ISSUE 11 FEBRUARY 2010

Historical timeline of Onvest Oy

1913 Businessman Alfred Onninen started a plumbing installation business in Turku, Finland, in 1913. The start-up developed quickly into a successful business operation.

1920 In the 1920s, the business expanded from installation work into heating and plumbing wholesale. The main operation moved to the capital of Finland.

1930 In the 1930s, wholesale grew to be of more importance to the company than installation work. After the Second World War, the company's operations expanded to a number of towns.

1950 In 1950, following the death of Alfred Onninen, Martti Auriala started as the company's Managing Director. Technology was advancing rapidly, and district heating and oil-fired heating were becoming more common. In 1956, the Managing Director's chair was taken by Auriala's son-in-law Erkki J. Toivanen, who energetically embarked on developing and expanding the company.

1960 In the 1960s, operations expanded nationwide. In 1969 ventilation became one of the company's interests.

1970 In the 1970s, the company name was changed to Onninen. Operations were further expanded into electrical wholesale and contracting. The first export projects outside Finland were carried out in the Soviet Union and the Middle East. The company now employed more than 2,000 people.

1980 In the 1980s, the company's network of cash and carry outlets expanded rapidly. The company confirmed its position as the leader of the Heating, Plumbing and Air Conditioning sector in Finland.

1990 In the early 1990s, market leadership was confirmed through major corporate acquisitions and the expansion of the cash and carry business. The company set up sales offices in Russia, Poland and the Baltic countries.

1997 In 1997, a decision was made to clarify the corporate structure of the Group, which by now included nine subsidiaries. The old Onninen adopted the name Onvest Oy and the largest business operations were transferred to subsidiaries operating under the names Onninen Oy and Are Oy.

2000 In the beginning of the 21st century, a large proportion of the Group's turnover was being generated abroad. In 2001 Maarit Toivanen-Koivisto, the daughter of Erkki J. Toivanen, became President and CEO of Onvest.

Don't be afraid to take on a big responsibility.

Maarit Toivanen-Koivisto: Questions and Answers

What challenges is the Group currently facing?

We are currently in the midst of one of the most difficult cyclical crises in our sector. I believe that long-term thinking becomes even more important in these economic challenges. Despite falling demand we need to continue to develop operations.

As we pilot our family company onward to future generations it's important for us to keep a spread of business risk among our four sectors:

• technical wholesale services;
• services for contracting, maintenance and renovation of properties;
• investment activities;
• property activities (leasing and real estate development).

What principles guide the Group?

Our principles are:

• Long-termism: The company is developed in the long perspective, factoring in the economic realities. The cornerstone of our finances is steady growth, good profitability and high solvency.
• Retaining ownership within the family is a choice that communicates long-term commitment.
• Responsibility: Responsibility makes itself apparent in the strong ethical principles which guide our operations. Responsibility is emphasised in our human resource policy, in our long-term relationships with the society that surrounds us, and in the goal of responding to customers' changing needs.
• Development: To stay a reliable and valued partner, we need to constantly improve operations. Retaining competitiveness demands the ability to innovate as well as the ability to adopt new things rapidly.

On a more personal note, what was the process by which you become leader of the business?

My father allowed me to work in the business but never encouraged me to think of myself as the potential leader. He was of the generation that went through World War II and had quite traditional views on the place of women. He never told me very much about the business that he led for over 40 years.

The day after my father died, I sat in his office with my mother and we knew that we faced a huge challenge. At that point I had not even been a director. I had to learn a lot and learn it quickly. I soon realized that quick decisions could lead to costly mistakes. But we learnt to live with the situation and manage it.

When it was a possibility to become CEO, one of my first thoughts was: 'I have four young children, I can't do it.' I used to do so much for them. But it's amazing how they can adapt to situations and get on better than you might expect. And there are people who can help you. I think that my father would be proud of how things have turned out. So I say to others: don't be afraid to take on a big responsibility!

Have you benefited from academic programs and research into Family Business?

I went on the program at the IMD Business School eight years ago. It was useful to find out in advance what might cause problems and study possible solutions. If something is in the future, it's a challenge. If it's in the present, it's a problem. And if it's in the past, it was a disaster!

I think it is useful to have the possibility of interaction with academics. When you listen to a presentation or read a business case then it's possible to follow up with the academic behind it.

What do you see as the benefits of the Family Business Network?

It's useful to talk to others who face similar challenges as there are always new stories to listen to. It's also useful to build contacts with Family Business leaders in other countries. I think the Next Generation work is very important as it is international and offers opportunities for training.

How would you summarize the benefits and challenges of Family Business?

When you have strong family relationships underlying a strong business, you are in a doubly strong position. But if the relationships and the business are suffering, you are doubly weak.

So family business is a double challenge - and that's why it's so important to connect with others through the Family Business Network.

Without it, families can feel very alone.

In this issue

Marrying into the business What is it like for people to marry into a family business?

How families manage risk Taking risks is at the heart of entrepreneurship.

How to build trust during difficult times
Trust is a special form of business capital.

Never waste a good crisis (Part I)
Family leaders came together for a unique "ideas café" at the FBN's 2009 International Summit.