A Business continuity management maturity model : the search for an ISO 22301 Compliant BCM Maturity model

BCM (business continuity Management) is a holistic management process aiming at ensuring business continuity and building organizational resilience. Maturity models offer organizations a tool for evaluating their current maturity in a certain process. In the recent years BCM has been subject to international ISO standardization, while the interest of organizations to bechmark their state of BCM agains standards and the use of maturity models for these asessments has increased. However, although new standards have been introduced, very little attention has been paid to reviewing the existing BCM maturity models in research - especially in the light of the new ISO 22301 standard for BCM. In this thesis the existing BCM maturily models are carefully evaluated to determine whetherthey could be improved. In order to accomplish this, the compliance of the existing models to the ISO 22301 standard is measured and a framework for assessing a maturitymodel´s quality is defined. After carefully evaluating the existing frameworks for maturity model development and evaluation, an approach suggested by Becker et al. (2009) was chosen as the basis for the research. An additionto the procedural model a set of seven research guidelines proposed by the same authors was applied, drawing on the design-science research guidelines as suggested by Hevner et al. (2004). Furthermore, the existing models´ form and function was evaluated to address their usability. Based on the evaluation of the existing BCM maturity models, the existing models were found to have shortcomings in each dimension of the evaluation. Utilizing the best of the existing models, a draft version for an enhanced model was developed. This draft model was then iteratively developed by conducting six semi-structured interviews with BCM professionals in finland with the aim of validating and improving it. As a Result, a final version of the enhanced BCM maturity model was developed, conforming to the seven key clauses in the ISO 22301 standard and the maturity model development guidelines suggested by Becker et al. (2009).

Improving reporting management with relational database management system

Data management consists of collecting, storing, and processing the data into the format which provides value-adding information for decision-making process. The development of data management has enabled of designing increasingly effective database management systems to support business needs. Therefore as well as advanced systems are designed for reporting purposes, also operational systems allow reporting and data analyzing. The used research method in the theory part is qualitative research and the research type in the empirical part is case study. Objective of this paper is to examine database management system requirements from reporting managements and data managements perspectives. In the theory part these requirements are identified and the appropriateness of the relational data model is evaluated. In addition key performance indicators applied to the operational monitoring of production are studied. The study has revealed that the appropriate operational key performance indicators of production takes into account time, quality, flexibility and cost aspects. Especially manufacturing efficiency has been highlighted. In this paper, reporting management is defined as a continuous monitoring of given performance measures. According to the literature review, the data management tool should cover performance, usability, reliability, scalability, and data privacy aspects in order to fulfill reporting managements demands. A framework is created for the system development phase based on requirements, and is used in the empirical part of the thesis where such a system is designed and created for reporting management purposes for a company which operates in the manufacturing industry. Relational data modeling and database architectures are utilized when the system is built for relational database platform.

The board of directors as a part of family business governance – multilevel participation and board development

In this study, I examine the board of directors as a part of family business governance. Both boards and governance have increased their attractiveness as a research topic lately. Research on boards has concentrated mostly on the study of different board attributes, like composition, and the relationship of these attributes to the firm’s performance. Family business governance studies are criticized for ignoring the multifaceted needs of companies. More research observing the context and contingencies affecting the governance and board of directors is needed. The objective of this study is to clarify: 1) how the board participates in family business governance, and 2) how the board develops along with the firm’s and family’s development. The study is implemented as qualitative research, and the longitudinal process approach has been used as it provides the opportunity to examine development in context. Selection criteria for the two cases selected for this study are: active board of directors, at least one implemented succession, and interviewees available from two generations and from different positions in the firm. The data consists of interviews and secondary data, and it is collected from different data sources. The analysis was done selecting first some critical events from both cases to closer examination, and analysing them by using content analysis technique. Several conclusions were drawn basing on the findings. First, the family business board participates in the firm’s activities much more widely than it is customary to think. Second, the family business board is not a static part of the business, but it develops and it has to develop for different reasons. Third, ownership is not only the basis for the board’s activities or existence, but the relationship between the board and ownership is two-way. The board contributes to a large extent to the ownership decisions, and in this way to the management of ownership. Fourth, according to the cases, the board has many unrecognized possibilities to facilitate succession in family firms.

Computational modeling of stented coronary arteries

The application of computational fluid dynamics (CFD) and finite element analysis (FEA) has been growing rapidly in the various fields of science and technology. One of the areas of interest is in biomedical engineering. The altered hemodynamics inside the blood vessels plays a key role in the development of the arterial disease called atherosclerosis, which is the major cause of human death worldwide. Atherosclerosis is often treated with the stenting procedure to restore the normal blood flow. A stent is a tubular, flexible structure, usually made of metals, which is driven and expanded in the blocked arteries. Despite the success rate of the stenting procedure, it is often associated with the restenosis (re-narrowing of the artery) process. The presence of non-biological device in the artery causes inflammation or re-growth of atherosclerotic lesions in the treated vessels. Several factors including the design of stents, type of stent expansion, expansion pressure, morphology and composition of vessel wall influence the restenosis process. Therefore, the role of computational studies is crucial in the investigation and optimisation of the factors that influence post-stenting complications. This thesis focuses on the stent-vessel wall interactions followed by the blood flow in the post-stenting stage of stenosed human coronary artery. Hemodynamic and mechanical stresses were analysed in three separate stent-plaque-artery models. Plaque was modeled as a multi-layer (fibrous cap (FC), necrotic core (NC), and fibrosis (F)) and the arterial wall as a single layer domain. CFD/FEA simulations were performed using commercial software packages in several models mimicking the various stages and morphologies of atherosclerosis. The tissue prolapse (TP) of stented vessel wall, the distribution of von Mises stress (VMS) inside various layers of vessel wall, and the wall shear stress (WSS) along the luminal surface of the deformed vessel wall were measured and evaluated. The results revealed the role of the stenosis size, thickness of each layer of atherosclerotic wall, thickness of stent strut, pressure applied for stenosis expansion, and the flow condition in the distribution of stresses. The thicknesses of FC, and NC and the total thickness of plaque are critical in controlling the stresses inside the tissue. A small change in morphology of artery wall can significantly affect the distribution of stresses. In particular, FC is the most sensitive layer to TP and stresses, which could determine plaque’s vulnerability to rupture. The WSS is highly influenced by the deflection of artery, which in turn is dependent on the structural composition of arterial wall layers. Together with the stenosis size, their roles could play a decisive role in controlling the low values of WSS (<0.5 Pa) prone to restenosis. Moreover, the time dependent flow altered the percentage of luminal area with WSS values less than 0.5 Pa at different time instants. The non- Newtonian viscosity model of the blood properties significantly affects the prediction of WSS magnitude. The outcomes of this investigation will help to better understand the roles of the individual layers of atherosclerotic vessels and their risk to provoke restenosis at the post-stenting stage. As a consequence, the implementation of such an approach to assess the post-stented stresses will assist the engineers and clinicians in optimizing the stenting techniques to minimize the occurrence of restenosis.

Learning information technology business in a changing industry landscape. Introducing Team Entrepreneurship in Renewing Bachelor Education in Renewing Bachelor Education in Information

Speed, uncertainty and complexity are increasing in the business world all the time. When knowledge and skills become quickly irrelevant, new challenges are set for information technology (IT) education. Meta-learning skills – learning how to learn rapidly - and innovation skills have become more essential than single technologies or other specific issues. The drastic changes in the information and communications technology (ICT) sector have caused a need to reconsider how IT Bachelor education in Universities of Applied Sciences should be organized and employed to cope with the change. The objective of the study was to evaluate how a new approach to IT Bachelor education, the ICT entrepreneurship study path (ICT-ESP) fits IT Bachelor education in a Finnish University of Applied Sciences. This kind of educational arrangement has not been employed elsewhere in the context of IT Bachelor education. The study presents the results of a four-year period during which IT Bachelor education was renewed in a Finnish University of Applied Sciences. The learning environment was organized into an ICT-ESP based on Nonaka’s knowledge theory and Kolb’s experiental learning. The IT students who studied in the ICT-ESP established a cooperative and learned ICT by running their cooperative at the University of Applied Sciences. The students (called team entrepreneurs) studied by reading theory in books and other sources of explicit information, doing projects for their customers, and reflecting in training sessions on what was learnt by doing and by studying the literature. Action research was used as the research strategy in this study. Empirical data was collected via theme-based interviews, direct observation, and participative observation. Grounded theory method was utilized in the data analysis and the theoretical sampling was used to guide the data collection. The context of the University of Applied Sciences provided a good basis for fostering team entrepreneurship. However, the results showed that the employment of the ICT-ESP did not fit into the IT Bachelor education well enough. The ICT-ESP was cognitively too tough for the team entrepreneurs because they had two different set of rules to follow in their studies. The conventional courses engaged lot of energy which should have been spent for professional development in the ICT-ESP. The amount of competencies needed in the ICT-ESP for professional development was greater than those needed for any other ways of studying. The team entrepreneurs needed to develop skills in ICT, leadership and self-leadership, team development and entrepreneurship skills. The entrepreneurship skills included skills on marketing and sales, brand development, productization, and business administration. Considering the three-year time the team entrepreneurs spent in the ICT-ESP, the challenges were remarkable. Changes to the organization of IT Bachelor education are also suggested in the study. At first, it should be admitted that the ICT-ESP produces IT Bachelors with a different set of competencies compared to the conventional way of educating IT Bachelors. Secondly, the number of courses on general topics in mathematics, physics, and languages for team entrepreneurs studying in the ICTESP should be reconsidered and the conventional course-based teaching of the topics should be reorganized to support the team coaching process of the team entrepreneurs with their practiceoriented projects. Third, the upcoming team entrepreneurs should be equipped with relevant information about the ICT-ESP and what it would require in practice to study as a team entrepreneur. Finally, the upcoming team entrepreneurs should be carefully selected before they start in the ICT-ESP to have a possibility to eliminate solo players and those who have a too romantic view of being a team entrepreneur. The results gained in the study provided answers to the original research questions and the objectives of the study were met. Even though the IT degree programme was terminated during the research process, the amount of qualitative data gathered made it possible to justify the interpretations done.

From emerging opportunities to successful business networks – evidence from bioenergy

Increasing renewable energy utilization is a challenge that is tried to be solved in different ways. One of the most promising options for renewable energy is different biomasses, and the bioenergy field offers numerous emerging business opportunities. The actors in the field have rarely all the needed know-how and resources for exploiting these opportunities, and thus it is reasonable to seize them in cooperation. Networking is not an easy task to carry out, however, and in addition to its advantages for the firms engaged, it sets numerous challenges as well. The development of a network is a result of several steps firms need to take. In order to gain optimal advantage of their networks, firms need to weigh out with whom, why and how they should cooperate. In addition, everything does not depend on the firms themselves, as several factors in the external environment set their own enablers and barriers for cooperation. The formation of a network around a business opportunity is thus a multiphase process. The objective of this thesis is to depict this process via a step-by-step analysis and thus increase understanding on the whole development path from an entrepreneurial opportunity to a successful business network. The empirical evidence has been gathered by discussing the opportunities of animal manure refinement to biogas and forest biomass utilization for heating in Finland. The thesis comprises two parts. The first part provides an overview of the study, and the second part includes five research publications. The results reveal that it is essential to identify and analyze all the steps in the development process of a network, and several frameworks are used in the thesis to analyze these steps. The frameworks combine the views of theory and practical experiences of empirical study, and thus give new multifaceted views for the discussion on SME networking. The results indicate that the ground for cooperation should be investigated adequately by taking account of the preconditions in all the three contexts in which the actors operate: the social context, the region and the institutional environment. In case the project advances to exploitation, the assets and objectives of the actors should be paired off, which sets a need for relationships and sub-networks differing in breadth and depth. Different relationships and networks require different kinds of maintenance and management. Moreover, the actors should have the capability to change the formality or strategy of the relationships if needed. The drivers for these changes come along with the changing environment, which causes changes in the objectives of the actors and this way in the whole network. Bioenergy as the empirical field of the study represents well an industrial field with many emerging opportunities, a motley group of actors, and sensitivity for fast changes.

CFD modeling of dispersion water feed in wastewater cleaning application

Fluid particle breakup and coalescence are important phenomena in a number of industrial flow systems. This study deals with a gas-liquid bubbly flow in one wastewater cleaning application. Three-dimensional geometric model of a dispersion water system was created in ANSYS CFD meshing software. Then, numerical study of the system was carried out by means of unsteady simulations performed in ANSYS FLUENT CFD software. Single-phase water flow case was setup to calculate the entire flow field using the RNG k-epsilon turbulence model based on the Reynolds-averaged Navier-Stokes (RANS) equations. Bubbly flow case was based on a computational fluid dynamics - population balance model (CFD-PBM) coupled approach. Bubble breakup and coalescence were considered to determine the evolution of the bubble size distribution. Obtained results are considered as steps toward optimization of the cleaning process and will be analyzed in order to make the process more efficient.

Promoting Cleantech in Emerging Markets: Business Model for Waste Pre-treatment Equipment in China

Waste incineration is becoming increasingly widespread method of waste disposal in China. Incineration plants mostly use grate and circular fluidized bed (CFB) technology. Waste combustion in cement production is also beginning to gradually increase. However, Chinese waste composition is causing problems for the energy utilization. Mechanical waste pre-treatment optimizes the combustion process and facilitates the energy recovery. The objective of this study is to identify how Western waste pre-treatment manufacturer could operate in Chinese markets. Chinese waste management industry is reviewed via PESTEL analysis. The current state and future predictions of grate and CFB incineration as well as cement manufacturing are monitored. Grate combustion, which requires lesser waste pre-treatment, is becoming more common at the expense of CFB incineration in China. The most promising future for waste treatment is in cement production industry. Waste treatment equipment manufacturer should try to create pilot projects with biggest cement producers with a view of growing co-operation in the future.

Supplier segmentation and development in project business

The purpose of this study was to expand the applicability of supplier segmentation and development approaches to the project-driven construction industry. These practices are less exploited and not well documented in this operational environment compared to the process-centric manufacturing industry. At first, portfolio models to supply base segmentation and various supplier development efforts were investigated in literature review. A step-wise framework was structured for the empirical research. The empirical study employed multiple research methods in three case studies in a large Finnish construction company. The first study categorized the construction item classes into the purchasing portfolio and positioned suppliers to the power matrix by investigating buyer-supplier relations. Using statistical tests, the study also identified factors that affect suppliers’ performance. The final case study identified improvement areas of the interface between a main contractor and one if its largest suppliers. The final results indicate that only by assessing the supply base in a holistic manner and the power circumstances in it, buyers comprehend how to best establish appropriate supplier development strategies in the project environment.

The demand-supply balancing process in supply chain management - case mining & metals industry equipment

The aim of this thesis is to search how to match the demand and supply effectively in industrial and project-oriented business environment. The demand-supply balancing process is searched through three different phases: the demand planning and forecasting, synchronization of demand and supply and measurement of the results. The thesis contains a single case study that has been implemented in a company called Outotec. In the case study the demand is planned and forecasted with qualitative (judgmental) forecasting method. The quantitative forecasting methods are searched further to support the demand forecast and long term planning. The sales and operations planning process is used in the synchronization of the demand and supply. The demand forecast is applied in the management of a supply chain of critical unit of elemental analyzer. Different meters on operational and strategic level are proposed for the measurement of performance.

Spatial modeling techniques for mapping and characterization of acid sulfate soils

Acid sulfate (a.s.) soils constitute a major environmental issue. Severe ecological damage results from the considerable amounts of acidity and metals leached by these soils in the recipient watercourses. As even small hot spots may affect large areas of coastal waters, mapping represents a fundamental step in the management and mitigation of a.s. soil environmental risks (i.e. to target strategic areas). Traditional mapping in the field is time-consuming and therefore expensive. Additional more cost-effective techniques have, thus, to be developed in order to narrow down and define in detail the areas of interest. The primary aim of this thesis was to assess different spatial modeling techniques for a.s. soil mapping, and the characterization of soil properties relevant for a.s. soil environmental risk management, using all available data: soil and water samples, as well as datalayers (e.g. geological and geophysical). Different spatial modeling techniques were applied at catchment or regional scale. Two artificial neural networks were assessed on the Sirppujoki River catchment (c. 440 km2) located in southwestern Finland, while fuzzy logic was assessed on several areas along the Finnish coast. Quaternary geology, aerogeophysics and slope data (derived from a digital elevation model) were utilized as evidential datalayers. The methods also required the use of point datasets (i.e. soil profiles corresponding to known a.s. or non-a.s. soil occurrences) for training and/or validation within the modeling processes. Applying these methods, various maps were generated: probability maps for a.s. soil occurrence, as well as predictive maps for different soil properties (sulfur content, organic matter content and critical sulfide depth). The two assessed artificial neural networks (ANNs) demonstrated good classification abilities for a.s. soil probability mapping at catchment scale. Slightly better results were achieved using a Radial Basis Function (RBF) -based ANN than a Radial Basis Functional Link Net (RBFLN) method, narrowing down more accurately the most probable areas for a.s. soil occurrence and defining more properly the least probable areas. The RBF-based ANN also demonstrated promising results for the characterization of different soil properties in the most probable a.s. soil areas at catchment scale. Since a.s. soil areas constitute highly productive lands for agricultural purpose, the combination of a probability map with more specific soil property predictive maps offers a valuable toolset to more precisely target strategic areas for subsequent environmental risk management. Notably, the use of laser scanning (i.e. Light Detection And Ranging, LiDAR) data enabled a more precise definition of a.s. soil probability areas, as well as the soil property modeling classes for sulfur content and the critical sulfide depth. Given suitable training/validation points, ANNs can be trained to yield a more precise modeling of the occurrence of a.s. soils and their properties. By contrast, fuzzy logic represents a simple, fast and objective alternative to carry out preliminary surveys, at catchment or regional scale, in areas offering a limited amount of data. This method enables delimiting and prioritizing the most probable areas for a.s soil occurrence, which can be particularly useful in the field. Being easily transferable from area to area, fuzzy logic modeling can be carried out at regional scale. Mapping at this scale would be extremely time-consuming through manual assessment. The use of spatial modeling techniques enables the creation of valid and comparable maps, which represents an important development within the a.s. soil mapping process. The a.s. soil mapping was also assessed using water chemistry data for 24 different catchments along the Finnish coast (in all, covering c. 21,300 km2) which were mapped with different methods (i.e. conventional mapping, fuzzy logic and an artificial neural network). Two a.s. soil related indicators measured in the river water (sulfate content and sulfate/chloride ratio) were compared to the extent of the most probable areas for a.s. soils in the surveyed catchments. High sulfate contents and sulfate/chloride ratios measured in most of the rivers demonstrated the presence of a.s. soils in the corresponding catchments. The calculated extent of the most probable a.s. soil areas is supported by independent data on water chemistry, suggesting that the a.s. soil probability maps created with different methods are reliable and comparable.

Competence foresight: linking the identification of HR competences and competence management alignment with business strategy

The objective of this study was to increase understanding of the link between the identification of required HR competences and competence management alignment with business strategy in a Finnish, global company employing over 8,000 people and about 100 HR professionals. This aim was approached by analyzing the data collected in focus group interviews using a grounded theory method and in parallel reviewing the literature of strategic human resource management, competence-based strategic management, strategy and foresight. The literature on competence management in different contexts dismisses in-depth discussions on the foresight process and individuals are often forgotten in strategic frameworks. However, corporate foresight helps in the detection of emerging opportunities for innovations and in the implementation of strategy. The empirical findings indicate a lack of strategic leadership and an alignment with HR and business. Accordingly, the most important HR competence areas identified were the need for increasing business understanding and enabling change. As a result, the study provided a holistic model for competence foresight, which introduces HR professionals as strategic change agents in the role of organizational futurists at the heart of the company: facilitating competence foresight and competence development on individual as well as organizational levels, resulting in an agile organization with increased business understanding, sensitive sensors and adaptive actions to enable change.

Enhancing business-to-business relationship through value co-creation in traditional business sector: A case of building services engineering

This study discusses the significance of having service as a business logic, and more specifically, how value co-creation can be seen as an enhancing phenomenon to business-to-business relationships in traditional business sector. The purpose of this study is to investigate how value cocreation can enhance a business-to-business relationship in the heating, ventilation and airconditioning (HVAC) industry of building services engineering, through three sub-objectives: to identify what is value in the industry, how value is co-created in the industry, and what is value in a business-to-business relationship in the industry. The theoretical part this study consists of academic knowledge and literature related to the concepts of value, value co-creation and business-to-business relationships. In order to research value co-creation and business-to-business relationships in HVAC industry of building services engineering both, metaphorical and conceptual thinking of service dominant (S-D) logic and more managerial approach of service logic (SL), contributed to the theoretical part of the study. The empirical research conducted for this study is based on seven semi-structured interviews, which constituted the holistic, qualitative single case study method chosen for the research. The data was collected in September 2014 from CEOs, managers and owners representing six building services engineering firms. The interviews were analysed with the help of transcriptions, role-ordered matrices and thematic networks. The findings of this study indicate that value in HVAC industry consists of client expertise and supplier expertise. The result of applying client expertise and supplier expertise to the business-to- business relationship is characterized as value-in-reputation, when continuity, interaction, learning and rapport of the business relationship are ensured. As a result, value co-creation in the industry consists of mutual and separate elements, which the client and the supplier apply in the process, in addition to proactive interaction. The findings of this study, together with the final framework, enhance the understanding of the connection existing between value co-creation and business-to-business relationship. The findings suggest that value in the HVAC industry is characterized by both value-in-use and value-inreputation. Value-in-reputation enhances the formation of value-in-use, and consequently, value cocreation enhances the business-to-business relationship. This study thus contributes to the existing knowledge on the concepts of value and value co-creation in business-to-business relationships.

Software business expansion through distribution channel : Case M-Files - Denmark

The purpose of this study was to find out how a software company can successfully expand business to the Danish software market through distribution channel. The study was commissioned by a Finnish software company and it was conducted using a qualitative research method by analyzing external and internal business environment, and interviewing Danish ICT organizations and M-Files personnel. Interviews were semi-structured interviews, which were designed to collect comprehensive information on the existing ICT and software market in Denmark. The research used three external and internal analyzing frameworks; PEST analysis (market level), Porter´s Five Force analysis (industry level competition) and SWOT analysis (company level). Distribution channels theory was a base to understand why and what kind of distribution channels the case company uses, and what kind of channels target markets companies’ uses. Channel strategy and design were integrated to the industry level analysis. The empirical findings revealed that Denmark has very business friendly ICT environment. Several organizations have ranked Denmark´s information and communication technology as the best in the world. Denmark’s ICT and software market are relatively small, compared to many other countries in Europe. Danish software market is centralized. Largest software clusters are in the largest cities; Copenhagen, Aarhus, Odense and Aalborg. From these clusters, software companies can most likely find suitable resellers. The following growing trends are clearly seen in the software market: mobile and wireless applications, outsourcing, security solutions, cloud computing, social business solutions and e-business solutions. When expanding software business to the Danish market, it is important to take into account these trends. In Denmark distribution channels varies depending on the product or service. For many, a natural distribution channel is a local partner or internet. In the public sector solutions are purchased through a public procurement process. In the private sector the buying process is more straight forwarded. Danish companies are buying software from reliable suppliers. This means that they usually buy software direct from big software vendors or local partners. Some customers prefer to use professional consulting companies. These consulting companies can strongly influence on the selection of the supplier and products, and in this light, consulting companies can be important partners for software companies. Even though the competition is fierce in ECM and DMS solutions, Danish market offers opportunities for foreign companies. Penetration to the Danish market through reseller channel requires advanced solutions and objective selection criteria for channel partners. Based on the findings, Danish companies are interested in advanced and efficient software solutions. Interest towards M-Files solutions was clearly seen and the company has excellent opportunity to expand business to the Danish market through reseller channel. Since the research explored the Danish ICT and software market, the results of the study may offer valuable information also to the other software companies which are expanding their business to the Danish market.

The role of network competence and international business competence in multinational corporations: Subsidiary perspective

On-going process of globalization makes companies all over the world to go beyond the national markets and internationalize. Organizational form of multinational corporation (MNC) has capabilities for establishing the affiliate companies in several countries. Thus, the relocation of resources occurs and particularly, the cross-border transfer of knowledge which possesses the competitive advantage. However, differences in countries` business environments and cultures may constrain this capability. The research aim of this thesis is to investigate the role of subsidiary’s network competence (ability to build and manage the relationships with other local business units) and international business competence in relation to the benefits that MNC receives from a subsidiary. Additionally, subsidiary’s business adaptation, partnerships and knowledge transfer mechanism with parent company and external partners are investigated. This research, conducted in the Finnish-Russian context, consists of theoretical and empirical parts. The qualitative approach in the form of multiple case studies is employed. The empirical data incorporated primary and secondary data in the form of interviews collected in 2013 and 2015 years. Interviews were collected from four Finnish case companies in Saint-Petersburg and Kaluga region and five Russian partner companies. Results are drawn from two cases from Saint-Petersburg. The abductive research approach for the results analysis is adopted. The results indicate that both competencies lead to the subsidiary’s local embeddedness in the form of mutual business activities with local business partners and product adaptation for the local market needs. In addition to the monetary benefits in form of payments or turnover share, local embeddedness brings the knowledge of the local environment which is utilized by an MNC in the long-term planning. Another found tacit benefit is the access to the national market. This is strategically useful benefit not only for parent MNC but also for the subsidiary’s partners, i.e. international suppliers.