Geopolitical uncertainty creates a challenging environment for businesses. Findings from a new survey point to alternative markets and more innovation as ways to maintain growth.

Tariffs and global uncertainty are a challenge for Nordic businesses, but looking towards alternative markets may be one way to compensate for the challenges in the traditional markets.

This is one of the conclusions from a new survey conducted by Ipsos on behalf of Danske Bank as part of Danske Bank’s Sustain Tomorrow initiative. A total of 50 Nordic businesses participated in the survey, and almost 90% percent of these reported that they see moderate or high potential for growth in alternative markets.

However, results from the survey show that the dominant factor for ensuring success is the development of innovative solutions, with 27% of the surveyed businesses highlighting this as a key factor. This, however, conflicts with the fact that the survey also shows that 30% of the Nordic companies surveyed are concerned about their ability to remain competitive when it comes to innovation and technological advancements.

One way of achieving more and faster innovation is by focusing on partnerships. But strong and lasting innovation is also about leadership – both at an operational level and at board level.

A recent discussion forum with Sanna Suvanto-Harsaae, Chair of the Board at Finnair, and Carsten Egeriis, CEO of Danske Bank, reveal, innovation demands much more than big ideas. It requires governance, leadership, trust, and a long-term perspective.

“Perspective is a really, really important concept in the scope and in the thinking of how you make sure that you think strategically and you think long term. Perspective for me is about being able to not just zoom in on the day-to-day and on the nitty-gritty of daily execution, which is extremely important, but also to zoom out, to take a step back. To see what is ‘noise’ and what is ‘signals’ – and what is really important, for you, for your business and in the world we live in,” says Carsten Egeriis.

Innovation in the boardroom
Gaining such a perspective also means increasingly higher stakes for the boards of Nordic companies. In a complex world filled with uncertainty, misinformation and new competition, the role of the board is challenging. And for businesses to stay competitive in the future, board members need to have a strong focus on innovation.

“The operative management is very often involved in the daily operations, and it can be difficult to see further on into the future. And that’s one of the biggest roles that boards have: to ensure that you look further into the future than the operating management can. So the board has a key role to ensure that innovation happens, even in times of turbulence. Top management is there to ensure you have results now. The board’s role is to ensure you also have results in the future,” Sanna Suvanto-Harsaae explains.

But although strong governance and having a long-term strategy can be perceived as the obvious way to go, there remains a need for simplicity – not least in uncertain times.

“If you ask more questions and you keep giving more jobs to the management, that’s the road to catastrophe. One of the board’s key roles is to ask the questions, but they must be the right questions,” she says.

Finding the right questions sometimes requires working in partnerships and looking outside your own organisation:

“Innovation doesn't happen in a vacuum. It happens when businesses have the right financial foundations, when they’re supported by strong partnerships, and when they have the space to think beyond the immediate problem and focus on the bigger picture,” says Carsten Egeriis.

 

Strong Nordic potential
The good news is that the Nordic countries hold a lot of potential. Populations are highly educated, and Nordic societies exhibit a high degree of trust, which can also be a catalyst for innovation. And according to Carsten Egeriis, the Nordic countries have great potential for even more innovation.

“I think it’s in our DNA to innovate, to explore opportunities and to work with others. And to bring Nordic opportunities to life globally,” he says and continues:

“In general, Nordic societies are seen as being quite innovative, you know, very digitalised countries, we invest in research and development. And we have a lot of fantastic global, innovative companies.” 

Sanna Suvanto-Harsaae also believes the Nordic region has untapped potential:

“The best thing the Nordic countries have are our people. It’s an untapped opportunity globally. It’s a highly educated population and a population who have a democratic soul. We need to get more out of this raw material because it can be our global edge,” she says and concludes:

“If we could really get the collaboration going more intensively within the companies and across the Nordic countries, that would give us a huge power and the possibility to be much more innovative and come up with the new things. At the moment, we’re working too much in our own little ecosystems instead of looking at the whole Nordic approach that would give us much more and much quicker.”