Finantsuudised.ee asked Paul Lukka, Chief Financial Officer of Operail to reflect on the most difficult decisions of the past year and share his thoughts on sustainable business and corporate social responsibility.
What was the hardest decision you faced during the coronavirus last year?
Last year was an extremely challenging time for us. The uncertainty about the future made it particularly difficult to make decisions. There were many possible scenarios, but it was necessary to make the optimal decisions during these uncertain times. This required an extreme degree of flexibility from the entire organisation and a readiness to adapt rapidly to change.
The financial unit certainly played a very important role in this situation, as a range of possible plans needed to be drawn up and their potential results assessed. Based on this roadmap, the route forward became clearer and it was possible to make some operative decisions.
In 2020, we faced challenges in all our areas of activity. At the beginning of the year, the freight volume decreased, as well as the rental prices of wagons. Supply difficulties and restrictions on the movement of people made it difficult to build our locomotives, which also affected the start of our freight transport in the Finnish market.
However, in retrospect it is clear that we have coped well with the difficult situation and have done much better than we initially feared. This is certainly based on the great contribution of our people and our ability to react quickly.
We owe thanks for this flexibility to our past challenges, which resulted from a complex and changing business environment. A few years ago, the company was in a difficult situation where we had to be able to adapt quickly and find new solutions. We opened new business lines and adjusted our existing activities, and as a result Operail achieved strong growth and financial security. These experiences have benefited us in the current situation.
How did you manage the risks? What did you do differently when planning this year?
We were more aware of the various risks and we know that the number of possible scenarios we need to consider has significantly increased. Therefore, the planning in the company as a whole has changed – in addition to planning our normal business processes, we needed to develop several action plans to cover the missing resources in the event of the spread of the virus; for example, to ensure that our customer service would not suffer in this event.
Can a sustainable business also be profitable?
I would go as far as saying that sustainable entrepreneurship is becoming a prerequisite for profitability. Various key stakeholders are placing an increased emphasis on the corporate ecological footprint and social responsibility. This includes the customers, employees and the society at large.
Sustainability principles are becoming an essential factor for healthy business operations and deviations are leading to the extinction of certain existing business models as the margins fall and costs increase; for example, in the form of various taxes.
It can also be difficult to recruit, communicate and collaborate with customers who consider responsible management to be important without following the principles of sustainable operations, while a company’s position and reputation in the local community may also start to suffer. A prerequisite for the survival of a profitable business is investing in sustainable technology and other investments that will ensure the sustainable development of the social and natural environment.
The article was published 22.02 on Finantsuudised.ee news portal.