ABB is a global leader in technologies for energy and automation. In Poland, the company employs more than 8,500 people, has 11 factories and sales offices in the country’s major cities as well as an R&D centers in Krakow.
ABB has a truly impressive footprint in Poland. What makes the country such a good location for your business?
There are many reasons behind our commitment to Poland, firstly historical ones. The changes that occurred in Poland in the 1990s brought our management to the conclusion that it is a good place to invest. ABB Group, as one of the first global corporations, invested in Poland in that time and engaged its capital and technological expertise in companies which were of key importance to Polish economy and energy infrastructure. This also allowed these companies to adapt to new economic reality, which amounted to the strong presence you see today. A second reason was access to workforce.
Starting out our investments were geared towards production, about 70% of our workers were blue collars. But eventually our management realized what excellent engineers Poland has, and shifted focus on engineering capabilities and R&D.
The employment structure changed accordingly: we now have 40% blue collar and 60% white collar staff. I would like to emphasize, that at the same time we have increased the total number of blue collar employees.
The projects you have developed here cover a very wide spectrum, from power plants modernization, power grids, renewable energy etc. What are the key drivers for your business presently?
We have five business divisions here and the largest from a demand perspective is the business focused on energy sector. Investment is coming primarily from private entities, less so on the government side. Especially in the power sector investments went slightly down.
The rolling stock has been fruitful for us recently. We have three large rolling stock factories and have been delivering a variety of components. The same goes for renewable energy - we saw some slowdown in the past but now the country is investing more and more. We are all waiting for offshore wind - if the plans of its development in Poland will be implemented, we expect to be involved in the projects in this sector in the following next years.
We see growing interest in automation of processes in control systems in the energy sector, for examples in microgrid management and energy distribution. The need for increasingly autonomous management requires complex algorithms and support systems. We are committed to develop solutions that drive digital transformation of industries.
You have an R&D center in Krakow, can you give us examples of innovations that have come out of there and serve the energy sector?
We are very proud of the system we implemented for the Warsaw metro, which recovers and stores braking energy from decelerating metro cars and makes it available again for acceleration. This special feature helps to reduce operating costs, while enhancing energy efficiency.
Like our peers, we work very hard to develop energy storage technology. Now there are only small and medium applications available but it is time we come up with large ones.
How forthcoming is Poland’s energy sector in terms of adoption of new technologies, compared to other industries or countries in the region?
We still have a lot to do to catch up on the level of Western Europe in terms of adoption of new technologies. In my opinion, we're about few years behind Western European countries and it seems that for many companies there are other investment priorities than new technologies. However we can see that this is changing.
Energy savings are of great importance here - it's a global trend to reduce CO2, but also because Poland has some of the highest prices of energy in Europe. Customers are naturally quite interested in the solutions we offer in this field and that's a great sign that they're getting more open to innovations.
What typically holds companies back from adopting new technologies at a faster pace?
It usually boils down to money. Labor costs in Poland are still competitive to other European countries, so companies here are less inclined to automate their processes.
While innovation always pays off in the long term, it still involves an initial investment, which is more challenging in CEE economies.
We can also observe some mistrust of the companies towards new technologies. They want to see such technologies in action before investing in them. Luckily, there are more and more modern solutions that have already proven to be efficient and can be observed live, so it helps to overcome fear of investors. ABB has an extensive experience and a lot of success stories that show how technology adds value to our customers operations.
Looking at the near future (2-3 years) what are the priorities for your business?
The main focus is on delivering the growth, continue to keep focus on people development and to finalize organizational changes. We will carve out the Power Grids business and create a joint venture with Hitachi in 2020.
Do you have a final message for investors that are eyeing the Polish market?
Do not be afraid. This is a great place to be, the market is huge and will continue growing. We must spend money to reduce CO2, energy infrastructure needs upgrading so there is significant work to be done here for at least another 30 years.
