Are you doing things right as an owner? Read Marko Parkkinen’s four assertions!

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Solutions agency Seedi’s CEO Marko Parkkinen has worked as a director on the boards of his own companies and on the boards of listed companies, family-owned firms and businesses owned by associations. He presents here different perspectives of an owner’s most important missions.

1. National economy: Risk-taking

At the level of society, an owner’s mission is to create the dynamics for renewing the national economy. If owners are not prepared to take risks, there will be no renewal. “If there’s no appetite for taking the risks associated with growth and internationalisation, it would be better for the national economy to sell off its companies to an entity capable of pursuing faster growth. In practice, of course, each owner makes an individual decision, and not from the macroeconomic perspective.

2. Employees: The vitality of a company must be retained

From an employee’s viewpoint, an owner must ensure the company is able to renew. “Only through constant renewal can a company maintain its vitality. A smart owner seeks savings and efficiencies, but simultaneously invests in development projects. Even with good results, an owner cannot rest on his or her laurels. The targets for the following year must be set still higher in order to safeguard jobs and salaries. Otherwise, a situation may be encountered that forces salaries to be lowered.

3. Company: Setting a target level and minimum requirements for the company

It is essential for the company to set a target level and minimum requirements. “That sounds simple, but raising the bar to exactly the right height is actually very difficult. To succeed in this, a thorough understanding of the company and its market situation is needed. A person unfamiliar with the sector would find it difficult. Simply analysing the financial statements will result in driving forwards guided by the rear view mirror. An owner should also bear in mind that the executive management’s motive in target-setting may differ from the owner’s motive.

4. The owner himself or herself: Spreading risk

Ownership involves not only taking risks, but also spreading risk. Holdings should be diversified, and their risk levels should be balanced against the owner’s own targets. A good owner will use financial leverage wisely, while also weighing up what should be personally financed, how many partners to bring in and how much external capital should be raised. “How large the risks an owner is prepared to take depends on the person. From what I’ve observed, Finnish small business owners are very bold. Acquiring business premises, for instance, is a dauntingly large risk for a startup.

Photo: Junnu Lusa

Read more: Marko Parkkinen: Ownership is not a sin but a skill