Impact of Investment Strategies on Performance in Pulp and Paper Industry

The main objective of this study was to examine, what kind of investment strategies the leading European and North American pulp and paper industry companies (PPI) used in 1991-2003, and how the selected strategies affected their performance. The investment strategies were categorised in three classes including mergers and acquisitions, investments in new capacity and investments in existing capacity. The results showed that mergers and acquisitions represented the largest share of total investments in 1991-2003 followed by investments in existing capacity. PPI companies changed investment strategies over time by increasing the share of mergers and acquisitions, which decreased investments in new capacity especially among North American companies. According to the results, good asset quality and investments in new and existing capacity provided better profitability than often expensive acquisitions. Also the capacity decreases had a positive impact on profitability. Average asset quality and profitability were higher among European companies. The study concluded that in the long term the available value creating investment opportunities should limit capital expenditure levels, not the relation of capital expenditure to depreciation.

Customer driven business model – connecting customer value to firm resources in ICT value networks

The objective of this thesis is to provide a business model framework that connects customer value to firm resources and explains the change logic of the business model. Strategic supply management and especially dynamic value network management as its scope, the dissertation is based on basic economic theories, transaction cost economics and the resource-based view. The main research question is how the changing customer values should be taken into account when planning business in a networked environment. The main question is divided into questions that form the basic research problems for the separate case studies presented in the five Publications. This research adopts the case study strategy, and the constructive research approach within it. The material consists of data from several Delphi panels and expert workshops, software pilot documents, company financial statements and information on investor relations on the companies’ web sites. The cases used in this study are a mobile multi-player game value network, smart phone and “Skype mobile” services, the business models of AOL, eBay, Google, Amazon and a telecom operator, a virtual city portal business system and a multi-play offering. The main contribution of this dissertation is bridging the gap between firm resources and customer value. This has been done by theorizing the business model concept and connecting it to both the resource-based view and customer value. This thesis contributes to the resource-based view, which deals with customer value and firm resources needed to deliver the value but has a gap in explaining how the customer value changes should be connected to the changes in key resources. This dissertation also provides tools and processes for analyzing the customer value preferences of ICT services, constructing and analyzing business models and business concept innovation and conducting resource analysis.

Purchasing and supply management capabilities in Finnish medium-sized enterprises

Purchasing and supply management (PSM) has become increasingly important for companies to survive in current highly competitive market. Increased outsourcing has extended the role of PSM, making external resource management and supplier relationships critical success factors in business. However, the recent research has mainly concentrated on large enterprises. Therefore the PSM issues related to medium-sized enterprises represent a significant research area. The thesis aims to explore the status and role of PSM in Finnish medium-sized firms, understand how strategic companies consider PSM to be, clarify what are the competence requirements for PSM professionals, and increase the understanding of PSM capabilities needed from the points view of individual competence and organisational capabilities. The study uses data that was collected in 2007 from purchasing executives at the director/CEO level representing a sample of 94 Finnish firms. 54 % of the respondent enterprises had a supply strategy. The total supply cost was on average 60 % of firms' turnover. Centralisation of PSM and outsourcing of logistics will increase in Finnish medium-sized enterprises. The findings point out that Finnish medium-sized enterprises had strategical features of PSM. However, Finnish firms have not concentrated on making strategies that relate to PSM. The elements that explain the existence of a supply strategy could be found in this study. It can be concluded from this study that there is an advantageous base for the development of strategic PSM, because nearly all the enterprises were of the opinion that PSM capabilities have an effect on business success. When reviewing the organisational capabilities, the five most important development elements were supplier relationships, both operational and strategic processes, time management, and personnel's competence. Training in internationalisation, strategic management, and communication could help to improve competences of PSM personnel.

Offshore Sourcing in Software Development: Case Studies of Finnish-Russian Cooperation

The study examines international cooperation in product development in software development organisations. The software industry is known for its global nature and knowledge-intensity, which makes it an interesting setting to examine international cooperation in. Software development processes are increasingly distributed worldwide, but for small or even medium-sized enterprises, typical for the software industry, such distribution of operations is often possible only in association with crossing the company’s boundaries. The strategic decision-making of companies is likely to be affected by the characteristics of the industry, and this includes decisions about cooperation or sourcing. The objective of this thesis is to provide a holistic view on factors affecting decisions about offshore sourcing in software development. Offshore sourcing refers to a cooperative mode of offshoring, where a firm does not establish its own presence in a foreign country, but utilises a local supplier. The study examines product development activities that are distributed across organisational and geographical boundaries. The objective can be divided into two subtopics: general reasons for international cooperation in product development and particular reasons for cooperation between Finnish and Russian companies. The focus is on the strategic rationale at the company level, in particular in small and medium-sized enterprises. The theoretical discourse of the study builds upon the literature on international cooperation and networking, with particular focus on cooperation with foreign suppliers and within product development activities. The resource-based view is also discussed, as heterogeneity and interdependency of the resources possessed by different firms are seen as factors motivating international cooperation. Strategically, sourcing can be used to access resources possessed by an industrial network, to enhance the product development of a firm, or to optimise its cost structure. In order to investigate the issues raised by the theoretical review, two empirical studies on international cooperation in software product development have been conducted. The emphasis of the empirical part of the study is on cooperation between Finnish and Russian companies. The data has been gathered through four case studies on Finnish software development organisations and four case studies on Russian offshore suppliers. Based on the material from the case studies, a framework clarifying and grouping the factors that influence offshore sourcing decisions has been built. The findings indicate that decisions regarding offshore sourcing in software development are far more complex than generally assumed. The framework provides a holistic view on factors affecting decisions about offshore sourcing in software development, capturing the multidimensionality of motives for entering offshore cooperation. Four groups of factors emerged from the data: A) strategy-related aspects, B) aspects related to resources and capabilities, C) organisation-related aspects, and D) aspects related to the entrepreneur or management. By developing a holistic framework of decision factors, the research offers in-depth theoreticalunderstanding of offshore sourcing rationale in product development. From the managerial point of view, the proposed framework sums up the issues that a firm should pay attention to when contemplating product development cooperation with foreign suppliers. Understanding different components of sourcing decisions can lead to improved preconditions for strategising and engaging in offshore cooperation. A thorough decisionmaking process should consider all the possible benefits and risks of product development cooperation carefully.

Resurssien ja kyvykkyyksien vastaavuus alan muuttuviin vaatimuksiin

Tämän diplomityön tavoitteena on tutkia kohdeyrityksen strategista muutosta perinteisestä tuotetoimittajasta ratkaisujen toimittajaksi. Toimialan muutosta arvioidaan tarkemmin, jotta voidaan selvittää kuinka yrityksen tulisi mukauttaa resurssejaan ja kyvykkyyksiään sopeutuakseen muutoksen tuomiin uusiin haasteisiin. Tarkastelun alla on erityisesti yrityksen strateginen muutos ja kuinka löytää strategian kannalta ne dynaamiset kyvykkyydet joiden avulla yritys saa pysyvää kilpailuetua. Yritykset pyrkivät strategisessa suunnittelussaan pysyvään kilpailuetuun. Strategista johtamisen teorioita on esitetty useita ja niiden kautta on vaikea selittää nykyisin nopeasti muuttuvassa toimintaympäristössä toimivien yritysten menestystä. Dynaamisten kyvykkyyksistä on haettu selitystä menestyksen taakse. Yritysten tavoitellessa kokonaan uusia liiketoiminta-alueita niihin kohdistuu suuria muutoksia niin ulkoisesti kuin sisäisestikin. Tällöin on kriittistä tunnistaa ne ydinkyvykkyydet joiden avulla voidaan menestyä uusilla liiketoiminta-alueilla. Työn ensimmäisessä osassa esitetään strategiaan ja kyvykkyyksiin liittyviä teorioita. Teoriaosiossa tarkastellaan myös palveluyritykseksi muuntautumisen haasteita, jonka jälkeen esitellään kohdeyrityksen strategiset tavoitteet ja kuinka puuttuvia resursseja voidaan tunnistaa. Resurssipohjaisen lähestymistavan avulla päästiin hyvin käsiksi toimialan muutoksen aiheuttamiin puuttuviin resursseihin. Analyysin aikana tunnistettiin puutteita tavoitteisiin nähden ja tässä työssä nousi yhtenä keskeisimpänä esille ICT-osaaminen kohdeyrityksen siirtyessä laitevalmistajan roolista kohti ratkaisun toimittajaa. Tutkimuksen perusteella voidaan todeta, että resurssipohjaisen lähestymistavan avulla voidaan tunnistaa tämän tyyppisessä yrityksessä resurssipuutteita joita kehittämällä yritys voi saavuttaa pysyvää kilpailuetua.

On Value Creation at an Industrial Intersection – Bioenergy in the Forest and Energy Sectors

The traditional forest industry is a good example of the changing nature of the competitive environment in many industries. Faced with drastic challenges forestindustry companies are forced to search for new value-creating strategies in order to create competitive advantage. The emerging bioenergy business is now offering promising avenues for value creation for both the forest and energy sectors because of their complementary resources and knowledge with respect to bioenergy production from forest-based biomass. The key objective of this dissertation is to examine the sources of sustainable competitive advantage and the value-creation opportunities that are emerging at the intersection between the forest and energy industries. The research topic is considered from different perspectives in order to provide a comprehensive view of the phenomenon. The study discusses the business opportunities that are related to producing bioenergy from forest-based biomass, and sheds light on the greatest challenges and threats influencing the success of collaboration between the forest and energy sectors. In addition, it identifies existing and potential bioenergy actors, and considers the resources and capabilities needed in order to prosper in the bioenergy field. The value-creation perspective is founded on strategic management accounting, the theoretical frameworks are adopted from the field of strategic management, and the future aspect is taken into account through the application of futures studies research methodology. This thesis consists of two parts. The first part provides a synthesis of the overall dissertation, and the second part comprises four complementary research papers. There search setting is explorative in nature, and both qualitative and quantitative research methods are used. As a result, the thesis lays the foundation for non-technological studies on bioenergy. It gives an example of how to study new value-creation opportunities at an industrial intersection, and discusses the main determinants affecting the value-creation process. In order to accomplish these objectives the phenomenon of value creation at the intersection between the forest and energy industries is theorized and connected with the dynamic resource-based view of the firm.

Synergiaedut portfolioyrittäjyydessä

Tämän tutkimuksen tarkoituksena on osallistua portfolioyrittäjyydestä käytävään akateemiseen keskusteluun. Tutkimuksen tavoitteena on kuvata portfolioyrittäjyyttä ja ymmärtää synergiaetujen arvo kyseisessä kontekstissa. Synergiaetujen syntymistä ja olemassaoloa tarkastellaan resurssiperusteisen näkemyksen kautta. Tavoitteena on selvittää mitä portfolioyrittäjyys pohjimmiltaan on, minkälaisia synergiaetuja portfolioyrittäjyydessä esiintyy, ja millaisia lisäarvoja synergiaedut portfolioyrittäjyyden kentässä tarjoavat. Tutkimus on luonteeltaan laadullinen ja tutkimusmetodina sovelletaan teemahaastattelua. Haastatteluaineisto on kerätty pitkäkestoisilla haastatteluilla kolmen menestyneen portfolioyrittäjän kanssa. Haastateltavat ovat toimineet yrittäjyyden kentällä useita vuosia ja vakiinnuttaneet paikkansa portfolioyrittäjinä. Tutkimuksen perusteella voidaan todeta, että portfolioyrittäjyys on varteenotettava yrittäjyyden muoto, johon sisältyy resurssien siirrettävyyteen perustuvia synergiaetuja. Näiden synergiaetujen rooli on portfolioyrittäjän menestymisen kannalta merkittävä.

Outsourcing process in pharmaceutical product development

The aim of this study was to create an outsourcing process for pharmaceutical product development. This study focuses on two main questions. The first question is “What is the outsourcing process model?” In the second phase key success factors of the outsourcing process are identified. As a result of the literature reviews, a general outsourcing process was created. Transaction cost economics and resource based view were used to derived a theoretical framework to the process by combining the existing processes presented in the literature. The model of process is considered used to the outsourcing broadly. The general outsourcing process was then developed further with the key factors that affect the success of pharmaceutical product development and the interviews of pharmaceutical outsourcing experts. The result of the research was the process consists of seven phases with key activities and expected outputs for each of the phases. In addition, the strategic decision-making framework for outsourcing decision in pharmaceutical product development is giving as well as the tools for selecting supplier and preparing structured contract. This study also gives some recommendations for managing the outsourcing process.

Julkinen-yksityinen kumppanuuden vaikutus asiakasarvon muodostumiseen terveydenhuollon toimialalla

Terveydenhuollon toimiala on voimakkaiden muutospaineiden edessä. Huoltosuhteen heikkeneminen asettaa julkiselle terveydenhuollolle suuria haasteita. Uudenlaisten palveluratkaisujen ja teknologian avulla voidaan tuottavuutta sekä tehokkuutta nostaa. Työssä selvitetään julkinen - yksityinen kumppanuuden merkitystä asiakasarvon muodostumiseen terveydenhuollon toimialalla. Työssä on kahden case-esimerkin sekä kirjallisuuslähteiden avulla tutkittu asiakasarvon syntyyn vaikuttavia tekijöitä. Teoreettisina viitekehyksinä on käytetty resurssipohjaista näkemystä. Case-esimerkkeinä käytettiin MedOne Oy:n ja Lahden kaupungin välistä ulkoistussopimusta sekä Effica-potilastietojärjestelmän käyttöönottoa. Kummassakin tapauksessa voidaan katsoa asiakasarvoa syntyneen, muttei täysin ongelmitta.

Kumppanuusohjelman strateginen johtaminen - Monitapaustutkimus puolustushallinnossa

Puolustushallinnossa syntyi 2000-luvun alussa strateginen aie keskittyä ydintoimintoihin, ulkoistaa pääosa tukitoiminnoista ja saavuttaa kustannussäästöjä, jotka voitaisiin kohdentaa ydintoimintoihin. Puolustusministeriö perusti ulkoistamisen hallinnoimiseksi kumppanuusohjelman, mihin kuului lähes alusta alkaen kuusi hanketta, jotka ovat nyt toteuttamisvaiheessa. Näistä valittiin neljä tähän tutkimukseen: maavoimien materiaalin kunnossapito, puolustusvoimien ruokahuolto, puolustusvoimien vaatetushuolto ja puolustushallinnon talous- ja henkilöstöhallinto. Kumppanuusohjelman strategisen johtamisen tutkimus perustuupuolustusministeriön ja puolustusvoimien asiakirja-aineistoihin sekä puolustushallinnon ylimmän johdon ja hankejohtajien haastatteluihin. Kumppanuusohjelmaa ja -hankkeita on seurattu vuodesta 2000 vuoden 2010 kevääseen asti. Tarkastelu kohdistuu strategiaprosessiin ja strategian sisältöön ”puolustushallinnon konsernissa”, johon kuuluvat tässä tutkimuksessa puolustusministeriö, pääesikunta ja puolustushaarat. Tutkimuksen tulokset tukevat viitekehyksessä esitettyjä näkökohtia. Laajan kumppanuusohjelman hallinta edellyttää hyvää strategisen johtamisen otetta. Selkeät päämäärät ja tavoitteet luovat perustan strategiaprosessille. Kumppanuusohjelman strategia muotoutui tarkastelujakson aikana niin strategiaprosessien kuin strategian sisällön suhteen. Toimiva ohjausjärjestelmä on puolustushallinnon avaintoimintoja strategisessa johtamisessa. Resurssiperusteinen strategia osoittautui tärkeäksi ulkoistamisissa ja sosiaalinen pääoma, erityisesti yhteisymmärrys osoittautui tärkeäksi tekijäksi konsernijohtamisessa. Kumppanuusohjelman strategisen johtamisen toimivuuden kehittämiseksi kartoitettiin tekijöitä, jotka muodostuivat tehokkaan strategisen johtamisen esteiksi. Esteitä kartoitettiin kumppanuusohjelmasta ja -hankkeista. Tutkimuksen tärkein kontribuutio kohdistuu strategisen johtamisen kehittämiseen. Se on mahdollista hankkimalla konsernin johtotasoilla yhteisymmärryskehittämisohjelmasta ennen ohjelman käynnistämistä, ottamalla huomioon strategisen johtamisen perusteet, ottamalla käyttöön jatkuva strategiaprosessi ja turvaamalla riittävä osaaminen kumppanuusohjelmassa ja -hankkeissa.

Tuotekehitys pysyvän kilpailuedun lähteenä

Tuotekehityksen merkitys yrityksen menestymisen kannalta on pitkään ollut mielenkiinnon aihe ja on pohdittu onko tuotekehitys välttämätöntä, jotta yritys pysyy kilpailussa mukana. Tässä työssä käsitellään tuotekehitystä yritysten kilpailuedun lähteenä. Tuotekehityksen ja resurssiperusteisen näkemyksen perusideat ja niiden välinen yhteys on esitetty. Tietoa tähän työhön on haettu useiden eri lehtien artikkeleista sekä alan oppikirjoista. Pääasiallisina lähteinä on pyritty käyttämään niitä artikkeleita, jotka ovat vahvasti vaikuttaneet näiden kahden teorian ja niiden sisältämien käsitteiden muodostumiseen. Työn tavoitteena on selvittää onko tuotekehityksellä ja yrityksen menestyksellä selkeä yhteys ja kuinka keskeistä tuotekehitystoiminta on yrityksen kilpailuedun kannalta. Työssä määritellään kilpailuetu ja mitkä tekijät vaikuttavat sen saavuttamiseen. Kilpailuedun perusteoriana on esitetty resurssiperusteinen näkemys, jossa tärkeimpiä käsitteitä ovat resurssit, kompetenssit ja kyvykkyydet. Työssä perehdytään näihin käsitteisiin ja niiden yhteyteen ja niiden avulla määritetään yrityksen saavuttama kilpailuetu. Tuotekehityksestä otetaan esille useita näkökulmia, jotka kaikki osaltaan vaikuttavat yrityksen menestymiseen uuden tuotteen avulla. Tuotekehityksen yhteydessä on erityisesti perehdytty teknologian kehitykseen, ja sen vaikutusta yritysten sisäisiin muutoksiin. Tuotekehitys ja kilpailuetu on yhdistetty, ja eri teorioiden ja tutkimusten hyödyntämisen kautta on huomattavissa selkeä yhteys tuotekehityksen ja kilpailuedun saavuttamisen välillä.

Supply management capability

The objective of this thesis is to define supply management capability. The thesis study what factors consist of supply management capability, and which of those factors are critical to achieving competitive advantage. One objective is also to study how firms can measure their supply management capability. This study is a qualitative research. The thesis examines the literature regarding to supply management and the context of capability and there are used Delphi panel to examine the current and future insights of supply management professionals concerning of supply management skills and capability. The empirical data of the thesis was collected by interviews. The Delphi panel was used in data collection and analysis and for prioritization of the factors of supply management capability. The thesis includes lists of factors of supply management capability. Main findings of the study were that there is no one clear, generally suitable set of supply management skills which bring competitive advantage for all firms and the most important factors of supply management capability, according to the experts, are total cost analysis, customer focus, general business view, market knowledge and supplier relationships. In this study the supply management capability is defined as organization’s overall capacity and ability to achieve a holistic understanding of purchasing needs, manage its suppliers and collaborative partners, and conduct its internal tasks, routines and responsibilities in a way that achieves desired results. The results of this thesis show also that Finnish firms need more right kind of supply management knowledge.

Smart homes as service platforms. Research report of ÄLYKOP sub-project “Competitive advantage from customer value”

In this report, we summarize results of our part of the ÄLYKOP-project on customer value creation in the intersection of the health care, ICT, forest and energy industries. The research directs to describe how industry transformation and convergence create new possibilities, business opportunities and even new industries.The report consists of findings which are presented former in academic publications. The publication discusses on customer value, service provision and resource basis of the novel concepts through multiple theorethical frameworks. The report is divided into three maim sections which are theoretical background, discussion on health care industry and evaluations regarding novel smart home concepts. Transaction cost economics and Resource- Based view on the firm provides the theoretical basis to analyze the prescribed phenomena. The health care industry analysis describes the most important changes in the demand conditions of health care services, and explores the features that are likely to open new business opportunities for a solution provider. The third part of the report on the smart home business provides illustrations few potential concepts that can be considered to provide solutions to economical problems which arise from aging of population. The results provide several recommendations for the smart home platform developers in public and private sectors. By the analysis, public organizations dominate service provision and private markets are emergent state at present. We argue that public-private partnerships are nececssary for creating key suppliers. Indeed, paying attion on appropriate regulation, service specifications and technology standards would foster diffusion of new services. The dynamics of the service provision networks is driven by need for new capabiltities which are required for adapting business concepts to new competitive situation. Finally, the smart home framework revealed links between conventionally distant business areas such as health care and energy distribution. The platform integrates functionalities different for purposes which however apply same resource basis.

Technology park as an element of innovative infrastructure- its role in internationalization support.

The Thesis concentrates on two central terms – Technology park and the resource-based view of the organization. General attention is devoted to competencies and capabilities of organizations that operate in foreign environment. It is difficult to go abroad without any experience and support from local government, especially for small or medium company. Technology and Science parks are the main sources of competitive advantage for this kind of organizations. They provide a huge range of services as well as business consultations and financial support on different stages of companies’ development. The Thesis was made with the assistance of Technopolis Oy in Lappeenranta. During the research companies in Finland and Russia were interviewed. Based on empirical findings important capabilities for entering foreign market were identified and some recommendations for the Technology park were given.

Research framework for the connection between environmental collaboration and firm performance

This thesis focuses on collaborative activities with regard to environmental issues both within the firm and outside the firm with the key suppliers and customers, i.e. internal and external environmental collaboration. Integrating environmental thinking into supply chain management has received increasing interest in recent years. The relational view and the natural resource-based-view together suggest that environmental capabilities can be built jointly with supply chain partners and used to gain sustained competitive advantage. Several studies have been undertaken to analyse the connection between environmental activities and firm performance but most studies have taken only economic performance into account. This study pays attention also to two other dimensions of firm performance, intra-firm supply chain performance and environmental performance, and aims at presenting the linkages between them and environmental collaboration. This thesis creates a research framework for the connections between environmental collaboration and firm performance and suggests approaches to analyse these. In order to find out the key concepts and their relationship, an extensive literature review is conducted. The research framework proposes a positive connection between internal and external environmental collaboration and all three dimensions of firm performance. In addition, environmental performance and intra-firm supply chain performance are expected to contribute positively to economic performance. Hence, firms are suggested to benefit from environmental collaboration both within the firm and outside the firm. Empirical testing of the developed research framework is out of the scope of this study. However, this thesis proposes using a mixed methods research approach, including survey research and multiple case studies. Finland State of Logistics 2012 survey commissioned by the Finnish Ministry of Transport and Communications and conducted by Turku School of Economics is used as an example of data for the quantitative phase. The applicability of these two methods is discussed at a general level and with regard to analysing the research framework developed in the thesis. Future research will aim at the development of the research framework and the methods in order to confirm the connection between environmental collaboration and firm performance.