When leadership in times of crisis brings a winning year!
Tuesday, 7 July 2020
(TOP 101) Iskra: When leadership in times of crisis brings a winning year!
Iskra, d. o. o., is expected to generate 103 million euros in revenues and 11.4 million euros in operating profit this year, according to the annual plan, updated at the end of May.
Despite the corona crisis, the company owned by the Šešok family continues to reduce its debt and increases its added value per employee. Investments in capacity will increase by a third, reaching 8 million euros.
We spoke with four directors - Davorin Dobočnik, Peter Goltnik, Martin Letonje and Aleš Klavžar.
The introduction of the "Crisis Management Team" paid off
"We responded immediately to the disrupted operations in supply chains due to the corona crisis, both by increasing stock levels and by launching independent production of some products in the field of system technology" explains Aleš Klavžar. They are satisfied that they are able to supply customers in such a standard manner every month.
Otherwise, at the outbreak of the epidemic, the company significantly upgraded its management when they formed an extended »12-member management board«. A management group called "Emergency Measures" is still meeting twice a day, including weekends. "Some time ago, we found out that the state of emergency in the business environment has become a permanent practice. This results in quick and flexible decisions, so this style of leadership serves us pretty well, "explains Peter Goltnik. As he says, managing such different production programs as they have at Iskra is demanding, but at the same time, this provides the company with a countercyclical advantage.
Directors together with employees, production facilities didn't close even for a day
They state that even before Covid 19, they took appropriate measure to successfully protect their production facilities.
"Business went smoothly in all countries - Bulgaria, Turkey, North Macedonia, Russia, Slovenia and Croatia, we did not close even for a day any of the two or three production facilities in each country" explains Martin Letonje. Directors improvised so as they are in the field with employees, and not in their offices. In addition, at the outbreak of the crisis, the management reduced its salaries by half for six months.
Rearrangement of employees according to business needs
The measure of ''waiting at home'' in Iskra, as they say, was not implemented. In most production programs they had excess in demand and a need for new manufacturing capacities. However, two programs suffered a decline in orders, namely the manufacturing of products for the automotive industry and the production of filters for white goods. "Instead of terminating contracts, we rearranged staff to production facilities where there was a need for additional employees." explains Davorin Dobočnik.
However, where rearrangement was not possible, we introduced part-time work.
According to the explanation from Directors, the 7% reduction in the number of employees written in Iskra's business plan by the end of the year is not a result of the corona crisis, but was planned earlier in order to increase productivity per employee. »At our d. o. o. we are reducing the number of employees, but at the group level we are a larger employer every year, "adds Klavžar.
When it comes to new acquisition targets, finances are ready
As Iskra's financial position is strong, they are paying close attention to possible new acquisitions, both in their industries (related to roads and railways) and other industries too. In the past, Iskra has grown organically, last year they took over the Šibenik shipyard, and in the future, they will focus even more ambitiously on expansion through acquisitions - both in the field of production and sales channels.
Five million investments in factories, new premises in Kranj
This year, five of the eight million euros of investments at Iskra will be directed to the automation and digitalization of production and expansion of production capacities, and the remaining three million to the system part and management. Recently, they also bought premises in Kranj from Iskratel, because they want to centralize as many businesses as possible in a single location.
Iskra expects the highest growth in measurement technology and switchgear. The products follow the latest trends such as renewables, smart homes and e-mobility. All advanced solutions are constantly and immediately incorporated into their own production.
The Šibenik shipyard is increasingly strengthening the group
At the group level, Iskra is planning EUR 130 million of revenues this year. A business plan for 2021 has not yet been prepared, and organic growth is expected to be five to seven percent.
The recently acquired Šibenik shipyard already increased its sales to EUR 20 million with a profit of EUR 1 million, and this year the revenues of "Iskra shipyard " will increase to EUR 27 million. Its main export market is Norway with ships for the salmon farming industry, while also rebuilding ships of the Croatian Navy as well as for commercial clients.
The company also entered into a partnership with the shipping operator "G & V Line" in Croatian islands. New tenders for concessions and expansion give priority to newer fleets and electric boats.