Export companies in rural areas can grow and do well

Rural areas produce not only Finnish food but also export companies. While companies in sparsely populated areas are usually very small, a significant number of international growth companies can be found in Nivala-Haapajärvi area, for instance.

Companies create jobs and the regions offer opportunities. The European Union supports smart specialisation in the regions, which in practice means a broad strategic focus on each region's specific strengths. Research and development driven by companies’ needs can support jobs and growth, or the vitality of the region, through innovations and new investments.

Resilience has become a topical concept and a buzzword

Resilience can be understood as flexibility in the face of change. The resilience of a region means its ability to anticipate and recover from such shocks as structural changes caused by the closure of a large enterprise, and the ways of strengthening it include education policy decisions. The focus on your region’s strengths must be goal-oriented but not too narrow. Oulu's ability to pick itself up after Nokia's mobile phone operations went bust is an internationally famous example of regional resilience. Such recovery is more challenging in rural areas, where all resources are thin on the ground and companies are fewer, which is why the role of anticipation, adequate risk diversification and goal-oriented regional development is emphasised.

Engaging companies in research

In a study focusing on the Nivala-Haapajärvi area, export companies were interviewed as part of a multinational research and regional development project. The prerequisites for boosting a company to the international market include an excellent product and good timing, or an ability for both quick action and sustained work. In this respect, genuine cooperation between different regional actors may be an important enabler, as good local, national and international networks are a key resource when aiming for success. The key message of the interview study was very positive. Export companies did not feel that their location was an important factor affecting their success and growth. While we are living through exceptionally challenging times, the interviewed companies were doing well considering the overall situation.

On the scale of Europe and Finland, a remote location or operating in an area affected by structural change do not preclude success. The location of a rural enterprise is mainly determined by the entrepreneur's place of residence. This possibility can be supported by regional policy instruments, especially by investing in education. The challenge that emerged in the interviews was inability to attract and retain the younger cohorts. This ability should be supported through educational opportunities at the level of universities of applied sciences and vocational institutions that are close by and offer adequate quality.

The companies participating in the study made goal-oriented investments in research and development, but they had little cooperation with such actors as higher education institutions. Most companies seeking growth and internationalisation had a systematic internationalisation strategy. In family businesses, change of ownership often brings new momentum for renewal, growth and internationalisation. The use of digitalisation in companies varies considerably. Companies that export their own products are forced to invest in digitalisation to survive in the market. In this respect, education and research are good partners.

Common operating models need to be developed

The concentration of the population challenges us to develop regional policy in order to find new solutions for supporting rural areas. What is needed is support measures, and regional developers who are able to target them correctly. Challenges have been tackled successfully before this. Skilled labour is a challenge in terms of the competitiveness of companies in regions affected by structural change, and this need can be met by the offering of secondary level and higher education institutions. This offering relies heavily on the foundation that high-quality basic research lays for applied research and continuous learning. The University of Oulu responds to this challenge by continuously developing methods by which companies and other actors can use research evidence to bolster their success.


Katariina Ala-Rämi, PhD, Senior Researcher, Ossi Kotavaara, PhD, Docent, Research Director, and Valtteri Laasonen, Lead Specialist, Consultancy for Regional Development MDI

The article was published in the newspaper Keskipohjanmaa on 31 January 2021 as part of an article series by the staff at the University of Oulu Kerttu Saalasti Institute.