Improving customer satisfaction