In a new interview with LeadershipDaily, Oleksandr Avramuk, General Manager at Lactalis Ukraine, discusses the transformation of the dairy industry, business resilience amid the war, and the prospects for the development of Ukraine’s agri-food sector.
Key topics include how the war has changed production management, logistics and supply chains, why food security is a matter of national resilience, and how companies are managing to maintain production, jobs and partnerships with Ukrainian farmers.
The interview also focuses on global trends in the dairy market, including growing demand for high-protein and natural products, the development of innovation, digitalization and energy efficiency. We also discuss the European integration of Ukraine’s dairy industry, the country’s export potential and the structural changes needed to strengthen its international competitiveness.
Oleksandr Avramuk also shares his perspective on modern leadership, including the role of trust, responsibility, swift decision-making and a leader’s ability to maintain a long-term vision even amid constant crises and transformation.
LeadershipDaily: The global food industry is undergoing a period of profound transformation — from changing consumer habits to geopolitical risks. What factors are having the greatest impact on the development of the dairy industry today?
O. Avramuk: The global dairy industry is changing faster than ever. We are operating in an environment where the economy, technology, consumer expectations and the geopolitical landscape are all changing simultaneously.
On the one hand, producers are facing rising costs of raw materials, energy, logistics and packaging materials, a shortage of skilled workers and increasingly stringent regulatory requirements. On the other hand, consumers themselves are changing rapidly. People are paying closer attention to product labels, protein and sugar content, the naturalness of ingredients, and want to understand how products are actually made.
This means that a modern producer must be efficient, innovative and responsible at the same time. It is no longer enough simply to produce a high-quality product — companies must be able to adapt quickly without losing consumer trust.
I am convinced that change has always existed and always will. The question is not how to avoid it, but how quickly you can adapt without compromising your principles. For us, those principles remain quality, responsibility and long-term partnership.
LeadershipDaily: Lactalis is one of the largest dairy producers in the world. How is the strategy of global companies changing amid economic instability and growing operational risks?
O. Avramuk: One of the greatest advantages of an international company today is its ability to combine global experience with strong local teams.
At Lactalis, we operate under a multilocal management model. Unified standards of quality, safety and responsible business practices remain unchanged across all countries, but decisions are made as close to the market as possible. This allows us to respond quickly to changes and take local specifics into account.
Ukraine has clearly demonstrated the value of this approach. Over the past few years, we have repeatedly found ourselves in situations where decisions had to be made within just a few hours. Under such circumstances, it is extremely important for the local team to have sufficient authority to act quickly, relying on the support and expertise of the international Group.
In my view, this is what a modern international company looks like: global in its values and standards, but as local as possible when it comes to decision-making.
LeadershipDaily: The Ukrainian market has faced unprecedented challenges in recent years. What key management decisions have enabled Lactalis Ukraine to maintain business stability and consumer trust?
O. Avramuk: From the very beginning, we established a clear order of priorities.
First — the safety of our people. Second — continuity of production. Third — fulfilling our commitments to consumers, farmers, customers and partners.
We did not wait for the situation to stabilize. We adapted the business to the new reality. We strengthened coordination between our facilities, revised logistics routes, invested in energy autonomy, created contingency scenarios for critical processes and placed much greater emphasis on risk management.
Open communication within the company was equally important. In times of crisis, people need to understand not only the decisions made by management, but also the reasoning behind them. It is precisely the trust within the team that enables us to fulfill our commitments to external partners.
Trust is not created by big words. It is built through consistent decisions and concrete actions. This principle helped us maintain business stability even during the most difficult periods.
LeadershipDaily: How has the war changed the approach to managing production, logistics and supply chains? What lessons have been the most valuable for the company?
O. Avramuk: The war has fundamentally changed our understanding of operational efficiency.
Whereas previously efficiency meant maintaining minimal inventories, optimizing routes and maximizing production capacity utilization, today it also means being able to operate amid air raid alerts, disruptions to energy supplies, damaged infrastructure and sudden changes in logistics.
We have significantly strengthened scenario planning, diversified our supply sources, revised our approach to critical inventories and created additional mechanisms to ensure continuity of production. What was once considered a contingency plan is now often part of our day-to-day operations.
But the most important lesson for me is that resilience cannot be built solely on processes or technology. It starts with people. Professionalism, mutual trust and a willingness to take responsibility are what enable a company to operate when external circumstances are constantly changing.
The crisis has also taught us to value partnerships even more — within the company, with suppliers, customers, farmers, government authorities and the international Group. In difficult times, partnership becomes the most important factor in business resilience.
LeadershipDaily: The world is increasingly discussing food security as an element of national security. What role do international food producers play in this process?
O. Avramuk: I would not divide producers simply into international and local companies. During wartime, all food industry businesses operate in the same reality and share the same responsibility — to provide people with safe, high-quality products every day.
Food security does not begin with having a product on the shelf. Behind it lies the resilience of the entire chain: farms, production, energy, logistics, quality control systems and the people who make it all work.
International companies can additionally provide access to global expertise, technologies, financial resources and proven standards. But this advantage only has real value when it contributes to the development of the local economy.
For Lactalis Ukraine, this means continuing to manufacture products at our Ukrainian facilities, purchasing milk from Ukrainian farms, preserving jobs and investing in production resilience.
In my view, food security begins with the responsible decision to stay, produce and develop a business in the country even under the most difficult circumstances.
LeadershipDaily: Today, consumers expect brands to offer not only high quality, but also transparency, responsibility and environmental sustainability. How are these expectations influencing the development of Lactalis Ukraine?
O. Avramuk: Consumers have become much more demanding — and this is one of the main drivers of our development. People want to understand what they are buying, what a product is made of, what benefits it provides and how responsibly the company operates.
I remember the beginning of the full-scale war well, when, due to objective circumstances, our customer hotline was not operational for almost two weeks. Some believed that this was not a priority at the time. But as soon as we restored the service, we immediately received inquiries about product quality and even the readability of the font on the packaging.
This was an important signal: Ukrainian consumers do not lower their expectations because of circumstances. And, frankly, we are grateful to them for that. High expectations are precisely what push businesses to become better.
For us, responsibility is not a separate communications campaign. It is reflected in our daily decisions: in the quality control of raw materials, clear labeling, efficient use of water and energy, and the way we manage packaging, production waste and by-products.
The Lactalis Group’s purpose is “Nurturing the Future.” For us, this means creating high-quality products today while acting responsibly toward people, resources, communities and the future of the country.
LeadershipDaily: Which global trends in dairy consumption do you believe will shape the market over the next decade?
O. Avramuk: Ten years is a sufficiently long horizon to be cautious about making categorical predictions. Food habits are changing very quickly, so for a producer it is important not only to anticipate the future, but also to be able to respond to it quickly.
At the same time, we can already see several lasting trends.
The first is growing demand for high-protein products. They are gradually moving beyond sports nutrition and becoming part of the everyday diet.
The second is growing interest in natural products with recognizable ingredients and lower sugar content. Consumers are paying increasing attention not only to taste, but also to the nutritional value of products.
The third is the development of products designed for specific needs and different stages of life: active lifestyles, weight management, healthy aging, digestive health, or a quick and nutritious snack.
Convenience will also become increasingly important: portion-sized formats and ready-made solutions for breakfast, snacks or meal preparation.
At the same time, I do not believe traditional dairy categories will lose their importance. Milk, butter, cheese, yogurt and cottage cheese will remain staples of the diet. The task for producers is not to abandon tradition, but to adapt proven products to modern lifestyles.
The Lactalis Group has been working with milk for more than 90 years. It is precisely this combination of deep expertise and a willingness to innovate that allows us to respond to changing consumer expectations without losing sight of what matters most — product quality.
LeadershipDaily: To what extent are innovations becoming a competitive advantage for food producers today? Which areas do you believe the industry will invest in most?
O. Avramuk: Today, innovation is no longer an additional advantage — it is one of the conditions for maintaining competitiveness.
At the same time, innovation is not just about a new flavor or packaging design. The most important changes are taking place in formulations, production technologies, automation, energy efficiency, demand forecasting and data management.
In terms of products, we see significant potential in high-protein solutions, products with reduced sugar content, new formats of cheeses and cream cheeses, as well as professional solutions for the HoReCa segment.
But a new product only makes sense if it addresses a real consumer need, offers clear value and can be effectively scaled. Innovation for the sake of innovation quickly becomes complexity that creates no value for either the consumer or the business.
Another major area is digitalization. We are restructuring our demand and supply planning processes, working toward a single source of data and improving forecast accuracy. In the food industry, even a small improvement in forecasting directly affects product freshness, inventory levels, waste, production capacity utilization and customer service levels.
Therefore, future industry investments will focus simultaneously on products, technology and data. The companies that succeed will be those able to combine these three elements into one effective system.
LeadershipDaily: How is the management model of a large international company changing amid constant uncertainty? What qualities are most important for a modern leader today?
O. Avramuk: Today, a leader almost never has complete information. They have to make decisions when some data is missing and the situation itself may change as early as the next day.
Therefore, the ability to quickly set priorities, take responsibility and remain calm is becoming increasingly important. A team is very sensitive to the state of its leader. If a leader appears uncertain or keeps changing direction, uncertainty within the organization only increases.
At the same time, speed should not mean chaos. The leader’s task is to create a simple and clear system: what is the priority right now, who is responsible for the result, what decision needs to be made and by what deadline.
The ability to delegate is equally important. In a large company, a leader simply cannot make every decision personally. Their role is to build a strong team, define the direction and give people sufficient authority to act.
Another key quality is honesty. People quickly sense when someone is trying to make reality look better than it is. Trust emerges when a leader speaks openly about the situation, explains the reasoning behind decisions and takes responsibility for the outcome.
For Ukraine, I would add one more quality — humanity. In our circumstances, it is impossible to manage a business effectively without understanding what employees and their families are going through. A strong leader must demand results while remaining human.
LeadershipDaily: Ukrainian producers are gradually integrating into the European market. What opportunities and challenges does this process create for the dairy industry?
O. Avramuk: European integration gives Ukraine’s dairy industry access to a large market, new technologies, investment and higher standards of doing business. This is a major opportunity for development.
But it will not automatically become an advantage. The European market is highly competitive and heavily regulated. Requirements apply not only to the quality of the finished product, but to the entire production chain: animal husbandry conditions, veterinary controls, raw material traceability, the use of veterinary medicines, environmental standards and animal welfare.
Therefore, it is important for Ukrainian businesses to understand today which requirements will come into force, how much time adaptation will require and what level of investment it will involve. Waiting until the negotiation process is complete before beginning the necessary changes would be too late.
I participate in the work of an industry committee on European integration, and it is important to me that this process is as practical as possible — with a clear roadmap, consultations for businesses, an assessment of the required investments and realistic transition periods.
Most importantly, European integration should not be viewed solely as an opportunity to export more. It is a chance to improve the quality of Ukraine’s entire dairy industry and make our products competitive in any market.
LeadershipDaily: What factors have the greatest impact on the cost of dairy production today, and how can companies remain competitive under these conditions?
O. Avramuk: Raw milk traditionally accounts for the largest share of the cost of dairy products. This is followed by energy, packaging materials, logistics, wages, maintenance and the costs associated with ensuring uninterrupted production.
In Ukraine, additional war-related costs have emerged: generators, fuel, backup equipment, protection of production facilities, additional inventories and more complex logistics. The shortage of drivers and production personnel also directly affects both costs and service levels.
It is impossible to remain competitive simply by raising prices. This is the easiest response, but it has its limits. Companies need to systematically improve plant productivity, optimize their product portfolio, increase energy efficiency and forecasting accuracy, and reduce production losses and inventory levels.
For the dairy industry, it is particularly important to use all components of milk efficiently. It is impossible to focus on an individual product alone. Companies need to manage the balance of raw materials, production capacity and the portfolio as a whole.
Another fundamental point is the shift from a volume-based approach to a value-based approach. A company needs to clearly understand which products, formats, brands and channels genuinely create value for consumers and contribute to business resilience.
Under difficult conditions, the winners will not necessarily be those who simply produce more, but those who manage every liter of milk, every production line and every SKU in the portfolio more effectively.
LeadershipDaily: How important is cooperation with Ukrainian farmers and milk suppliers for business development? How are partnership requirements changing?
O. Avramuk: There can be no strong dairy industry without strong farmers. The quality of the finished product does not begin at the factory — it begins on the farm.
Today, the partnership between farmers and processors must go far beyond price negotiations. The stability of milk quality, transparency, biosecurity, animal welfare, control over the use of veterinary medicines, farm productivity and the ability to plan development several years ahead are becoming increasingly important.
We work with Ukrainian farms in different regions of the country and are specifically interested in building long-term relationships. This model gives farmers the opportunity to plan investments and development, while allowing processors to secure predictable volumes and consistent raw material quality.
European integration will further raise requirements for the traceability, safety and quality of milk. At the same time, responsibility for meeting these requirements cannot be placed on one side alone. The farm and the processing facility are parts of the same chain.
Therefore, the future model is not simply a buyer-seller relationship. It is a partnership in which both sides share responsibility for the quality of the finished product and the competitiveness of Ukraine’s entire dairy industry.
LeadershipDaily: How do you assess Ukraine’s potential to become one of the future centers of production and export of high-quality dairy products to Europe and other global markets?
O. Avramuk: Ukraine has significant potential to become one of the prominent dairy producers serving European and other international markets. We have a strong agricultural base, professional farming enterprises, longstanding dairy production traditions and a favorable geographic location.
At the same time, potential alone does not guarantee results. Successful export development requires consistent milk quality, efficient farms, modern processing facilities, a predictable regulatory environment, developed logistics and access to long-term financing.
Ukraine already exports dairy products to Europe and other regions. The next step is to gradually increase the share of higher value-added products: cheeses, high-protein products, specialized ingredients and other technologically more complex categories.
I do not believe our strategy should simply be to produce more. We need to produce consistently and efficiently, focusing on products that are in demand in our target markets.
To achieve this, it is important to combine the strengths of Ukraine’s agricultural sector with modern technologies, European standards and a deep understanding of consumers. Under these conditions, Ukraine will be able to compete not only on price, but also on quality, innovation and reliability of supply.
LeadershipDaily: What structural changes do you believe Ukraine’s agri-food sector needs to strengthen its international competitiveness?
O. Avramuk: First and foremost, we need systematic modernization of the production base, both in agriculture and processing. This is not only about new equipment, but also about technologies, energy efficiency, automation, quality management and productivity improvements.
The second area is the harmonization of standards with the European Union. Businesses need to understand in advance what the future requirements will be, when they will come into force and what level of investment will be required. The more predictable this process is, the better companies will be able to prepare for it.
The third factor is the development of logistics and energy infrastructure. For the food industry, reliable energy supplies, dependable transportation routes, modern warehousing facilities and efficient export channels are critical.
Ukraine also needs to change the structure of its exports, gradually moving from raw materials and basic commodities toward products with greater added value. This will create more jobs, retain more value within the country and reduce dependence on fluctuations in commodity markets.
Another major challenge is the shortage of qualified personnel. The industry needs engineers, technologists, production line operators, quality specialists, digital systems experts, logistics professionals and technical maintenance specialists. Therefore, investment in vocational education and workforce development is just as important as investment in equipment.
Finally, stronger coordination is needed between the government, producers, processors, educational institutions and industry associations. International competitiveness cannot be created by the efforts of a single company. It is the result of the effective functioning of the entire ecosystem.
LeadershipDaily: What reforms do you believe could most significantly accelerate the development of Ukrainian manufacturing and attract international capital?
O. Avramuk: Investors primarily need clear, stable and equal rules for everyone. Therefore, the foundations for attracting capital remain the rule of law, investment protection, a predictable tax and customs environment, an effective judicial system and the effective implementation of decisions.
The second critical area is war-risk insurance and access to long-term financing. Many international companies see Ukraine’s potential, but the high level of risk increases the cost of capital or delays the implementation of investment projects.
Fast and transparent procedures for obtaining permits, connecting to energy infrastructure, construction and launching new production facilities are also important. An investor needs to understand not only the requirements, but also the actual timelines for completing each stage.
At the same time, Ukraine does not need to find all the answers on its own. Hundreds of international companies are already operating in the country and have practical experience in investing, developing production and working with the government. Their experience should be used more actively when shaping reforms.
Business associations, chambers of commerce and industry, the Council for Business Support and other platforms already exist for this purpose. It is important that dialogue with business is continuous and that it results in concrete and timely decisions.
I am convinced that new investors will come to Ukraine. But it is equally important to create conditions in which companies that have already been operating in the country for many years will continue to expand production and launch new projects.
The reinvestment of existing businesses is one of the strongest signals of confidence in the country.
LeadershipDaily: What does effective leadership mean to you during a period of constant crises and transformation?
O. Avramuk: For me, leadership is not about control. It is first and foremost about responsibility.
A leader cannot influence all external circumstances, but they are responsible for how the team responds to them. In the most difficult moments, it is particularly important to remain calm, speak honestly about the situation and help people see not only today’s problem, but also the bigger picture.
Even when dealing with issues related to safety, energy supplies, logistics or production every day, a leader should not lose sight of the long-term vision. The team needs to understand not only how we will get through the current crisis, but also where the company is heading over the next three or five years.
I am convinced that strong teams are built on trust. A leader should not personally make every decision. Their task is to build a team of professionals, set the direction, clearly allocate responsibility and give people sufficient authority to act.
In difficult situations, I always follow a simple order. First, we need to make sure that people are safe. Then we assess the situation honestly, identify those responsible and move to a concrete plan for restoring operations.
Over the past few years, we have all learned to adapt very quickly. But there are things that should not change depending on circumstances: respect for people, quality, responsibility for our decisions and keeping our commitments.
In times of crisis, people evaluate a leader not only by their words. They look at how the leader behaves, whether they remain alongside the team and whether they are personally prepared to take responsibility for the result.
That is why, for me, personal example remains the most powerful leadership tool.
