CLOSE-UP KESLA 2010-2020

#yourlifetimematch Close-up Kesla 2010-2020 2

#yourlifetimematch - Close-up Kesla 2010–2020

Sirkka-Liisa Aaltonen #yourlifetimematch - Close-up Kesla 2010 – 2020 Kesla Oyj, Joensuu, 2021

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Sirkka-Liisa Aaltonen #yourlifetimematch - Close-up Kesla 2010 – 2020 Kesla Oyj, Joensuu (FIN), 2021 1st edition Copyright Kesla Oyj Translation: Lingoneer Oy Graphic design: Miia Tirkkonen Photos: archives of Kesla Oyj and its cooperation partners ISBN 978-952-94-4867-8 (hbk.)

ISBN 978-952-94-4868-5 (PDF) Print: Punamusta, 2021, Joensuu (FIN)

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Contents

Foreword 6 Home in the realm of metal and wood

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Year 2010 13 Who travels for love finds a thousand miles no longer than one

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A man and his hands 18 Year 2011 19 Some kind of afforestation boom will still come

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Year 2012 25 Heading for Belarus 26 Bread, vodka and cows 29 Russia wants to promote Scandinavian forest management model

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Year 2013 31 Collaboration at the forefront of development

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No tie around that neck 33 You can always ask 34 Hiro – accelerator for the Japanese market

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Year 2014 39 Best available technology only 42 O tempora, o mores 45 Extensive product portfolio 46 Expediency above all 46 The cat that showed its claws 49 Year 2015 51 A horrible handicap 52 System thinker Saastamoinen 54 Forest expertise for organic machine 58 Don’t laugh too soon 60 Like patricide 62 Spartan heavy worker 66 Risk-taking pays off 67

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Year 2016 69 City cranes for heavy users 70 Ilomantsi’s via dolorosa ends with flag raising

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The result left a good feeling 78 What goes around comes around 79 Year 2017 81 Business division 2017 82 For the love of the sport 83 Team player with entrepreneurial attitude 84 Year 2018 87 The first decorations in Kesla’s history 88 Success through cooperation 90 Taking control of building the brand

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Communications as a performance factor 94 #yourlifetimematch – focusing on the customer

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Opportunities for development and self-improvement 95 People from all factories head to Kitee

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The value of values 98 Year 2019 101 Citius, altius, fortius 102 Not even summer jobs 105 Crane columns reinforced 106 Developing after-sales services 107 To help the customer succeed 110 Timber entrepreneur Tero Hannonen: Efficiency first 112 Partners Kyösti Tiainen and Juuso Laukkanen: Good forest management through development

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Forest machine entrepreneur Rauno Matikainen: Productivity and year-round employment

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Year 2020 119 Like a sophisticated extension of your hand

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Wild card shuffles the deck 122 From a barn business to a multitalent of forest technology 1960-2010

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We catch the fish

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we fish for

Kesla’s journey began in Rantasalmi in 1960.

ness, in which Kesla also intends to be more

tion. Five years later, the company is pushing

The industrialisation of Finland was gaining

strongly involved.

to the 2020s in a strong shape. The incurring

momentum after the wars. The world was in

The population is ageing and it will affect,

of debt has been tackled, self-sufficiency im-

the middle of the Cold War. Climate change,

among other things, the availability of labour

proved and the balance sheet strengthened.

carbon footprint, bioeconomy, recycling,

very quickly. The change also requires Kesla

Resilience to crisis is needed, as economic cy-

digitalisation, automation, robotics – these

to be able to use technological competence,

cles inevitably fluctuate upwards and down-

2020s words probably had not even been

digitalisation and automation. We are agilely

wards. If there is no turbulence, there is at least

invented yet. For a long time, the Internet

involved in this flux of changes. The company

intermittent crosswind. The most important

was also unknown – Finland was not able to

has launched the NOSTE project, which in-

thing is to keep the course steady forward,

join the world wide web until the late 1980s.

volves investments in production technology,

towards strategic goals. “We catch the fish we

At the time, the Internet was mainly used by

quality production capacity, automation and

fish for” – these words written by the Finnish

universities and research institutions.

efficiency.

national author Aleksis Kivi in his play Heath

The Finnish Innovation Fund Sitra has listed

The global economy is forecast to grow. How-

Cobblers also serve as an excellent summary

the 2020 megatrends: ecology and the chal-

ever, there are a huge number of variables on

of the significance of strategic goals.

lenge of environmental change, ageing of the

the playing field. What is Europe’s importance?

Responsible, innovative, quick and reliable

population, strengthening of relational pow-

What is Joe Biden’s United States of America

performer – these are Kesla’s values. The val-

er, technology infusing with everything and

like? What is the impact of the influx of refu-

ues influence decision-making in our daily

the economy seeking direction. Virtually all of

gees moving towards Europe? What kind of

lives. “Professional!” That is how our German

these megatrends affect Kesla in one way or

cough is it in China at any given time that is

customers described how Kesla handled the

another.

said to infect the rest of the world? At the end

2124L crane column problem at the end of

The world is striving to get rid of fossil raw

of 2019, that cough was COVID-19, the impact

2019. The service life of the columns proved

materials. In this struggle, forests are needed,

of which on the citizens of the world, let alone

to be clearly shorter than designed. We reacted

wood fibre is useful – the innovative use of

on the economy, nobody can fully predict right

according to the company’s values – responsi-

wood fibre is only in the early stages. As con-

now.

bly, valuing our customers. The columns were

sumption increases and resources become

In 2015, Kesla was a company in crisis, with a

replaced with stronger ones – professionally

scarce, the importance of substitute materials

net gearing of 140% and empty coffers. The cri-

and efficiently.

and recycling is emphasised. The requirement

sis was brought about not only by fluctuations

of ecology and recyclability will increase busi-

in the world economy, but also by internal ac-

Simo Saastamoinen, CEO

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“If the story of Outokumpu Oyj started from a big rock, it was on chunks of stone that Antti Kärkkäinen based his business 60 years ago.”

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Home in the realm

of metal and wood

Since 1974, Kesla Oyj has been domiciled in North Karelia, whose success is rooted deep in the forest and in metals. On the strength of these roots, the region has developed into a strong metal industry expert and exporter. In 2018, the turnover of the North Karelian metal industry exceeded the threshold of €1 billion.

North Karelia, approximately 21,600 km² in

An emerging industry needed experts. The

area, is 89% forest. When Finland was building

mining company once founded its own min-

its future, the region’s wood flows had to be mo-

ing vocational school in Outokumpu. Ensuring

bilised. The roots of the strong union of forest

a skilled workforce was also on the mind of min-

and metal date back to Nils Ludvig Arppe, who

ing counsellor Wilhelm Wahlfors, who managed

was born in 1803 in Kitee, North Karelia. Arppe

to bring the Abloy lock factory, which was part

was a great Finnish industrialist, and his Värt-

of the Wärtsilä Group, to Joensuu. Without the

silä sawmill and iron mill gave birth to Wärtsilä

technical college, North Karelia would not have

Corporation, an internationally leading supplier

been a success, so with Wärtsilä’s strong con-

of marine and energy market power solutions.

tribution, engineering and technical training

The knowledge heritage that enabled success

started in Joensuu in 1961.

also started to be built in Outokumpu in the ear-

Joensuu gained a university in 1969. In 2010,

ly 20th century. A sample of a chunk of stone

the universities of Joensuu and Kuopio merged

found by accident in a canal worksite turned

into the University of Eastern Finland. The multi-

out to be a rich copper ore. The credit for this

disciplinary University of Eastern Finland is one

discovery belongs to mining engineer Otto

of the largest scientific universities in Finland.

Trustedt. The Outokumpu ore body had plen-

The university also provides education in forest-

ty of digging for 79 years. When the mining

ry. In the early 2000s, many masters of forestry

operations ended in 1989, knowledge-based

started their careers at Kesla. Mikko Lehikoin-

capital remained in the region. Among other

en, M.Sc. (Agriculture and Forestry), who later

companies, the journey of the internationally

joined Valtra, was one of the builders of inter-

significant steel manufacturer Outokumpu Oyj

national Kesla. Former forestry students from

started in Outokumpu.

Joensuu still working in Kesla include Business

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Director Mika Tahvanainen, International Sales

opportunities for diverse cooperation.

Manager Vesa Tammiruusu and Business Devel-

In 2019, the company’s values defined by mem-

opment Managers Jouni Kainulainen and Toni

bers of the Kesla community are “responsible,

Lehtinen.

innovative, quick and reliable performer”. The

Karelia University of Applied Sciences started

value base seems in many ways suitable for

operations in 1992. Karelia UAS is not only an

North Karelia. “The North Karelian identity is

educational institute, but also a partner in re-

something very special and unique. It’s rough

search, development and innovation projects.

and rootsy, but increasingly also built on mod-

Kesla is one of the key partners of Karelia Uni-

ern know-how and open-mindedness, and

versity of Applied Sciences.

especially authenticity,” wrote Pasi Koivumaa,

Riveria, the educational institution of the North

editor-in-chief of the regional newspaper Kar-

Karelia Municipal Education and Training Con-

jalainen (“The Karelian”), when North Karelia

sortium, is one of the largest providers of voca-

celebrated its regional day for the first time on

tional education and training in Finland. Kesla

25 August 2018.

and Riveria signed a partnership agreement in

If the story of Outokumpu Oyj started from a

the spring of 2019.

big rock, it was on chunks of stone that Antti

In Joensuu, the European Forest Institute (EFI)

Kärkkäinen based his business 60 years ago.

and the Finnish Ministry of Agriculture and

Matti Alaluoto, Mayor of Kesälahti in North Ka-

Forestry’s Natural Resources Institute Finland

relia, demonstrated prompt action and invest-in

(Luke) also operate at company interfaces. As

thinking. It is said that he whipped the money

an organisation of around 1,300 researchers and

that enabled Kesla to move to North Karelia in

experts, Luke is also an important development

1974 from his desk drawer. North Karelia col-

partner for Kesla.

lected the pot after the municipality of Joroinen

Forestry and metal are also among the top

in South Savo did not warm up to the metal

sectors of the Business Joensuu business de-

engineering workshop’s requests.

velopment organisation. Business Joensuu announced in 2019 that it would invest heavily in raising the automation level and improving the competitiveness of the region’s metal industry.

In the development of products and services, ensuring competitiveness and obtaining a skilled workforce, Kesla utilises the resources of its home region – knowledge, innovation and

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“The North Karelian identity is something very special and unique. It is rough and rootsy, but increasingly also built on modern know-how and open-mindedness, and especially authenticity,” Pasi Koivumaa

Koli landscapes – the forest, rocks and lakes – are the quintessential North Karelian landscape.

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Kesla Oyj manufactures several forest technology and material processing products.

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2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Prospects for recovery After a year of deep recession, business recovered, with net sales growing by 29.1% from the previous year, totalling €33.7 million. The operating profit was approximately €2.2 million.

“Like driving a car while pushing the brake and accelerator pedal at the same time,” says CEO Jari Nevalainen of the atmosphere.

The recovery was mainly driven by a general improvement in the economic cycle. Sales and marketing efforts were increased. The stabilisation of financial markets, coupled with low interest rates, also contributed to the relaunch of investment.

The most significant investment of the financial year was the introduction of a new ERP system. The total investments for the financial year were approximately €620,000.

The company celebrated its 50th year of operation.

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Who travels for love

finds a thousand miles no longer than one

A living legend. That is Kimmo Paakkunainen, who as Service Manager travels all around the world to serve Kesla’s customers. “I’m proud to be a Kesla employee. The most important thing in work is to do things right and to be honest,” he sums up his principles.

The title of this story is a Japanese proverb. It is

tice Paakkunainen has mastered the entire Kesla

about love, and Paakkunainen’s 37 years at Kesla

product range. As Service Manager, he is used

also speak of love for the work.

to shuttling quickly through many time zones.

On the last of May in 1983, Kimmo Paakkunain-

“After two or three days at home, I didn’t always

en from Kesälahti received a comprehensive

quite know what time the cuckoo clock would

school leaving certificate. On the first of June,

call.”

he started work at Kesla’s factory in Kesälahti.

Here is a photo from China where a KESLA 25RHS head was installed on a SANY CY135 excavator.

“As a farmer’s son, I had a lot of experience

Learning from Donald Duck

with machines. While in school, I had also done

More than 70% of Kesla’s turnover comes from

practical training at Kesla. When I was offered a

exports, and the logging sites are often far away.

chance for an apprenticeship, I started studying

In May 2019, Kimmo Paakkunainen visited Japan

to be a mechanic.

for the 40th time. His trips to the country began

The apprenticeship training also involved

in 2005, when the Japanese found Kesla to be

theoretical studies, which were organised in

the best partner for harvesting timber in chal-

Valkeakoski. That is where Paakkunainen also

lenging mountain forests.

met his future wife.

On Paakkunainen’s first trip to Japan, he hap-

“Yes, Kesla’s been involved in a lot of life chances

pened to buy a Donald Duck pocketbook at the

for me.

airport as a souvenir for his son. By coincidence,

The work as a mechanic was varied, ranging

the pocketbook was Japan-themed. Konnichi-

from plant maintenance to machine repairs and

wa, dōmo arigatō gozaimasu, mata ashita – in

from tool manufacture to machining. In 1999,

Japanese “good day”, “thank you for the meet-

Paakkunainen was appointed Service Manager.

ing” and “see you tomorrow”.

Among Kesla’s products, he is mainly responsi-

“It turned out to be a pretty good dictionary for

ble for harvesters and forest cranes, but in prac-

me. When I got to Japan, I knew the local greet-

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ings, swords and such!”

“The installation site will be in the ‘jungle’, to

“My job is also about technical development,

Since then, his language skills have further

harvest wood for the local pulp mill. I know

the utilisation of feedback from customers. For

improved, for example, by studying business

that the nearest hydraulic hose manufacturer is

example, we can say that the Japanese have

English. Paakkunainen’s adaptation to different

about four hours of travel from there. It is bound

taught us about many details. They prioritise

cultures is accelerated by his social nature and

to be an interesting trip!”

details and top quality in many places.”

desire to learn new things. He enjoys conversa-

It is also noteworthy that once strong trust has

tions with different people. But whatever the

A service attitude

been built, customers rely on Kesla’s expertise in

country or continent, patience is needed. Trust

Kimmo Paakkunainen’s stories from around the

increasingly large entities and also in base ma-

does not build itself; it requires work in listening

world highlight the importance of listening to

chine choices. No matter what the time zone of

to customers.

the customer.

the customer who has questions, Paakkunainen is only a WhatsApp message away.

March of the machines When Kimmo Paakkunainen arrives at a new export destination to train machine operators, it may well be that the group has never even seen a forest machine. In many parts of the world, the mechanisation of forest harvesting is only just beginning.

“We’re talking about countries where a labour is cheap and plentiful. Just as in Finland back in the day, mechanisation will progress, but it will take time.

The replacement of axe and chainsaw with a Kesla harvester can be accelerated with the help of example. Paakkunainen tells of an African tea plantation where they harvest tens of thousands of cubic metres of wood per year for drying the tea leaves.

“The difference in efficiency was clear when the people at the plantation saw Kesla’s strong harvester head at work.”

Paakkunainen is looking forward to an upcoming trip to Vietnam, where Kesla harvester heads have already been shipped.

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Installation in Indonesia. Kimmo Paakkunainen (back right) and Aki Juvonen (second on the left).

A souvenir of malaria Paakkunainen knocks on wood and says that thankfully, there have been no serious mishaps on his trips around the globe.

“The roots of a tree that grew in high winds are strong.”

Japanese proverb

“I have been in all kinds of places and travelled by all kinds of vehicles, eaten this and that. Never even a stomach bug.”

Not until Paakkunainen’s second business trip to Kenya, where he was bitten by a malaria-transmitting mosquito. Unaware of the infection, he had time to return home for three days and leave on his next business trip to South America.

Then he was struck by a high fever, despite the fact that his malaria medication had once again been handled properly.

Paakkunainen sought help at a private clinic. After some searching, they found a local medical professional who had served on a peacekeeping mission in the Congo and was able to do a reliable malaria test.

“I tested positive. Malaria drained my strength, and I thought about how vulnerable a person can be.”

After a few days in the hospital, a flight ban and some rest, Paakkunainen was able to return to Finland. The wretched infection has been tackled, at least for the time being, although complete certainty will only come with time.

Kimmo Paakkunainen’s globe-trotting has not been discouraged by the malaria experience.

The Japanese have a great proverb to describe his perseverance: “The roots of a tree that grew in high winds are strong.”

Kimmo Paakkunainen (in the cab) and Janne Häyrynen (right) have gone on many trips together.

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xxxxxxxxx

Paakkunainen’s palms have inspired respect for both their size and strength.

A man and his hands When Kimmo Paakkunainen greets others, he shakes their hand – as we Finns usually do. He also did so in Japan, but soon discovered that his hands inspired respect and even wonder.

The size of his palm and the strength of his grip were such that the hosts then offered their hands enthusiastically to be shaken – especially those who had not experienced the greeting before.

On one trip, the Japanese hosts had come up with a different activity for Paakkunainen. They had invited the local master of arm wrestling, against whom the Kesla man was to compete.

Paakkunainen won.

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2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Time to adjust structures The recovery from the deep recession of 2009 continued. The company’s turnover increased by 30.3% to €43.9 million. The operating profit rose to approximately €2.9 million.

Product development was strengthened. The most important investment in sales and marketing was the establishment of a subsidiary in Germany. In addition to the forest machine sector, the growth of material recycling needs in Europe was seen as a significant growth potential for Kesla’s forest machine group’s products.

In Germany, Kesla’s subsidiary was to be responsible for selling and marketing the products of the forest machine group to German dealers and industrial partners. The subsidiary was planned to start in the first half of 2012.

The situation of the subsidiary MFG Components was critically assessed. Turnover increased, but profitability decreased. Towards the end of the year, the company launched co-determination negotiations to adapt its operations and structures.

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Some kind of afforestation boom

will still come

“It’s always a good idea to plant a tree. Plant-

ly – a bit like in Finland in both sides of the 2010s,”

ing forests will be a global megatrend, I’m ab-

says Antti Asikainen.

solutely sure of that. It’s also a cure for climate

Japan had already implemented an extensive re-

anxiety. Plant a thousand trees and you can

forestation programme from the 1950s to 1970s.

say you’ve done something about it.”

The country’s forest resources – over 6 billion m3 – are twice the size of Finland’s.

The original quote belongs to Luke’s Executive

Antti Asikainen, then Professor of Forest Tech-

Vice President for Research, Antti Asikainen, who

nology at the Finnish Forest Research Institute

was asked by Talouselämä magazine in March

Metla, predicted in the history of Kesla published

2019 what an individual can do for the climate.

on the company’s 50th anniversary that by 2020 the use of forest energy in Finland would reach

Quake boosts bio-trend

12 million m3.

In March 2011, the Fukushima Daiichi nuclear

“Its use increased to 7–8 million m3 – 2015 was

power plant in Japan was in the eye of a storm.

the turning point of the forest energy boom. The

The power plant was cut off, and the backup

use of wood energy has increased further, but

power generators failed. The water in the con-

the growth has come from industrial by-prod-

densation pool boiled and the cores of three re-

ucts.

actors melted. Nearly 19,000 people died in the

The Finnish forest energy boom now appears to

chaos and tsunami caused by the earthquake,

have moved to Japan due to natural disasters.

comparable to the Chernobyl nuclear accident.

Kesla, in turn, is a global operator in the forest

Before the disaster, Japan produced a quarter of

equipping of tractors, and the company has a

its energy from nuclear power. After the accident,

good reputation in Japan, according to Asika-

more than 50 nuclear power plants were shut

inen.

down in the country. Kesla, which was already

“Previously Kesla’s harvester heads were installed

active on the Japanese market at the time, was

only on Sumitomo machines, but now on other

also affected by this series of events.

brands as well. I think that’s very smart. Kesla’s

“Japan launched a bioenergy programme, which

market position has remained good.”

has increased the use of forest energy very quick-

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The photo shows Antti Asikainen, Executive Vice President for Research in Japan in 2016.

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Blowing your nose on a tissue

Good to cut down the tree

“With global warming, the beetle has spread to

In Finland, the forest energy boom transitioned

Let us get back to the beginning of the story

protected areas and commercial forests, wiping

to pulp boom, and the sawmill industry recov-

and the climate issue. Can forests still be felled

out a billion cubic metres of forest so far. The

ered rapidly in the 2010s.

in the future? Yes, says Asikainen, after casting a

climate benefits would have been enormously

“It was influenced by the megatrend of urbanisa-

concerned glance towards Canada. According to

greater if the mountain pine beetle had been

tion; the global building materials market started

Asikainen, Canada should cut down hundreds of

delimited in time through sanitation felling to

to rise. Production volumes in the sawmill indus-

millions of cubic metres every year.

prevent the damage from spreading.

try have increased. Enormous amounts of bark

“In Canada, logging might be a real climate act!

Canadian forests are burning far away, but we

and sawdust are produced as a by-product, so

There, the situation is that the forest resources

also run the risk of pests in Finland, with the

it has no longer been necessary to seek wood

no longer grow and sequester carbon, and in-

spruce bark beetle going after old and dense

energy directly from the forest. Urbanisation also

stead the carbon is released into the atmosphere.

spruce woods.

changes people’s consumption habits.”

In recent years, Canadian forests have been a

Forest management logging needs to be contin-

“When people pack into the cities, almost

huge source of emissions – an area the size of

ued, forests exploited and timber harvested. In

everything they consume every day is packaged

Belgium burns there every year. Large areas of

the opinion of Asikainen, the expectations for the

several times. Most of the growth in demand has

dead standing forest flare up easily.

positive climate effects of forests are excessive,

gone into plastics, but quite a large share into

According to Asikainen, the destruction is a chain

and the bioeconomy cannot replace the huge

fibre-based products as well. And a citizen of this

reaction. Forest management, global warming

fossil economy. We would run out of biomass

age can no longer do without different kinds of

and the mountain pine beetle are among the rea-

and come against the ecological boundaries

soft tissue.”

sons for this. The latter is a wretched insect pest.

even before that.

Trees damaged by the mountain pine beetle be-

“I’m sure some kind of afforestation boom will

A question of value

come covered with blue stain fungus, which dyes

still come.”

“Forest resources are ultimately the largest and in

the wood a blueish grey.

the best condition in places where forests have been managed and used. On the other hand, if forests are of no value, they are often cleared for fields. In South America, for example, the main reason for deforestation is not the forest industry but soya and wheat cultivation because timber does not pay.

Asikainen has equally grim news from the United States, where the forest industry is in dire straits.

“Foreign investors buy forest industry facilities.

Not for the factory, but for the land. They cut down the forest and grow peanuts instead.

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Janne Häyrynen (front left) from Kesla, Antti Asikainen (back) and Kimmo Paakkunainen (right) from Kesla.

Kesla’s forest machines are seen all over the world. This photo is from the Northern parts of the United States.

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First presentation of the KESLA 30RH-II harvester head in Uruguay. From left Adrián García (Tornometal), Neivo Person (JCB), Victor Salomon (Tornometal) and Martin Ibarra (Tornometal). Tornometal represents KESLA products in Uruguay.

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2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Forward through development The financial crisis in the US mortgage market culminated in the collapse of the Lehman Brothers investment company in autumn 2008. The economic difficulties also extended to Europe. Several countries got into debt rescuing their banks. The darkest moment of the crisis occurred in 2012 when capital fled Europe and the whole Euro system was feared to collapse.

Kesla also felt the effects of the economic crisis. The company’s turnover decreased by 8.6% to €40.2 million. The operating profit plummeted to €405,000.

At the very least, the business environment was foggy, as the Annual Report put it. However, the company pushed forward by launching the KESLA 2015 development project.

KESLA 2015 was reported to consist of the development and renewal of core activities, such as product development, sales and marketing, as well as manufacturing operations and structures. The project also involved operations related to quality, productivity, security of supply and flexibility. The Joensuu factory invested in a surface finishing plant, machining and automation.

Expectations about the progress of the German subsidiary were high in sales and marketing development. The subsidiary started operations at the beginning of March 2012.

On the product side, investments were made in the crane range. The range had also been renewed by harvester heads, chippers, loaders and timber trailers.

The economic crisis also hit MFG Components hard, and its turnover fell by 11.1% compared to the previous year. The result was still decent, even though there was a credit loss. The company had to lay off some people.

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Kesla has long cooperated with the Belarusian company Amkodor by supplying harvester heads and cranes, for example. Photo taken at Minsk Forestry Exhibition.

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Heading for

Belarus

Kesla was among the first Finnish companies that realised the market potential of Belarus in the mid-2000s. The first forestry crane was delivered to the Minsk tractor factory in 2005 and the first harvester head and harvester crane to Prommedinvest in 2006.

Amkodor’s strategic partner

ners and customers were guided and advised

At the end of October 2019, Kesla Regional

on various issues in the right direction – not

Manager Veli Käyhkö was preparing a training

everything had to be learned the hard way.

trip to Amkodor. Approximately 20 Amkodor

At that time, Belarus had a strong govern-

service representatives were coming to the

ment-led motivation and plan to mechanise

training seminar. Käyhkö and his colleague, Re-

timber harvesting. The same level of planning is

gional Manager Artur Ihno, compiled material

still evident in the country’s forestry sector. The

related to Kesla’s products in close cooperation

goals listed individually in the Belarusian For-

with Amkodor’s own technical team.

est Programme 2016–2020 included technical

“Half theory, half practice: simulation training,

modernisation of forestry, more efficient use of

and forwarder and harvester practice and meas-

forest resources as well as modernisation of tim-

urements. Kesla is Amkodor’s strategic partner,

ber harvesting and wood processing industry.

and systematic training cooperation also speaks to that,” says Veli Käyhkö.

Importance of cooperation In the early years of cooperation, bureaucracy

Strong consulting

related to the movement of both goods and

When Veli Käyhkö started his work as Kesla’s

people also presented challenges. There was

Service Manager in 2006, he was also urgently

no chance of visa exemption, and the paper-

needed in the Belarusian market.

work involved in travel took a long time at the

“Amkodor was familiar with machine shop engi-

airport. The transport of various promotional

neering and earth-moving equipment, but did

materials, electronics and components was also

not have much forest machine expertise yet at

problematic.

the time. Things started from the very basics.

“It’s been a big change. Today, mobility and in-

“Kesla Sales department, with Tarja Tykkyläinen

teraction are smoother.”

as an interpreter, played a big role when part-

Veli Käyhkö says the Belarusians are quick learn-

27

ers. Instead of the basics of mechanics, electrical

Amkodor is a significant OEM customer for Ke-

much English. Communication was conducted

engineering and hydraulics, these days the part-

sla. Most of Amkodor’s machines stay on the

through interpreters and local representatives.

ners discuss new product ideas and innovations

Belarusian domestic market. One of the main

That was another starting point for studying the

as well as product improvement proposals.

export countries is Russia, and Amkodor’s forest

language and culture.

Amkodor was founded in 1927 as a working

machines are also sold in the EU.

Today, Käyhkö can communicate partly in Rus-

community that made children’s toys. In 1952,

sian. His spoken language skills still need a lot

the company started manufacturing road con-

Monoglot beginnings

of work, but his reading is coming along. His

struction machines. The first harvester chains

Veli Käyhkö had to learn a lot of new things

studies continue, although travelling and time

were manufactured by the company in 2006.

while doing business in Belarus.

differences make it difficult. Since autumn 2019,

The Amkodor Group was formed in 2012, and

“At first, the lack of language skills caused

Veli Käyhkö has also been responsible for Kesla’s

its forwarder was named the product of the year

communication problems. I didn’t speak Rus-

marketing and operations in the Quebec region

in Belarus.

sian, and ordinary Belarusians didn’t have

in Canada.

Andrei Sirotenko (left) from EM-System (representative of the Amkodor importer). Veli Käyhkö (back row), Artur Ihno and Alexandra Ihno from Kesla.

28

Amkodor personnel and Kesla’s Artur Ihno, Tarja Tykkyläinen and Veli Käyhkö

Bread, vodka and cows “At the time, I was the only Russian speaker in Kesla’s sales department, so I got to join the trip as an interpreter,” says Export Assistant Tarja Tykkyläinen.

The first contact with Amkodor took place at the Elmia Fair in 2005, where Amkodor’s representatives were mapping out potential partners. Subsequently, Amkodor faxed Kesla product enquiries. Mikko Lehikoinen, Kesla’s marketing manager at the time, and Tykkyläinen set out to see what kind of company Amkodor was and whether the enquiries were serious.

“I was very impressed with Minsk, everything there was very big. From the first visit, I especially remember the trip to the forest. We went to a grocery shop with our hosts, and they bought bread and vodka for lunch. Then we drove somewhere, stopped by a pasture and had our lunch,” recalls Tarja Tykkyläinen, whose career in Kesla started in 1996.

They did not talk business there on the edge of the pasture, but rather got to know each other – without pretence, with an audience of cows, and enjoying the genuine country atmosphere. Personal chemistry hit it off, and trade with the Belarusians started quite quickly.

29

Luke researcher Sari Karvinen:

Russia wants to promote Scandinavian forest management model

30

In August 2006, Kesla established its own ex-

In autumn 2018, Amkodor announced its inten-

mated at between $250 million and $300 million.”

port company OOO Kesla in Russia. As early as

tion to start the production of accessories and

In summer 2019, Amkodor announced that the

2009, Kesla announced the winding down of

components for forest machines in Petrozavodsk.

Ministry of Industry and Trade of Russia, the

the subsidiary’s operational activities. It was al-

Amkodor had acquired the Onega tractor factory,

Government of the Republic of Karelia and Am-

ready known in advance that the establishment

which used to be Petrozavodsk’s most important

kodor-Onego had signed a 10-year investment

and start-up of a subsidiary in Russia would be

industrial plant before its bankruptcy. Amkodor

agreement, which will grant tax relief to new for-

a challenging and time-consuming operation.

reportedly had plans to settle in Yekaterinburg

est machines production, among other things.

After the wind-down, Kesla continued sales in

on the Urals, but Petrozavodsk eventually drew

Amkodor-Onego said that it would invest some

Russia through local dealers and partners. The

the long straw. The city’s strengths are a univer-

€200 million in the machines production of the

steering and support functions were carried out

sity with a focus on forest technology and good

Onego tractor plant. The aim is to produce at least

from Finland.

logistic connections.

a thousand forest machines a year. Production is

Luke researcher Sari Karvinen, who has been

On 17 September 2018, Natural Resources In-

set to start in 2030.

studying Russian forestry for 15 years, estimates

stitute Finland (Luke) released the news: “Am-

that there has been a significant change in Rus-

kodor announces the establishment of the

sian forestry over the past couple of years. The

Amkodor-Onego company in Karelia, within the

debate on improving the efficiency of forestry,

framework of which it will start the production

which began as early as the 1960s, has finally

of accessories and components for forest ma-

materialised in a reform of the rules on forest

chines, such as booms and cutting equipment.

use. Russia wants to promote the transition to

This can reduce dependence on foreign suppli-

the Scandinavian forest management model and

ers and increase the share of local production.

to increase the amount of improvement cutting.

The production volume of forest machines may

Russia’s political will appears to be a great op-

rise to 1,000 units per year, which will give the

portunity for Finnish forest machine technology.

company a leading position in the Russian forest

The annual logging volumes of the country of

machines market.

massive forest resources are telling. While in 2008

The project has the support of both regional and

the logging volume in Russia was about 180 mil-

federal authorities. The company is eligible for

lion m3, in 2014 the volume had already risen to

benefits in terms of credits, taxation and energy

203 million m3. In 2018, 239 million m3 of wood

tariffs, and the state may compensate for part

were felled in Russia. At the moment, only 5%

of the purchase of machinery and the costs of

of the wood comes from improvement cutting.

construction and research. The investment is esti-

Kesla’s partner Amkodor has announced plans to start a company in Karelia.

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Investments become concrete The annual report describes 2013 as unsatisfactory. The turnover rose to approximately €44.9 million.

The operating profit for the financial period was slightly over €1.2 million. Most of the investments under the KESLA 2015 project were made during 2013 – amounting to almost €5.3 million.

The situation of MFG Components continued to be difficult. The difficulties were justified with the restructuring of the Finnish mechanical engineering industry.

The launch of the subsidiary Kesla GmbH also faltered. However, the company signalled its intention to gain greater visibility and a foothold in the important material and energy wood and recycled material processing machine and equipment markets in Central Europe.

31

Collaboration

at the forefront of development ProSilva Oyj, which operates in Ruovesi in the interior of Finland, is a forest machine manufacturer and long-term partner of Kesla.

“Our cooperation dates back to before ProSilva

so it was natural for ProSilva and Kesla to join

was founded. My brother and I used to do forest

forces.

work, originally forest fertilisation. There were no

ProSilva introduced a hybrid harvester at FinnMETKO 2012.

32

suitable machines in the market, so we started

Towards hybrids

to make them ourselves,” says Lasse Karilainen.

In 2012, ProSilva presented its first hybrid har-

Kesla’s founder Antti Kärkkäinen did the same

vester in Finland at the Metko exhibition. The

back in the day – he built the machines himself,

910 Eh was the occasion of the year at Metko. In

noting that there was a wider demand in the

addition to final felling, the medium-sized chip-

market for smart technical solutions.

per was also reported to be suitable for thinning

The Karilainen brothers used Kesla harvester

and harvesting energy wood. The 151 kW diesel

heads on their machine when they were building

engine of the hybrid machine was replaced by a

small harvesters that could work with 30 metres

60 kW diesel and two consecutive 30 kW electric

between wheel tracks.

motors. The goal was to save up to 40% on fuel

“A small company can’t just follow develop-

consumption per cubic metre of wood.

ments, it must lead them.” This is how ProSilva

The development was driven by tighter emis-

defined its position in the market when the com-

sion standards. However, the global conquest

pany was founded.

with the hybrid harvester was sooner said than

“At that stage, Kesla with its cranes and harvest-

done; the technical solutions needed further

ers became more and more involved. There was

refinement.

a lot of cooperation with Kesla’s Kimmo Paak-

“In truth, we were about ten years ahead of our

kunainen and Mika Tahvanainen. The coopera-

time. There were losses because development

tion was open. The base machine was ours, and

work and testing is extremely expensive,” says

the crane and the harvester head came from

Karilainen.

Kesla.”

ProSilva and Kesla are also on the same track in

Chilean forest companies are among the largest

hybrids; Kesla announced the first ever hybrid

in the world. It was difficult for an SME to break

chipper in 2014. The starting point of the de-

into such a large and challenging market alone,

velopment of the KESLA C860H hybrid chipper

“No tie around that neck” Lasse Karilainen, CEO of ProSilva Oyj, was thinking trade during his first trip to Chile in 2008. A local contractor and the forest company Arauco had approached ProSilva. In Chile, technology was needed for thinning in demanding conditions.

Discussions were held in a business-like setting around a conference table, but Kariwas to improve machine performance and fuel

lainen was eager to get to the forest site. The Chilean hosts wondered at the enthu-

economy. Despite the efforts, Kesla also had to

siasm with which the Finnish executive so eagerly wanted to participate in logging.

admit having been ahead of its time in the de-

They asked whether such a thing was normal in Finland.

velopment work, and the chippers could not be

“The advantage of a small company is that you do not have to wear a tie and sit in an

produced commercially.

office,” Karilainen recalls, recalling how important for success it is to talk to machine contractors, machine operators and forest owners alike.

More resources

“Subsequently, discussions with the Chileans covered the required power of the ma-

ProSilva’s Karilainen transferred from CEO du-

chine, cost-efficiency and other goals. We put the framework together. We promised

ties to the Board of Directors a little before the

them we’d build a machine for them to test drive for three months at our own risk. If

company announced a significant acquisition in

the machine achieves its targets, we make a deal. If the targets are not achieved, the

October 2019. Tampereen konepajat Oy bought

customer will pay only the return freight of the machine.”

the majority of ProSilva.

The results were achieved and the Chileans paid for the ProSilva 810, which was

“ProSilva had a turnover of approximately €4

equipped with a KESLA 25RH harvester head and a KESLA 1395 parallel crane. Since

million, many times that of Tampereen konepa-

then, Arauco’s top executive has travelled to Ruovesi to see for himself the company

jat. After the acquisition, we are part of a large

that sent the machine to Chile at its own risk.

group, with more resources for future development,” says Lasse Karilainen.

“Growth is sought from exports,” said Juhani Lehti, Managing Director of Tampereen konepajat, on the acquisition in Aamulehti newspaper (10 October 2019).

Cooperation with Kesla continues and both continue in the same direction: growth is sought from exports.

Lasse Karilainen, an influential figure in mechanical timber harvesting, died in Ruovesi on 3 April

Lasse Karilainen at FinnMETKO.

2020 after a long illness.

33

You can

always ask

In 2007 Kesla had good news from Japan. The company signed a cooperation agreement with Japanese Sumitomo (S.H.I.) Construction Machinery Sales Co. and Usui Automechanic Shop.

Sumitomo is one of the leading excavator manufacturers in the world. There was a reason why everyone at Kesla was so excited. However, there was one final hurdle – or rather, one clarifying question.

34

Around 40% of Japan’s forests are planted

species Japanese cedar. All parts of hinoki cy-

eo about the stroke harvester. The video was

stands, the majority of which have been plant-

press, from bark to pith, are used, and harvest-

found and played, and soon the Japanese were

ed since the Second World War. Japan’s forests

ing must leave no marks on the wood.

excited! That was the solution – Kesla’s stroke

– more than 6 billion m3 of forest resources –

The Japanese delegation visited Kesla’s Kes-

harvester.

grow in mountainous areas, where the ter-

älahti factory. Mikko Lehikoinen, Marketing

When the party left for the airport a second

rain is difficult to navigate and annual rainfall

Manager at the time, asked Export Manager

time, the Japanese were humming with sat-

can often reach around 1,500 mm. There are

Mika Tahvanainen in passing to escort the del-

isfaction.

therefore many challenges in the harvesting

egation to Joensuu Airport for their trip home.

conditions.

Tahvanainen had not participated in any in-

In the mid-2000s, Sumitomo produced more

depth discussions with the guests.

than 10,000 excavators per year. At the same

As Tahvanainen was driving the group to-

time, a forest programme with a strong in-

wards Joensuu, the mood in the car seemed

crease in timber harvesting volumes was

quite disappointed. This made Tahvanainen

launched in Japan. The Japanese wanted to

ask what the guests had come looking for

develop a factory-fitted crawler harvester suit-

and whether they had found it. He asked the

able for modern timber harvesting.

important question. They had been seeking a

A delegation came from Japan to Finland in

harvester head for a small excavator, but ac-

search of a forest technology partner. The

cording to the guests they had not found one.

Japanese were looking for a small harvester

Mika Tahvanainen mentioned Kesla’s stroke

head on the market that would be best suited

harvester – the Japanese should see it. A few

especially for harvesting hinoki cypress. Hinoki

kilometres before the airport, the car made a

cypress is a valuable coniferous tree species in

U-turn. The Export Manager remembered that

Japan that grows on drier land than its sister

somewhere in Joensuu there was a VHS vid-

Hiro (left) and Mika Tahvanainen (right) during a customer visit in Japan.

“That was the solution

– Kesla’s stroke harvester.”

35

Chippers have also been delivered to Japan. Pictured are Kesla’s Janne Häyrynen (bottom row, second from left), Kimmo Paakkunainen (bottom row, fourth from left) and Hiro (bottom row, right). The others pictured are the importer’s representatives and customers.

36

Hiro – accelerator for the Japanese market

the University of Helsinki and Meido-Kan Budo

The Japanese delegation to Kesla also in-

years, moving back to Finland in Ostrobothnia

cluded Hiroyasu “Hiro” Tanayama – the sen-

in 1973.

sei of Kurikka, 11th member of the Finnish

“During those years of Japan, I worked at a trav-

Judo Association’s Hall of Fame and a great

el agency there and helped out a small zipper

friend of Finland. It was largely thanks to

company from Nykarleby. We met on a bullet

Hiro that Kesla broke into the Japanese

train when hearing someone speaking Finnish

market at record speed.

caught my attention.

Club. In Helsinki, he also met his Finnish wife Katri. In 1970, the family moved to Japan for three

The zipper company’s business waned, and Hiro Hiroyasu “Hiro” Tanayama started practising

and his family, who had moved to Nykarleby

judo in Kawasaki in 1955. He was trained as an

from Japan, moved to Kurikka.

engineer and grew interested in Finland and

“Nykarleby was a beautiful place, but not Finn-

The Kalevala from a young age.

ish enough,” says the great lover of the Finnish

“In Tokyo, I met a Finnish missionary, Pentti Ka-

language.

rikoski, who spoke fluent Japanese. On Sundays,

In Kurikka, Hiro worked as a buyer for the Velsa

we went to church and afterwards I attended

machine engineering workshop. In 1974, Velsa

lectures given by the priest on the subject of

was taken over by Valmet, and Hiro commuted

The Kalevala. I was already learning a little Finn-

to Tampere for a while. Hiro naturally brought

ish there,” Hiro recalls.

judo with him from one place to another.

Sensei Tanayama started teaching security skills

Finnish attraction

to vocational school students in Kurikka. Hiro

The enthusiasm for Finland and The Kalevala

was already a well-known judoist in Finland at

led Hiro to Turku in 1966 to study literature. Hiro

that time. The people at Kone-Ketonen in Kris-

made his first trip to Finland by train across Si-

tinestad had also heard about the industrious

beria. The trip took three weeks. His daily meal

Japanese man. Ketonen was Hiro’s first contact

on the train was cabbage soup – he was a very

with forest machines.

slim man upon his arrival in Finland.

“Ketonen had export aspirations to Japan and

In the evenings Hiro taught judo at two local

I promised to help them with cultural issues,

judo clubs (Turun akateeminen judoseura and

among other things. The cooperation did not

Turun judoseura). After two years, he moved to

go as well as it could have and ended quickly.”

Helsinki. There he continued to teach judo at

Hiro, Kimmo Paakkunainen and Janne Häyrynen.

Kesla brand tipster In Japan, there was a lot of interest in Finnish forest machine technology. Sumitomo had a strong desire to enter the forest machine market. Hiro was no longer interested in partnership with Kone-Ketonen, which had cooperated with the Japanese importer’s contractual service partner Usui Automechanic Shop’s owner Yutaka Usui.

Kesla had already become somewhat familiar to Hiro, so he tipped Yutaka Usui off about the KESLA brand. Hiro was the interpreter of the Japanese delegation when Sumitomo paid their first visit to Kesla. Kesla and Usui continue their strong cooperation.

What does it take to gain access to the Japanese market? According to Hiro, it takes at least perseverance, patience, decency, listening and lack of pretences. Japanese and Finns share a simi-

37

lar initial restraint and observation. Once that

lem-solver! A good problem-solver is needed

tively in judo. The story goes that when Hiro’s

is overcome, ideally a deep trust can be built.

in the Japanese market, since getting started

sons came to visit their parents for Christmas

Hiro recalls a few times when a demanding

can be so difficult. And luckily we had Service

one year, they went to spar on Kurikka Seibu-

Japanese customer gave customer feedback

Manager Kimmo Paakkunainen with us from

kan’s tatami before sitting down for the Christ-

to Kesla’s people.

the beginning. He is fantastic with customers!”

mas meal. For these men, the essence of judo

“I remember one conversation between the

Hiro has been a real accelerator the company in

is shiai – competition and matches. Thus, the

head of Sumitomo and Mika Tahvanainen. I

Japan – without him, Kesla’s access to the mar-

Christmas meal could not start until a familiar

thought the turns of phrase were unusual,

ket would have taken years longer.

dentist patched up the men a little first.

though these business relationships never de-

Hiro made dozens of trips to Japan with Kesla as

In 2018, Hiroyasu Tanayama was named as the

volved into personal comments.

a coach, cultural guide and interpreter. The long

11th member of the Hall of Fame of the Finnish

Kesla’s Marketing Director Mika Tahvanainen

cooperation ended in 2017 when he started his

Judo Association during the association’s 60th

remembers the complaint and feedback.

well-earned retirement.

anniversary festivities.

“The Japanese are in a league of their own in quality requirements. And yes – we have to

Judo legend

listen to the customer. When machine deliv-

Hiroyasu Tanayama (78) is a Kurikka celebrity,

eries expanded to series, even small variations

a true sensei of Finnish judo. Hiro’s three sons

were revealed and a lot of attention was paid

Juhani, Tomi and Saku have also competed ac-

to them,” Tahvanainen remembers, stating that his role was to balance the customer’s demands with their own production.

“We had some pretty tough meetings. However, we quite quickly found a common view on how to further improve quality according to the customer’s wishes.”

Perfect personal chemistry In the early stages of the cooperation, Sumitomo was just learning about forest technology.

Hiro particularly gives credit to people’s competence and attitudes for building the close cooperation. The customer was genuinely listened to. Hiro describes Kesla’s people as skilled and open-minded professionals.

“Oh, Mika Tahvanainen is such a good prob-

38

Hiro is a sensei of Finnish judo. He has been named the 11th member of the Hall of Fame.

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Subsidiaries in difficulties Economic growth in Europe was developing promisingly until spring 2014, when markets reacted strongly to the crisis in Ukraine. The economic climate for the forest industry continued to be good.

However, growth in the use of renewable forest energy was slowing down.

Kesla’s turnover was €45.1 million, operating profit a modest €607,000. The operating result of machine engineering systems operated at a loss of over €260,000, while one year earlier it was still nearly €110,000 in the black.

The investments under the KESLA 2015 project continued by approximately €4 million.

The wind-down of OOO Kesla, the subsidiary in St Petersburg, had already started in 2009. In 2014, the liquidation of the subsidiary was completed. Despite the divestment of the subsidiary, Russia remained an important export country of Kesla.

The news of the German subsidiary was grim. This situation was explained by the weak development of the Central European market during 2014.

39

Hard worker

in harsh conditions

Rapidly growing e-commerce increases demand for packaging board in Russia. Timber is moving and the pulp mills are spinning. In order to get the timber moving, the country needs Kesla’s legendary timber handling cranes.

‘Legendary’ is exactly the right word to describe

the engines are not switched off even during an

Each year 150 to 200 timber handling cranes are

the KESLA 2009S product family. This is a 9

hour’s break. Experience has shown that this is

exported to the country. Customers range from

tonne-metre class timber handling crane, which

the best way to keep the machines operational.

small private logging companies to giants like

is descended from a timber handling crane that

Ihno also explains the importance of the du-

the Ilim Group. The largest wood processing

impressed the market under the Forester brand.

rability and reliability requirement in terms of

company in Russia, Ilim Group, produces about

The first Foresters entered the market in the

distance.

3.2 million tonnes of paper and pulp per year.

1980s. Built for expediency, these beasts of bur-

“The logging sites are located a considerable

Half-owned by Russian Ilim Holding and Ameri-

den proved superior to their competitors. In the

distance from the cities, far away from services.

can International Paper, Ilim is planning to make

brand reform of 2005, the Forester brand was

It’s normal to have a distance of 500 km from

significant factory investments in Russia in the

discontinued. The change of name did not un-

any kind of service shop or spare parts. In other

coming years.

dermine customers’ confidence, as the timber

words, when we talk about the reliability and

“Ilim has several large plants, where about 50

handling crane had already demonstrated its

durability of KESLA timber handling cranes, we

Kesla timber handling cranes are continuously

excellent functionality and reliability at Russia’s

are talking about something that is absolutely

at work throughout the harvesting season.

extremely challenging logging sites.

crucial for the customer.”

The winter season 2019–2020 was mild and

Kesla has its own importer in St Petersburg,

challenging in regard to stands marked for cut-

In the arms of Siberia

which organises servicing and spare parts ser-

ting. However, the short harvesting season was

The most demanding of harvesting locations are

vice. According to Ihno, practically every major

preceded by a few good winters.”

in Siberia. Timber is harvested in winter, when the

customer has a spare parts and service point

“The previous winter was short for harvesting,

temperature may well be under -40°C.

next door. Kesla also has close cooperation with

but the price of timber was good. Last winter,

“Special liquids and oils, special hoses and, of

the car brands that manufacture base machines.

on the other hand, was more problematic, as the

course, the way of using the machines,” says Ar-

Partners include Volvo, Mercedes, MAN, Scania,

price of timber was falling. However, people in

tur Ihno, who was Kesla’s regional manager until

KAMAZ and MAZ.

Russia don’t seem to be concerned about weath-

2020, listing the special requirements related to

40

er fluctuations, let alone climate change. They

the use of the crane. In practice, the machines run

Growth on the horizon

say that the fluctuations are normal and that we’ll

around the clock – in harsh freezing conditions,

Russia is an important export country for Kesla.

soon have a decent cold winter again.”

Expedient Russians appreciate the expediency of KESLA 2009S and KESLA 2009ST timber handling cranes. There is nothing extra in the cranes, no frills at all. At its simplest, the crane has lever control and top seat equipment. Around 70% of the sales are machines with top seat equipment. Customers mostly only buy cabin cranes for Siberia.

In Siberia, the driver is subjected to the lowest temperatures, but you would think that poor weather conditions would affect drivers elsewhere as well.

Here, Russians joke about the speed of work: they say that a driver with top seat equipment works faster without the comfort or protection from the elements provided by a cabin.

41

Best available

technology only

In 2011, Kesla launched a major KESLA 2015 investment programme. The most significant investments were made in 2013 and 2014. In total, the company invested over €10 million in its production during the decade. According to Production Director Paavo Hopponen, the investment policy is clear: “No replacement investments – we invest in automation and the best available technology.”

Paavo Hopponen’s Kesla career began at a time

specifies the configuration of the product. Af-

of strong growth. Many recruitments were made,

ter that, the product is manufactured on the

more temporary labour was hired and the sub-

basis of a pre-planned offering of products and

contracting chain was increased.

equipment. The ERP system made product sales,

“There were no prejudices or mental limitations,

specifications, configuration and assembly more

we just boldly sought growth. All means were

flexible.

used, since demand was high.

Welding is a process in which preparation and getting it right in one go play a crucial role. The ISO 3834-2 certification acquired by Kesla in 2018 helps ensure a good result.

42

The rapid pace eventually lasted for less than

KESLA 2015

two years, and then the world economy and Ke-

At the beginning of the new decade, the com-

sla with it went into recession. There were lay-

pany launched the KESLA 2015 investment pro-

offs ahead and also redundancies. At the time,

gramme. One of the most significant individual

even the production manager was only working

investments was a new finishing line. The line

half-time.

was launched in March 2014. In addition to im-

During the period of sluggish demand, Hoppo-

proving quality, the investment of around €3

nen had plenty of time to start reforming Kesla’s

million made it possible to increase production.

production management system in cooperation

“Surface finishing had to be brought to a better

with the financial management. The first inven-

level, with particular pressure from the Central

tory items were transferred to the new ERP sys-

European market. In addition to the quality of

tem at the end of 2010.

the powder-coating, the investment also ena-

The ERP system changed the company’s deliv-

bled better cost-effectiveness and reduced en-

ery method, which switched to product config-

vironmental burdens.

uration. Configure to order (CTO) is a principle

Kesla’s old painting shop only did wet painting.

whereby when placing an order, the customer

In the Central European climate, wet painting

“No replacement investments – we invest in automation and the best available technology.”

At Kesla, all personnel are involved in quality development. Pictured are Quality Manager Tero Tanskanen, Assembly Operator Jarmo Riikonen and Production Director Paavo Hopponen.

43

proved problematic – corrosion protection had

ed many other individual investments: Modern-

distress, and investments stopped.

to be improved.

isation of the surface finishing at the Kesälahti

“Business is cyclical, we must adapt to the rise

“Large boom systems were transported for pro-

factory as well as a fine-ray plasma cutter with a

and fall of world politics. There will be no aver-

cessing to an external industrial paint shop. It

bevel head, investments in storage and materi-

age investment solutions. We will seek the best

was soon discovered that, in practice, the trans-

al transfer, development of mass customisation,

available technology that will serve us for the

port, scheduling, anticipation needs and ulti-

adoption of the LEAN operating model and an

next ten years.”

mately total costs proved unfeasible.

ISO quality system certified in 2012.

Hopponen is proud that Kesla’s production work-

Another bottleneck requiring investment was the machining of large pieces. Critical capacity

Cyclic business

on how to develop and improve the various stag-

had to be brought in-house.

In 2014, Yle’s foreign news headline asked “What

es of production.

There was also room for improvement in test

makes the crisis in Crimea serious?” (Yle 20 March

“Obviously, one part of the development of pro-

driving, the functional testing of products be-

2014). Russia had decided to extend its state bor-

duction is benchmarking, i.e. monitoring our in-

fore delivery to the customer. With technological

ders to Crimea. EU countries agreed on Russian

vestment and machine development and that of

solutions, the whole package from design to pro-

trade sanctions. Kesla had just had time to finish

other actors in the sector.”

duction and deliveries was whipped into shape.

the biggest projects of its extensive investment

The KESLA 2015 investment programme includ-

programme. The company went into financial

The machining centre of the Joensuu factory was completed in 2014. It still represents the very top of its field. The photo shows CNC Operator Eero Huurinainen.

44

ers actively come up with ideas and suggestions

O tempora, o mores While working in tool manufacturing at Perlos, Paavo Hopponen became accustomed to brightly lit, almost laboratory-like spaces. Precision was at the heart of Perlos’ activities, which served mobile phone manufacturers. When the end was already in sight for Perlos, Paavo Hopponen responded to a job advertisement in the newspaper. Kesla was looking for a Production Director.

On the 2 April 2007, Hopponen was looking at the factory premises of his new workplace from the point of view of the Production Director. Hopponen had experience in the machine engineering industry at the beginning of his career, but he was still was startled by the darkness and stuffiness of the production facilities. “I was also surprised that people were smoking on factory premises, even though the Tobacco Act had banned it long before. There was a tough-guy atmosphere,” says Hopponen.

Jari Nevalainen, who was CEO at the time, said that the smoking would stop since even the law protected non-smokers. Nevalainen advised Hopponen that the new production manager should not intervene, at least not during his very first week working there.

Oh, what times! Oh, what customs! In more than ten years, the cultural change in Kesla’s factory premises has been huge. The darkness, dust and smoking are long gone.

The KESLA 2015 project modernised the surface finishing line of the Joensuu factory. In surface finishing, the product receives a nanoceramic primer as well as a zinc interlayer and surface powder coating, which together provide good corrosion protection and wear resistance.

Pictured is Production Director Paavo Hopponen, who led the project.

45

Extensive product portfolio While many competitors are mainly specialised in one main product area, Kesla is progressing on a wide product line. In the harvester head market, all manufacturers bigger than Kesla are tied to specific forest machine manufacturers. The market for chippers, tractor equipment and timber handling cranes is very fragmented globally. However, among the many actors, Kesla’s position is strong.

One of Kesla’s strengths is the ability to build good partnerships, such as Sumitomo in Japan. Recent cooperation with AGCO Group and Valtra, as well as with the French Dalby Group, open up new opportunities both on the tractor equipment side and in the recycling crane market.

Expediency

above all

In Finland, the axe and bucksaw were commonly used in timber harvesting until the 1950s.

evolutionary thinking of mechanisation, which

The proper mechanisation of logging – felling, delimbing and bucking – began in Finland

progresses from chainsaws to tractor-based

in the 1970s. Kesla has been heavily involved in this development. The mechanisation of

equipment, from excavators with harvester

logging is also inevitably progressing in the emerging global market. Kesla is once again at

heads to factory-made wheeled harvesters.

the centre of events.

“I don’t think it’s that simple, there isn’t always a technical and economic basis for such

46

In emerging markets, finding your own niche

significant influence in machine investments,”

thinking. The choice of equipment should be

in the market segment and organising a net-

says Mika Tahvanainen, Kesla’s Marketing Di-

guided by expediency. No one wants to buy

work of dealers and partners and after-sales

rector.

machines for fun, just to make a living. Tech-

services require sustained and persistent work.

Tahvanainen refers to regional practices in

nology appropriate to each operating environ-

Competition is often intense. Success may re-

which a machine entrepreneur may be almost

ment is needed.”

quire much more than the best possible ma-

forced to invest in machines that are not opti-

When talking about expediency, Tahvanain-

chine from the customer’s point of view.

mal for the entrepreneur’s performance – oth-

en also refers to competence. The challenge

“In South America, for example, Finnish forest

erwise they will not get a contract.

of harvesting work is the constant shortage

machine manufacturers have competed for

“They are urged to get purpose-built machine

of first-rate drivers. The challenge seems to be

a place in the sun and noticed that the com-

chains in an operating environment where, for

very similar all over the world. The differenc-

petition is not only about the souls of forest

example, excavator-based solutions would be

es in productivity per driver are considerable

machines entrepreneurs. Forest companies,

more economical.”

and are further exacerbated by challenging

which act as major contract assigners, have

Tahvanainen criticises the narrow-minded

working conditions. Efficient use of machines

For Kesla, user experience is a competitive advantage and the expediency of machines is a virtue. The user is also the starting point for product design. In the photo the harvester entrepreneur Juuso Laukkanen and Product Designer Paavo Alhainen.

47

“It is pointless to fill the machine with ‘nice-to-have’ features that mainly only increase the costs for the entrepreneur and increase the sensitivity to interference – unless there is a real need for the features.”

requires special professional skills and the ability to plan and execute work tasks in the right way. These requirements can be met not only by training, but also by simplifying the use of machines.

“In countries with lower levels of education and skills, productivity cannot be optimised with the same recipe as in Finland, for example. In this case, the productivity of the machine relative to the cost of the machine becomes a critical factor.”

Close to the customer For Kesla, user experience is a competitive advantage and the expediency of machines is a virtue.

It is pointless to fill the machine with ‘nice-tohave’ features that mainly only increase the costs for the entrepreneur and increase the sensitivity to interference – unless there is a real need for the features. At least these ‘frills’ must not be used to cover up flaws in basic technology. For example, it makes no sense to give information systems required in Finnish conditions to a customer who does not need them – they would only be a burden. It is real a shame if a half-million euro machine stands idle due to Windows updates.

48

The cat that showed its claws Mika Tahvanainen from Ilomantsi completed his Master’s Degree in Agriculture And Forestry at the University of Joensuu. Before joining Kesla, he had time to work as a researcher, teacher, information system developer and harvest supervisor, among other things.

“My course-mate from university, Mikko Lehikoi-

2012, the export manager became Kesla’s Mar-

“Over the years, my role has changed more from

nen, and I joined Kesla at the same time in March

keting Director when Eero Lukkarinen, who was

being a market pioneer to being an enabler. It’s

2003. Not to speak ill of our predecessors, but I

the marketing director after Mikko Lehikoinen,

my job to give our current pioneers the condi-

must say that in the past the company had been

moved from Kesla to another employer.

tions to open up new markets. My own experi-

heavily focused on sales with barely any attention

Mika Tahvanainen grew up on a farm and was

ence on the front line helps me understand what

to marketing. We joked that we came to work at

familiar with forestry and machines from a young

kind of conditions are needed for the work. We’ve

Käkisalmi’s machine engineering workshop and

age. As a legacy of his childhood, he says that he

always found new people for our team whose

not at a listed company,” says Mika Tahvanainen

also received Valtra and Kesla genes.

claws have firm grips. The future looks pretty

with a smile.

“We always had a Finnish tractor at home, and in

safe.”

Tahvanainen remembers Lehikoinen’s energy

1981 we got the first PATU loader-trailer combi-

and ability to inspire his team to perform better

nation made by Kesla.”

and better.

Experiences from home and a partner’s role in

“My own experience in sales and marketing was

his brother’s timber harvesting company have

quite modest, and I still don’t really think of my-

strengthened the Marketing Manager’s ability

self as a top marketing expert. My strength has

to deeply understand Kesla’s customers.

always been a strong practical knowledge of tim-

“Thanks to my technical expertise and under-

ber harvesting processes and an understanding

standing of timber harvesting processes, I un-

of the customer’s life. Mikko, on the other hand,

derstand the customers and their needs, which

is a very dynamic person with a sales and market-

I have been able to pass on to Kesla’s product

ing drive. We may have had some disagreements,

development.”

but Mikko had a lot of faith in the team’s abilities

At Kesla, Tahvanainen has also become a pioneer

as long as the guidelines were clear. It takes a

in new markets. When North America plunged

leap of faith – when you throw a cat up towards

heavily under the pressure of the 2008 financial

a ceiling timber, it depends on the cat whether

crisis, Kesla already had a good foothold in Ja-

it can grab onto the beam with its claws.” That is

pan and South America. Tahvanainen played an

how Lehikoinen described what was going on

important role in the opening of those markets.

at the time.

Since then Kesla has started operating in emerg-

Tahvanainen’s claws have had a firm grip. In

ing markets elsewhere in Asia and also in Africa.

Business Director Mika Tahvanainen has worked at Kesla since 2003. During his career he has become familiar with wood harvesting around the world.

49

Machines must operate in very different types of conditions, from the Arctic to the hot tropics.

50

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Time for corrections “The Kesla 2015 project has been completed. Jari Nevalainen has completed the task as promised, so we can continue forward.” Veli-Matti Kärkkäinen, Chairman of Kesla’s Board of Directors, stated this in April 2015 when the company announced the change of CEO. Jari Nevalainen had managed Kesla for a total of 14 years.

When Yle asked about the CEO’s election for a news story, Kärkkäinen replied: “The search for Nevalainen’s successor is well advanced, as the Board of Directors of Kesla has already interviewed new candidates for CEO. The election is due to take place in April and it is hoped that the new CEO will start this spring.” The Chairman of the Board expected the new CEO to have experience and the ability to “get the organisation of 300 people to work together”.

Europe’s weak economic growth combined with the economic crisis in Russia was still reflected in Kesla’s business environment. The company’s turnover fell from the previous year to €40.1 million. The financial period saw an operating loss of approximately €1.6 million.

According to Kärkkäinen, Chairman of the Board, however, the long-term outlook for forest technology was nothing to complain about. “We look forward to the realisation of Äänekoski and other major Finnish investments. The use of forests and machines will increase in the coming years,” assured Kärkkäinen in Yle’s interview.

The turnover and profit of MFG Components continued to decline. Both internal and external sales were in the red. Over the years, MFG had become a very problematic part of Kesla.

Things were not going well in Germany, either. The impact of the subsidiary’s profit and loss on the Group’s result was clearly negative.

51

Simo Saastamoinen has been the Captain for Kesla since 2015.

52

A horrible

handicap

Simo Saastamoinen started his work as Kesla’s CEO in 2015. Kesla was a company in crisis, with a gearing of 140% and empty coffers. The crisis was brought about not only by fluctuations in the world economy, but also by internal action.

As a result of the crisis in the Crimea, it was

time and cost a lot of money. The company

en’s first task was to agree on procedures with

suddenly quiet on the eastern front of the mar-

had made a significant error of judgement.

the company’s investors.

ket; Russia, Belarus, Ukraine, the Baltic States

“We were able to freeze loan repayments for a

and part of Central Europe were at a standstill.

Corrections

while. I wrote a 10-page planning memoran-

The total investment load for 2013 and 2014

CEO Saastamoinen had to start taking the

dum on our actions, which we then followed.

was approximately €9 million. The misfortunes

company towards a clear change. As several

This allowed us to work in peace and focus on

also included increasing sales receivables.

Kesla employees have said afterwards, there

making structural changes.

At the same time, MFG Components was

was a situation where “something had to be

The company started reorganising its business

operating at a loss. MFG’s import business,

done”. There was a financial crisis. Saastamoin-

operations.

which had previously been more profitable, had already fallen as digitalisation changed customer behaviour. As a result, the closure of the Ilomantsi factory was close.

There were also problems in Germany, where Kesla had quickly established its own subsidiary Kesla GmbH in 2012. It was clear from the outset that the start-up of a subsidiary would incur costs in the first years. It came as a surprise that Kesla had entered the German market with incomplete initial data. The weight limits for transports there are significantly lower than those in Finland. With that fact, Kesla’s sturdy and heavy timber handling cranes proved too heavy for the Germans. The crane model had to be changed, made lighter. It took

Kesla GmbH personnel: Simo Saastamoinen (left), Elke Vogel, Achim Weidner, Werner Ziefle and Bernhard Huber, now retired.

53

“This is not a sprint, it’s more of a marathon. Good thinking becomes good action, which helps us achieve good results. In organisational culture, we build courage and perseverance to renew ourselves.”

Tall and thin trees in Thailand.

54

“Pretty much at the beginning, I said that the

ent company recognised a total of over €2.6

Both Kesla’s turnover and profit have seen

way it was going, the company would not

million of impairment in its MFG investment.

good growth during Saastamoinen’s time as

exceed €50 million in turnover. The process-

The big news was that Kesla discontinued its

CEO. The problem that emerged at the end of

es were unclear and so were the competitive

long-term cooperation with Hankkija and en-

2019 regarding the durability of the crane col-

strategies of business operations. We had to

tered into a partnership with ACGO Finland

umns was a setback. The durability problem

seek a more systematic approach and think

and Valtra in 2016.

concerns KESLA 2124L cranes – the ones that had to be urgently developed for the German

about what business we want to be in, who our customers are, what our competitive ad-

A streamlining strategy process

market in early 2012. In accordance with its re-

vantages and strengths are.”

It took a lot of work to get through those diffi-

sponsibility value, Kesla promised to replace

Kesla established its own business organisa-

cult times. Kesla also had a lot of luck. The rap-

the columns of all of these cranes delivered

tions for truck-mounted and industry cranes,

id recovery of demand in the Russian market

from 2013 onwards with a new reinforced con-

timber harvesting equipment and tractor

contributed to the end of the difficulties of the

struction. The operation made a dent of ap-

equipment. The goal was to shake an organ-

Ilomantsi factory.

proximately €700,000 in the company’s profit.

isation set in its ways to see the company as

The cooperation with Valtra, in turn, brought a

At the end of 2019, Simo Saastamoinen reiter-

a whole from the perspective of its custom-

whole new kind of drive to Kesla. The compa-

ated his earlier message: Kesla aims to increase

ers – to understand the systemic thinking

ny’s strategy work, launched in 2018, clarified

performance on a permanent and reliable ba-

demanded by Saastamoinen. The CEO estab-

the common tune that Simo Saastamoinen

sis.

lished new operating methods in the organ-

and his orchestra want to play. Business-spe-

“This is not a sprint, it’s more of a marathon.

isation. Among other things, every Monday

cific targets were clarified. It all motivated

Good thinking becomes good action, which

the situation in the supply chain was reviewed

people, who had learned to look at the com-

helps us achieve good results. In organisation-

together.

pany’s businesses as a whole and succeeded in

al culture, we build courage and perseverance

In 2017, corrections were carried out in connec-

increasing communication both in-house and

to renew ourselves.”

tion with the German subsidiary. The number

towards customers.

of employees was reduced and the spare parts

In 2016, the success in the Thai market was

stock was transferred to Finland. As regards

more good news. The Kesla team had done

MGF Components, the solution was to make

thorough groundwork, built trust with cus-

Kesla’s strategically important Ilomantsi facto-

tomers and managed to beat their competitors

ry part of Kesla in 2016 and sell MFG’s business-

also in the speed of the service.

es. MFG’s manufacturing business was sold to

“Overall, there is a lot of room for improvement

Kotka Power Tech Oy in September 2017. In

all the time. We must work on configuring prod-

autumn 2018, Kesla announced that it had sold

ucts, improving understanding of customer

MFG’s import business to Tools Finland Oy. At

needs, supporting dealers, developing life-cycle

various stages of the process, the Group’s par-

services and improving service levels.”

55

System thinker Saastamoinen Simo Saastamoinen, who was born in Uimaharju in North Karelia, is a graduate engineer. He also holds a Master of Science degree from Cranfield Institute of Technology in the United Kingdom. His career started at Suomen Posti Oy, where worked as production Planning Manager, Product Manager and Product Group Manager.

56

Saastamoinen joined Perlos in 1999 when he

later Marke Tyrväinen, then Managing Director

Solving one single problem does not elimi-

and his family moved back to the Joensuu re-

of Kesla, was moving on to a new job. Kesla’s

nate the root causes of the problem. In sys-

gion. In 2001, he was appointed Director for

management contacted Saastamoinen asking

temic thinking, the causes of the problem are

Procurement and Logistics. His Perlos career

if he would be interested in a position as Ke-

given a deeper look, paying special attention

was also the source of his systemic thinking

sla’s CFO.

to bottlenecks.

– extremely fast paced and global business

“I had run internal accounting, but I was not an

“Managing the whole and understanding

showed how everything affects everything; if

accountant. Becoming CFO felt like jumping

causal relations requires a rational and con-

any part of the system changes, the change

into a black well,” says Saastamoinen, describ-

crete approach. It must also be understood

inevitably affects the whole.

ing his jump out of his comfort zone.

that the minimum unit cost is not the mini-

From 2008 to 2011, Saastamoinen worked for

He said that working on his first financial state-

mum of the total cost of the system.”

Lite-On Mobile, a Taiwanese company. He was

ments with the company accountant at the

Saastamoinen, who trusts the results of sys-

responsible for managing the global business

time brought him to tears.

temic thinking, says that well-designed is

supply chain. Lite-On Mobile acquired Perlos

“I really learned to appreciate financial profes-

completely undone, but well-documented is

in Finland in 2007. While working for the Tai-

sionals! In retrospect, I believe that it would

completely done. When it comes to solving

wanese company, Saastamoinen spent the

be a good idea for everyone at management

problems, one of his advantages as an exec-

year 2010 in China.

level to go through the financial reporting pro-

utive is the three-year CFO position – “we live

After returning to Finland, Saastamoinen left

cess. In that process, the numbers, contents or

by numbers, not gut feeling!”

Lite-On Mobile with the intention of taking a

schedules are unyielding. The only part of the

“I authorise people, I’m not afraid to let them

well-deserved sabbatical. It was important for

equation that yields is man.”

make their own decisions. I look at the whole

him to have time for his mother’s terminal care,

Simo Saastamoinen was appointed Kesla’s CEO

picture and note any bottlenecks. From my

his father and family.

in 2015. In the demanding position, everything

time as CFO, I have good monitoring tools – I

When Kesla advertised for a marketing director

he has experienced in his career before has

see the situation evolving, and whether I need

in 2012, Simo Saastamoinen applied for the po-

proved to be a special resource. Saastamoin-

to react to something.”

sition, but was not elected. Mika Tahvanainen

en says that it was in the telecommunications

was appointed as Marketing Director. A little

industry that he learned systemic thinking.

Kesla’s 10,000th truck-mounted crane was handed over to Jaku Yhtiöt at FinnMETKO 2018.

57

The KESLA 18RH-II head is ideal for thinning and can be found in Sampo-Rosenlew harvesters.

58

Forest expertise

for organic machines

Sampo-Rosenlew’s saviour Timo Prihti and Kesla’s founder Antti Kärkkäinen seem to have much in common. Kärkkäinen started the construction of stone clearing machines before anyone had even invented them. Timo Prihti was driven to the forest machine market by a similar reason – there were fewer loggers and the level of forest thinning management had decreased. The market did not seem to have the right kind of machines for thinning.

“The big machines damaged trees and created

duction. More than 100 forest machines are pro-

huge wheel tracks. We needed a lightweight ma-

duced each year. Around 85% of sales are exported.

chine, an organic machine of sorts – environmen-

“Eight out of ten machines leave with a Kesla har-

tally friendly,” says Timo Prihti, who holds the hon-

vester head. Europe is the largest export region,

orary title of industrial counsellor.

with global exports ranging from Europe to Canada

As a forest owner himself, Timo Prihti knew that Ke-

and from China to Chile,” says Hietikko, Business Di-

sla booms would be the ideal choice for a forest ma-

rector for Forest Machines.

chine manufacturer from Pori. It started with boom

It is precisely in the export market that Hietikko

cooperation and expanded to harvester heads. Co-

sees significant growth opportunities. Support for

operation started as early as the late 1990s.

growth and development in export efforts and net-

Sampo-Rosenlew started the serial production of

work building is provided by Mahindra, the Indian

thinning machines in 1997. Product development

co-owner of Sampo-Rosenlew. Mahindra & Mahin-

was carried out, and increasingly efficient ma-

dra, the world’s largest tractor manufacturer, owns

chine models followed each other. In 2013, Sampo

49.04% of Sampo-Rosenlew. The Prihti family owns

Rosenlew’s harvester head experienced a complete

the rest.

transformation. From the outset, Timo Prihti’s great

In December 2017, Sampo-Rosenlew acquired Log-

idea was that a forest machine could be built using

man Oy’s bankruptcy estate. The purchase decision

parts of a thresher. Later on, the demands for steel

was part of the forest machine business growth

strengths, engine power and transmission of forest

plan. In August 2018, Sampo-Rosenlew announced

machines increased and the use of thresher parts

that it would increase its range with a total of three

was abandoned.

new forest machines showing Logman’s heritage.

The harvester heads of the new range are produced

Growing strong

by Kesla.

Over the past two years, Sampo-Rosenlew, led by

“The loaders and harvester heads come from Kes-

Hannu Hietikko, has tripled its forest machine pro-

la, while the automation is supplied by Technion.

59

The cooperation is long-standing and based on

Don’t laugh too soon

systematic planning and continuous dialogue.

And although machine sizes have increased, Sam-

It was 1997. People had gathered in Pori at Teljänhovi Hotel Restaurant for management

po-Rosenlew is above all an expert in thinning,”

training organised by Rauma Business School. A young Hannu Hietikko was also present.

says Hietikko.

Hietikko had already gained experience in forest machine business. From 1986 to 1992 he worked for Lokomo Forest. After that, his career progressed to Marketing Manager

Socio-economic issues

of Timberjack’s Finnish sales company. A few years later, he was appointed Managing

The global popularity of the cut-to-length method

Director of Timberjack Finland.

continues to grow. The introduction of this method requires a good knowledge of the operating con-

Rauma-Repola was giving up its extras in the mid-1990s in the wake of the recession.

ditions of the new market. In developing forestry

Timo Prihti, an engineer who worked in combine harvester production all his life, saw his

countries, cheap labour is available and work is

opportunity. Prihti bought Sampo-Rosenlew from Rauma-Repola and saved Finnish tim-

manual labour.

ber harvester production with a management style that has been described as earthy.

“The transition threshold from manual labour to cutting-edge technology is high in many places.

The men gathered in Teljänhovi for business training were reading the morning news-

However, there are signs that even though there

paper, Satakunnan Kansa. In a front-page ad, Prihti’s Sampo-Rosenlew announced that

is cheap labour available, young people can no

it would start manufacturing forest machines. ”The announcement had pictures and

longer be tempted to harvest timber manually,”

more… We joked about it and mocked them for entering the market with those ma-

says Hannu Hietikko.

chines,” recalls Hannu Hietikko.

Hietikko is not content to just focus on the work phase taking place at the tree.

John Deere bought Timberjack in 2000. In 2005, Hietikko became Deere’s Country Direc-

“You have to look at all the logistics and approach

tor in Russia, responsible for the development of forest machine sales. He stayed there

from the forest to the plant. Many socio-economic

for about four years. Hietikko returned to Finland and left the forest machine business.

issues need to be addressed. Russia is a good ex-

In 2009, he became Managing Director of Volvo Construction Equipment Finland.

ample of this. Exporting technology there was very slow. Now they have awakened, and the Russian

After Volvo, Hietikko decided to take a breather. However, he barely had time to take a

forest machine market is growing rapidly.

deep breath before Timo Prihti’s son and Sampo-Rosenlew’s then CEO Jali Prihti called

The goal of breaking into new markets is something

Hietikko and asked him to come work for him. Hietikko started as the Head of Sam-

that Sampo-Rosenlew and Kesla have in common,”

po-Rosenlew’s Forest Machine Division in August 2017.

says Hietikko.

“We don’t focus on operating in mature markets where the big players hold onto their positions. We aim for where mechanisation is starting and growing and a real thinning specialist is needed as a partner.”

60

”Yes. Remembering Teljänhovi, the lesson is quite clear – don’t ever laugh too soon.”

Hannu Hietikko 61

“Kesla is an upright operator who can take things forward – it’s not just empty talk.

Talk flows openly. We can discuss common lines and share our thoughts on where the world is going.”

Mikko Lehikoinen

62

Like

patricide

Engagement, a significant step forward for customers, joy in finding common logging ground, opportunity to conquer new markets together. That is how the media characterised the cooperation between Kesla and Valtra that started in January 2016. The new partnership was celebrated on both sides, even though at one level Kesla people felt it was like patricide.

“In 1977, Kesla’s development got a real kick for-

along, and we no longer had any personal con-

ward when close cooperation with the Hankkija

nections with Hankkija. It was a big decision,

central cooperative began.” That is how Seppo

but I think that in the end it was handled appro-

Kärkkäinen, the CEO of Kesla until 1976, has

priately by both sides.”

characterised the start of the cooperation that

According to Veli-Matti Kärkkäinen, the Valtra

lasted for more than 30 years. Since then, the

partnership has created new faith in Kesla. “Val-

significance of the cooperation has been de-

tra also thinks we are a good operator. We have

scribed on many different occasions by stating

been very pleased with the decision.”

that without Hankkija, Kesla would not exist.

According to the Chairman of the Board, the

Veli-Matti Kärkkäinen, Chairman of Kesla’s

change situation was handled as delicately as

Board of Directors, describes the change of

possible at the personal level, so that “no one

partnership as follows:

would be left with large cracks in their souls.”

“Valtra had a great interest in us. The Board of

The situation was eased by the change of the

Directors had discussed Valtra and giving up

CEO of Kesla. Jari Nevalainen’s term of office as

Hankkija cooperation years earlier. We con-

CEO ended in April 2015. Simo Saastamoinen

sidered the focus of the market – as an actor,

was appointed as the new CEO in May of the

Hankkija was focused on Finland. Valtra, on the

same year.

other hand, would allow us to export products to Europe and the rest of the world. In autumn

Desire to cooperate with Kesla

2015, we then decided to take a leap into the

As a former Kesla employee, Valtra’s Marketing

unknown. Ending the long-term partnership

Director Mikko Lehikoinen knew Kesla well.

with Hankkija felt like patricide.”

When Valtra launched a strategic development

The world and the market had changed, and

project, Kesla seemed to be the decisive piece

Kesla also needed a change. “New men came

of the puzzle.

63

Kesla and Valtra’s management in connection with the publication of the cooperation. From the left Janne Sinkkonen, Ville Mansikkamäki, Jari Rautjärvi, Simo Saastamoinen, Matti Kallio, Mika Tahvanainen and Mikko Lehikoinen.

64

“During the year, we went over several different

The dream of many years came true in Janu-

technological capability, product development

actors, looking for a future partner on the forest

ary 2016. “This is a significant innovation in our

and the service and maintenance network. Kes-

side of things. We also went over the process

forestry product portfolio – market leaders are

la can take you anywhere on Earth in the forest

with Kesla and found a common list of priori-

now under the same roof in this segment as

segment – that is not the case with everyone.

ties. The other companies we considered were

well,” said Matti Kallio, AGCO’s Finnish Sales Di-

Where is the world going to? Lehikoinen says

far too small to grow with us. We desired to co-

rector, in a stock exchange release, comment-

that the importance of meeting the end cus-

operate with Kesla. Kesla was the only partner

ing on the start of cooperation between Kesla

tomer will continue to be emphasised. The im-

with experience in the global operating envi-

and Valtra.

portant thing is how customers find products

ronment. We share the same philosophy.”

According to Lehikoinen, Kesla’s assets include

and services.

“Digitalisation changes the customer encoun-

The Valtra Unlimited Studio customisation tool

were started in 2016 would no longer be able

ter, the connection with customers is getting

continues to grow and offers partners new op-

to cope with the new changes – Kesla must also

closer and the dealer is no longer the corner-

portunities and countries every year.

take responsibility for developing operations

stone of everything. Today, a dealer has sever-

“Partners are an important resource for us – we

alongside us.”

al representations and can no longer be a pro

must find win-win-win situations in everything

While for Kesla it was painful to give up Hankki-

seller for all products. By using digitalisation,

we do. We offer partners a good system through

ja, at Valtra the end of cooperation with Kronos

we can get more refined commercial deci-

which they can grow and network. It always de-

caused some friction.

sion-making material and support for dealers.”

pends on the partner’s own activeness, how

“There was a rather strict cult of Kronos in the

The world conquest started with AGCO Finland

well they are able to use these opportunities.”

company, so the change was not an open-and-

and Kesla working together. New export desti-

Lehikoinen sees a bright future. He believes that

shut case for us either. But if you go to our sell-

nations have opened up and are about to open

Valtra and Kesla have tremendous opportuni-

ers now and ask them which is easier and better

up in the Nordic countries, Japan, Korea, Russia

ties in developing their cooperation – opportu-

to work with, the answer is clearly Kesla.”

and Brazil. In addition to geographical expan-

nities that none of Kesla’s competitors will ever

sion, new moves are being made in new cus-

achieve.

tomer segments, such as municipal engineer-

“Of course, Kesla must also be able to develop

ing, recycling business and military segments.

at this pace. The Kesla with whom operations

AGCO cooperation has since expanded to include e.g. Sweden. Photo from SkogsElmia Fair 2019, where Lantmännen’s team won over their Nordic partners.

65

Spartan heavy worker A doer, not a ditherer. That is Valtra’s Marketing Director Mikko Lehikoinen. Born in Lieksa, Lehikoinen obtained a Master’s Degree in Agriculture and Forestry in Joensuu and then built satellite positioning units for forest patterns at Arbonaut Oy. Lehikoinen joined Kesla in April 2003.

“I joined around the same time as my fellow

“A man of action, fast on the move. A proper

worker with concrete growth prospects.”

Master’s Degree in Agriculture and Forestry Mika

Sales Director, who had to be reined in some-

“We were not burdened with history. We were

Tahvanainen. We picked up dusty desks in the

times – Mikko would have conquered the world

able to do things with open minds. The time at

back of the warehouse, wiped off the dust and

already in the early 2000s,” says Veli-Matti Kärk-

Kesla taught me something important – we can

got to work. I was the youngest on the team,

käinen, Chairman of Kesla’s Board of Directors.

influence things though how active we are,” says

while the senior employee on the team was

The achievements of the energetic team are

Lehikoinen.

Sales Manager Risto Koski. It was an amazing

perfectly illustrated by a writing by pseudonym

When Lehikoinen joined Kesla, the company’s

team, and sometimes sparks flew,” says Lehikoi-

Bullero-Pena on Kauppalehti’s discussion board,

turnover was approximately €17.8 million. When

nen.

who wrote as follows in spring 2004: “I would

he left the company with some high emotions in

describe Kesla at the moment as a Spartan hard

2008, the turnover had climbed to €55 million.

Photo from a trip to Japan. Kimmo Paakkunainen (left), Mika Tahvanainen and Mikko Lehikoinen.

66

Risk-taking pays off “I have never subscribed to the idea that a common history alone is a guarantee of a good future. Of course, it is worth striving for a long-term partnership, but only with those who can grow in the same direction as us,” says Mika Tahvanainen.

Tahvanainen played a key role in the creation

er not to take it up. However, in my opinion,

“I had decided to take the risk, accepting the

of the Valtra partnership. The meaningfulness

factory-level cooperation with a tractor man-

possibility that the trick might be my last act

of the cooperation with Hankkija in the chang-

ufacturer was such a crucial opportunity for

at Kesla. I had prepared a long and thorough

ing market situation had been a long-standing

our tractor forest equipment business that it

presentation on the Valtra business. After the

concern for him. In autumn 2014, it began to

could not be left unaddressed. I felt it was my

sales review had been held, I continued, devi-

look like the door to discussions on coopera-

duty to ensure that the matter was discussed

ating from the agreed meeting agenda, by pre-

tion was opening on Valtra’s side. Jari Nevalain-

by the Kesla Board of Directors on a neutral

senting my views on cooperation opportunities

en, who worked as CEO at the time, did not

basis, whatever the outcome of the discussion.”

with Valtra. The Board of Directors saw the light,

warm to the idea of cooperation with Valtra.

In autumn 2014, Mika Tahvanainen was invited

and discussing the matter was considered im-

“It must have been difficult. Questioning the

to a meeting of Kesla’s Board of Directors to

portant.”

company’s longest-standing partner was an

give an overview of sales.

awkward topic for the CEO, so it was easi-

At the Konemessut machine fair in 2014, Kesla was still presenting its tractor equipment with Agrimarket and green tractors.

67

As a result of the new cooperation, the applications of KESLA tractor equipment have expanded to include agriculture and municipal engineering.

68

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Valtra and Dalby Simo Saastamoinen was appointed as Kesla’s new CEO. The company’s turnover grew slightly from the previous year to €42 million. The operating profit for the financial year was €949,000.

MFG Components was taken under close watch. Kesla bought Ilomantsi-based MFG in 2007. MFG Components specialised in the design, marketing and manufacturing of transmission products and solutions. MFG was believed to bring new customers to the Group.

Subsequently, Kesla incorporated the operations of its Ilomantsi factory into Kesla Components Oy, a wholly-owned subsidiary of Kesla. In autumn 2008, Kesla Components Oy was merged into MFG Components Oy. During Saastamoinen’s term of office, the structures began to be dismantled. The Ilomantsi factory was transferred from MFG Components Oy to its parent company through an internal business transaction in 2016. This left the Tohmajärvi factory as the only unit of MFG Components.

The move reinforced the Ilomantsi unit’s security of supply. “It was not essential to maximise the result of Ilomantsi. Instead, the purpose was to keep the factories in Joensuu and Kesälahti going. There was only one thing to measure, namely how Kesla’s other factories operate,” says Simo Saastamoinen about the situation. In order to accelerate this objective, a personnel reward system was created, with an emphasis on ensuring security of supply.

Kesla entered into significant partnerships when cooperation with AGCO Group’s Valtra and the French Dalby Group started.

Digitalisation as a megatrend rose to the centre of discussions for more or less the first time. The company worked hard on auxiliary control systems, remote monitoring and product support, stability management, networking of equipment and after-sales services.

69

Toni Lehtinen has been working with City cranes since autumn 2019.

70

City cranes

for heavy users

Kesla stepped into the spotlight of the recycling business in Lyon, France, in 2016. A few months earlier, the company had announced a cooperation agreement with the French Dalby Group.

Dalby’s new subsidiary TechMat started to sell a customised recycling unit, which included a truck, container, hooklift and Kesla crane.

Dalby designs, manufactures and sells hydrau-

Kingdom and, in the future, also in Southern

lic hooklifts ranging from 2 tonne-metres to

Europe. Growth is now being built by strength-

over 30 tonne-metres. In the Finnish Kesla,

ening the dealer network, which speaks the

France’s largest hooklift manufacturer saw a

same language as recycling professionals.

knowledgeable and innovative partner.

“Kesla has a good reputation as a manufactur-

“Recycling is a big and constantly growing

er of strong timber handling cranes. Now we

business – a much bigger playing field than

want to build a resale channel that can specif-

moving timber,” says Toni Lehtinen, Business

ically talk to recyclers and waste processors.”

Development Manager of Kesla’s City Crane

Lehtinen does not emphasise the importance

business.

of active communication for nothing. He re-

Lehtinen names three clear target groups for

fers to the EU directive that entered into force

the stability control cranes: glass, metal and

in 2011, according to which all cranes with a

paper recyclers, waste collection with large

lifting capacity of more than one tonne used

bags and soil distributors.

for recycling must be equipped with stability

“Recycling and reuse of all kinds of material

control.

is increasing all the time. This is a global meg-

“The EU requirement is clear, but in practice it

atrend, whether you look at it from the trans-

is still interpreted loosely. This is an important

port side or from the material flow side.

safety factor. Far too many are operating in a

Stability control in the focus

grey area. The importance of stability control is

Toni Lehtinen, who has been working in Kesla’s

well known to companies that have suffered a

export operations since 2007, operates in the

serious accident. We want to convey the mes-

Western European market. The aim is to fur-

sage of safety and responsibility – not wait for

ther strengthen Kesla’s foothold in the Nordic

people to learn things the hard way.”

countries, the Benelux countries, the United

The specialty of City cranes is the stability control system that enables the use of the crane outside forests. The sensors communicate possible problems to the driver via a separate display.

71

Developed by Kesla

Until now, stability control cranes have been

Stability control is a piece of safety equipment

operated either by radio control or top seat

whose installation and calibration is a small

equipment. In early 2020, a crane with a cabin

price for safety. It is a system that ensures that

and stability control also entered the market.

the vehicle cannot tip over during work – no

Having a cabin is a significant improvement in

matter what mistake the driver may make.

working conditions, for example, in difficult

The stability control software was developed

climate conditions.

at Kesla.

“It was naturally new for us and for the French

“Speed and the number of repetitions, good

to start working together on such a concept,

usability, agility – a complete set for the heavy

starting from scratch. Of course, we knew the

users of recycling,” says Lauri Laukkanen, who

itself crane well, so we were able to focus on

has been the Service Manager of Kesla’s City

the system and the end product. There have

cranes for a long time.

been challenges, but now the product and the

The Dalby-TechMat stand at Pollutec 2016, when City cranes were also launched. Originally, the name also included the word ‘recycling’.

72

“Speed and the number of repetitions, good usability, agility – a complete set for heavy users of recycling” range are in order,” says Laukkanen, who has been building the TechMat cooperation almost from the beginning.

The design of the City cranes was inspired by the cooperation with the French company Dalby-TechMat. Pictured: Director Benoît Salgues.

73

Ilomantsi’s via dolorosa

ends with flag raising

74

In April 2016, Kesla’s subsidiary MFG Components announced that it was negotiating the clo-

chine engineering workshop made parts for Ke-

sure of its Ilomantsi machine engineering workshop. According to the stock exchange release,

sla and also for external customers. They were

the closure was planned for the end of the same year, due to “the prolonged weak financial

often individual pieces, which took a lot of time

situation of the Ilomantsi machine engineering workshop”. The employees of the Ilomantsi

and labour. There were all kinds of disturbanc-

unit responded to the news with a walkout. The escalation of the wretched situation began

es and delays – many products were not at all

many years earlier.

suitable for our production and the operations

Ilomantsi had manufactured hydraulic cylin-

Founded by the late Pekka Shemeikka, MFG

ders and machining parts for Kesla’s products.

had produced a decent result. The purchase

In 2005, the machine engineering workshop

price of the company has even been described

was incorporated into Kesla Components Oy,

as cheap. Even so cheap that 12 years after the

a wholly-owned subsidiary of Kesla. Jari Ne-

transaction Veli-Matti Kärkkäinen, Chairman

valainen, then CEO of Kesla, described the in-

of Kesla’s Board of Directors, described the

corporation in an interview on 27 October 2009:

transaction as follows: “Just like Sulo Vilén – we

“Until the incorporation, the Ilomantsi factory

bought it because it was cheap.” Sulo Vilén was

had been carried by its parent company with-

a Finnish comedy character in the late 1970s.

out any real market pressure. Operations were

In the TV series, Vilén was an unlucky service

too passive – they just delivered what Kesla or-

station entrepreneur whose business was not

dered. The incorporation seeks to change the

going well at all, but who kept buying all kinds

situation and activate sales.”

of things – because they were cheap.

“Just like Sulo Vilén”

Motivation put to test

In 2007 Kesla had purchased MFG Components,

When Kesla purchased MFG Components in

a company based in Tohmajärvi, which was sup-

2007, the product range of the Ilomantsi ma-

posed to bring with it the sales know-how of

chine engineering workshop changed. The

machine engineering systems and also external

atmosphere was described by Harri Mustonen,

customers. The idea was to give the company

who joined the company in 1997. He observed

more supports in order to make it less depend-

the goings-on in Ilomantsi as a production

ent on the cycles of the forest industry.

worker and team leader: “The Ilomantsi ma-

were not profitable.”

When production stalled, Kesla had to buy the products it needed from abroad. Everyone in Ilomantsi knew the reasons for the losses. The situation took its toll on the team’s motivation.

Bad personal chemistry Juha Tahvanainen, who worked as a mechanic in Ilomantsi for 25 years, explains that he understands Kesla’s management’s motives regarding MFG, but in his opinion the implementation started off on the wrong track right from the start. A manager was elected from in-house to run the company. There was bad personal chemistry, and the workers in Ilomantsi felt that they were being treated condescendingly.

Time of crisis Kesla’s turnover had dived in 2015, due, for example, to the crisis in Crimea. At the same time, Kesla was in the middle of a cash crisis. On 27 May 2015, the company announced that it had

appointed a new CEO. Saastamoinen had already jumped to the position of interim CEO in spring 2015, when Jari Nevalainen’s service as CEO of Kesla ended.

Opportunity to sell Manufacturing engineer Simo Saastamoinen was now the number one man in a listed company which, in his own words, started to push forward with a “horrible handicap”.

While the closure of the Ilomantsi machine engineering workshop was discussed in April 2016, in May of the same year Kesla announced that it was negotiating the sale of the Ilomantsi machine engineering workshop. Kesla CEO Simo Saastamoinen confirmed that serious discussions on the sale took place with two domestic metal companies.

Saastamoinen commented on sales intentions in an Yle news story on 11 May 2016: “There is no certainty yet. And MFG hasn’t even decided to close the Ilomantsi machine engineering workshop yet. In any case, we want to do everything in our power to keep the operations there going.” In the same Yle news story, it was stated that “While Kesla is in charge, operations in Ilomantsi do not seem likely. The subsidiary MFG Components’ second branch in Tohmajärvi is not covered by the co-determination negotiations.”

75

Harri Mustonen (left) and Juha Tahvanainen – proud members of the Kesla squad.

76

At the time, 46 people worked at the Ilomantsi

turned into a profit of just under €1 million in

unit. The atmosphere was bleak, and some of

2016. In Ilomantsi, the complete reversal of the

the employees left on their own initiative. A ma-

closure plans was seen to be mainly due to the

chine tool and two robot cells were moved from

rise in the economic cycle in the forest industry.

the machine engineering workshop to Tohma-

As the market strengthened, Kesla had better

järvi. The outlook was that in a few weeks or

secure the availability of hydraulic cylinders and

months, Ilomantsi’s production bay of slightly

machining in its own camp. The purpose of the

less than 400 square metres would lie empty.

Ilomantsi unit is not to minimise unit costs, but to keep Kesla’s wheels spinning. Delivery time

An Italian strike

and security of supply are key.

When the end was in sight, the workers in Ilomantsi responded with a so-called Italian strike.

Raising the Kesla flag

The goal was to wake up Kesla’s leadership. The

Machinist Juha Tahvanainen was interviewed

people were at work and the machines were

for the Kesla personnel’s internal information

running, but no completed products left the

channel in the autumn of 2018. Tahvanainen

building. After the Italian strike had lasted for a

says that Kesla’s collective spirit is now top

couple of weeks, Timo Ala-Jääski went to give

notch. The Machinist feels literally like a “Proud

them a loud talking-to. The employees did not

member of the Kesla squad”. When asked about

bat an eyelid, as they had already been handed

memorable events over the years, Tahvanainen

their notice.

did not hesitate for a moment to answer: “When the co-determination negotiations to close the

Change of plan

Ilomantsi station were in the final stretch, CEO

During 2016, Kesla was able to make profit

Simo Saastamoinen came to Ilomantsi, asked us

again. The big news was that instead of getting

to raise the Kesla flag back on the flagpole and

rid of the Ilomantsi machine engineering work-

said that no one would be fired.”

shop, Kesla wanted to get rid of MFG Compo-

Harri Mustonen, who was appointed Production

nents. MFG Components employed some forty

Manager of the Ilomantsi machine engineering

people in Tohmajärvi. According to Kesla, the

workshop in 2018, said: “The right policies and

conditions for the sale of MFG were good since,

decisions were made in the company. The peo-

for example, the maritime industry seemed to

ple in Ilomantsi are extremely committed to the

have recovered.

work. We now have a future.”

Kesla Group focused again on forest machines.

The operating loss of €1.5 million in 2015 was

77

“The result left a good feeling” Markku Lappalainen served as Mayor of Ilomantsi in 2007–2017. Lappalainen recalls the critical stages of Kesla’s Ilomantsi factory at a time when other bad news were also heard in Ilomantsi. The University of Eastern Finland was closing down the Mekrijärvi research station, and Vapo had announced the closure of its pellet factory.

“Kesla’s CEO Simo Saastamoinen contacted us with the aim of opening a discussion on what options would be available in the difficult situation. Kesla was an important company for Ilomantsi, a significant industrial employer,” says Lappalainen.

One of the options discussed was that the municipality of Ilomantsi could buy Kesla’s production bay. This would have eased Kesla’s cash situation and the company would have continued to operate as a tenant in the building. The municipality began to consider the establishment of a business real estate company even before the new municipal law required it.

Another alternative was that another company would have joined Kesla in the industrial hall.

Discussions were also held with investors.

“We studied alternative ways forward quite far, as the aim was to maintain production and jobs in Ilomantsi.”

The municipality did not rest on its laurels, and there was good communication with Kesla.

According to Lappalainen, the issues were weighed thoroughly and in good cooperation. In terms of information, the municipality of Ilomantsi had a strict policy; Kesla had full responsibility for distribution of information.

The knot finally started to unravel for the best from Ilomantsi’s perspective. Lappalainen estimates that the motivation and determination of the personnel of Kesla’s Ilomantsi factory played a big role in the solution, in addition to the increased demand in the forest machine market.

“CEO Saastamoinen called and asked for a meeting. If I remember correctly, it was a warm summer Friday when Simo rode his motorcycle to Ilomantsi. He explained the solution to the situation and thanked the municipality for exploring alternatives during the process. The events and Kesla’s way of working left a very good feeling. The result was good for Ilomantsi, and I could leave the meeting for the weekend with a light heart.”

78

Today’s Ilomantsi team does not lack motivation.

What goes around

comes around

Cooperation between Markku Laaksonen and Kesla dates back to the mid-1990s, when Technion Oy was still called Leomatik and Laaksonen worked for Mitron Oy, a manufacturer of the Motomit control system.

“In 1993, at the end of my studies, I took a sum-

forest machine systems business. One of his

“In 2009, I started contacting old Mitron col-

mer job at Mitron and stayed there. A colleague

clients was Kesla.

leagues. Shortly before I left, Mitron had been

once said that the forest business is like a big

“As the new CEO, the goal was to first get the

sold to Canadian electronics manufacturer

sandbox – you can try to climb out of it, but

contract manufacturing business in good

Vansco Electronics LP, which had since been ac-

eventually you always fall back,” says Markku

shape and then expand into our own con-

quired by Parker in April 2008. The contacting

Laaksonen, Managing Director of Technion Oy.

trol systems. Apart from the 2009 economic

paid off, as several former colleagues joined

Let us go back to 1979, when Leo Fredman

downturn, things have progressed well.”

Technion.”

fication company. The company received a sig-

New name, bigger pool of experts

Cooperation in new gear

nificant boost in 1994 when Leomatik started

The name of Leomatik, owned by Asanti, had

In 2009, Markku Laaksonen contacted Kesla.

to manufacture wiring harnesses for Multilift.

been abandoned in 2007, and Technion was

“I went to Joensuu to listen to their needs –

As a contract manufacturer of harnesses, the

chosen as the company’s new name. The new

support and development work with their

company’s turnover rose to around €3 million

name was more modern, also describing the

supplier at the time had deteriorated, and it

in ten years.

change and development that Markku Laak-

was a good time to start working with a new

In 2005, Fredman sold Leomatik to Jaakko As-

sonen had started. Technion had soon grown

company, but with familiar people. In 2010, the

anti. Asanti, who had a career in Nokia’s cable

into a company that employed 45 people and

project was kicked off, and Technion started to

business, had decided to look for a suitable

generated a turnover of around €5 million.

develop a new harvester head control system.”

company in his former home region of Turku

In October 2008, the company had started

The cooperation has been fruitful. The elec-

that could benefit from his industrial know-

co-determination negotiations after Multilift

tronic control system for Kesla’s harvester

how and that he could help develop.

and Sandvik, the company’s largest custom-

heads is praised for its precision, speed, ease

Growth-oriented Leomatik was looking for a

ers, had communicated rapidly deteriorating

of use and smooth movement that makes the

CEO, and a head-hunter contacted Laakso, who

order books. The company was not paralysed

work of machine drivers easier.

worked for Mitron. He accepted the offer and

under the pressure of the recession, but in-

“Work on the development of control systems

took the lead at Leomatik in September 2006.

stead started to invest in developing its own

is progressing rapidly. The intelligent control

At Mitron Laaksonen was responsible for the

products.

system aims to assist the driver to make work

from Raisio founded Leomatik, a small electri-

easier and produce results.”

79

When talking about the intelligence of the con-

constantly to tour HYDAC Group’s country of-

Technion’s vision is to be one of the leading

trol system Laaksonen emphasises the expedi-

fices, trade fairs and customer meetings.

suppliers of electronic control systems to the

ency of the features. The development work is

“Previously, I had two salespeople in an or-

industry manufacturing vehicle equipment,

guided by messages from the field.

ganisation of 70 people. Now there are 3,000

commercial vehicles and work machines, close

“We are developing features for the control

salespeople in an organisation of about 10,000

to the customer. Kesla is Technion’s largest cus-

system that make the driver’s work easier and

people.”

tomer in the forest systems business area.

more productive.”

As a result of the acquisition, Technion received support from the HYDAC Group’s global sales

Kesla ranks first in forest systems

network and a significant increase in the prod-

By 2018, Technion had grown into a company

uct offering of control system solutions.

with a turnover of around €9 million, employ-

“Having a large international family-owned

ing around 70 people.

industrial company as our principal owner

In August 2019, the company had big news

gives us credibility and additional resources,

when Hydac Oy, a Finnish subsidiary of the

enabling long-term business development for

German HYDAC Group, announced that it had

the benefit of our customers. Together with

acquired a majority stake in Technion. Manag-

HYDAC, we are able to offer our customers

ing Director Markku Laaksonen was travelling

larger and more competitive entities.”

Markku Laaksonen (left) has worked closely with KESLA customers.

80

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Finances improve CEO Simo Saastamoinen initiated significant changes in the company. The company described the need for change as necessary: “Something had to be done.”

The Group implemented a division of business, with the emphasis on deepening market understanding, responding more quickly to customer needs, better product and portfolio management and striving for faster profitable growth. The Group’s business areas included truck-mounted and industry cranes, timber harvesting equipment, tractor equipment and after-sales services supporting all businesses.

In September, Kesla announced in a stock exchange release that it was selling MFG Components’ manufacturing business to Kotka Power Tech Oy. With the acquisition, a total of 41 employees were transferred to Power Tech. Power Tech continued to design and manufacture axle switches in Tohmajärvi, also concentrating its new contract manufacturing there. The remaining part of MFG owned by Kesla continued its transmission import business in Tohmajärvi with four employees. The turnover of the import business was approximately €2 million.

“As a result of the acquisition, Kesla Group will focus more strongly on the business of solutions that improve the handling of forest and recycled materials. The arrangement strengthens Kesla’s financial position and thus creates better conditions for investing in the profitable growth markets we have identified,” said Saastamoinen, CEO of Kesla.

Restructuring was also carried out within the forest machine segment, as the spare parts activities of the German subsidiary Kesla GmbH were centralised in Finland.

Year 2017 was financially reassuring for Kesla. The company’s turnover grew slightly to €42.7 million.

Operating profit improved significantly from the previous year, being nearly €1.5 million.

The machine and construction investments made in 2013 and 2014 had increased the debt burden of Kesla Group to approximately €17 million. The Group’s net interest-bearing debt now decreased by approximately €2 million. The gearing had been reduced from 140% to 101.5%. After strenuous efforts, the sale of MFG brought in some cash for the company.

81

Business division 2017 In August 2017, Kesla sharpened its business management by forming three business areas. Ari Pirhonen has been Business Director for the truck-mounted and industrial cranes business since the beginning of 2019. His area of responsibility accounts for approximately 40% of Kesla’s turnover. The most important products are timber handling cranes, bioenergy cranes, grapples and recycling cranes.

Mika Tahvanainen manages the logging equipment business. The main products of the business are forwarder cranes, harvester cranes and harvester heads. The business accounts for around 30% of turnover.

Janne Sinkkonen took responsibility of the tractor attachment business. The most important products are loaders, trailers and chippers. The tractor attachment business accounts for around 30% of turnover.

What here?

82

For the love

of the sport

Janne Sinkkonen, Director for Tractor Attachment Business, joined Kesla in 2011. Before that, he worked as Sales Manager at Hankkija.

Janne Sinkkonen’s favourite activity is working in the forest with a tractor.

“For the love of the sport! The forest has always

Kesla wanted to export. At the same time, the

been number one for me,” says Janne Sinkko-

long-term partner’s business seemed to be

nen when asked for his reason for the transfer

more focused on gardening and leisure activ-

to Kesla.

ities than on forestry and machine trade.

Love for the forest has determined the life of

“As a Kesla team member, I wondered if it sup-

the agrologist since childhood. His face melts

ported our brand in any way anymore. At the

into a smile when he talks about Patu – the con-

same time Valtra seemed like a brand with

cept of the tractor world, as he puts it. Patu was

strong products and a sharp focus to work on

once Kesla’s legendary product and the world’s

the machine side.”

best-selling loader brand. A pioneer in its field.

When the cooperation between AGCO Finland

“Working in the forest with a tractor – it was

and Kesla was announced in early 2016, Urakoin-

something special even as a child. When I was

ti Uutiset magazine titled its article “AGCO and

allowed to drive a Patu, it was something amaz-

Kesla engaged”. Listening to Janne Sinkkonen,

ing! The machine was agile and handled what

it is easy to become convinced that the engage-

previously had to be done by hand.”

ment has deepened into passionate love:

Forest management is still Sinkkonen’s most

“Kesla and Valtra are finding their way to new

beloved hobby, involving two absolutely vital

export markets together. We can expand from

things – Kesla and Valtra. Sinkkonen attaches

the forest to new areas. The world’s population

the utmost importance to the cooperation with

is growing, and food and machines to produce

Valtra, which started in 2016.

it are needed. We have a growing share to gain

“Hankkija was undoubtedly the best possible

in food production as well as in, for example, the

partner for Kesla for a long time. But the world

public cleaning of urban centres. We can replace

changes. In Finland, the number of farms has

many machines cost-effectively by connecting a

been declining throughout our EU membership.

Kesla crane directly to a tractor. Let’s make the

Hankkija, on the other hand, was not a partner

whole thing work like a Swiss army knife – one

through which new export opportunities could

machine, a hundred jobs.”

be opened to Kesla.”

Janne Sinkkonen joined another employer at the beginning of 2021.

83

Mika-Pekka Tiainen (left) and Part Production Operators Oskari Kostamo and Juha-Pekka Neuvonen.

84

Team player

with entrepreneurial attitude

When Mika-Pekka Tiainen concluded his studies in mechanical engineering and production at Mikkeli University of Applied Sciences in spring 2007, he aimed for Kesla. The door to the dream job opened. At the same time, a unique opportunity opened for entrepreneurship and the accumulation of knowledge-based capital.

Mika-Pekka Tiainen became Part Production

the Kesla team again – even more experienced,

culture seems to be servant leadership rather

Manager at Kesla’s Kesälahti factory. Years

entrepreneurial and development-oriented.

than top-down management. In practice, serv-

passed. Sometimes Tiainen also worked as the

ant leadership is reflected in creativity and con-

plant’s Occupational Safety Manager. A job at a

Spirit of cooperation

fidence-building everyday activities, in which

forest technology company was an important

Kesla Oyj’s management structure was modi-

every member of the work community can in-

part of life, but at the same time the idea of his

fied in 2017. In the new organisational model,

fluence the results of the work. The common

own farm business percolated – he was a farm

designers, sellers and production are welded

goal is a satisfied customer, and success requires

boy from Parikkala, after all.

together more firmly. Tiainen believes that

everyone’s work input. Discussions with Kesla

“At first, my farm business had 40 dairy cows

the organisational restructuring is reflected in

employees show that the common goal has

and around 80 hectares under cultivation. We

everyday life in even better consideration of the

been genuinely internalised.

were quickly faced with a market situation

customer’s needs.

“It is very important to understand that we are

where the price of milk fell. The alternatives

The company established its own business

not here to cut stones, but to build a cathedral.”

were to invest a few million euros to grow the

organisations for truck-mounted and industry

Tiainen confirms that this message from the CEO

farm or to give up the cows.”

cranes, logging equipment and tractor attach-

has been embraced by everyone.

Instead of heavy investments, Tiainen shifted

ments. The organisational change aims at a

the farm to cultivation – today, there are cumin,

deeper understanding of the market, rapid re-

Knowledge-based capital

oats and rapeseed growing in the fields. In ad-

sponse to customer needs, strong management

At the end of the day of the interview, Mika-Pek-

dition to cultivation, he went to work in agricul-

of product packages and further growth.

ka Tiainen tells us that he is going to harvest

tural trade for a few years. Tiainen did sales work

Kesla’s harvester heads, tractor attachments and

oilseed rape in the evening. The work of his own

and also acted as deputy CEO of Savonlinnan

chippers are manufactured in Kesälahti. The pro-

farm is, on the one hand, a good counterbalance

maatalouskauppa Oy until he decided to call

duction of plate cut-outs and edged parts has

to daytime work at the machine engineering

Arvo Rönkkönen, the then Factory Manager of

also been centralised in Kesälahti. As Production

workshop and, on the other hand, the accumu-

the Kesälahti factory.

Manager, Tiainen is responsible for part produc-

lation of the knowledge-based capital needed

Rönkkönen welcomed Tiainen, who saw entre-

tion and welding.

for his day job.

preneurship and business from new perspec-

From the way Mika-Pekka Tiainen describes

“It’s kind of like benchmarking. I see how big

tives, back to Kesla. Thus, in 2017, the man joined

Kesla’s current approach, the management

a company works and I can apply those prin-

85

ciples in my own entrepreneurship. In a small

“There are many practical aspects to the in-

been made to Kesälahti in the last year, and it

company, for example, the laws of economics

vestment, starting with the transfer of former

has been surprisingly easy to get good tal-

are translated into an understanding, which, in

machines, earthworks, electrical, new nitrogen

ents. Some of them have been returnees, even

turn, gives a good perspective when looking at

gas lines. The entire project will be completed

though cities today seem to be very attractive.”

the whole as a production manager.”

without disruption to the rest of the production.

Tiainen is also satisfied with Kesla’s way of coop-

In its interim report in August 2019, Kesla an-

The essence of the investment is to improve the

erating with educational institutions. Kesla em-

nounced its investment plans of €5 million. The

current production process and to translate the

ploys student trainees, students from vocational

aim of the investments is to increase the accura-

benefits into concrete benefits for customers.”

schools and universities of applied sciences, as

cy and automation level of the core processes of

well as diploma workers. Another entry route is

part manufacture. The Kesälahti factory’s share

Kesälahti attraction

of the total investment is about one million, to

Around a hundred people work at the Kesälahti

be spent on a new laser cutting line. Studies on

factory. The commuter area is extensive, ranging

the investment have been carried out for a long

from Joensuu to Tohmajärvi and from Kitee to

time, and Tiainen is inspired by the responsibili-

Savonlinna and Parikkala.

ty for the investment.

“Kesla has a good reputation. Recruitments have

Loaders, trailers, chippers and harvester heads are manufactured in Kesälahti.

The photo shows harvester head assembly by Tuukka Hirvonen.

86

apprenticeship training.

Kesälahti production makes chippers, tractor forest equipment and harvester heads.

The photo shows Tuukka Hirvonen assembling a harvester head.

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Intensive, laborious, comprehensive “Debt is a brother when you take it on, a nephew when you pay it off,” said CEO Simo Saastamoinen in his greetings in the Annual Report 2018, repeating a Finnish proverb. MFG Components Oy, which had been divested, and a German subsidiary whose operations had been rationalised, were named as such “nephews”.

The turnover grew slightly from the previous year to €45 million. The operating profit for the financial year improved to slightly over €2.2 million.

The year was marked by a thorough strategic process – “intense, laborious and comprehensive”. During the process, the Group’s vision was crystallised in the slogan “Your Lifetime Match”. During the process, Kesla’s new values were defined as “responsible, innovative, quick and reliable performer”.

The division of the business done in the previous year was specified as “life-cycle services” for after-sales services.

Once the structures had been rebuilt, the strategy clarified and the debt burden lightened, people dared to talk about an excess of €50 million in turnover. The new strategy sought to continue “towards new records – and beyond them”.

87

The first decorations in Kesla’s history were granted in 2018.

Pictured from the left Simo Saastamoinen, Aulis Kinnunen, Juha Sarvi and Erkki Lyhykäinen.

The first decorations

in Kesla’s history

“Kesla’s role is to take responsibility for the decoration system as part of Finnish society. We bear responsibility for ensuring that people who have distinguished themselves receive perhaps the most important public recognition in Finnish society, as they deserve,” said Kesla CEO Simo Saastamoinen at the award ceremony of the first decorations in Kesla’s history in Joensuu in December 2018.

Decorations 2018 For the first time in its history, Kesla honoured its long-term employees with decorations in 2018. At that time, Product Designer Aulis Kinnunen and ICT Manager Juha Sarvi were awarded the Cross of Merit of the Order of the Lion of Finland. Maintenance Technician Erkki Lyhykäinen was awarded the Medal of the White Rose of Finland.

88

Decorations 2019 On Independence Day 2019, Product Designer Paavo Alhainen and Service Manager Kimmo Paakkunainen were recipients of the Cross of Merit of the Order of the Lion of Finland. Teuvo Leppänen, Service Manager, received the First Class Medal of the White Rose of Finland with golden cross. Welder Juha Lehikoinen, Buyer Hannu Kärki, Payroll Clerk Leila Neuvonen and CNC Engineer Jari Ikonen were awarded the First Class Medal of the White Rose of Finland.

Decorations 2020 On the Independence Day of 2020, the honoured Kesla employees were: Production Director Paavo Hopponen, Knight of the Order of the Lion of Finland; assembler Tuomo Makkonen, welder Kauko Turunen and welder Kari Kohonen, who were all awarded First Class Medal of the White Rose of Finland, and spare parts seller Kalle Tiainen, Medal of the White Rose of Finland.

The decoration tradition continued in 2019. Pictured are the recipients and Simo Saastamoinen. From the left: Juha Lehikoinen, Hannu Kärki, Kimmo Paakkunainen, Paavo Alhainen, Simo Saastamoinen, Leila Neuvonen and Teuvo Leppänen.

89

The FORESTERI 2009, a part of 20-series, was originally designed by Product Designer Aulis Kinnunen. The crane’s successor KESLA 2009ST is propably the most sold crane model of Kesla. It has been especially popular in Russia.

90

Success through When Kesla was elected the company of the year of North Karelia in 1982, Juha Sarvi and Aulis Kinnunen were among the company’s nearly 30 employees. Sarvi’s career in Kesla began in early 1981, and Kinnunen joined in December of the same year. Erkki Lyhykäinen from Ilomantsi had joined Kartekki Ky in 1980.

Juha Sarvi from Rautjärvi had graduated as a technician from Imatra Technical School in 1980. He also had vocational training in the metal industry. He came to Joensuu for a yearlong introductory training in method development. Arvo Rönkkönen, a schoolmate who joined Kesla in 1980, gave him a tip that there would be an open position for a work researcher in Kesla.

“I applied and was selected. We were young and full of ideas. We looked at some of those method things and started to put the basics in order,” says Sarvi.

Before joining Kesla, Aulis Kinnunen from Kitee had time to design paper machines at a design office in Rautpohja. Kinnunen’s work could be seen in Kouvola, Imatra and Svetogorsk, among others. However, the paper machine trade seemed to be shrinking and the number of colleagues around was decreasing. Kinnunen started looking for a new job. Meanwhile Kesla was looking for a Product Designer.

“I came to the CEO Esko Paajanen for an interview, at the end of which he said that the position of designer has already been filled – but that they have other jobs for a good man,” Kinnunen says.

cooperation “We were young and full of ideas” Kinnunen and Sarvi quickly developed into a dynamic work team as Kesla’s product repertoire expanded into loaders. According to the men, they had “quite a few manufacturing problems”. Prototypes had been built, but production did not succeed.

“We started adjust things a little bit, even changing structures. There were no proper blueprints, either.” Eventually, the product changed to something completely new and Kinnunen’s job description changed to product development.

Juha Sarvi’s strong competence was in production automation. In the utilisation of automation, Kesla was at the forefront of the industry; in 1985, Kesla alone accounted for as much as 15% of the total welding robot population in Finland.

“In the utilisation of automation Kesla was at the forefront of the industry” “I think that the utilisation of new technology went even a little too far,” says Kinnunen, respecting the expertise of his colleague.

“Well, why not? We managed to do the work as profitably as possible, we achieved a nice profit margin and did better than our competitors.

We were able to simplify the product. Parts were made more complete at once and the number of welds was reduced. Aulis drew pictures that the robot could weld,” Sarvi explains.

Kesla’s expansion to Joensuu took place in 1988. In the same year, Kesla also acquired a

majority shareholding in Foresteri Oy, a manufacturer of timber harvesting machines in Joensuu.

“With no team around me” In 1990, Esko Paajanen persuaded Kinnunen to move from Kesälahti to Joensuu.

“Well, I went. Back then, the Karjalan Rautarakenne hall purchased from Rakennusliike Tervo was a modest building covered in soot. I was alone, with no team around me.”

When the recession erupted in the early 1990s, lay-offs also started at Kesla. After being laid off, Juha Sarvi traded inaction for postgraduate studies, supplementing his knowledge in telecommunications and programming technology.

“It’s either lay-offs or we start designing new products” Aulis Kinnunen describes how the CEO invited the employees one by one to his office. They came out of the room with a notice of dismissal or a lay-off notice. It was Kinnunen’s turn to step inside: “Esko said there are two options here. It’s either lay-offs or we start designing new products Otherwise, we won’t have things to make when the recession ends.”

As the recession eased, Kesla began to change its entire IT architecture. Subsequently, Sarvi, who had trained as an ICT specialist, was also kept busy by the expansions of offices in Finland and around the world. Sarvi has contin-

91

ued his studies throughout his career at Kesla.

In 2004 he graduated as a telecommunications engineer. He completed a master’s degree in 2013.

“I trust they’ll walk me out when the time comes” At the time of the interview in September 2019, Sarvi and Kinnunen had a few months to go before reaching the official retirement age.

Neither of them is planning to retire.

“I trust they’ll walk me out when the time comes,” they say, grinning.

“Seventh guy at Kartek” Erkki Lyhykäinen recalls that he was the seventh employee at Kartek in Ilomantsi. His career began as a young man, and even during his military service he was on the books as a Kartek employee. Lyhykäinen is responsible for the maintenance and production capacity of the Ilomantsi factory – and enjoys his work!

“The work varies widely: electrical and plumbing work, repair and maintenance of machines, installation of new machinery. Each day is different, and the best thing working with people. And if there’s a problem, I can very well call a retired co-worker and ask for advice.

My co-workers don’t have to be embarrassed, either, when disturbances occur and a maintenance technician is needed.” From decade to decade, the committed veteran has been the one who rushes in to help, never sparing his efforts to get production rolling. Lyhykäinen is also the man who is busy at the factory in July while others are on holiday.

“It’s a tight four weeks to get it all ready again. I take my own holidays either early in the spring or in the autumn.”

92

The Maintenance Mechanic Erkki Lyhykäinen with Ilomantsi’s new lathe robot.

93

Taking control of building the brand Until 2012, communication matters in Kesla had been handled largely by each person alongside their own work. Much of the visible work had been outsourced. When Mika Tahvanainen was appointed Marketing Director of the company in 2012, Tahvanainen set one condition for his accepting the post: the company must hire a marketing communications professional.

“It was already agreed at the interview stage with the then CEO that a full-time specialist would be sought for marketing and the main responsibility for building the brand’s core would be taken into our own hands.”

According to Tahvanainen, it was not easy to convince the CEO of the importance of the matter.

“I pressed quite hard on the issue because I thought it was very important for the development of the company. I think this is one of those really big changes – it is a big cultural change about understanding of the importance of communication.”

Communications

Success in planning and implementing internal

as a performance factor

94

communications depends to a large extent on the level of commitment of the company’s management to communication. In 2010, Kesla did not

Marketing Designer Miia Tirkkonen describes Kesla as a traditional engineering house, which ten

have a designated full-time communication office.

or so years ago had not yet internalised the importance of communication. Digitalisation, the im-

Today, Miia Tirkkonen is assisted by Marketing

portance of employer image and the pressure of global competition have been such strong drivers

Assistant Aleksandra Ihno. Tirkkonen cooperates

of change that even an engineering house has found the flexibility and will to think in new ways.

closely with Human Resources Manager Maria

Communication is leadership, commitment, moti-

We communication professionals need to be

vation and at the same time a service and its con-

able to push things forward, sometimes against

tinuous development. External communication

the wind.”

does not work without internal communication,

Kesla operates in three factory locations in Ilo-

emphasises Miia Tirkkonen, tackling the age-old

mantsi, Joensuu and Kesälahti. The total number

misconception that the necessary information

of employees is around 250. Open, understand-

would just fly by itself from one workplace to an-

able, honest and prompt communication is not

other and from one person to another.

only a key part of leadership, but also the key to

“A typical situation is that people in different parts

employee engagement and motivation.

of the organisation do their work incredibly well.

“It’s incredibly important that the whole crew un-

They create many great innovations, services

derstands the whole thing. When every employee

and products. But unless things are relayed and

understands what is going on in the business, the

communicated onwards, the work done does

company’s values can actually become practices,”

not bring benefits. Communication is needed.

says Tirkkonen.

Mustajärvi in the implementation of the company’s internal communications.

Operating environment change Competition in the global market is intensifying.

The importance of meeting the end customer is becoming increasingly important. At the same time, companies are competing for skilled labour.

All of the above are big issues that can also be influenced by communication.

“The communication aspect should be included in everything,” says Tirkkonen.

Over the last 10 years, the communication environment has more or less turned upside down.

“I’ve been able to test myself and introduce new

transformed companies, organisations and people

“Opportunities for development and self-improvement”

into their own “media”. The boundary between

When Miia Tirkkonen started her work as a

dared to do bold things.”

internal and external communications is blurry, if

marketing assistant at Kesla in 2013, she be-

In Tirkkonen’s opinion, progress must be realistic

there is one at all. Each employee of an organisa-

came responsible for coordinating and imple-

and the available resources must be taken into ac-

tion can be simultaneously an employee, taxpayer,

menting Kesla’s marketing. More than six years

count. All Kesla’s businesses need communication

shareholder or otherwise just a loud citizen. Com-

later, the job description has expanded into

support.

munication has also accelerated – things happen

comprehensive marketing communications.

“Communication is marketing and marketing is

24/7.

Tirkkonen graduated as a bachelor of applied

communication. Target group analysis is needed

science in International Marketing in Kuopio.

in both. For target groups – internal and external

Transformation of Kesla

Since then, she has supplemented her skills with

customers, partners and stakeholders – Kesla

Kesla also faced plenty of changes. The change in

community communications studies and a de-

wants to be profiled as being close to the customer

corporate culture initiated by the change of CEO

gree in management. During her time at Kesla,

and easily accessible.”

has progressed rapidly. The management ap-

she has also completed a specialist qualification

proach has been transformed into participatory

in audio-visual communication. She also plans to

and servant leadership. In 2017, Kesla’s product

complete a specialist qualification in service de-

portfolio was divided into the business areas of

sign during 2020.

logging equipment, truck-mounted and indus-

“At Kesla, people have opportunities for develop-

try cranes and tractor attachments. At the end of

ment and self-improvement. I value the education

2019, the segment of life-cycle services is becom-

even more than the salary.”

ing the fourth business area.

Tirkkonen says her co-workers are amazing. She

At the same time, digitalisation has become an

also welcomes the fact that the company is recep-

increasingly important part of customer contact.

tive to new ideas.

The media field is fragmented. Social media has

kinds of activities. Kesla has pushed forward and

Kesla’s social media channels – Facebook, Instagram, YouTube, LinkedIn – see a lot of use. There are dozens of brochures and technical materials in both electronic and print format. Internationality is reflected in an increased number of language versions. Trade fairs in Finland and abroad are repeated annually.

“A lot of things have been done and are being done, but we also constantly get more work to do and things to develop. We don’t have an advertising partner; most of everything is done in-house.

#yourlifetimematch – focusing on the customer Kesla’s vision is crystallised in ‘#yourlifetimematch’.

Overall, ‘your’ refers to Kesla’s customer focus, ‘lifetime’ refers to sustainability, life-cycle cost competitiveness and long customer relationships, and ‘match’ refers to Kesla’s equipment integration and deep business partnerships in the distribution and supplier network.

This choice has suited us well, because Kesla has wanted to be quite down-to-earth.”

95

People from all factories head to Kitee In April 2018, approximately 60 Kesla retailers from different parts of the world gathered for dealer training days at Koivikko Manor in Kitee.

KESLA BOOTCAMP offered the dealers comprehensive information about Kesla chippers, cranes, tractor attachments and harvester heads.

96

An impressive sample of different Kesla prod-

cranes and loaders, while videos and stories

people about KESLA products around the

ucts had been brought to Kitee, so it was de-

about Kesla’s machines around the world were

world was an unforgettable experience for

cided to also extend the event to Kesla’s own

also on offer.

many. It made tangible how far the company

personnel. The personnel from the Ilomantsi,

The day was full of experiences and strength-

had travelled from stone clearing machines

Kesälahti and Joensuu factories were trans-

ened the community spirit of Kesla employees.

and harrows to the top of international forest

ported by bus to Koivikko Manor. There was

Seeing the cavalcade of machines hearing the

technology and material processing.

an opportunity to sit at the controls of Kesla

stories shared by Kesla’s sales and marketing

97

The value

of values

Kesla’s Human Resources Manager Maria Mustajärvi returns to internal communications and its

and operating methods guide us all. In order to

key tasks: taking the organisation’s vision, mission idea and values into everyday life and com-

build a common culture, we also need a certain

municating information related to work tasks. In 2019, one of Kesla’s most important internal

type of calibration of supervisory skills, harmo-

communication themes was value communication.

nisation of operating methods,” says Mustajär-

Responsible, innovative, quick and reliable per-

each other about values. Discussions have also

former – these are Kesla’s values. In his book

taken place.”

Väärää yrittämistä (“Wrong Entrepreneurship”),

The binding of values into everyday work at

Kim Väisänen, Blancco founder, non-fiction

Kesla started with supervisors, shop stewards

writer and startup investor, says that ‘value’ is a

and occupational safety representatives. Occu-

difficult word for Finns. “The situation becomes

pational health care is also involved. According

easier when you replace the word ‘value’ with

to Mustajärvi, a few superiors admitted to hes-

something easier to understand, ‘behaviour’.

itation before the operation started.

Values determine how a company or individu-

“After the value workshops had been held, even

al ultimately behaves – especially when things

the hesitators found the experience a pleasant

are difficult and you’re going against the wind.”

surprise. This confirms the idea that values be-

Väisänen seeks to concretise value thinking with

come concrete in everyday life through your

his metaphor. Kesla also wants to make values

own thinking, not when they are handed to

into a natural part of everyday life. According to

your from the outside.”

Human Resources Manager Maria Mustajärvi,

98

the goal is for everyone at Kesla to know and

Calibration

understand the importance of values. Lectures

Values are the reference framework for everyday

and endless PowerPoint presentations do not

decision-making. It is important that the same

help, doing things and thinking about them do.

values and operating methods guide Kesla

“We have made people process the meaning of

team members, regardless of their task or the

values for themselves. We have held workshops

location of the factory.

and discussions and carried out a wide range

“The challenge is that Kesla operates in three lo-

of activities and monthly value themes. People

cations. But so do many other companies. Local

have been encouraged to communicate with

tensions are forgotten when the same values

vi, reminding that the main task of a human resources manager is to support managers in their work.

Clear direction Maria Mustajärvi joined Kesla at the beginning of 2018 to carry out a human resources management development project. With the project, the master of Administrative Sciences planned to obtain a doctoral dissertation in law.

Kesla finally claimed the hard-working woman’s entire attention, and the doctoral dissertation was left to wait for its turn.

“I’ve always wanted to improve myself, to study new things. I also bring that will and spirit to Kesla. Traditional engineering thinking is still shifting from machines to people, but it is on the right track. Machines and equipment are needed, but without skilled people, they don’t achieve anything.”

The “right direction” mentioned by Mustajärvi means, among other things, that she encourages the 26 managers of Kesla to consider and plan the competence needs and training of the employees of their organisation.

The strategy process initiated by CEO Simo Saastamoinen was completed in 2019. Strategic development themes relate to capital-efficient delivery capability, product portfolio management, service business and strengthening market presence. Courage and perseverance in reinvention have been highlighted as the development theme for the organisational culture.

“The strategy process itself has been at least as important as the outcome. This process has also been reflected in our personnel surveys.

The feeling is that we are in controls, the direction is clear and our next steps are plotted.”

Maria Mustajärvi joined another employer in March 2021.

“Values are the reference framework for everyday decision-making.

It is important that the same values and operating methods guide all Kesla team members, regardless of their task or the location of the factory.”

Maria Mustajärvi emphasises the importance of internal communication for the success of the company.

99

Kesla’s values have been widely communicated to the staff. A photo of one of the supervisors’ value workshops in 2019.

100

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Pulp boom passes The first three quarters of 2019 progressed in exactly the same bright atmosphere as expected after 2018 – the €50 million turnover target was realistic. The Group’s earnings per share for the first half of the year almost tripled from the previous year to €0.30. The net cash flow from operating activities was also better than the previous year.

However, the last quarter made the year very divided. The price of pulp started to fall at the beginning of the year, and by the end of the year the price had fallen by more than one third. The pulp boom was over, and the effects on Kesla hit at the end of the year. The column issue with Kesla’s 2124L truck-mounted cranes also caused some grief. To remedy this problem, the company made an expense provision of €0.7 million.

Kesla’s turnover for the financial year was €47.4 million. Turnover grew in Finland, in the forest damage areas of Central Europe and in Norway. However, the Russian market had been more subdued since the spring. Towards the end of the year, sales in Belarus had picked up. Operating profit for 2019 decreased to €1.6 million under the pressure of non-recurring items.

In December, the company launched co-determination negotiations. It was decided to adjust the number of personnel for the reduction of nine persons without redundancies. Avoiding redundancies was received as positive news that signalled the company’s belief that the difficult market situation was temporary.

101

Veli-Matti Kärkkäinen’s family is one of Kesla’s main owners and founders. Veli-Matti himself is actively involved in Kesla’s Board.

102

Citius, altius,

fortius

The first ten years on Kesla’s Board of Directors were a learning experience for Veli-Matti Kärkkäinen. The company lived on, but the third-generation Kärkkäinen did not have firm grip on things. The company’s financial distress worsened in the early 2010s and Kärkkäinen noted the paralysis of the personnel.

When Eeva Punta, previously Chairwoman of

Simo Saastamoinen as CEO proved to be logical

Straight talk

the Board, stepped aside after 2013, Veli-Matti

decisions.

When the reform of Kesla’s management cul-

Kärkkäinen was offered the position of Chair-

“Communications in the company improved.

ture started after 2015, a new approach was

man.

The challenging slump was overcome, and

taken to strategy work. Clarification of the

“At first, I was a little doubtful if I was up for it.

finally the light at the end of the tunnel was

company’s vision and strategy was needed in

Of course, I had already had some practice as

more than just the light of the oncoming train.”

the market and at least as much now also in

Vice-Chairman of the Board of Directors,” says

The functioning communication – or lack there-

the company. An external consultant was hired

Veli-Matti Kärkkäinen.

of – also played a role in Kesla not yet having

to assist.

Kärkkäinen’s hesitation was understandable.

have a clear strategy internalised by the organ-

“The consultant said right from the start, ‘Lis-

The company had invested heavily and at the

isation in the early 2010s. Of course, the Board

ten, boys, let’s get that ownership strategy on

same time the market melted down. The sub-

of Directors had been holding strategy days

paper first and then we’ll move on.’ As far as I

sidiary MFG was in serious difficulties and sales

since the 1990s. However, they failed to get

know, until then, the Kärkkäinen and Paajanen

receivables also piled up.

the organisation to commit.

families didn’t have anything on paper – who

“The people I saw in the corridors seemed de-

“When the strategies of the time were pre-

wants what and why.”

jected and unhappy. I was afraid that, especially

sented to the organisation, people laughed

in sales, people’s work motivation was com-

outright.”

pletely disappearing.”

Communication issues Veli-Matti Kärkkäinen’s chairmanship of the Board initiated major changes in the company, not the least among them the departure

“In recent years, more formal practices than what the previous generation had have been created for Kesla.”

from the company of Jari Nevalainen, who been managing Kesla for 14 years. The resignation of Nevalainen and the appointment of

103

The ownership strategy was refined for about

growth. Here, too, Jouni and I have to sit down

“Wherever we are, we want to be number one,

three months. During the process, for exam-

every year and think about the future from the

or at least number one’s first challenger.”

ple, a policy emerged that 40% of the compa-

perspective of the owners.”

The Chairman of the Board also has a clear vi-

ny’s profit would be distributed in dividends,

sion that Kesla must strive hard forward – faster,

though of course nothing was carved in stone.

At the heart of the strategy

higher, stronger.

The percentage can be considered moderate.

As Chairman of the Board, Kärkkäinen highlights

“Kesla is still a small company heavily affected

The money will continue to be used for invest-

some of the top themes of Kesla’s strategy:

by external shocks in the market. We must grow

ment and growth.

“The values defined for the company – respon-

it into a bigger company so that it can better

“In regard to the ownership strategy, we are still

sible, innovative, quick and reliable performer

withstand pressure.”

lacking in reflection on what happens after us…

– guide decision-making in the company. We

Speaking of growth targets, the Chairman of

Jouni and I still feel young,” says Veli-Matti Kärk-

carefully define our markets, in smaller seg-

the Board is not content to stick to the organic

käinen with a laugh – and gets serious right after:

ments if necessary. It is not realistic to think that

growth target. The company is also ready to

“In recent years, more formal practices than

we can conquer the whole world here and now.”

grow through acquisitions when suitable pur-

what the previous generation had have been

Veli-Matti Kärkkäinen emphasises that Kesla

chases appear.

created for Kesla to support the company’s

does not compete for the best third or fourth

“The Board is vigilant.”

place in the market area.

Kesla’s Board in 2020. Jouni Paajanen (left), Ritva Toivanen, Veli-Matti Kärkkäinen, Vesa Tuomi and Ari Virtanen.

104

Not even summer jobs “The boys are not allowed to join the company until they earn their spurs elsewhere.” That was the policy of Seppo Kärkkäinen and Esko Paajanen, two of Kesla’s largest owners.

Seppo Kärkkäinen, son of Kesla’s founder Antti

“I recall that one summer I had a summer job

Kärkkäinen, had served as CEO of Kesla from

at the company, working on the building ex-

1971 until 1976. In 1976, Seppo Kärkkäinen

tension. Esko and Seppo had words about it

became Chairman of Kesla’s Board of Direc-

and agreed that it must not happen again,” says

tors and Esko Paajanen, who had been hired

Veli-Matti Kärkkäinen.

as Marketing Manager in 1974, was appointed

Both Veli-Matti Kärkkäinen and Jouni Paajanen

CEO of Kesla.

graduated with a Master’s Degree of Social

“My father Seppo has always been such an im-

Sciences. Kärkkäinen has since worked, for ex-

pulsive person. He got new ideas all the time,

ample, as a Researcher and since 1997 as the

but completing things was more challenging

Managing Director of Lipu Oy. Jouni Paajanen

for him. Not the best quality for a CEO,” says

built a career in information technology at Fu-

Veli-Matti Kärkkäinen, explaining the reasons

jitsu Finland Oy, among others. They were ap-

for changing CEOs.

pointed members of Kesla’s Board of Directors

The Kärkkäinen and Paajanen families lived

at the same time in 2003.

next door to each other in Kesälahti. Veli-Mat-

Esko Paajanen served as CEO of Kesla on two

ti Kärkkäinen and Esko Paajanen’s son Jouni

different occasions – in 1976–1992 and 2000–

Paajanen were both born in 1967.

2001. He resigned as Chairman of the Board of Directors in 2009.

Seppo Kärkkäinen served on Kesla’s Board of Directors until 2006.

“I recall that one summer I had a summer job at the company, working on the building extension. Esko and Seppo had words about it and agreed that it must not happen again.”

105

Crane columns reinforced In November 2019, Kesla issued a performance warning when a durability problem had been detected on KESLA 2124L cranes. Kesla reacted in accordance with its responsibility value and announced that the company would replace the columns of all of such cranes delivered from 2013 onwards with a new reinforced construction.

This particular crane model had been developed for the needs of longwood transportation in Central Europe. Model marking L referred to a lightweight 24-tonne crane, which was a lightweight version of the 2024 crane.

Due to the corrective measures, Kesla made a non-recurring expense provision of €700,000, which meant that the company’s operating profit was expected to remain at the same level as in 2018.

The replacement of the 2124L model’s columns went quite well. In the photo the Welding Operator Esko Paavilainen preparing column changes.

106

Developing

after-sales services

“Sales sells the first machine, and after-sales service sells the following ones,” says Reijo Tuononen, Kesla’s After Sales Manager.

Kesla’s after-sales services include spare parts,

In after-sales services, Kesla has focused on

For the common good

maintenance, warranty and product advice re-

consumables and spare parts. In Finland, the

When Kesla reacted to the durability issue de-

lated to the package. As After Sales Manager,

company has a network of more than 30 ser-

tected in the company’s cranes in November

Tuononen is responsible for Kesla’s after-sales

vice points. Construction of a similar service

2019, the stock exchange release announced

operations and development work. He is the

network in Germany, Norway and Sweden

a new separate quality organisation. Kesla also

direct supervisor to three service managers

is under way. So far, local importers provide

announced that it had made product develop-

and two service technicians. Tuononen’s or-

after-sales services in all Kesla’s export areas.

ment more systematic and improved quality

ganisation cooperates closely with the com-

Globally, Kesla has approximately 140 outlets

of through a product development process

pany’s three business units, which each have

and service points.

based on gate reviews and FMEA analysis. Fail-

specialised maintenance personnel.

ure Mode and Effect Analysis (FMEA) examines in particular possible material and equipment

107

defects, the consequences of which may have a significant impact on product performance and market position. The aim is high product quality, durability and convenience of use.

“Due to the development of the policy, the risk of similar problems occurring in the future is significantly lower,” said CEO Simo Saastamoinen in the stock exchange release.

All quality improvement measures, from design to product development and production, benefit after-sales services. When there is no need to react afterwards, after-sales service resources can be proactively allocated to a better customer service.

A lot has happened in the field of after-sales services since Reijo Tuononen joined Kesla in 2008. Improving quality is an everyday fact. The company has, among other things, established a reception inspection station. Measurements of new products in sampling inspections, such as cylinder performance tests, and analysis of defective products returned from the field to the factory, are carried out at the reception inspection station.

Kesla has also studied service design, the importance of which Tuononen believes will only grow. As a result of a service design project carried out in 2019 by Kesla and students of the University of Eastern Finland, Kesla modernised the premises of its service centre in Joensuu.

Customers and Kesla personnel were involved KESLA branded products have gradually been added to the spare parts range as well.

The After Sales Manager Reijo Tuononen (left) and Spare Parts Coordinator Kimmo Karvinen.

108

in the project using benchmarking and testing.

Personal Kesla wants to intensify communication with the customers. This aim is supported, among other things, by the accumulation of a customer data register. Service will be more personal, more accurate and faster.

The company plans to use digitalisation in spare parts e-commerce and online training, among other things. Kesla has started cooperation with Riveria Vocational School. Riveria will be used to learn how after-sales services can better train its customers.

“Spare parts service, maintenance, warranty and advice must work smoothly to build a strong customer relationship. Another clear trend is that customers are becoming more professional and interested in more extensive and comprehensive services.”

The goals are ambitious as after-sales services are being developed with high stakes. Quality is at the heart of everything.

“We must always try to do things right and more and more proactively. If problems arise, Kesla reacts responsibly according to its values.”

The inspection centre was completed in early 2020.

In the photo the Receiving Inspector Pasi Sormunen.

109

Understanding the customer’s needs is at the heart of Kesla’s operations. Pictured are harvester entrepreneur Juuso Laukkanen and Product Designer Paavo Alhainen

110

To help the customer

succeed

Kesla’s competitive advantage throughout the company’s history has been based on the efficiency and durability of the products. The efficiency and reliability of the equipment become the most important factors when entrepreneurs consider the profitability of their business.

Equipment choices are guided by expediency – technology appropriate to each operating environment and each application is needed.

The impact of megatrends

Kesla’s technological solutions make it possible

Global megatrends, such as climate change, de-

to expand from the forest into new sectors – re-

pletion of natural resources, population growth,

cycling, urban environments, real estate services

the ageing of the population, urbanisation and

or maintaining basic infrastructure for society.

changes in consumption patterns, affect Kesla and Kesla’s customers. Many forest machine

Close to the client

entrepreneurs and transport entrepreneurs are

Entrepreneurs know that you cannot succeed

observing climate change and Finnish forest

with unreliable equipment. When the situation

debate with great concern.

requires it, smooth servicing and spare parts

“Of course, the debate feels confusing at times.

service are extremely important.

It is easy to get the impression that agriculture

Kesla’s truck-mounted cranes have six sales points

and forestry are the worst crimes in this coun-

in Finland and more than 30 service points.

try,” says Juuso Laukkanen, Managing Director

Kesla’s tractor equipment and chippers are rep-

of Punkaharjun Metsäpalvelut Oy LKV.

resented in Finland by AGCO Finland’s sales and

Megatrends change the values and attitudes of

service network of more than 30 locations.

society. New trends may in turn emerge from

Kesla’s harvester heads and forest machine

the changed values. In the constant change, Ke-

cranes are mainly sold directly to forest machine

sla listens to its customers as it moves forward.

manufacturers and for excavators.

New opportunities

Made in Finland

Products developed for customer needs, reli-

In December, the Association for Finnish Work

able delivery capability, active presence in the

celebrates the ‘Buy Work in Finland Day’. The day

market and services promoting the customer’s

is also important for Kesla, whose products man-

business have been put at the heart of the strat-

ufactured in Finland have been awarded the Key

egy. The forest is still Kesla’s strongest support.

Flag origin label.

111

Timber transport entrepreneur Tero Hannonen:

Efficiency first Kitee-based company Veljekset Hannonen Oy does contract timber transport for Metsä Group in Central Karelia. At best, they move more than half a million cubic metres of wood annually.

Equipment choices are guided by efficiency, reliability and good availability of spare parts.

112

The year 2015 was in many ways an important

Hannonen was supported by Ari Pirhonen, Ke-

from the forest without tight schedule pres-

milestone at Veljekset Hannonen Oy. Found-

sla’s current Business Director for truck-mount-

sures. At the terminal, timber is loaded onto

ed by brothers Heikki and Martti Hannonen in

ed and industry cranes. Pirhonen has solid ex-

road vehicles with a KESLA 2024 terminal crane.

the 1970s, the company has been continued by

perience in heavy goods vehicles as a designer,

Autumn 2019 was at times challenging for

younger brothers Jukka and Arto Hannonen.

manufacturer and driver. The high-capacity

the timber transport company. According to

The company moved towards transfer to the

transports started in 2016.

Tero Hannonen, transport volumes decreased

next generation when Martti’s son Tero Han-

“Our experiences with high-capacity vehicles

slightly compared to the previous year. The sof-

nonen joined the company. The same year, the

have been very positive, they have served our

tening of roads due to the warm autumn also

company started using only KESLA cranes.

operations well.”

caused problems. When, at the turn of Novem-

“There had been a couple of competing brands

Veljekset Hannonen has two timber trucks with

ber and December, temperatures went below

in use. We decided to focus on Kesla – we had

10-tonne-metre cranes and one timber truck

freezing again, they worked long days.

good experiences, and good availability of

with 12-tonne-metre crane The other two tim-

service and spare parts,” says Tero Hannonen.

ber trucks are equipped with 12-tonne-metre

2015 was also a year of change for the com-

Z-cranes.

pany in that it gave up logging, which was

“The Z-crane gives the vehicle significant ad-

previously part of the service selection, and

ditional capacity; the vehicle’s load space can

focused entirely on timber transportation. At

be used efficiently. When the time comes to

the same time, they were preparing to try out

replace the straight-boom crane, Z-cranes will

high-capacity transport.

be strongly considered.”

In Finland, high-capacity vehicle (HCV) refers

Veljekset Hannonen purchased their first

to combinations longer than 25.25 metres or

12-tonne-metre crane in 2015. According to

weighing more than 76 tonnes. Hannonen’s

Tero Hannonen, the size class has proved ef-

HCV was granted a trial licence by the Finnish

ficient and smooth for the company’s needs

Transport Safety Agency Trafi for a vehicle com-

– they will never go back to using smaller

bination weighing 84 tonnes. The HCV trans-

equipment.

ports timber to Lappeenranta and Joutseno.

Veljekset Hannonen has two separate timber

In the timber transportation business, Veljekset

terminals to which timber can be transported

“The Z-crane gives the vehicle significant additional capacity; the vehicle’s load space can be used efficiently. When the time comes to replace the straight-boom crane, Z-cranes will be strongly considered.”

The photo shows members of the Hannonen family of entrepreneurs: Tero, Jukka and Arto.

113

Kyösti Tiainen and Juuso Laukkanen work together. They both rely on Kesla’s equipment.

114

Partners Kyösti Tiainen and Juuso Laukkanen:

Good forest management through development Juuso Laukkanen runs Punkaharjun Metsäpalvelu Oy LKV, and Kyösti Tiainen has been working for the company with his loader/trailer combination for almost 15 years. Tiainen is a true artist with his KESLA combination whose user experiences are also of interest to Kesla’s international customers.

Punkaharjun Metsäpalvelu Oy LKV operates

sinks and forest management disputes can

“Tiainen is a hard worker, and his Kesla ma-

within a radius of about 50 km from Punka-

easily confuse the Finnish ethos that the man-

chines see a lot of use. We also benefit from his

harju. The company produces forest manage-

agement of forest assets is always worthwhile.

involvement in the development and testing of

ment services ranging from forest manage-

“Of course, the debate feels muddled at times.

Kesla’s machines,” says Juuso Laukkanen.

ment work to timber trade as well as forest

It’s easy to get the impression that agriculture

Tiainen has a developer’s approach to his work;

landscape and nature management. Three

and forestry are the worst crimes in this coun-

for years, he has collaborated with Kesla in test-

shareholders of the family-owned company

try,” says Laukkanen.

ing and sharing user experiences with a development mindset. Tiainen has trusted Kesla and

work for the company. In addition, the service company employs three loggers, a harvester

The dogs bark, but the caravan goes on

Finnish tractors throughout his career. At the

operator and a forest specialist. In the office,

Kyösti Tiainen from Punkaharju also chose his

moment, he uses a Valtra M120 tractor, KESLA

the secretarial work is done by a subcontractor.

own road in forest management. Until the ear-

12MD trailer and KESLA 316T loader. Kesla’s

The company’s own fleet includes a ProSilva S4

ly 1990s, Tiainen tended dairy cattle and meat

customers around the world are also interested

harvester with Kesla’s 25RH2 head and a 1610

cattle. Keeping the cattle would have required

in the professional’s experiences.

crane.

a lot of investment, and forestry work caught

“Kesla has brought many groups of visitors to

“We harvest about 30,000 m3 of timber a year.

his interest.

Punkaharju to observe our work. I have also

During summer 2019, forest management

“It’s been a matter of principle for me to em-

travelled with Kesla to Indonesia on a couple

work was carried out on roughly 200 hectares.

ploy myself. In the beginning, I handled small-

of occasions. There, the eucalyptus plantation

The majority of the management contract

er-scale purchases for delivery for land-own-

had more or less the same tractor that I myself

estates come through Metsä Group. We are

ers. I have now been working for Punkaharjun

have.”

always trying to communicate our services to

Metsäpalvelu for over a decade.

private forest owners,” says Laukkanen.

According to Kyösti Tiainen’s calculations, he

However, it is not easy to reach private forest

has done almost 27,000 hours of driving since

owners. Forest owners are becoming more

2004. A first thinning produces 70 to 80 m3 of

urbanised and distant from their property.

solid wood (m3sw) per day, the second thin-

The overwhelming and branching debate on

ning 100 m3sw and the final cutting 250 m3sw.

environmental issues, sufficiency of carbon

115

The harvester entrepreneur Juuso Laukkanen receives often visitors. Pictures are Kesla visitors from South America admiring Juuso’s harvester.

116

Forest machine entrepreneur Rauno Matikainen:

Productivity and year-round employment Brothers Rauno and Veini Matikainen, owners of Itämoto Oy, do contract work for Stora Enso and private forest owners. Their versatile equipment was acquired with a view to productivity and year-round employment.

Rauno Matikainen completed the last tillage

larger logging jobs last several weeks.

“We were already using a Kesla harvester head

contract of 2019 in late November. It was time

“There are stands marked for cutting in the

in our early wheeled harvesters. We’ve had

to equip the Doosan 140 excavator with a Ke-

coming winter, but due to the mild autumn,

good experiences with them; the servicing

sla harvester head again and head for the bo-

we now have to choose them carefully. We look

and spare parts service work well.”

glands for winter thinning.

forward to the winter,” says Rauno Matikainen

Working in a machine in the middle of the

“During the summer season, the excavator is

in late November.

woods is a lonely and independent job. Matika-

used for tillage work, and during winter the

At Itämoto, machine choices are not made out

inen says that he has come across bears a few

excavator harvester is used for timber harvest-

of pure brand loyalty – productivity and relia-

times over the course of his career – although

ing in soft boglands. The excavator harvester is

bility are crucial. The excavator is typically used

bears have probably come across him more

gentler on the forest floor. Forest owners also

for tillage for six months out of twelve, a little

often without him noticing.

prefer the excavator harvester. The Xtender

longer in a mild year. After that, the investment

“It takes a certain type of person. When you’re

makes it possible to work in rather difficult

is kept profitable with bog thinning. In addi-

alone on a dark night shift, you have to get

places,” says Rauno Matikainen.

tion to the excavator harvester, the equipment

along with yourself. You have to be able to trust

Kitee-based Itämoto Oy started its operations

includes two John Deere harvesters and a Sam-

the machines.”

in 2014. The Matikainen brothers’ entrepre-

po-Rosenlew forwarder.

neurship dates back to 1994, when they helped

“The investments are big but unavoidable.

found Kone-Korpi Oy. Before that, they worked

Equipment must be kept relatively new, be-

as machine drivers.

cause you can’t cope with this kind of work

Entrepreneurship has led to growth. In addi-

with unreliable equipment. During the win-

tion to the pair of brothers, Itämoto employs

ter season, work is done in two shifts, also on

three machine drivers and one contractor dur-

Saturdays. In summer, working hours are the

ing the winter season. Their logging sites are

normal eight hours with no weekend work.”

located within a radius of about 60 km from

Itämoto’s first excavator harvester was a New

the centre of Kitee. They have a separate pallet

Holland, also equipped with a Kesla harvest-

for transporting the equipment. The smallest

er head. The current Doosan was acquired in

contracts are completed in a few hours, the

2016.

117

The Matikainen brothers, Veini and Rauno, harvest timber with an excavator harvester.

118

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

A Finn always makes it Sixty years of history. Difficulties, letting go, reinvention, successes. Business as usual. However, the turbulence caused by the COVID-19 pandemic was unexpected. Little was known about the new virus at the beginning of the crisis. The governments of the various countries resorted to extensive blockage measures, which had a significant impact on the functioning of the economy. In the situation, Kesla was as agile as possible, striving to anticipate, not just react. The company’s attitude is well illustrated by the title of the Annual Report for 2020, ‘A Finn always makes it’.

In 2020, Kesla’s turnover dropped by nearly one-fifth from the previous year – the truck-mounted and industry cranes business suffered the most. The Group’s turnover was €39.6 million. A year earlier, the company had achieved a turnover of €47.4 million. Operating profit decreased to €567,000, down 63.3% from the previous year.

Large stimulus measures, the pent-up demand caused by the pandemic and the pick-up in pulp prices made for better demand in the second half of the year than in the previous year. The Group anticipated the turn in a timely manner and increased its sales efforts at the beginning of the second half of the year. The efforts paid off, and especially during the fourth quarter, new orders were received and turnover increased. Turnover grew significantly in the United Kingdom, Belarus and France. In other market areas, however, including Finland, business slowed down.

Kesla was among the first Finnish companies that realised the market potential of Belarus in the mid2000s. Amkodor, the Belarusian manufacturer of forest and civil engineering machines, became a significant customer for Kesla. In mid-December 2020, the European Union decided to extend its sanctions against Belarus in December not only to key members of the regime, but also to Belarusian businessmen who benefit from the regime of President Alexander Lukashenko. The sanction decision has stopped business with Amkodor.

Excellent delivery capability, products developed for customer needs, service package promoting the customer’s business, strong presence in the market. These are the cornerstones of Kesla’s strategy. The customer has been put at the heart of all activities. Doing your best is not always enough. Right now, the world is shielding itself from COVID-19 with vaccines. Tensions in world politics are increasing.

119

Like a sophisticated

extension of your hand

Smooth and productive, but not abrupt, let

tomer so wishes, the benefits of the electronic

alone aggressive. Ergonomic for the user, so

control system and the feel of mechanical con-

that their body is not stiff at the end of the

trol can be combined in one machine.

working day. Expedient and safe. At best, an

“If necessary, the familiar joysticks of electric

attraction factor that makes young drivers

control can be replaced with bigger levers to

interested in the industry. These are a few

lower the threshold for those accustomed to

descriptions of what a good crane is like by

traditional control to switch to the electric con-

Kesla Product Designer Matti Räsänen.

trol system.”

“A good crane is like a sophisticated extension

A new generation of professionals is needed at

of your hand. Its use is productive – fingers

crane controls. In order for the sector to remain

don’t go numb and movement doesn’t feel

attractive, technology needs to be developed

clumsy,” says Matti Räsänen.

in an electronic, intelligent and more produc-

In the control systems of forest machine cranes

tive way. Kesla’s product development has also

and harvester heads, Kesla’s partner is Techn-

accepted the challenge.

ion Oy. Kesla handles the design and produc-

Dialogue with customers is an integral part of

tion of the control systems of all other Kesla

the daily life of a product designer.

products in-house.

“We receive direct customer feedback, active-

Räsänen, who works in the company’s control

ly collect feedback through product manage-

system team, has personal experience as a

ment and get user experiences from our test

forest machine driver and timber truck driver.

customers. Thoughts, ideas and concerns are

That experience is a big advantage – he speaks

listened to – and even read between the lines,”

the same language as the customers.

promises Matti Räsänen.

For many specialists who have worked with a

Thoughts, ideas and concerns are listened to – and even read between the lines, promises Matti Räsänen.

120

crane for years or decades, the idea of switching to an electronic control system may have been difficult. Räsänen says that the sector is somewhat conservative.

Kesla has also taken into account committed users of mechanical control systems. If the cus-

121

Wild card

The strategic choice to use the network of agents

shuffles the deck

In spring 2019, Kesla CEO Simo Saastamoinen was a little worried. A year earlier, the pulp market had been experiencing peak times. At its best, more than $1,200 per tonne had been paid for long-fibre softwood pulp in 2018. Saastamoinen, who closely followed the trend indicators, thought that the pulp boom would soon be over. And that is what happened. The slowing down of the pulp market was later described by many as a ‘crash’. Kesla prepared for the deterioration of the market situation, and co-determination negotiations were launched towards the end of 2019.

Pandemic

and shops were closed. Industry’s concern about

December 2019. The first suspicions of COVID-19

the availability of materials and components in-

were raised in Wuhan, China. Soon there was talk

creased. Kesla was also worried. Although approx-

of an epidemic. Early in the year, the epidemic

imately 80% of the materials used by the company

area of COVID-19 was defined as continental Chi-

are sourced in Finland, there were challenges in

na, Iran, South Korea, Italy, Tirol in Austria and the

tackling production problems.

German state of North Rhine-Westphalia.

In April 2020, Kesla announced arrangements to

At the end of January 2020, a Chinese tourist

protect the personnel and slow down the wave of

was isolated in Lapland Central Hospital due to

contagion. The range of measures included strict

COVID-19. About six weeks later, Finland invoked

hygiene, work space arrangements, remote work

the Emergency Powers Act. The World Health

opportunities and minimising contacts. Sales and

Organisation declared the COVID-19 epidemic a

technical support activities were secured, and

pandemic on 11 March.

partners were given full support.

At Kesla, the anticipation of lay-offs eased the

The COVID-19 pandemic shut down air traffic

transition to COVID-19 reality. The first quarter of

worldwide. As in so many other companies and

2020, the company persevered. In April, there was

organisations, Kesla effectively harnessed remote

a sharp drop, and the order book dwindled.

connections. Teams meetings and WhatsApp became an agile part of distance communica-

122

Preparation

tion with partners and customers. The company

Remote working, distance education, disbelief

operating in the international market was able to

In several countries, people’s movements, travel

improve the clock frequency of communication

and gatherings were restricted and public spaces

and the frequency of interaction, as the CEO put it.

in new markets also proved wise from the point of view of COVID-19.

Temporary Economic crises have different backgrounds.

In Finland, banks, businesses and people were devastated by the domestic recession of the early 1990s. The 2008 financial crisis stemmed from subprime mortgage lending in the United States. Low interest rates, loose lending and blind risk-taking by financial institutions pushed the economy downhill.

At the same time, awareness of megatrends grew stronger. Climate change, ageing of the population, technological issues – these are things that appear to Kesla mainly as business opportunities.

In the middle of everything, the COVID-19 pandemic confused things in a different way. Unlike megatrends, COVID-19 was described as a wild card – surprising in its suddenness, but not continuous.

Towards growth Kesla was in remote working mode for a total of five months and felt the effects of COVID-19 throughout the year. In April, the slump was deep.

In hindsight, it was said that people came back to work after the summer holidays with too optimistic expectations. August was slow, and it would have been wise to continue with the lay-offs.

When the media reported promising new vaccines from around the world in late 2020, the

turn of the COVID-19 crisis seemed to be at hand.

sla, which was selected in December 2020 in the

is a sign that we are moving in the right direction,

Exchange rates started to rise. Stock exchange

top ten finalists of Finland’s EY Entrepreneur of

and at the same time it challenges us to further

movements were monitored at Kesla more close-

the Year competition, will do the same. A total of

improve our operations.” That was how CEO Saas-

ly than the EU region’s GDP figures – for good

54 growth companies sought to make it to the

tamoinen and Veli-Matti Kärkkäinen, Chairman of

reason. About three-quarters of Kesla’s turnover

finals in the competition, which evaluated the

Kesla’s Board of Directors, verbalised their satis-

comes from the EU.

company’s value base, management, strategy

faction at the competence of Kesla’s entire team

Towards the end of the year, positive signals

and growth and success. “Getting into the finals

and the capture of the place in the final ten.

strengthened; we were nearing better times. Kesla’s order book strengthened. The Russian market showed signs of recovery. The Belarusian market developed favourably. The strengthening of the Swedish krona exchange rate stimulated trade to Sweden. In the success column, the cancellation of lay-offs of people who worked in the client interface when the COVID-19 pandemic eased slightly was another big plus. The people who returned to work worked hard, and Kesla’s sales grew sharply.

Right direction Kesla has demonstrated its flexibility and adaptability in the context of the financial crisis and COVID-19. The CEO describes Kesla’s agility as follows: “Evolution also proves it – even the biggest and strongest dinosaurs didn’t do as well with changes as the most adaptive ones.”

Attention is again shifting more strongly from the wild card of COVID-19 to megatrends that bode well for Kesla’s business. The COVID-19 pandemic has prompted people to think about climate change and look for alternatives to fossil raw materials. When COVID-19 is finally beaten, the world will continue to strive for growth. Ke-

Kesla’s plans for the 60th anniversary were largely postponed by a year. However, we were able to have some birthday cake with the personnel during the summer lull of COVID-19. In the photo Simo Saastamoinen, the CEO, cutting cake.

123

“It’s in my nature that when I see a useless tool, the rotten thing really bothers me inside.

I start wondering why it wasn’t done this way and that way.”

– Kesla founder Antti Kärkkäinen –

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From a barn business to a multitalent of forest technology – Kesla 1960–2010

From a barn business

to a multitalent of forest technology SUMMARY 1960–2010

Antti Kärkkäinen, the founder of Kesla’s predecessor Rantasalmen Raivausväline, was a pioneer with plenty of ideas and the smarts to seize the opportunities of his time. Since the 1950s, agriculture in Finland, which was recovering from the war, was being mechanised at a tremendous rate.

Kärkkäinen’s innovations included the Kivi-Antti stone clearing device and the Isokita ripper tooth.

“Kivi-Antti plucks stones out of the field as easily as women pop bread loaves into the oven.”

However, after the promising start, the cooperation between Rantasalmen Raivausväline and the Municipality of Joroinen rapidly fell apart due to local politics. “Joroinen is an entrepreneur-friendly municipality, but not enough attention has been

- Kivi-Antti advertising slogan at the Kaavi Agricultural Exhibition in 1957 -

paid to the local entrepreneurs here, at least not

The product range was expanded to include a

who wanted to operate in the new industrial hall.”

stone fork and a tractor spring-tooth harrow in the 1960s. The factory premises in the village of

- Interview with Seppo Kärkkäinen in Savon Sanomat newspaper, 28 March 1974 -

Kolkontaipale in Rantasalmi no longer met the

Seppo Kärkkäinen started discussions with sever-

to us…. We ranked too low on the list of those

needs of production, and the search for a new factory space began in early 1969.

Antti Kärkkäinen died in 1969. After Antti, the company was led first by his eldest son Raimo Kärkkäinen and then by his younger son Seppo Kärkkäinen in 1971.

A large pre-order for harrows received in 1969 accelerated the company’s move to Joroinen. where a 400-m2 hall was found to be available.

According to the verbal agreement, the municipality pledged to build more hall space for the company and also a dead-end track.

From a barn business to a multitalent of forest technology – Kesla 1960–2010

125

“Kesla was ahead of its time when it started to develop forestry machines. There was no actual forest machine boom yet back then.”

- Ari Koskivaara, Farmer -

al municipalities on the possible new seat of the

change in agriculture. Especially small-time farm-

Paajanen, who had been hired as Kesla’s Market-

company. Kesälahti came on top thanks to Mayor

ers and their families from Eastern and North-

ing Manager a couple of years earlier, became

Matti Alaluoto, who “whipped the money out of

ern Finland moved to the population centres of

CEO.

his desk drawer and said that a decision can be

Southern Finland and Sweden in the 1960s and

In an interview for Kesla’s 50th anniversary his-

made quite quickly”. Alaluoto kept his word, and

1970s. Economic uncertainty was also overshad-

tory, Paajanen said: “A company can be founded

in 1974 Kesälahti built 1,800 m of production

owed by the oil crisis.

around ideas and innovations. But everything

facilities for the company.

When the company moved to Kesälahti, its name

only gains value when the innovations are com-

Finland was already undergoing a structural

was also addressed. Consultant Jyrki Karttila

mercially exploited. The company still had a lot

came up with name ‘Kesla’. The choice influenced

to learn…. I started telling Seppo that we needed

by the name of the municipality has proven to

product development.”

2

“Matti Alaluoto, Mayor of Kesälahti, whipped the money out of his desk drawer and said that a decision can be made quite quickly” 126

be a good one also in the international market.

Seppo Kärkkäinen guided the company through significant changes. In April 1976, Kärkkäinen became Chairman of the Board of Directors. Esko

From a barn business to a multitalent of forest technology – Kesla 1960–2010

“I started telling Seppo that we needed product development” - Esko Paajanen, who was appointed CEO of Kesla in 1976 -

Esko Paajanen as CEO and Seppo Kärkkäinen as

of Hankkija, played a key role in the start of the

time when it started to develop forest machines.

Product Development Director formed an ef-

cooperation.

There was no actual forest machine boom yet

fective trio with Designer Raimo Ahonen, who

“Hankkija had already bought forks from us in

back then. The JYTY forest trailer and the loader

joined the company in 1975. Paajanen has de-

the past. When we were at the Mikkeli Agricul-

placed on top of the trailer were the first items,”

scribed Raimo Ahonen as a significant innovator

tural Exhibition in 1977, Reino came to our trailer

said Ari Koskivaara, who used to work at Farmer,

for the company, along with Seppo Kärkkäinen.

and asked if we could make them 3,000 harrows.

in an interview on 8 September 2009.

As early as 1972, the company was aiming for

Esko and I looked at each other and said yes,” said

JYTY forest trailers were exported to Sweden,

the Swedish market with stone forks and ripper

Seppo Kärkkäinen, reminiscing in March 2009.

England and Norway. Exports picked up rapid-

teeth. The production at the Kesälahti factory

Chief Agronomist Seppälä had strong views of

ly in the early 1980s. Cooperation with Farmer

was busy, already employing some 30 people.

what kind of machines farmers wanted. “Farmers

in the export market continued for a total of 15

The first export deliveries of forks were made in

were not very happy to use big forest machines

years.

the same year to Norway.

for thinning, as they made deep tracks in the

At the beginning of the 1980s, Kesla grew even

An entirely new era in Kesla’s history began in

forest if the earth was not frozen,” Reino Seppälä

more focused on the forest machine market.

1977, when the company started cooperation

said in an interview on 6 February 2009.

The company designed and manufactured ef-

with the Hankkija central cooperative. Chief

Hankkija’s subsidiary Farmer started managing

ficient machines for forestry work. Their light-

Agronomist Reino Seppälä, the then director

Kesla’s exports in 1975. “Kesla was ahead of its

ness, agility and strength increased efficiency

“For Kera, Kesla was a quality maker in the metal industry of the whole region right after Rauma-Repola.

And it was around Kesla that the district association of Northern Karelian metal industry was founded.”

- Juho Björn, who started as a company analyst at Kera in 1976 -

From a barn business to a multitalent of forest technology – Kesla 1960–2010

127

“In the 1980s, Kesla’s Patu forest machines were known in more than twenty countries. Forest machines made Kesla a real export company.”

128

and also conserved nature. In addition to trucks

ly frozen. It was a business risk that we had no

include cranes for timber trucks and industry.

and trailers intended for short-haul transport,

concrete control over. About ten machines were

Foresteri products quickly became part of Kes-

felling heads and processors were introduced.

sold before the entire project was completely

la’s selection.

A forest excavator was developed for cleaning

shut down.” (Interview with Esko Paajanen on 8

The liberalisation of the financial markets, the

the drainage in Finnish bog forests. In the 1980s,

July 2009).

banks’ enthusiasm for lending, the lack of over-

Kesla’s Patu forest machines were known in more

In 1984, Kesla expanded from Kesälahti to Il-

sight, the policy of the stable mark and, ultimate-

than twenty countries. The forest machines made

omantsi by purchasing and merging with the

ly, the collapse of the Soviet Union plunged the

Kesla a real export company.

Kartekki Ky machine tooling shop. In 1988, Kesla

Finnish economy into a recession in the early

The development of Patu M100 forest excavator

expanded to Joensuu by acquiring the machine

1990s.

required capital, which Kesla sought with a stock

engineering workshop of Karjalan Rautarakenne.

Kesla was also hit by the recession. Kesla’s salva-

exchange listing. Expectations for the excavator

In September 1988, Kesla acquired a majority

tion was ultimately its strong balance sheet and

were high, but the results were poor. “As a result

shareholding in Foresteri Oy, a manufacturer of

the company’s ability to compensate quite quick-

of the recession in the 1990s, allocations for

timber harvesting machines. As a result of the

ly for lost markets. “It reflects the professional

rehabilitation drainage were almost complete-

acquisition, Kesla’s product range expanded to

skills and good decisions that were made in the

From a barn business to a multitalent of forest technology – Kesla 1960–2010

company at the time. I think that the post-recession situation was handled very well and very quickly in the company. I had no fear for Kesla, my fear was for other companies entirely. Kesla had good products and the company was not too dependent on Soviet trade,” said Juho Björn, Regional Director of Kera in the early 1990s, in an interview on 26 January 2009.

Esko Paajanen gave up his position as Kesla’s CEO in 1992. “I was just so tired that I felt that letting go at that point was better both for me and the company. The financial problems were not what ate at me the most; the hardest part was the redundancies. People had trusted me, built their future. In the end, there was nothing we could do about difficult times,” said Paajanen in an interview on 19 November 2008.

Timo Suni, who had previously served as Junkkari’s CEO, was hired as the new CEO of Kesla. Suni ran the company until 1997.” In retrospect, that time of change, the wisdom of Seppo Kärkkäinen and Esko Paajanen to see the need for someone new from outside the company, was crucial. This time, that someone was me,” said Timo Suni in an interview on 11 October 2009.

The early years of Suni’s leadership were hard time, as sales of forest equipment shrunk by as much as 60% from before. On the product side, a work platform that progressed to the serial production stage was a cause for celebration.

Slowly, domestic trade in timber recovered, and the popularity of the cut-to-length method increased worldwide. That also gave Kesla a boost.

“During my career, Kesla had the best export people.

Young, energetic, educated.”

- Timo Suni -

From a barn business to a multitalent of forest technology – Kesla 1960–2010

129

“Kesla has grown fast and moved forward. There is a significant market for the company’s product range as mechanisation of logging continues to grow.”

- Antti Asikainen in an interview on 16 March 2009 -

Kesla had long handled its exports through the

mit the organisation to the changes. A few ma-

In autumn 2006, Kesla sold its work platform

export company Farmer. The responsibility for

jor product projects stalled and, for example, the

business in order to focus on forest technology.

export was gradually transferred to Kesla itself.

production control system reform was a more

Kesla produced its last agricultural machines in

The company opened its own export depart-

challenging job than expected.

1995.

ment in 1989.

After Kinnunen, Esko Paajanen returned to the

In December 2005, Kesla Oyj became a group af-

After Timo Suni, Asko Kinnunen was appointed

position of interim CEO.

ter Kesla hived off the operations of its Ilomantsi

CEO. He served from 1997 to 2000. Kesla sought

Jari Nevalainen was appointed as the new CEO

factory into an independent wholly-owned sub-

strong growth and the company launched the

in 2001. Nevalainen’s management concept

sidiary named Kesla Components Oy.

Kesla 2000 development programme. A lot hap-

consisted of a balance between product de-

In 2007, Kesla acquired the entire shareholding

pened on many fronts: production control sys-

velopment, production, sales and marketing.

of MFG Components Oy in Tohmajärvi. MFG

tems and marketing, financial management and

The production of Kesla’s own disc chipper was

Components specialised in the design, market-

reporting systems were redesigned. The working

discontinued, as was the production of a trail-

ing and manufacturing of transmission prod-

method was team-based.

er-mounted work platform.

ucts and solutions. It was believed that MFG

In the end, Kinnunen did not manage to com-

130

From a barn business to a multitalent of forest technology – Kesla 1960–2010

From a barn business to a multitalent of forest technology – Kesla 1960–2010

131

132

Components would bring new customers to the

As a result of the international economic down-

about the permanence of the change. The

Group. In autumn 2008, Kesla Components Oy

turn, Kesla’s business operations contracted in

company started the new decade with further

was merged into MFG Components Oy.

2009. The operations of OOO Kesla, Kesla’s first

adjustment efforts.

The global economic downturn in autumn 2008

foreign subsidiary founded in 2006, had already

“Kesla’s history is as long as the history of mech-

turned out to be faster and deeper than antici-

been wound down a year earlier.

anisation of forest work in Finland. The struc-

pated. As a result of the financial crisis, the world

“Russia remains an important market. Now we

tural change that has taken place is irreversible

seemed to be stagnating. Suddenly there were

had just come to the point where, as tough ad-

– there is no going back to human labour felling.

too many new and barely used machines and

justment measures were taken in Finland, we

Finnish machine manufacturers have taken hold

equipment for the needs of the end customers

were unable to bear the losses of the St Peters-

of the market and mechanisation continues to

and the dealer network. In Finland, the struc-

burg subsidiary,” stated CEO Jari Nevalainen in

grow,” said Antti Asikainen, Professor of Forest

tural change in the forest industry, combined

Kesla’s Stock Exchange Release on 4 August

Technology at the Finnish Forest Research In-

with the weakened demand for products and

2009.

stitute Metla, in Kesla’s 50th anniversary his-

high stocks of raw materials, slowed down the

Positive signals of economic recovery were al-

tory.

cutting of commercial timber.

ready on the horizon, but there were doubts

133

“Kesla’s history is as long as the history of mechanisation of forest work in Finland.

The structural change that has taken place is irreversible – there is no going back to human labour felling. Finnish machine manufacturers have taken hold of the market and mechanisation continues to grow.”

- Antti Asikainen in an interview on 16 March 2009 -

134

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#yourlifetimematch - Close-up Kesla 2010–2020

136

#yourlifetimematch Kesla Oyj is a machine engineering group specialised in the development, marketing and manufacturing of forestry and material handling technology. It produces high-quality material handling solutions that integrate with the client’s base machine, create a fantastic user experience and boost the client’s business activity. Kesla’s activity is focused on three business areas: tractor attachments, logging equipment and truck and industrial cranes. The group’s turnover for 2020 was €40 million, of which 70% was attributable to export operations. Established in 1960, Kesla has production facilities in Joensuu, Kesälahti and Ilomantsi, as well as a sales office in Appenweier, Germany. Kesla employs about 250 people. Kesla’s A series shares are listed on the Nasdaq Helsinki Ltd.

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Kesla Oyj Kuurnankatu 24 | Joensuu www.kesla.com Metsolantie 2 | Kesälahti

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