Päivi Hirvola is communications consultant at Eurofacts Oy, a Finnish public affairs and communications agency operating in the Baltic Sea region. Eurofacts is part of Fleishman-Hillard global communications network.
TS Group has been one of Finland's leading pioneers in introducing new technology to newspaper production, and its subsidiary Hansaprint shows the value of a family-oriented approach
In 1860 when Finland was part of Russia, 17 newspapers in various languages were available in Finland. In the subsequent 40 years events changed drastically. By 1900, there were 84 newspapers in existence, of which 56 were in Finnish, with a total circulation of 250,000. Turun Sanomat, a Finnish-language paper sympathetic to the interests of Finnish-speaking nationals, was one of those 56 papers, established on 1 January 1905.
In 1917, at the young age of 28, Arvo Ketonen became Managing Director of Turun Sanomat. His two passions were sport and politics, which both received plenty of column space in the paper. Arvo's ownership of Turun Sanomat increased over the years and by the time he died in 1948 it had reached 72%.
During Arvo's reign as managing director, the paper's total distribution grew vigorously. After he died, the ownership passed to Arvo's young wife Irja and their four children. The business was familiar to the young heiress, as she had worked there as a messenger girl and office worker before her marriage to Arvo. Despite her familiarity with the business, Irja had to learn the skills required by such responsibility and adapt herself to the fact that as a young heiress, she provoked many diverse reactions.
In 1955, at the age of 34, she was finally ready to take responsibility for the roles of Managing Director and Chairperson of the Board. Through Irja's leadership, which lasted over three decades, Turun Sanomat rose to become Finland's third-largest newspaper.
During Irja's administration, the ownership of the paper was concentrated more intensely within the Ketonen family. In 1982, the company was renamed the TS Group, a communications group "that processes and provides information as well as develops, produces and markets graphic products and related services".
Twenty-three subsidiaries sit under the TS Group umbrella, including Hansaprint Oy, Finland's largest commerical printing house and leading graphic media service provider in the Baltic region. Today, the group employs 2,100 people. Irja's eldest son, Keijo, is Managing Director, his brother Mikko is Chairman of the Board and one of their sisters, Taru, has been TS Group's PR Manager since 1978.
TS Group's Managing Director, Keijo Ketonen, began life in a house in which the company still maintains its headquarters and where the editorial staff of the newspaper toils. In fact, the printing office was on the building's ground floor, so it became a familiar place to him in childhood. He remembers creating a mess with his brother in the printing area – and receiving a clip round the ear as a thank you from the printing office manager.
Keijo has done everything that can be undertaken in a full-service communications firm. He has always been interested in the rhythm of the news and used to enthusiastically take messages about the results of big sporting events to the window of the newspaper building for all to see. His first job was that of a messenger boy, and he and his brother were employed maintaining the cylinders of the dictation machines used by the editorial office.
He delivered copies of Turun Sanomat to the various provinces and saw how the countryside would awaken with their newspaper. Keijo's career in a family enterprise, therefore, has not been made from living in an ivory tower. He also has the reputation of being a dynamic man; he is a visionary and entrepreneur known to take brave decisions.
"TS Group has been built around Turun Sanomat. The newspaper has always had its own printing press and Turku has been the centre for printing house-related expertise. The first printing facility in Turku was established during the 1640s in connection with the Academy of Finland," says Keijo, in regard to the origins of Finland's printing sector.
The 1960s brought significant growth to the Group in respect to printing operations. When Irja stepped into the management of the company in 1955, it had been important to ensure the continuation of the newspaper. Thus, the family embraced new technology and the first new printing machine was ordered in 1958. When rumours began to surface from the USA that a computer had been developed for typesetting newspapers, Keijo and Mikko went to investigate.
"In the spring of 1964, the first installations were found. The computers concerned comprised seven pieces and the idea was that these machines would help in large volume work. The machine itself was simple. A perforated tape controlled the printing machines and the typesetting speed was about 15 lines a minute. The progress achieved was amazing – human speed was only five to six lines a minute," Keijo recalls enthusiastically.
The brothers brought three essential items back from their trip to the USA. The most important of these were typesetting computers. The machines allowed for mass production and adjusted very well to the printing of, for example, newsprint and telephone directories. Indeed, the latter became the foundation of the company's printing-related business activities. The other novelty was computer paper.
The brothers decided that these items would be new fields for the family business and set about promoting them. Testing was performed during the summer of 1964 and the first European product, Paimion Kunnan Historia (History of the Municipality of Paimio), to be published by means of a computer-based typesetting machine appeared in February 1965. Following that, TS Group printed the first catalogue, a comprehensive listing for Finland's Postbank.
Embracing technology eventually led TS Group to become strongly involved in the University of Technology project, where a computer monitor for the industry was finally developed. Keijo considers this to be one of the most significant innovations for his family company and the printing industry.
"It was a great boost for the whole field," reflects Keijo about that peak moment in technical development. "Previously, everything had to be done twice. As a result of having this monitor, we were able to jump the queue in the area of telephone directories. Delivery times were shortened and a whole new outlook on image processing emerged."
Hansaprint generates growth
Although TS Group was the first European company to use computer-based typesetting, the company's success and growth are due to technical innovation and the courage to respond to challenges. This is especially illustrated by Hansaprint, which was founded in 1996 and is TS Group's largest and most profitable subsidiary.
While other Nordic printing houses spend their time engaged in various information technology projects, Hansaprint has digitalised the value chains of printing and is now making an effective profit. By doing so, Hansaprint's business has quadrupled in the short span of six years.
One of Hansaprint's generators of growth has been the collaboration of its Salo printing plant with Nokia in the production of cellular phone manuals. Currently, these handbooks are published in various languages across Europe. Along with these manuals, Hansaprint also handles the folder materials, including CD-Roms, provided in the retail pack that comes with the Nokia "Communicator".
"The computer system made close cooperation between the printing house and the client feasible. Hansaprint is the client's partner. Relations have been very close, and the manner of working has, to a large extent, followed a common standard. For instance, issue management at Nokia and our Salo printing plant has been developed hand-in-hand so that they speak the same language," emphasises Keijo. According to Keijo, the boldness required for investments and research is based on the fact that the foundation work is carried out under the company's auspices.
Timo Ketonen, the eldest in the Ketonen family's third generation, is Hansaprint's Executive Vice President. He regards the modern printing capacity and investments in large printing machines as the strengths of Hansaprint. They have made the company's position as a strong market leader in directory and catalogue publishing feasible.
A second significant strength is in logistics know-how, which developed as a result of having Nokia as a client. "I know Nokia quite well. The boom in cell phones and Nokia's growth occurred during the time when I worked in Salo. In 1994, we arrived at a significant solution from the perspective of growth by investing heavily to serve Nokia," recalls Timo.
Hansaprint's third strength lies in the printing of high-quality large-volume magazines, as well as in direct marketing expertise. Another milestone in Hansaprint's growth, according to Timo, is the close cooperation with Finland's largest magazine publisher, Sanoma Magazines Finland.
Though Hansaprint is, at its roots, a Turku-based enterprise, the Executive Vice President draws attention to the international character of this Finnish giant in printing services. In 2001, the share of turnover in export and foreign operations was already about one-third. "Our domestic market region doesn't end at Finland's borders. Our export and foreign activities have grown tremendously. This development is demonstrated by the fact that the value of export is currently greater than Hansaprint's entire turnover was during its first year of operations in 1996. In practice, this means Hansaprint has ventured beyond the national series and has taken its place in the European league," explains Timo.
The substantial and systematic investments made in printing services over the past five years stand behind the TS Group's growth. The services connected with printing – represented by Hansaprint – have clearly risen to make communications the largest area of activity in the TS Group. Among the most important targets in Hansaprint's immediate future are the advancement and increase of export, so that investments are utilised in the best possible way.
With the introduction of the Nordic region's first 64-page heat-set web offset printing press, Hansaprint has become the most modern and efficient print facility in the region. According to Timo's forecasts, Hansaprint has secured an effective competitive edge with its current investments for at least 10 years.
Timo points out: "Printing itself is not a particularly glamorous commercial activity, but we speak of total solutions in graphic communications. Efficiency comes specifically from the information technology solutions-based work stages leading up to and following printing, as well as from the automation of the printing process itself."
Family and non-family
Timo appreciates the work of his predecessors and believes their work helped shape TS Group into what it is today. He feels that he has learned about what a family business is from both inside and beyond it. He has worked outside the family company and considers this a plus. The TS Group has no written rules in regard to family members working within the firm, but all the third generation members have worked elsewhere before joining the family business.
For Timo, the matter was made clear by his grandmother Irja. Her advice was to see the world first and then come back to the family business. So, after university Timo worked in Stockholm in marketing and later in Helsinki and London as a banker. After five years abroad, he felt the call to return home and, in 1993, he found himself at Hansaprint's Salo plant.
In addition, the family does not believe in keeping everything in the family. In the management of the firm, a mixture of family members and external professionals is, in Keijo's view, a necessity. The supervisory board of the TS Group comprises people from family, work, church and university. The family also employs a non-family President, Esa Honka, at Hansaprint.
Honka's career has been devoted to this family enterprise. He has worked for the TS Group for more than 33 years and, in this respect, he considers himself one of the "family". He came to the company as a computer programmer and has been involved with Keijo's projected development effort throughout his career. He transferred from developmental tasks to responsibility for production during the mid-1980s and became President of Hansaprint in 1996.
Honka reflects on his time at the company: "TS Group is a family enterprise that the owning family is actively involved with. The company's a way of life for the family, as is generally the case in family-run businesses and, as a result, the idea is that the organisation should experience things the same way."
The positive outcome of this attitude is that employees are more committed when the owners are a family rather than a faceless entity. According to Honka, strong owners enjoy a considerable share of appreciation among the personnel: "The owners give a company its face, foundations and traditions. Staff members appreciate it when they have a chance to meet the directors and discuss things with management."
Keijo continues: "In a family business, human relations become more concrete and intense. The families of employees are also known and they're involved more comprehensively. At best, work communities function the same way as family communities. For this reason we've tried, for example, to keep smaller units inside the group. On the other hand, we fear inflexibility. Every day, we should keep going forward – if we aren't, we're going backwards."
Appreciation for family members within a family company is not, says Timo, to be taken for granted. "Both my grandmother and my father have acted on the basis that respect must be earned by the work you do. The basic principle is to actually work – rather than just talk about it. Our family's public profile has always been low."
The owners of TS Group have a strong desire to develop Hansaprint. This desire is based on a vision: Hansaprint is a growth company and it must be invested in boldly. The development and business operations of the firm are supported by clear roles within the family. Timo regards his uncle Mikko's commercial know-how and his father Keijo's expertise and breadth of outlook as special strengths.
Timo sees his own role in terms of the strong sympathetic feedback he is able to give in interfacing with clients: "My father's strongest point is his technical vision. It is he in particular who has brought the best to the company of what the world has to offer. Without him, we wouldn't have large web-offset printing presses. The fact that we are a family enterprise has significance for the client. In the beginning, I tried to keep a very low profile, but I've learned that there's no need to hide one's background."
Both Keijo and Timo are convinced that TS Group will remain a family business. "It's difficult to imagine that the family would ever give up its authority in the Group," says Timo. "The purpose is to develop the company's operations every way possible. I feel a powerful bond with entrepreneurship and my roots are strongly in the birthplace of the group in south-west Finland."
Keijo regards the continuation of the company as a family business with confidence. He has designated himself, along with his siblings, as entrepreneurs to the very end. As far as the next generation is concerned, Keijo believes that each individual will find his or her niche. From the perspective of the next generation, he considers it highly favourable that the printing and publishing field is so wide that there's always something that can be offered to everyone.