The Slovenia Times

Manager Association Boss: Slovenia Needs Quick Turnaround



The general manager of Danfoss Trata, the Danish-owned maker of electromechanical controls, said that managers should not only focus on profitability and development, but also on the company's role in the society as a whole.

Zalaznik, who took over from the former Simobil chairman Dejan Turk at the beginning of April, believes that managers need to take responsibility for the performance of their companies. A condition for a high quality of living is a successful and profitable economy, he added.

His programme as the Manager Association boss also looks to boost innovation and efficiency of companies, increase their ambitions and know-how and promote foreign investment in Slovenia.

"One of the measurable goals of my term will be to increase the average return on equity from the current 0.8% to 5% in three years." If companies fail to create considerably higher profits, the excessive debt of the state and companies will not be reduced, Zalaznik said.

"We need an efficient and cheaper state administration, which would pro-actively support the needs of businesses and citizens," he said, proposing that the part of the state apparatus which is not really necessary be abolished.

Zalaznik also called for a positive promotion of Slovenia abroad to help Slovenian companies find new deals, a more flexible labour legislation, and lower taxation of wages in order to boost domestic spending.

The Manager Association thinks that there will be no breakthrough in competitiveness in Slovenia if the country fails to reform the labour market, health care and pension system, and eliminate systemic corruption.

The association belongs to the circle of employer groups which advocate a cap on the payment of social security contributions. "From my viewpoint, the high taxes paid by the highly qualified employees in Slovenia are, to put it mildly, unfair."

Asked about the association's expectations from the government, public sector and banks, Zalaznik said that it needed the understanding about what helps competitiveness and what hampers it. "I believe that we have a common goal in Slovenia, to live in an economically and socially successful country."

While he is aware that not every strategy can enjoy a full consensus, Zalaznik would like to see the main stakeholders to agree on one strategy which would then be consistently implemented. "This is the aspect of stability which not only the economy, but every common citizen needs."

Zalaznik believes that exporters will remain the main engine of growth, while domestic spending would remain low. According to him, Slovenian exporters are successful because they have restructured on time.

Slovenia's key potentials are people and their know-how and innovativeness. "Supervisory boards should feature experienced, competent and ambitious individuals who will require constant improvement of results from managers."

The association encourages diversity on supervisory and management boards by including young people, women and foreigners as managers, whose skills and competences would facilitate a faster development of the society.

According to Zalaznik, business need to establish closer ties with education and research institutions when developing competitiveness programmes. "Since economic growth in the coming years will primarily hinge on growth of SMEs, we need to establish an environment which will encourage their growth".

As the manager in a foreign-owned company, Zalaznik said that Slovenia needs foreign investments, which are of key importance for Slovenia's development also because of the fact that the country faces a chronic lack of capital.

This is why both managers and the state need to do everything they can to make Slovenia attractive to investors who have capital and know-how. Greenfield investments are the most preferable, but they are not easy to attract, he said.

Selling state-owned companies to foreigners is a more realistic option, according to Zalaznik, who believes that the current government has done a good job so far as regards privatisation.


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