Nordic CIO interview: Janne Puustinen, Valmet
Janne Puustinen built Finnish industrial technology company Valmet’s entire IT organisation from scratch after a demerger
In March 2013, Janne Puustinen faced an unusual situation. He was an IT director at Finnish industrial engineering giant Metso when the decision was made to demerge the corporation into two independent listed companies.
Puustinen was given nine months to build an entirely new IT organisation for what would become Valmet, an industrial technology company with more than 13,000 employees worldwide.
“It was a new challenge for me,” says Puustinen. ”My responsibility had been IT for one of Metso’s business divisions, and I got all our infrastructure services from group IT so I could focus mainly on business applications. Infrastructure was a new area that I suddenly had to learn more deeply than ever.”
Presented with a limited timeframe, Puustinen took an efficiency-based approach. Initially, the two demerging companies floated the idea of transitional service agreements and providing selected IT services to each other. But Puustinen and his colleagues opted against that, and instead copied Metso’s existing IT infrastructure and rebuilt it independently for both companies.
It was no easy task. The work had to be done while Metso continued its normal operations. Puustinen calculated that the IT department performed the equivalent of 7,500 days’ extra work during the last half of 2013 – but still had no time for any real technology changes.
“It was very much a quick and dirty approach,” he says. “But in hindsight, one of the biggest lessons we learnt was that it was absolutely the right way to do this. If you continue to have shared IT services, which are built deep into your operations, you can’t truly develop a company independently. One big bang is better than continuous whining.”
Now Puustinen runs a well-functioning IT team of 150 people, and IT has been made a strategic part of Valmet’s operations. It is now a long way from the company’s early days when IT only had time to focus on keeping services going.
“One big bang is better than continuous whining”
Janne Puustinen, Valmet
“At the start, it was just about survival,” he says. “We mostly reported about the problems we had, not about the development we were going to do. But if you look at our annual plan now, around 75% of our IT projects are shared [development] projects with our business functions.”
This has not gone unnoticed by Puustinen’s peers. In 2019, he was named Finland’s CIO of the Year by Finnish IT magazine Tivi and Nordic CIO of the Year by Helsinki-based Management Events. That was not what Puustinen could have imagined 24 years ago when he started at Valmet as a mechanical engineering graduate. Then, an IT career wasn’t even on the cards.
“I started in R&D,” he says. “It’s a great place to begin a career, no matter where you end up. R&D has many of the elements that are valuable to learn at the start of a career. The birth of everything new, innovation, being forward-looking – and finding out if something doesn’t work or can’t be done. In other words, accepting failure through trial. That is very trendy nowadays.”
For Puustinen, IT came into the picture in 2003 when he was asked to head IT for the Metso business unit that would ultimately become Valmet. Although coding was close to his heart in his free time, he had only ever done a few weeks’ worth of IT-related studies – but that didn’t slow him down.
Outsourcing IT services
After the demerger, Puustinen’s approach was to move Valmet’s IT focus to development and new services. When the company first started, it had about 210 IT employees and almost everything was done in-house. Puustinen changed this in 2017 when Valmet outsourced its IT infrastructure services to CGI.
Two years later came an outsourcing deal with Capgemini, which covered Valmet’s IT application development and maintenance services. The two deals saw about 80 people leave Valmet, but also opened up new roles within the company. Still, Puustinen doesn’t like to use the word outsourcing.
“Instead of doing a lot of operative service production and maintenance in our organisation, we wanted to do more future building together with our business side,” he says. “We moved our operative jobs [to CGI and Capgemini]. This created savings which we could use to fund development work and shift our IT towards supporting future development.”
Puustinen is pleased with the results so far. He says there are always some small issues, but the main elements of the transition have succeeded. Reflecting on lessons learned, he emphasises that outsourcing projects should not focus on the transition itself, but to keep the focus on what follows. This is where the real value comes through as efficiency and quality are improved.
The same applies to internal projects, he says. Valmet is currently rolling out a new enterprise resource planning (ERP) system across 150 offices in 35 countries. The project, in which Valmet is moving from Infor’s Baan ERP to its successor, Infor LN, began in 2016.
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“We don’t see any of the benefits while we are developing the new system,” says Puustinen. “It takes millions of euros, but the benefits will only come when people adopt the new way of doing things. It is the same as with outsourcing cases.”
This means not only celebrating finished projects, but highlighting small successes, he says. Stereotypically, Finns have trouble with self-praise, but Puustinen thinks this is an important part of selling a project within a company. Real success cases, even small ones, help to raise morale and boost support for a project outside, as well as inside, the IT department.
Valmet’s IT has now reached the stage where it can focus on the future. IT is at the core of the company’s operations, so talk now inevitably turns to digitisation and innovation.
“I have slowly started to hate the term digitisation – it’s such a buzzword,” says Puustinen. “But the new things we are working on are typical digitisation things. These are intrinsically linked to what we can do with data.”
Puustinen mentions analytics, automation, artificial intelligence and machine learning. These are already part of Valmet’s technology portfolio, but they are not widely used – and that is what Puustinen wants to focus on next.
“I don’t mean product development, rather what new technologies can enable for us,” he says. “We need to drive this type of innovation from IT. Not everyone can follow technological changes, and it isn’t part of their job. But it is part of ours.”