Mr Zigmas, did you always know that business was your path, and what was it?
Until 1991, we had a number of successful businesses in Kaunas with various partners, but after the restoration of Lithuanian independence and a visionary view of the opportunities to do business in the port of Klaipeda, we took a risk and directed our investments towards setting up a business in the port city.
What was the beginning of doing business in Klaipeda?
First of all, it is fair to say that the move to set up a business in Klaipeda was extremely risky, as we did not have the territory, the necessary machinery and, last but not least, we had limited knowledge. However, we understood the need for importing goods from the West at that time and we clearly realized that the connecting link was none other than transport. Therefore, we decided that the company we were setting up would focus on Ro-Ro ships and containerized cargo in the port of Klaipeda. So, with a concrete vision in mind, we set out to build a company. We entered into a consortium with West Ship Repair, because there was no other possible legal form for renting berths in the port and operating. In the first year of operation, we faced the challenges of acquiring equipment and financing it. It may sound strange, but at that time Lithuania did not have a business credit system and the emerging banks were offering loans at 120% interest. We had to look for other ways to buy the equipment we needed for the terminal on more favorable terms. Nevertheless, in the first year of the company’s operation, we handled as many as 266 ships and became the first company in the Port of Klaipeda to start handling containers to and from ships.
This was followed by continuous investment, expansion, equipment acquisitions, team growth, customer growth, cooperation with the world’s largest container lines, and in the 30 years of operation we have grown into one of the leaders in the Port of Klaipeda.
What makes a successful business?
Clearly, it’s people. The team. Experts and professionals in their fields. The most valuable thing a company can have is not machinery or equipment, but a team that achieves the company’s objectives and helps it to achieve a unique position in the market.
Today, KTG is successfully managed by your daughter Ramune. When did you notice that her personal qualities would be a good match for the business?
I would like to start by saying that there is more than one family business in Lithuania that is not run by children and I am extremely happy to hear from my business peers that my duo and Ramune’s duo is an example of family business success. I am therefore grateful to her for taking on a difficult responsibility and keeping the business in the hands of the family.
And I noticed her strengths and qualities for business when she was still in Grade 12. That was when Ramune’s special concreteness, language of numbers, expression of reasoned positions and opinions, and her extremely responsible approach to finances became apparent.
With my daughter taking over the leadership of the KTG, it is likely that active involvement in the business has become secondary, is that right?
Of course the workload is different. After all, one of the objectives was to have someone with youthful energy, with a new approach, with a new vision and vision and direction. But I am not distant, because I am still Chairman of the Board of the KTG and involved in decision-making at a strategic level.
What do you see for the future of KTG?
This year marks the 30th anniversary of KTG and in order to move forward, we must always ask ourselves: what can we do better in our work than we did yesterday? Only this approach will take us forward for decades to come, and I see them as ambitious. It is also unwritten between Ramune and myself that our business should remain in the hands of the family and be continued by the third generation.
Mrs Ramune, you grew up surrounded by business since childhood, how did that feel?
It’s not about feeling, it’s about perception. Looking back, I remember very clearly that from the age of 11 I knew I was going to be in business. Although there was nothing consciously preparing me for it at that time, I saw my dad taking on different businesses and organizing, planning, implementing and managing them all the time. Even then, I was fascinated by the business processes that I was informally involved in, and I realized that I wanted to be like Dad.
When did you become part of the port-managed companies?
In 2005, a position opened up in the Sales and Marketing department at KCT, so I organically took up the position of Deputy Commercial Director, and in December, the position of Commercial Director. I was responsible for developing the marketing strategy, presenting services to customers, representing the company at international events, etc. It was not easy, because in the logistics sector, almost 20 years ago, the biggest challenge for a young girl was not knowledge or competence, but the attitude towards a young woman in an almost 100% male business. Only time and consistent work laid a solid foundation of cooperation with partners and customers who were more interested in quality terminal handling services than gender.
You spent 10 years at KCT and were appointed Director of UAB ,,Klaipėdos terminalo grupė” in 2015. Why was it decided to merge the companies under one management umbrella?
Working at KCT and interacting with clients from all over the world, I have seen how different businesses operate, how family businesses can be managed productively, by finding greater synergies between existing activities and businesses, optimizing’s certain processes or using financial instruments more effectively. This idea of merging the businesses had been in the back of my mind for months, and when the time was right, the decision was taken to manage the companies through a main management company.
What were the challenges of taking on the position of CEO of KTG?
First of all, we agreed within the family that there would definitely be a change in the management of the company and that it would require not only a professional team and time but also patience. I wanted to bring the group together and for all the companies to work as partners rather than as individual organizations. The aim was to centralize certain functions so that there would be no inefficient management or duplication of operational functions. Ensuring a smooth implementation of the change process was a key challenge with the team. And the word “change” is in principle already a source of resistance, so when we started to make systemic – administrative – changes, we had to deal with different reactions. Some rejected, some accepted, some laughed, but at the finish line we see a great result. Although I could have been even more decisive in this whole process than I was in being very humanly understanding.
Let’s look to the future. What are the challenges ahead of you and what is your vision for the future of KTG?
Currently, in the management of family businesses, we see that the biggest challenge that is difficult to predict is geopolitics. As an example, we can discuss the performance of our managed cargo terminals in Klaipeda, which is changing due to geography and reflects global issues in the context of cargo. We are just one part of the logistics chain, so any challenges in the logistics sector also affect our business and its performance. The second challenge is working with a team of multi-generational professionals, so it takes a lot of effort to get the team to talk to each other and to find consensus and motivation to work together to achieve their goals.
As far as the vision for the future is concerned, I think it is important not to stop, but to act and focus on the development and growth prospects of the Group’s companies and on the implementation of new projects, not only on a Lithuanian but also on an international scale. The main objective is to grow strong, independent companies that, together with their international partners, are able to match the performance of the major European terminals and companies.
Could you say in a few words where the success of KTG’s business lies?
KT Group’s success is encoded in the following key factors: transparency, responsiveness, experience and a quick response to changing customer needs.
“Klaipeda Terminal Group” includes companies providing cargo handling services from/to ships at cargo terminals, logistics, freight forwarding, ship agency, customs brokerage services, as well as trading in agricultural products and developing real estate projects.