1) The global financial crisis impacted companies in Estonia, with those focused on speculative activities like real estate development facing bankruptcy and job cuts. Others focused on selective salary adjustments to retain skilled workers. 2) Estonia adopted the euro in 2011, requiring companies to track invoices and prices in both euros and the Estonian kroon. This led consumers to scrutinize prices and quality more closely, reducing domestic demand. 3) For controlling in local Estonian companies, tasks will change to analyzing reserves, adjusting business models and profit estimates, and identifying new market opportunities. But for export-focused companies, controlling tasks will likely not change significantly.

1. The controlling
tasks will change
Estonia
Harald Kitzmann, head of the ICV working group Estonia, on
the effect of the global disorder in the finance sector and the impact
on controlling in Estonian companies: “In companies and organizations
with local focus tasks will change.”
Because of the tight connection between the Esto- sure. In this time the government of Estonia got
nian economics and the economics of the coun- the approval of meeting the Maastricht criteria and
tries in northern, western, eastern and central of got approval to enter the Eurozone starting
Europe, the welfare of these economics and there- 1.1.2011. The exchange rate was fixed at 15.6:1
fore also the global disorder in the financial sector and announced. This event had positive impact on
has impact on the economics in Estonia and surely the stability of the currency and therefore stabiliz-
also on the companies operating in Estonia. ing impact on the disordered finance sector.
But the impact is different depending on the busi- This event has an impact on the Estonian compa-
ness sector the companies are operating in. In the nies mainly in the administration field, because
speculative (= gambling) activities with short-term there is a need to document all external invoices
orientation like speculation with shares or short- and pricelists in both euros and the Estonian cur-
term real-estate development’ the impact was rency EEK. The main impact is connected with the
larger than in other sectors. Bankruptcy, closing psychological aspect of changing the currency.
down of parts of the company and redundancies The behavior of the consumer will change and
where the main subjects the management of these they will look more carefully at the goods they
companies dealt with. In others sectors the focus purchase, the prices and the product and service
was on selective adjustment of the salary without quality, undoubtedly leading to a decrease in do-
Harald Kitzmann, losing the brains, but with sometimes losing hands. mestic demand due to increasing self-sufficiency.
Chair of Operations Theses adjustments were mainly accepted because
Management, Tallinn salaries increased in the years 2005 – 2008 faster For the controlling in the Estonian companies and
University of Technology, than productivity increased because of a lack in organizations with local focus the tasks will change.
Head of the ICV working
resources (= brains). The controlling will mainly deal with these subjects:
group Estonia
The tight connection between business sectors • analyzing, allocation and using reserves in
and the finance sector as in most of the economics productivity
in central Europe (especially DACH countries) • adjusting of the business model, profit estimations,
does not exist in Estonia. Reason for this is the calculations scheme, etc.
In Estonia the salaries business friendly tax regulation, which supports • allocation of the new market possibilities and
had increased in the years the building of equity and therefore focusing more new products/services.
2005 – 2008 faster than
on the real business activities than dealing with
productivity had increased
because of lack in resources capital hunting. However, with regard to the companies with focus
(= brains). on sales into the Eurozone or other parts of the
export, no significant change in the controlling
Fixed exchange rate brought stability tasks will be expected.
In spring 2010 the disorder was in very critical
phases, when the euro as the main currency in
Europe became very instable and was under pres-
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