Challenges for the Lithuanian industry sector: what solutions will help to strengthen companies?
The disruption to businesses during the pandemic highlighted business weaknesses, including insufficient or non-existing digitalization, as well as supply disruptions in various industries. The pandemic will pass, but new challenges will arise in the future and the problems will not disappear; therefore, it is necessary to take care of strengthening business now. Specialists and experts discussed the preventive solutions that can help Lithuanian industry to grow resilience at the event “Industrial Digitization – How to turn this challenge for business in the Panevėžys Region into an opportunity?,” which was initiated by the Panevėžys Development Agency.
One way for companies to grow stronger is to join forces and find common solutions. We have industrial alliances operating in the European Union, which constitute a promising space to look for partners for your business.
“Companies should consider participating in the activities of alliances and more actively use the advantages of being a member of the EU,” says Mantas Pupinis, Research Manager of the LLC PPMI Group, adding that it is also possible to participate in other European Union projects.
Exploiting opportunities for cooperation
In addition to cooperation with companies, collaborations with universities are also worth considering. The PPMI Group is currently preparing a study entitled “Integration of Lithuanian industry into European and global value chains,” in which specific insights are already emerging.
“ We recommend cooperation between businesses and universities, based on specific value-creating goals. Businesses and universities should focus on very specific commercialized activities that would provide added value,” says M. Pupinis. According to Pupinis, cooperation should be encouraged by formulating certain missions and projects in which the public sector would expect a joint effort by businesses and universities.
Conviction is a form of cooperation needed for future success
The lack of business networking was particularly pronounced during the pandemic. When the supply chain broke down, companies started looking for suppliers in Lithuania, but one supplier may not be able to fill the gap and fulfil orders. Therefore, according to the Research Manager of the PPMI Group, it is not surprising that the pandemic was an impetus for large companies to seek larger supplier networks.
“Now is a good time for companies to try connecting with big European companies and get involved in their supplier networks. At the same time – while thinking about the networks of our suppliers – it is necessary to consider ways to diversify them,” notes M. Pupinis.
The European Digital Innovation Center “EDIH4IAE.LT,” controlled by the “Lithuanian Innovation Center” (LIC) is an example of successful non-industrial networking, which combines the potential of science and technology. It encourages companies to work together in order to find solutions to today’s challenges. This international project aims to streamline the digital transformation of the industrial, food, and energy sectors; therefore, the initiative has already been integrated into international networks.
“Discussions are already underway, actions are being coordinated, and a competition is being held with more than ten similar organizations in Europe in order to offer a wider range of services to businesses,” says Artūras Jakubavičius, head of the LIC’s Innovation Support Services Department.
Strengthening local business
Growing local businesses can also be an opportunity to enter the international market. “For example, the growth of the Panevėžys region is relatively strong, based on the growth of local companies, compared to the Lithuanian average. A positive strategy is possible for this and other regions with such a tendency, that is to further strengthen local companies and at the same time attract additional foreign investments,” says M. Pupinis.
A representative of the PPMI Group says that it is worth looking at investments wisely and specifically, rather than trying to attract anything that would undermine the existing system and deprive employees of companies that are already performing very well.
Speaking about the case of Panevėžys, M. Pupinis emphasizes that there is no shortage of innovative companies that could compete with many foreign companies. Finland is known for the successful application of such a strategy. “The country strongly supports local industrial growth and takes an openly reserved approach to foreign direct investment; it does not specifically seek to attract companies that can compete with their domestic, national capital companies.”
Panevėžys is a good example in the country
In Panevėžys, the rapidly developing industry applying production automation and digitization solutions can be seen as a good example in the country today. The experts who attended the seminar emphasized that there are opportunities to increase business resilience: all we need to do is to strengthen our overall competitive advantage, expand the scope of operations by connecting European value chains, and make the necessary digital solutions. Furthermore, these actions would allow urban companies to further strengthen their position in Industry 4.0.