Finnish first

Find out how Finland is gearing up for a new wave of innovation.

In an age when manufacturers are commonly outsourcing production to low-cost countries in Asia, one nation appears to be bucking this trend. Famed for technology as much as for design, Finland is keeping much of its production on home soil, if the activities of some of its leading brands are anything to go by.

Moreover, this small country is seeking to bolster its position within the global marketplace with the launch next year of a national 'innovation university' that will bring together technology, design and business to develop new innovatory products.

Finland's history as a design powerhouse goes back to the 1930s and 1940s when artists and architects alike played a key role in developing innovative glassware, porcelain and, of course, modernistic furniture and home interiors. One of the leading figures in this movement was Alvar Aalto, an architect born in 1898 who became known for his experimental approach to bending wood and creating iconic designs for chairs.

In 1935, Aalto and his group of 'humanist modernists' founded Artek, a company whose purpose (and name) was to combine art and technology. The business is still thriving today and makes furniture using the same hand-crafted principles and natural materials, as well as the original designs.

Aalto conceived these designs as being 'democratic' in the sense of being available and affordable for ordinary people, but these days the high quality and originality of the products inevitably bring a premium price tag - although Artek stresses that their durability makes them products for life, and therefore greener than many similar products.

Finland is obviously proud of its tradition of high-value design-led technology, which encompasses a range of consumer products from stainless-steel kitchens (the Stala brand) to mobile phones (Nokia). But the country is also aware that it will increasingly need to compete in the global manufacturing marketplace, where quality goods can be made cheaply in Asia - as Nokia itself was soon to realise - and where Finnish products will need to make the most of their unique selling points (USPs).

User-centred design

"Finland is a small nation trying to survive in a global world," says Professor Pekka Korvenmaa of the University of Art and Design in Helsinki. "We're realising that design is a key national asset."

He says the 'design business' of 1990s Finland has now become the 'design economy' - as evidenced by Nokia's success in inextricably linking innovation in both design and technology. The challenge for Finland, Korvenmaa suggests, is to "reconceptualise our business behaviour with new radical innovations that involve user-centred product design".

In simple terms, this means treating design as more of a commodity. As well as Nokia, another good (but non-Finnish) example of this is BMW cars, he says, which manage to combine unique design with mass appeal.

To promote user-centred design as a key plank of Finland's future business success, the government is investing €700m in the planned Innovation University, which is due to be launched next year. In recognition of the nation's architectural hero, it will be called Aalto University and will bring together three existing institutions - the University of Art and Design, the University of Technology and the School of Economics.

But in an age when Swedish giants such as Ikea can thrive on mass-production of low-cost versions of Artek-style designs, what does the future hold for Finland's high-class, high-cost products? For Korvenmaa, the answer is to create a new "innovation generation" that can merge technology, design and business nous to produce high-quality usable products that have wide appeal.

A key plank of this strategy is also sustainability - which has always been at the heart of Aalto's designs. The promotion of user-centred innovation, Korvenmaa says, goes hand-in-hand with helping to "solve global problems".

Whether Finland, whose damaging recession of the 1990s is still fresh in the nation's memory, will be able to make this strategy a reality remains to be seen. But there is evidence among companies large and small that the user-centred design philosophy is already being taken on board.

Practical art

Rocla is not a household name in Europe, but the Finnish forklift truck maker's products also go under the banner of the better-known industrial brands of Mitsubishi and Caterpillar, which own shares in the company. Rocla is typically Finnish in aiming to put design at the heart of its products, even though these machines are among the most unlikely candidates for high-class design principles.

However, Rocla does seem to encapsulate Finland's new-found drive for innovative, practical design. The fascias of its forklift trucks can be customised in the same way that Nokia phones can - with a choice of colours and designs that can easily be fitted onto the front of the machines, enabling the client to brand their trucks as they wish. On the other hand, a great deal of research and technological development has gone into making the forklifts more efficient and effective.

A lot of this innovation centres on improving the ergonomics of the truck from the driver's viewpoint, enabling ease of use, comfort, safety and speed. Rocla is currently working on a design concept that some may regard as a little extreme, in that the company's designers are aiming to mirror the 'Audi' experience - referring to the high-level comfort and performance of Audi cars.

The company has taken a similar approach with its next generation of fully automated forklift vehicles. These driverless trucks, launched last year and claimed to be the first of their kind, were modelled loosely on Honda's 'Asimo' robot design, using bold white-and-black exteriors with simple straight lines and a 'face' in the form of a touch-screen monitor providing information and interaction with humans.

Although this automated model is selling in small numbers at present - compared with the Finnish factory's 8,000 plus annual output of conventional forklifts - Rocla believes that the automated version will become increasingly popular as the effects of the 'baby boom' generation kick in, with more older workers retiring and fewer younger ones coming through to fill their shoes.

But does Rocla not fear cheap imitations from Asia? And why does it not make its products more cheaply there anyway? "We're strong in protecting our designs," insists Petteri Masalin, one of three full-time industrial designers employed by the company. Rocla mirrors other leading Finnish manufacturers in believing that it can best maintain its high-value design and technology principles by continuing to make its products at home rather than outsourcing production to, for example, low-cost Eastern Europe.

This approach may work for medium-sized niche manufacturers in Finland, but can outsourcing be avoided for products that have to fight for success in a competitive global market - such as mobile phone technology?

Nevertheless, Finnish companies such as Rocla boast that their USP does not rest on rapid growth and world domination - the company is only at about number six in the league table of European forklift truck makers, by sales. Rocla is not desperate to get to number one because its strategy is to offer unique, high-value products.

Customisation

Another such Finnish company is Stala, the stainless-steel sink maker. Stala's managing director, Tuija Rajamäki, whose father founded the company in 1972, says its USP is the ability to combine high product quality and innovative design with "mass customisation".

The company achieves the latter, she explains, through an innovatory website on which customers can order kitchen worktops that come in 30 different designs with as many as 250,000 variations in terms of positioning, measurements, materials, and so on. And, she emphasises, these customised orders are made and delivered within six days.

"You can't import from China [and get the goods to the customer] in six days. We can't compete on price [with Chinese goods] but we can on customisation," Rajamäki insists.

Stala is also content to be a medium-sized company whose focus is on innovative design and technology that carries a premium price tag but which also continues to sell. "Our challenge [under this strategy] is to maintain a continuous flow of orders for the factory," Rajamäki says.

Innovation in the form of customer-centred design, with designers and engineers working hand in hand, is a key characteristic of Finland's manufacturing nous. Even for a large Finnish company like Metso, which provides machinery and services for paper, pulp and minerals companies globally and turns over €6bn a year, several inhouse industrial designers can be involved in the development of a new machine model.

"Industrial design is integral to our research and development," says Metso designer Petteri Venetjoki. "A wide range of people [in different disciplines] will work concurrently on a project, sharing knowledge and reaching a common language."

But the starting point, he says, is a shared vision and targets. It's difficult to describe the contribution of pure design principles to the development of a huge papermaking machine but, says Metso marketing chief Ilkka Hiirsalmi: "We've had industrial design [in the company] for the past 36 years, and in the past 15 years our customers have been seeing the difference in terms of functionality [of our machines]."

Such functionality is also key to the success of companies like Fiskars, a leading maker of garden tools, and Suunto, which makes sports precision instruments such as watches for divers and orienteerers, according to Professor Korvenmaa. And both these companies still make their premium goods in Finland.

Spirit of Arabia

But perhaps the epitome of Finnish product design is a medium-sized company that was founded by a Swede in the 1870s to make homeware for the Russian market. It went on to produce the world-famous brand of porcelain, Arabia, named after the district on the outskirts of Helsinki where the factory was founded.

The brand's Finnish parent company, Iittala, proudly points to its debt to Alvar Aalto's wife, Aino, who in 1932 beat her husband in a glassware design competition. The company still uses these designs for glassware today. The Iittala group now encompasses a range of brands including Fiskars and kitchenware maker Hackmann.

Iittala considered outsourcing production of Arabia products to Asia but decided this year to keep manufacturing solely within Finland and Scandinavia. The simple reason for this, says communications manager Lotta Knuttinen, is that the company's success is due to its modern Scandanavian designs that have been created by artists-in-residence. To start producing these high-value goods outside of its homeland, with the label 'made in China' rather than 'Finland', could seriously undermine the brand.

And it is precisely this Scandinavian brand value that Finnish manufacturers and the government are seeking to protect and foster with the new design-and-technology strategy that is centred on the university education system.

As the UK government strives to develop manufacturing innovation in Britain through partnerships with industry and academia, its policymakers could learn from Finland's bottom-up approach of investing in free university education in design and technology to encourage fresh ideas and entrepreneurship.

If Finland succeeds in creating its new generation of forward-thinking industrial designers, it could leave Britain trailing in its wake as it engenders more world-beaters in the image of Nokia.

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