Lukas Savickas, advisor to the prime minister of Lithuania, highlights the changes needed for the Lithuanian life science industry to become more competitive, while discussing the opportunities awaiting companies willing to invest in the country.
Can you please introduce yourself to our international audience as well as the main points that drove you to your current position as advisor to the prime minister of the Republic of Lithuania?
“The healthcare sector clearly requires major reforms in optimizing the infrastructure as well as in dedicating the funds to clear objectives.”
The journey started when I developed a passion for exploring ways in which the government and industry could collaborate and engage in fruitful and effective dialogue. I had wanted to study abroad, so completed my bachelor’s degree in politics and international relations at York University in England, followed by a masters in the Netherlands. At that moment, an excellent opportunity came up: a program called ‘Create for Lithuania,’ searching for young Lithuanians who had work experience and studies abroad. They offered opportunities to come back to Lithuania for one year to work on projects of strategic national importance.
During that period, I was approached by Invest Lithuania, the Lithuanian agency dedicated to promoting FDI investments in Lithuania. Thanks to their efforts, Lithuania is increasingly assuming its rightful role as a credible FDI destination country. Invest Lithuania offered me a position to work alongside and later lead the team dedicated to improving the competitiveness of Lithuania. After that, I joined a business association called Business Forum, uniting the biggest foreign investment companies in Lithuania. I had actually planned to stay at least a couple more years with the association, but, in the wake of the elections, I was offered my current position as prime ministerial advisor.
What specific mandate were you given?
The goals set for me were to make Lithuania’s business environment the most competitive in the region, and secondly to set about establishing a model of strategic change management right at the heart of the government. From a historical point of view, many governments, not only in Lithuania, come into office with great plans and ambitions, but struggle with the implementation of the new reforms. We are very keen to avert this pitfall and to instead guarantee smooth and seamless execution of the reform agenda. The idea is to create a model and system that enables the government to ensure that the reforms are happening as planned, properly budgeted and rolled out on time.
You got appointed as advisor last December 2016, how would you assess your first year at the Lithuanian Government Office?
It all depends how you value such position. For us it was very important to set clear objectives that we plan to attain within 4 years. In this first year, we have implemented a significant number of reforms, which were dedicated to improving Lithuania’s competitiveness. I am very happy we advanced 6 positions on the Ease of Doing Business Report 2018 and ascended to 16th in the world. This is a significant achievement, especially considering it’s our first year. We have more to come in the pipeline, and aim to be first in the region from the second position we currently hold. It is important not to rest on our laurels. It’s a very competitive environment where you have to outperform your neighbours and remain a step ahead in the game because investment flows don’t respect national borders; they simply gravitate toward the attractive business destination.
In terms of strategic change management, we have a lot of new developments we are immensely excited about. First of all, we created a list of 33 priorities we have selected from all the objectives the government has promised to achieve in the next 4 years. We transformed those priorities into 40 specific projects, and assigned each to a responsible individual. All the projects will be overviewed and monitored by strategic committee, which is headed by the Prime Minister himself. Each responsible individual is presenting their plan outlining the strategy, project cost, period of time to be achieved and results to bring. Then they work on the incremental, but tangible steps that will help achieving the final goal. Committee takes it until revision, and either approves or asks for improvement.
At the strategic management level we have successfully implemented the necessary standards and arrangements. The final step is to maintain the momentum and make measurable headway in delivering the results and bringing our projects to fruition. We have created specialized strategic change management unit responsible on ensuring the implementation stage goes smoothly with minimal hitches. Mainstreaming a clear standard and establishing a lean, mean, efficient modus operandi across our organisations will additionally help to maintain the high standards of project management that we demand.
Can you expand on the projects related to healthcare?
One of the critical issues that the healthcare sector is facing right now pertains to the salary levels of the staff. We have a project that is not per se dedicated to medical staff, but moreover to how the overall salaries level can be improved. One of the achievements in this direction is the recently signed national agreement on the necessary reforms for the country’s progress, that representatives of the government, business and trade unions signed in October 2017. Some of our projects are dedicated to reducing the waiting periods to see the doctor or practitioner.
One of the major concerns of the pharmaceutical industry is the limited government resources allocated to healthcare. How is the government collaborating with the industry to continue enhancing the National Healthcare industry?
I would have to look at the exact numbers, but if I recall it correctly, overall expenditure is not quite as problematic as people often suggest. Take, for instance, the salary levels of our medical staff compared to our neighbours. Ours actually tend to be higher. Where we think there can be considerable progress is rather the efficient allocation of these resources by channelling them in directions where they can wield maximal impact.
The healthcare sector clearly requires major reforms in optimizing the infrastructure as well as in dedicating the funds to clear objectives. Funding from the GDP for the sector is not the problem here, when you look at the specific salary levels. For many clinical and medical positions there are already sizable increases in salaries. What we certainly do need to do, however, is to motivate healthcare providers to optimize, and efficiently receive the resources allocated.
How is the government collaborating with the industry in order to optimize the situation?
One of the clear positions the government has assumed is to have active dialog with the industry. We signed an agreement for the necessary reforms of the country, with trade organisations, employees’ organisations, unions, industry and the government. The document clearly states 5 priorities we want to focus on in the future, and that we have common agreement for the reforms. Mobilising solidarity around the need to reform is crucial.
One of the aspects was that we should engage in open dialog and that we should discuss any proposed changes with a full spectrum of stakeholders in a round table setting. The principle is agreed for the largest organisations and we have ongoing mechanisms to assess progress. Each ministry would propose different points to discuss, and also partners would also suggest issues they are facing so play a proactive part in crafting the agenda.
The government is absolutely steadfast in its desire to mobilise the support of industry. We have great ambitions for public health and need all hands to the deck to ensure that we realise them and deliver on our vision.
What are the initiatives that can propel Lithuania’s life science industry to be more competitive?
First of all, we want to attract more life science companies into Lithuania, which, in itself, stimulates the market. In order to do so, we need to ensure our workforce attains the qualifications needed from our universities. We believe universities need engage in dialogue and listen closely to the needs of industry. We are keen to ensure a seamless transition from the academia to the workplace and this can be achieved by having industry actually participating as part of the degree programs.
Secondly, in order to foster innovation, we need to establish an R&D centre locally. From our side, we strive to work hand in hand with the companies interested in penetrating the Lithuanian market, and those wishing to expand their footprint and operations. We are committed to easing their path and removing obstacles to these types of activities. Our legislative environment and regulations is matching the needs and we are seeking win-win solutions where everybody’s interests are closely aligned and harmoniously structured. We need to ensure that foreign industry is fully aware of the benefits awaiting them in the Lithuania life sciences market. Simultaneously, we need to make sure that the country realizes the importance of such actions, its impact on job creation, economic growth and general prosperity of the nation.
What are the main objectives behind all those initiatives that you would like to accomplish in the next years?
I would like to see the life sciences companies grow and to be successful, and in order to achieve that we need to have well-qualified talent pool. Ensuring our education sector is capable to seamlessly match the demand of the market is one of the current goals, but it will take time to achieve. It takes 3 years for a student to go through the programme, especially their bachelor degrees, and therefore there is a time lag that does not correct short term, immediate issues. Companies needs to have their staff today. In the medium to long term education will be better aligned with industry and companies will have a ready catchment pool of talent at their disposal.
At the same time, we are committed to converting our current skilled labour shortage into a strength, by using it as an opportunity to reform immigration policy. Lithuania is trying to position itself not only as a local market, but to be recognized as a top-class regional market. We are very successful making sure that our migration procedures are one of the easiest and fastest in the region as well as within European Union. If you are looking for the specialists, professionals, you no longer have to focus on the Lithuanian market, but you can choose from the talent pool in Poland, Latvia, Estonia, Ukraine and Belarus among others, all of whom can be successfully employed in Lithuania. This affords immediate relief to the life sciences companies operating and seeking to operate in Lithuania, and it goes some way to allowing us to become a Baltic powerhouse and magnet for the life sciences industry segment.
Finally, Lithuania leady enacted dedicated tax changes and incentives programmes to motivate people and companies to become more innovative.