Catching up with competitiveness in emerging markets – An analysis of the role of the firm’s technology management strategies

Emerging markets have experienced rapid economic growth, and manufacturing firms have had to face the effects of globalisation. Some of the major emerging economies have been able to create a supportive business environment that fosters innovation, and China is a good example of a country that has been able to increase value-added investments. Conversely, when we look at Russia, another big emerging market, we witness a situation in which domestic firms struggle more with global competitiveness. Innovation has proven to be one of the most essential ingredients for firms aiming to grow and become more competitive. In emerging markets, the business environment sets many constraints for innovation. However, open strategic choices in new product development enable companies in emerging markets to expand their resource base and capability building. Networking and close inter-firm cooperation are essential in this regard. In this dissertation, I argue that technology transfer is one of the key tools for these companies to become internationally networked and to improve their competitiveness. It forces companies to reach outside the company and national borders, which in many cases, is a major challenge for firms in emerging markets. This dissertation focuses on how companies can catch up with competitiveness in emerging markets. The empirical studies included in the dissertation are based on analyses of survey data mainly of firms and their strategies in the Russian manufacturing industry. The dissertation contributes to the current strategic management literature by further investigating technology management strategies in manufacturing firms in emerging markets and the benefits of more open approaches to new product development and innovation.

The Role of Third-Party Service Provider in B2B Integration

Sähköisen kaupankäynnin kasvun myötä, itsenäisten yritysten tietojärjestelmien integraation tarve on moninkertaistunut viime vuosien aikana. Yritykset ovat huomanneet, että tilaus-toimitusketjun automatisointiin tähtäävällä kokonaisvaltaisella integraatio-ratkaisulla on mahdollista päästä kattaviin kustannussäästöihin sekä tulojen kasvuun. Pääsääntöisesti yritykset kuitenkin etenevät hitaammin, integroimalla aluksi pienempiä liiketoiminnan tietojärjestelmien toimintoja. Positiivisten kokemusten perusteella yritykset ovat valmiitalaajentamaan sähköisen kaupankäynnin automatisointia myös muissa toiminnoissa. Tässä työssä keskitytään tarkastelemaan eri lähestymistapojayritystenvälisen integraation toteuttamiseen, sekä analysoimaan eri keinojen liiketoiminnallisia ja teknisiä vaikutuksia. Työ on tehty yhteistyössä UPM-KymmeneWood Oy:n kanssa, jonka tavoitteena oli saada perusteelliset tiedot yrityksenvälisestä integraatiosta ja syventää tietoja sekä integraatio-palveluita tarjoavien kolmansien osapuolten toimintatavoista että heidän tarjoamista palveluista ja niiden käyttökelpoisuudesta puutuoteteollisuudessa toimivassa yrityksessä. Käytännön osuudessa on tarkemmin esitelty integraatio-palveluita tarjoavien operaattoreiden kanssa käytyjen palaverien sekä heidän toimittamien materiaalien perusteella tehdyn tutkimustyön tuloksia, sisältäen yksityiskohtaiset kuvaukset yritystenvälisen integraation mahdollistavista palveluista.

Partnering in the Dynamic Environment: The Role of Trust in Asymmetric Technology Partnership Formation

The purpose of this study was to increase the understanding of the role and nature of trust in asymmetric technology partnership formation. In the knowledge-based "learning race" knowledge is considered as a primary source for competitive advantage. In the emerging ICT sector the high pace of technological change, the convergence of technologies and industries as well as the increasing complexity and uncertainty have forced even the largest players to seek cooperation for complementary knowledge and capabilities. Small technology firms need the complementary resources and legitimacy of the large firms to grow and compete in the global market place. Most of the earlier research indicates, however, that partnerships with asymmetric size, managerial resources and cultures have failed. A basic assumption supported by earlier research was that trust is a critical factor in asymmetric technology partnership formation. Asymmetric technology partnership formation is a dynamic and multi-dimensional process, and consequently a holistic research approach was selected. Research issue was approached from different levels: the individual decision-maker, the firm and the relationship between the parties. Also the impact of the dynamic environment and technology content was analyzed. A multitheoretical approach and a qualitative research method with in-depth interviews in five large ICT companies and eight small ICT companies enabled a holistic and rich view of the research issue. Study contributes on the scarce understanding on the nature and evolution of trust in asymmetric technology partnership formation. It sheds also light on the specific nature of asymmetric technology partnerships. The partnerships were found to be tentative and the diverse strategic intent of small and large technology firms appeared as a major challenge. The role of the boundary spanner was highlighted as a possibility to match the incompatible organizational cultures. A shared vision was found to be a pre-condition for individual-based fast trust leading to intuitive decision-making and experimentation. The relationships were tentative and they were continuously re-evaluated through the key actors' sense making of the technology content, asymmetry and the dynamic environment. A multi-dimensional conceptualization for trust was created and propositions on the role and nature of trust for further research are given. The purpose of this study was to increase the understanding of the role and nature of trust in asymmetric technology partnership formation. In the knowledge-based "learning race" knowledge is considered as a primary source for competitive advantage. In the emerging ICT sector the high pace of technological change, the convergence of technologies and industries as well as the increasing complexity and uncertainty have forced even the largest players to seek cooperation for complementary knowledge and capabilities. Small technology firms need the complementary resources and legitimacy of the large firms to grow and compete in the global market place. Most of the earlier research indicates, however, that partnerships with asymmetric size, managerial resources and cultures have failed. A basic assumption supported by earlier research was that trust is a critical factor in asymmetric technology partnership formation. Asymmetric technology partnership formation is a dynamic and multi-dimensional process, and consequently a holistic research approach was selected. Research issue was approached from different levels: the individual decision-maker, the firm and the relationship between the parties. Also the impact of the dynamic environment and technology content was analyzed. A multitheoretical approach and a qualitative research method with in-depth interviews in five large ICT companies and eight small ICT companies enabled a holistic and rich view of the research issue. Study contributes on the scarce understanding on the nature and evolution of trust in asymmetric technology partnership formation. It sheds also light on the specific nature of asymmetric technology partnerships. The partnerships were found to be tentative and the diverse strategic intent of small and large technology firms appeared as a major challenge. The role of the boundary spanner was highlighted as a possibility to match the incompatible organizational cultures. A shared vision was found to be a pre-condition for individual-based fast trust leading to intuitive decision-making and experimentation. The relationships were tentative and they were continuously re-evaluated through the key actors' sense making of the technology content, asymmetry and the dynamic environment. A multi-dimensional conceptualization for trust was created and propositions on the role and nature of trust for further research are given.

Innovation – from individual intuition to collaborative innovation. The role of individual key actor in facilitation of innovation in large organization context

The objective of this research was to study the role of key individuals in facilitation of technology enabled bottom-up innovation in large organization context. The development of innovation was followed from the point of view of individual actor (key individual) in two cases, through three levels: individual, team and organization, by using knowledge creation and innovation models. This study provides theoretical synthesis and framework through which the study is driven. The results of the study indicate, that in bottom-up initiated innovations the role of key individuals is still crucial, but innovation today is collective effort and there acts several entrepreneurial key individuals: innovator, user champion and organizational sponsor, whose collaboration and developing interaction drives innovation further. The team work is functional and fluent, but it meets great problems in interaction with organization. The large organizations should develop its practices and ability to react on emerging bottom-up initiations, in order to embed innovation to organization and gain sustainable innovation. In addition, bottom-up initiated innovations are demonstrations of peoples knowing, tacit knowledge and therefore renewing of an organization.

Interdependence of Emerging Eastern European stock markets

One of the main developments in the global economy during the past decades has been the growth of emerging economies. Projections for their long-term growth, changes in the investment climate, corporate transparency and demography point to an increasing role for these emerging economies in the global economy. Today, emerging economies are usually considered as financial markets offering opportunities for high returns, good risk diversification and improved return-to-risk ratios. However, researchers have noted that these advantages may be in decline because of the increasing market integration. Nevertheless, it is likely that certain financial markets and specific sectors will remain partially segmented and somewhat insulated from the global economy for the year to come. This doctoral dissertation investigates several stock markets in Emerging Eastern Europe (EEE), including the ones in Russia, Poland, Hungary, the Czech Republic, Bulgaria and Slovenia. The objective is to analyze the returns and financial risks in these emerging markets from international investor’s point of view. This study also examines the segmentation/integration of these financial markets and the possibilities to diversify and hedge financial risk. The dissertation is divided into two parts. The first includes a review of the theoretical background for the articles and a review of the literature on EEE stock markets. It includes an overview of the methodology and research design applied in the analysis and a summary of articles from the second part of this dissertation and their main findings. The second part consists of four research publications. This work contributes to studies on emerging stock markets in four ways. First, it adds to the body of research on the pricing of risk, providing new empirical evidence about partial stock market segmentation in EEE. The results suggest that the aggregate emerging market risk is a relevant driver for stock market returns and that this market risk can be used to price financial instruments and forecast their performance. Second, it contributes to the empirical research on the integration of stock markets, asset prices and exchange rates by identifying the relationships between these markets through volatility and asset pricing. The results show that certain sectors of stock markets in EEE are not as integrated as others. For example, the Polish consumer goods sector, the Hungarian telecommunications sector, and the Czech financial sector are somewhat isolated from their counterparts elsewhere in Europe. Nevertheless, an analysis of the impact of EU accession in 2004 on stock markets suggests that most of the EEE markets are becoming increasingly integrated with the global markets. Third, this thesis complements the scientific literature in the field of shock and volatility spillovers by examining the mechanism of spillover distribution among the EU and EEE countries. The results illustrate that spillovers in emerging markets are mostly from a foreign exchange to the stock markets. Moreover, the results show that the effects of external shocks on stock markets have increased after the enlargement of the EU in 2004. Finally, this study is unique because it analyzes the effects of foreign macroeconomic news on geographically closely related countries. The results suggest that the effects of macroeconomic announcements on volatility are significant and have effect that varies across markets and their sectors. Moreover, the results show that the foreign macroeconomic news releases, somewhat surprisingly, have a greater effect on the EEE markets than the local macroeconomic news. This dissertation has a number of implications for the industry and for practitioners. It analyses financial risk associated with investing in Emerging Eastern Europe. Investors may use this information to construct and optimize investment portfolios. Moreover, this dissertation provides insights for investors and portfolio managers considering asset allocation to protect value or obtain higher returns. The results have also implications for asset pricing and portfolio selection in light of macroeconomic news releases.

New and Emerging Challenges of the ICT-Mediated Health and Well-Being Services

This monograph dissertation looks into the field of ICT-mediated health and well-being services. Through six chapters that extend the work done in the reviewed and published articles, the dissertation focuses on new and emerging technologies, and to impact of their use on the beneficiary; the individual who eventually derives advantage from the services. As the field is currently going through major changes particularly in the OECD countries, the focus is on shortterm developments in the field and the analysis on the long term developments is cursory by nature. The dissertation includes theoretical and empirical elements. Most of the empirical elements are linked to product development and conceptualization performed in the national MyWellbeing project that ended in 2010. In the project, the emphasis was on conceptualization of a personal aid for the beneficiary that could be used for managing information and services in the field of health and well-being services. This work continued the theme of developing individual-centric solutions for the field; a work that started in the InnoElli Senior program in 2006. The nature of this thesis is foremost a conceptual elaboration based on a literature review, illustrated in empirical work performed in different projects. As a theoretical contribution, this dissertation elaborates the role of a mediator, i.e. an intermediary, and it is used as an overarching theme. The role acts as a ‘lens’ through which a number of technology-related phenomena are looked at, pinned down and addressed to a degree. This includes introduction of solutions, ranging from anthropomorphic artefacts to decision support systems that may change the way individuals experience clinical encounters in the near-future. Due to the complex and multiform nature of the field, it is impractical and effectively impossible to cover all aspects that are related to mediation in a single work. Issues such as legislation, financing and privacy are all of equal importance. Consideration of all these issues is beyond the scope of this dissertation and their investigation is left to other work. It follows from this that the investigation on the role is not intended as inclusive one. The role of the mediator is also used to highlight some of the ethical issues related to personal health information management, and to mediating health and well-being related issues on behalf of another individual, such as an elderly relative or a fellow member of a small unit in the armed forces. The dissertation concludes in a summary about the use and functions of the mediator, describing some potential avenues for implementing such support mechanisms to the changing field of ICT-mediated health and well-being services. The conclusions also describe some of the limitations of this dissertation, including remarks on methodology and content.

Cooperative strategy in emerging markets - analysis of interfirm r&d cooperation and performance in Russian manufacturing companies

Emerging markets have come to play a significant role in the world, not only due to their strong economic growth but because they have been able to foster an increasing number of innovative high technology oriented firms. However, as the markets continue to change and develop, there remain many companies in emerging markets that struggle with their competitiveness and innovativeness. To improve competitive capabilities, many scholars have come to favor interfirm cooperation, which is perceived to help companies access new knowledge and complementary resources and, by so doing, enables them to catch up quickly with Western competitors. Regardless of numerous attempts by strategic management scholars, the research field remains very fragmented and lacks understanding on how and when interfirm cooperation contributes to firm performance and competiveness in emerging markets. Furthermore, the reasons why interfirm R&D sometimes succeeds but fails at other times frequently remain unidentified. This thesis combines the extant literature on competitive and cooperative strategy, dynamic capabilities, and R&D cooperation while studying interfirm R&D relationships in and between Russian manufacturing companies. Employing primary survey data, the thesis presents numerous novel findings regarding the effect of R&D cooperation and different types of R&D partner on firms’ exploration and exploitation performance. Utilizing a competitive strategy framework enables these effects to be explained in more detail, and especially why interfirm cooperation, regardless of its potential, has had a modest effect on the general competitiveness of emerging market firms. This thesis contributes especially to the strategic management literature and presents a more holistic perspective on the usefulness of cooperative strategy in emerging markets. It provides a framework through which it is possible to assess the potential impacts of different R&D cooperation partners and to clarify the causal relationships between cooperation, performance, and long term competitiveness.

Emerging market patterns in recycled paper trade

The international recovered paper trade serves two important functions: increasing raw material availability in the paper and board industry and providing economic incentives to recycle. The purpose of this paper is to shed further light on emerging patterns in this trade by empirically analysing the changes in the bilateral trade flows of recycled paper between 1992 and 2008. According to our estimations, two important changes have taken place in the 1990s and 2000s. First, the growing importance of developing economies in global recycled paper trade plays a significant role in import demand as a determinant of trade flows. Second, the changes in global trade patterns necessitate investigating the transportation cost measures used in applied research.