INTERVIEW WITH MR LORENCIN (AITAC’s CEO) ON 15th ANNIVERSARY OF THE COMPANY: "Rebelliousness and creation are our motivation!"

 

With the approach of the 15th anniversary of the company, we hereby present an interview with the owner of AITAC, Mr Lorencin, in which you can learn how his entrepreneurship journey started, read about his personal motive to start the journey, about the challenges he faces, as well as his view of the whole naval industry in Croatia.  

 

1.      AITAC group has three successful branch companies (AITAC ltd, AITAC GmbH, AITAC Schiffabu GmbH), with over 200 employees and runs numerous successful naval engineering projects. Can You please tell us shortly how it all started and what is the result of 15 years of entrepreneurship and experience?

It is difficult to define strictly when and how it all started. I guess the first seed was planted when I was 3 or 4 years old, when I named myself “Marijan-Brod” (Marijan the Ship – English translation). From that moment on, everything in my life was dedicated to ships, sea, my sailing, up to naval engineering studies in Rijeka, getting a job in the branch and then starting own company later in life.

The idea of entrepreneurship started forming in my mind back in 2004, partially as realization of dream and encouraged by personal dissatisfaction and frustration of my own status and status of shipbuilding in Croatia in general.

The result has been mentioned in Your question; today AITAC is a respectable group of three companies, recognised in the world and around Europe by well-known companies; differing from its competitive companies in several factors. Firstly, in its attitude and culture as part of each employee, then in its ownership structure, and finally in a wide variety of services offered by the group.

The ownership of the company is my personal, unlike most competitive companies which are mostly or partially in foreign ownerships and offer a much smaller range of services in naval engineering. Such wide range of services are usually offered by larger group of companies or corporations, almost never by AITAC size of companies.

 

2.      In Your opinion, what is the basic purpose of AITAC business, what is the higher goal that You wish to achieve or the need You want to satisfy?

 I would like to, and am constantly trying to, make AITAC an inspirational company, constantly learning and improving in all segments, and to satisfaction of all employees, as well as, obviously, clients. As such, I would like for it to have a positive influence on our society as well. I think the purpose is well worth, and we have already become a recognised brand.

 

3.      What is AITAC’s biggest accomplishment in the 15 years that it has existed? What is for You personally the accomplishment You are most proud of?

Thank You for this question, the answer here is quite straightforward. From all the things we have worked on and finished so far, I am most proud of our excellent team and the culture that team spreads and emits. It is my opinion that we have already become well-recognised by that in our surroundings and within our clients. We accept challenges, communicate openly, and discuss all decisions. I am proud to say that the entrepreneurship spirit is developed, and it is not on rare occasions that our team members approach us with new ideas on further expansion, enlargement, or diversification of the business.

I am often impressed with my own team and the way they accept certain challenges we are faced with; they often develop the ideas much further than I have initially assumed possible or planned.

The company culture is something we pay much attention to, and constantly and actively work on.

 

4.      When we talk about success, the inevitable part of success are also failures, as well as challenges. Since challenges are an integrated part of your mission and business, can You perhaps single out the biggest failure that the company faced and how you have managed to overcome it?

It is obvious that failures are an inevitable part of the whole story. Finally, each failure brings us closer to success. Not a single successful business succeeded on the first try. What is important is how you see failure, and how you deal with it: it is important not to despair but to accept it as part of the journey and, most importantly, learn something from it. Since this is our attitude, it is hard to single out something that would qualify as complete failure. It is my opinion that we are quite cautious, so there were not too many cases anyway. There were some occasions when we chose wrong people for the wrong positions, which in essence hurt the most. Also, we have recently worked on a project which has taken an unexpected turn. Here, the responsibility lays on the Board since we have not followed through adequately. We have even reacted too late, but we have reacted after all. At that moment, the culture I have mentioned previously was what helped us. When we switched on all alarms, the team activated overnight, and worked extremely hard on damage control and minimising the consequences. Once again, we learned a lot, which is the most important thing.

 

5.      As a company, what is the business challenge in the near-by future that You are most looking forward to?

I am personally always the happiest when we have an opportunity to work on something new, something different. Currently we work on expansion to a new market, both in a geographical sense as well as in services and ship types we are working on.

I would prefer not to mention the details here. They will have been heard of (ha, ha)!

I am also looking forward to the work ahead of us, spreading the culture to new employees, the employees we acquired from other companies and who come with new experiences. Watching them integrate is wonderful, and us “residents” have an opportunity to learn from their positive experiences from other companies. This requires open communication and acceptance of different mindsets and business views.

 

6.      AITAC ltd. company has won numerous professional recognitions, and You personally have been named Manager of the year 2016 by HUM-CROMA, and, yet, You are not much present in local media? What is Your opinion on shipbuilding or naval engineering representation in local media?

I think there was a time when shipbuilding was constantly present in media, but, unfortunately, in a negative context. There are so many beautiful stories that have not even been mentioned in the media. It is hard to distinguish the cause from the consequence but for a long period of time, the politics have been uninterested in shipbuilding; mainly because it has been watched through a prism of failed shipyards that were exclusively discussed even in media. Due to a lack of understanding, Croatia missed to board on two significant “trains”.

Today we could have been a significant name in Mega Yacht industry, and a number one in small vessels production.

The future brings a new era of electric vessels and vessels with other engines, and I sincerely hope that we shall not miss this train.

 

7.      As a company, you are exclusively oriented on foreign markets. How difficult was it to build a brand in a foreign market and concur to leaders in the industry?

Extremely difficult. It still is difficult and represents a constant struggle that needs to be overcome. It should not even be regarded a struggle, but a day’s work. I was lucky to have started at a different time when Croatian engineers were cheaper than Western-European ones. Today, that is no longer the case. If you cannot concur with the price, you need to offer something else, something to make a client choose you over someone else. Price, deadlines, and quality are no longer the only valuables that sell you. Integrity, responsibility, consistency, and temperance are only some of variables in the formula of success.

Today, AITAC is well-known on the international market, and each of our employees is an ambassador of that name.

 

8.      Can You picture AITAC at its’ 30th anniversary? What values and organisational structure do You wish to pursue among Your employees in the following 15 years?

Honestly, I find it difficult to foresee the future when everything changes daily. I started in a living room, 15 years ago, with my own personal set of values which I manged to incorporate into AITAC team. Today, we preserve the same values, and I hope that in the future, even in 15 years from now, it will be cherished as well. One of the main characteristics of AITAC is its adaptability. AITAC has been developing and growing, and it is quite possible that we shall over time adopt some new values. It is impossible to equally run a company of one, ten or several hundreds of employees. What I can promise is that the values shall never be opposed to my personal moral and ethical values and that I shall always represent and actively work on them. At AITAC’s 30th anniversary I shall be 62 years old, and the world will quite probably be unrecognisable compared to what we know today. No matter what, I believe I shall still work toward the same goal – to make AITAC a company whose name and work cause positive respect, a company that raises the bar higher!

 

9.      AITAC is one of the three biggest naval engineering design companies in the region, considering the number of employed and its revenue, but, however, the biggest regional companies are mostly owned by foreign companies. Is it hard for you to find staff and how can You as the employer be concurrent to other companies that are backed by foreign capital and imposing names?

That is an interesting question that needs an elaborated answer. Of course, it is difficult, it always has been. Mainly because of, as You pointed out quite precisely in Your question, foreign ownership. We had to take the harder path, since most potential employees shall choose a well-known company with foreign ownership, rather than Marijan Lorencin’s company.

However, things have started shifting, and AITAC is no longer an unknown brand. On the other hand, private ownership allows us to define the direction of development as the one which we choose as adequate, with no need to follow wishes of a foreign owner. All of that makes us more flexible with regards to decision-making.

It is also impossible not to mention the current COVID crisis, which we have entered steady on our feet partially as result of my personal responsible manners throughout the years as owner. We have encountered major downturn in business, just as everyone else, but as the owner I have not been put in a position to choose profit over humans, unlike large corporations. I think this has been recognised by our employees, and they value to have an active owner whom they can look in the eyes rather than a corporation with its headquarters somewhere else, especially during crisis.

 

10.      Let us talk about Your personal role in this successful entrepreneurship story. Currently, You are both owner and manager of AITAC – which one of these two roles is easier to perform, and which one do You prefer? How important is the manager/owner in company’s success?

That is such a complex question! Both functions are challenging on their own, and the combination of the two can sometimes be a nightmare, especially if performed by a person who have strong sense of responsibility.

A person can be in self conflict, since the two functions can have diametrically opposing goals. As the owner, you expect to have a profit from the company you invested into. A manager is outranked by the owner, and he is therefore responsible for achieving the profit, but also, at the same time, needs to channel and distribute resources smartly so all stakeholders are satisfied – owner, employees, government, banks, suppliers etc. The equal distribution of satisfaction amongst everyone in the chain is, the more successful a manager is.

In this sense, it is particularly important for the manager and owner to be well-coordinated, they are the ones who provide guidance and develop the behavioural culture. Your question has omitted an especially important role of a leader, which differs from both the role of a manager and of an owner. A leader is doing right things while manager is doing things right. Leader should have a vision and affect his team with the vision!

Personally, when faced with dilemmas, it is the easiest for me to put things in perspective and ask myself what is important for the company in the long run, for the following 3 or 5 years, depending on the dilemma, even 10 years ahead.

Since I took combination of these three roles by will, it obviously suits me, no matter how difficult it can get at times. I am still young enough to enjoy the challenges, and I enjoy working with my team.

 

11.      Can You name a few facts that You think would have helped You, had You known them 15 years ago when You were starting Your business?

I think I knew just about as much as I needed to know (ha, ha!). No, seriously, the pleasure comes from the journey and gathering the knowledge and experience along the way, not by achieving the goal.

Looking back, I do not know if any of the things I know now would have helped me back then. It would probably make me more doubtful.

 

12.      What motivates You to continue with new business projects? Have the motives changed over the years?

Looking back, I can perhaps single out one motive that has been present from the beginning – rebelliousness and creation. To create and build, and to do so in a different manner, constantly questioning existing methods. To try to do things better, create workplaces, but such workplaces where the employees are motivated and satisfied.

I have always been motivated by the development, working with my own team, and today this has become even more important. That has been changed. Today my team motivates and inspires me. Interestingly, they still say the same for me.

 

13.      It is difficult not to mention the influence of current COVID-19 pandemic to global economy. What is Your opinion, how much has global naval engineering industry been influenced by the pandemic?

It is more than obvious that the impact is enormous and has been felt in all aspects of life and work. It is easily comparable to a world war. All economies have been hit, there has been a shifting of assets; life and work methods are brought to question. Unlike previous crisis, this one is quite specific in way that there is no crisis of a financial sector, a fact rarely mentioned. There is an ever-present fear, and even people with resources and projects, opt-out of the investing.

Naval engineering is no exception, but the sector that has been directly and severely hit, and the one we are highly dependent on, is tourism, specifically – cruising. Almost all cruisers were left empty overnight. Without passengers, there is no cash-flow, and consequently, no investments in new vessels and therefore no need for the services we offer.

All projects have been seized. Apart from cruisers, AITAC works on luxury yachts and we had a project there cancelled overnight, and the other one put on hold. The consequences for AITAC have been significant. This was a heavy blow, that happened overnight.

However, only now am I able to see the greatness of what I have achieved over the years. And that greatness is in one very respectable company. We have acted both financially and thoughtfully responsible for years, and in the good times when we had resources, we thought of ways to reinvest it into further development. About 3 or 4 years ago, perhaps in the last minute, we managed to diversify our business, services, and clients.

That decision was the one that got us through 2020 during this crisis, and the result was impressive. 2019 was the year of sudden expansion. We grew 2.5 times. But 2020 was just as successful – we managed to get through with only 5% less turnover than in 2019. The profit itself is much smaller, obviously, but nowhere near a zero or negative. And I consider this a phenomenal result in these hard times.

It is important to mention that most of the team was left over without commercial employment, but we have spent the time investing in the development of our employees and company. We have not had any layoffs, nor any salary reductions. All other unnecessary expenses were cut off, all except for investments and educations.

Today, we understand 2021 will be just as challenging, possibly with a different kind of challenges.

 

14.      We know that shipbuilding in Croatia has a long and significant tradition, our naval engineers are highly appreciated not just in Croatia, but around the world, too. At the same time, we are faced with shipbuilding in a negative connotation, with shipyards of questionable existence that fail to be profitable. What is, in Your opinion, the future of Croatian shipbuilding?

Look, Croatia has a long tradition and still capable people. Croatia has the sea, and 80% of the world transport is still over sea. Many people do not understand that Croatian shipbuilding still exists but has been redefined. Croatian naval engineering has existed through a whole chain of companies such as AITAC, all internationally successful companies.

An entrepreneur shall always develop his company. And as such, Croatian naval engineering and shipbuilding shall always exist, you are just not supposed to look for it in large shipyards.

Croatia, among other things, also has the second largest charter fleet of small pleasure crafts.

Up until now, Croatian politics have made all the wrong moves when it comes to Croatian shipbuilding. They must have had the wrong advisors. Even today, certain minds whose opinion is considered respectable, are proud to talk about Croatian shipbuilding successes from the 80’s, time that no longer exists.

Therefore, with entrepreneurs and a change of politics, Croatian shipbuilding could once again become a respectable brand. As I mentioned earlier, we have a new era of new types of engines ahead of us. Looking through history maybe is time when steam engines was replaced by combustion engines, who knows!? Maybe it would be enough to look at what is going on in car industry, for example.

 

15.      Shipbuilding is quite a conservative industry. How successful will it be in dealing with technological-industrial revolutions laying ahead of us?

Unfortunately, it is my opinion – very difficult. I repeat, all lays on the entrepreneurs, and even we-entrepreneurs will need energy to accept new ideas, young people, and readiness to collaborate. The prerequisite for successful overcoming of such revolutions is cooperation with universities, which is either non-existent or limited now. Not to mention the fact that universities also need to undergo major changes, which they are possibly even aware of, but no one wants to take initiative and start them.

 

       •  My favorite moto is:
I am a fan of proverbs, and depending on a situation, I choose my favourite one. If I must single one out, then it would be this:

“We keep moving forward, opening new doors, and doing new things, because we're curious and curiosity keeps leading us down new paths.” – Walt Disney

       •  The last book I read was:

Mind to matter – Dawson Church (currently reading)

       •  I like to spend my free time:

With my daughter and on sea. Preferably at the same time.

       •  The advice I like to give my daughter:

The same as my father gave me: “Always be honest to yourself and others. Unless you are honest, I shall not be able to help you when necessary.”

       •  The advice I took:

My father’s advice.

       •  The most important thing in work for me is:

Trust built on quality and honest relationships.

       •  I am most impressed by:

Excellence.

       •  A message to future entrepreneurs:

Love, learn, commit!

       •  The future of the Croatian shipbuilding is:

All of us.