Supply Chain Adaptation of Finnish Companies in Chinese Institutional Environment

Within the last few decades of operations and supply chain management, the field has seen the rise of so called best practices, methods that will help supply chains obtain their business goals and gain a competitive edge. These methods were thought to be universal. This however is not always the case, as the surrounding business environment could have a significant impact on what will be effective in gaining competitive edge. Contingency theory states that the success of a supply chain is determined by both internal capabilities, as well as external context aligning. This creates a strategic fit, which is a major determinant of success. In order for supply chains to reach this strategic fit, they must adapt. As China has seen rapid growth and over the last few decades become one of the major economies of the world, Western companies have tried to establish themselves there, only to find that the Chinese market is extremely difficult to operate in. The aim of this thesis was to investigate from contingency theory perspective, what are the institutional factors that affect supply chain management of Finnish companies operating in China, and how do Finnish companies adapt their supply chains to better fit the Chinese institutional environment. A theoretical model was created for this thesis, in which supply chains possess resources, which can be combined in a meaningful manner to create capabilities. Both resources and capabilities are affected by the surrounding institutional environment, which forces supply chains to adapt in order to find a better strategic fit. A total of six Finnish managers from three large and three small companies operating in China were interviewed. The results indicated that the Chinese business environment is significantly different, than that of Finland or Western countries in general. Three institutional factors were identified: Confucian though, fast-paced business environment, and managing labor force. These three institutional factors made the relationship and delivery capabilities particularly important, as well as human resources, reputation, physical resources and technological resources. In conclusion, it was discovered that the Chinese institutional environment is heavily affected by Confucian thought, as well as the rapid market growth. These are the two most important institutional factors that shape the Chinese market. If supply chains wish to be successful in China, adaptation regarding these two institutional factors should yield good results.

Supply Chain Adaptation of Finnish Companies in Chinese Institutional Environment

Within the last few decades of operations and supply chain management, the field has seen the rise of so called best practices, methods that will help supply chains obtain their business goals and gain a competitive edge. These methods were thought to be universal. This however is not always the case, as the surrounding business environment could have a significant impact on what will be effective in gaining competitive edge. Contingency theory states that the success of a supply chain is determined by both internal capabilities, as well as external context aligning. This creates a strategic fit, which is a major determinant of success. In order for supply chains to reach this strategic fit, they must adapt. As China has seen rapid growth and over the last few decades become one of the major economies of the world, Western companies have tried to establish themselves there, only to find that the Chinese market is extremely difficult to operate in. The aim of this thesis was to investigate from contingency theory perspective, what are the institutional factors that affect supply chain management of Finnish companies operating in China, and how do Finnish companies adapt their supply chains to better fit the Chinese institutional environment. A theoretical model was created for this thesis, in which supply chains possess resources, which can be combined in a meaningful manner to create capabilities. Both resources and capabilities are affected by the surrounding institutional environment, which forces supply chains to adapt in order to find a better strategic fit. A total of six Finnish managers from three large and three small companies operating in China were interviewed. The results indicated that the Chinese business environment is significantly different, than that of Finland or Western countries in general. Three institutional factors were identified: Confucian though, fast-paced business environment, and managing labor force. These three institutional factors made the relationship and delivery capabilities particularly important, as well as human resources, reputation, physical resources and technological resources. In conclusion, it was discovered that the Chinese institutional environment is heavily affected by Confucian thought, as well as the rapid market growth. These are the two most important institutional factors that shape the Chinese market. If supply chains wish to be successful in China, adaptation regarding these two institutional factors should yield good results.

In Search of Corporate Renewal: How to Benefit from Corporate Venturing?

Despite the rapid change in today's business environment there are relatively few studies about corporate renewal. This study aims for its part at filling that research gap by studying the concepts of strategy, corporate renewal, innovation and corporate venturing. Its purpose is to enhance our understanding of how established companies operating in dynamic and global environment can benefit from their corporate venturing activities. The theoretical part approaches the research problem in corporate and venture levels. Firstly, it focuses on mapping the determinants of strategy and suggests using industry, location, resources, knowledge, structure and culture, market, technology and business model to assess the environment and using these determinants to optimize speed and magnitude of change.Secondly, it concludes that the choice of innovation strategy is dependent on the type and dimensions of innovation and suggests assessing market, technology, business model as well as novelty and complexity related to each of them for choosing an optimal context for developing innovations further. Thirdly, it directsattention on processes through which corporate renewal takes place. On corporate level these processes are identified as strategy formulation, strategy formation and strategy implementation. On the venture level the renewal processes are identified as learning, leveraging and nesting. The theoretical contribution of this study, the framework of strategic corporate venturing, joins corporate and venture level management issues together and concludes that strategy processes and linking processes are the mechanism through which continuous corporate renewaltakes place. The framework of strategic corporate venturing proposed by this study is a new way to illustrate the role of corporate venturing as a purposefullybuilt, different view of a company's business environment. The empirical part extended the framework by enhancing our understanding of the link between corporate renewal and corporate venturing in its real life environment in three Finnish companies: Metso, Nokia and TeliaSonera. Characterizing companies' environmentwith the determinants of strategy identified in this study provided a structured way to analyze their competitive position and renewal challenges that they arefacing. More importantly the case studies confirmed that a link between corporate renewal and corporate venturing exists and found out that the link is not as straight forward as indicated by the theory. Furthermore, the case studies enhanced the framework by indicating a sequence according to which the processes work. Firstly, the induced strategy processes strategy formulation and strategy implementation set the scene for corporate venturing context and management processes and leave strategy formation for the venture. Only after that can strategies formed by ventures come back to the corporate level - and if found viable in the corporate level be formalized through formulation and implementation. With the help of the framework of strategic corporate venturing the link between corporaterenewal and corporate venturing can be found and managed. The suggested response to the continuous need for change is continuous renewal i.e. institutionalizing corporate renewal in the strategy processes of the company. As far as benefiting from venturing is concerned the answer lies in deliberately managing venturing in a context different to the mainstream businesses and establishing efficientlinking processes to exploit the renewal potential of individual ventures.

Tuotannonohjauksen kehittäminen sähkömoottoreiden huoltotoiminnassa

Diplomityön kohdeyrityksen liiketoiminta on kokenut viime aikoina merkittäviä muutoksia lisääntyneen volyymin, vaihtuneiden toimitilojen ja konsernin taloudellisesti haastavan tilanteen johdosta. Olosuhteiden muuttuessa ja taloudellisten vaikeuksien kasvaessa on tuotannonohjauksen kehittäminen jäänyt yksikössä takaa-alalle, mikä näkyy pitkittyneinä toimitusaikoina ja laskutusviiveenä, heikkona ohjattavuutena ja täten myös kannattavuuden huonontumisena. Työn tavoitteena onkin tutkia sähkömoottorihuoltotoiminnan nykytilaa ja löytää käytännönläheisiä ja nopeasti toteutettavissa olevia ratkaisuja tuotannonohjauksen kehittämiseksi. Työn teoreettisena viitekehyksenä käytettiin tuotannonohjauksen perusproblema-tiikkaa käsitteleviä teoksia, kuten myös tuotannonohjauksen kehityshankkeisiin liittyvää materiaalia. Tämän lisäksi työhön on pyritty saamaan lisänäkemystä suo-rittamalla benchmarking -vierailuja yhteistyöyrityksiin, jossa on hiljattain suoritettu vastaavan kaltaisia, onnistuneita tuotannonohjauksen kehityshankkeita. Työn empiirinen osuus jaoteltiin kahteen teemaan; nykytila-analyysiin ja toimenpide-ehdotuksiin. Nykytila-analyysi pyrittiin luomaan mahdollisimman kattavaksi sisällyttämällä siihen näkökulmia niin tuotannollisten lukujen kuin henkilöstön nä-kemysten perusteella. Analyysin pohjalta yritykselle laadittiin ehdotuksia käytän-nönläheisistä, nopeasti toteutettavissa olevista toimenpiteistä kuten myös ehdotuksia tuotannon jatkokehityksestä.

THE ROLE OF DYNAMIC CAPABILITIES IN THE INTERNATIONALIZATION OF MEDIUM SIZED FINNISH MANUFACTURING FIRMS - A case for Sormat Oy

A rapidly changing business environment has necessitated most small and medium sized enterprises with international ambitions to reconsider their sources of competitive advantage. To survive in the face of a changing business environment, firms should utilize their dynamic organizational capabilities as well as their internationalization capabilities. Firms develop a competitive advantage if they can exploit their unique organizational competences in a new or foreign market and also if they can acquire new capabilities as a result of engaging in foreign markets. The acquired capabilities from foreign locations enhance the existing capability portfolio of a firm with a desire to internationalize. The study combined the research streams of SME organizational dynamic capability and internationalization capability to build a complete picture on the existing knowledge. An intensive case study was used for empirically testing the theoretical framework of the study and compared with the literature on various organizational capability factors and internationalization capabilities. Sormay Oy was selected because it is a successful medium sized company operating in Finland in the manufacturing industry which has a high international profile. In addition, it has sufficient rate of growth in sales that warrants it to engage internationally in matters such as, acquisitions, joint ventures and partnerships. The key findings of the study suggests that, medium sized manufacturing firms have a set of core competences arising from their organizational capabilities which were identified to be employee know how and relationship with stakeholders which aid the firm in its quest for attaining competitive advantage, ensuring production flexibility and gaining benefits present in a network. In addition, internationalization capabilities were identified under both the RAT test and CAT test whereby the primary findings suggests that, firms that outperform their competitors produce products that meet specific customer and country requirements, foresee the pitfalls of imitation brought about by the foreign local companies and members of a particular network through joint ventures, acquisitions or partnerships as well as those firms that are capable to acquire new capabilities in the foreign markets and successfully use these acquired capabilities to enhance or renew their capability portfolio for their competitive advantage. Additional significant findings under internationalization capabilities were discovered whereby, Sormay Oy was able to develop a new market space for its products despite the difficult institutional environment present in Russia.

Asiakkaan osallistuminen innovaatio- ja tuotekehitysprosessiin

Tässä tutkimuksessa tarkastellaan asiakkaan ja valmistajan osallistumista yhteistoiminnalliseen innovaatio- ja tuotekehitysprosessiin ja sen vaikutuksia yritysten kilpailukykyyn. Asiakaslähtöinen avoin innovaatio- ja tuotekehitystoiminta on yksi merkittävä kilpailuedun lähde, sillä se mahdollistaa tuotevariaatioiden nopeamman lanseerauksen ja asiakastarpeiden huomioimisen tuotekehitystoiminnassa. Tämän empiirisen tutkimuksen tavoitteena oli selvittää millä tavoin kulutustavaroihin kuuluvien muoti- ja sportvaatteiden suunnittelussa yhteistoiminnallinen innovaatio- ja tuotekehitystoiminta on mahdollista toteuttaa ja miten sitä voidaan hallita. Tutkimus toteutettiin kvalitatiivisena tapaustutkimuksena. Empiirinen aineisto kerättiin teemahaastatteluina tapausorganisaatiosta. Yhteistoiminnallisesta kehittämisestä ei ole olemassa yhtä kattavaa teoriaa, jota voitaisiin hyödyntää. Tämän vuoksi yritysten on luotava itse yhteistoiminnallisen innovaation ja tuotekehityksen viitekehys, joka parhaiten palvelee liiketoiminnan tarpeita. Viitekehys ja käytettävät menetelmät sekä yhteistoiminnallisuutta tukevat työvälineet ovat riippuvaisia mm. toimialasta ja sen markkinatilanteesta, liiketoimintamalleista, yrityksen toimintaympäristöstä, asiakkaista ja kehittämisen kohteeksi valitusta tuotealueesta. Empiirinen tutkimus osoittaa, että yhteistoiminnallinen innovaatio voi olla kilpailuedun lähde sekä valmistajille että asiakkaalle, mutta vaatii aina yrityskohtaista sopeuttamista. Tutkimuksen mukaan hyvin johdettu yhteistyömalli, oikeat tuotevalinnat ja asiakasinformaation monipuolinen hyödyntäminen vaikuttavat positiivisesti kehittämisprojektin tuloksiin.

Collecting valuable consumer data: Motivating consumers to disclose personal information

Collecting and analyzing consumer data is essential in today’s data-driven business environment. However, consumers are becoming more aware of the value of the information they can provide to companies, thereby being more reluctant to share it for free. Therefore, companies need to find ways to motivate consumers to disclose personal information. The main research question of the study was formed as “How can companies motivate consumers to disclose personal information?” and it was further divided into two subquestions: 1) What types of benefits motivate consumers to disclose personal information? 2) How does the disclosure context affect the consumers’ information disclosure behavior? The conceptual framework consisted of a classification of extrinsic and intrinsic benefits, and moderating factors, which were recognized on the basis of prior research in the field. The study was conducted by using qualitative research methods. The primary data was collected by interviewing ten representatives from eight companies. The data was analyzed and reported according to predetermined themes. The findings of the study confirm that consumers can be motivated to disclose personal information by offering different types of extrinsic (monetary saving, time saving, self-enhancement, and social adjustment) and intrinsic (novelty, pleasure, and altruism) benefits. However, not all the benefits are equally useful ways to convince the customer to disclose information. Moreover, different factors in the disclosure context can either alleviate or increase the effectiveness of the benefits and the consumers’ motivation to disclose personal information. Such factors include the consumer’s privacy concerns, perceived trust towards the company, the relevancy of the requested information, personalization, website elements (especially security, usability, and aesthetics of a website), and the consumer’s shopping motivation. This study has several contributions. It is essential that companies recognize the most attractive benefits regarding their business and their customers, and that they understand how the disclosure context affects the consumer’s information disclosure behavior. The likelihood of information disclosure can be increased, for example, by offering benefits that meet the consumers’ needs and preferences, improving the relevancy of the asked information, stating the reasons for data collection, creating and maintaining a trustworthy image of the company, and enhancing the quality of the company’s website.

Increasing value add in white collar work using lean methods

The efficient indirect office work brings competitive advantage for companies in a rapidly changing business environment. The direct work methods in factory floors have been developed already for decades, but the office work is an area where the potential to improve the value add has not been studied and utilized systematically so far. The first objective of the thesis work is to find useful method for identifying and managing value add using literature. The usefulness of the method is validated in the case company`s environment. The second objective of the work is to understand what kind of effort is required to create more efficient target setting for the white collar employees. The operative level targets should be linked more tightly to the company strategy. Lean methods are selected as a tool for the improvement, since they are widely used in all kinds of industries and they are already familiar in other functions in the case company. Based on the literature review, suitable improvement methods are selected. The core of the lean is to identify the value add of a customer and eliminate the waste. Also visual control, cross functional work team, flow office and continuous improvement are used. The methods are tested in one production line and the results and feedback indicate that methods are useful in the studied environment.