1. STROI-Network

2. Presentation contents STROI-network, (=build network) Background of the research Phases of the network lifecycle and potential CASE-companies Phases of the research and perspectives Research approach Perspectives, targets, results and researches of the research – P 1: Selection of the network business sector – P 2: Definition of the network vision – P 3: Competence of human resource – P 4: Internal development and culture – P 5: Customer perspective and marketing – P 6: Measuring the network performance Summary of the research planning

3. STROI-network Objective is to develop management and leadership models for Finnish – Russian business networks operating in Russia. Project is sponsored by TEKES (Finnish Funding Agengy for Technology and Innovation) and companies mentioned below. Finnish research institutions are TTY (Tampere University of Technology), VTT (Technical Research Centre of Finland) and HAMK University of Applied Sciences. Russian research institutions are The State University Higher School of Economics and St. Petersburg State University.

4. Common co-operation companies HAMK: Contact personCompanyWeb-page Mika Räty Konecranes Heavy Lifting Oy(www.konecranes.com) Matti MikkolaKPM-engineering Oy(www.kpmeng.fi) Pertti TammivuoriLassila&Tikanoja Oyj(www.lassila-tikanoja.fi) Hannu MarkkanenGTT Oy(www.cloudberry.fi) Markku Lundström Forssan metallityöt Oy(www.forssanmetallityot.fi) Jouni HaajanenKehittämiskeskus Oy Häme (www.kehittamiskeskus.fi)www.kehittamiskeskus.fi TUT Olli NiemiNCC Oy(www.ncc.fi) Timo Laapio/Matti NiiranenPeab Seicon Oy(www.peab.com) Jukka Pekkanen/Jani KemppainenRakennusteollisuus RT(www.rakennusteollisuus.fi)www.rakennusteollisuus.fi VTT Matti Mikkola/Janne ManninenStora Enso Timber(www.storaenso.com) Peter NordgrenFinndomo Oy(www.finndomo.fi) Heikki SuhonenCRAMO Oyj(www.cramo.com) Esa Kosonen/Marko KallunkiMetsäliitto Osuuskunta, Finnforest(www.finnforest.com)

5. Background of the research  Creating a strategic network is prerequisite for the successful business  Strategic management and business networking is relative new in Russia  Profiling Business Networks Oriented to Russia is the first phase of this research project, during which three level management patterns and evaluation tools have been developed (report and profiling tools available from HAMK)  Risk Analysis for Business Operations in Russia  Quick Test of Business Networks  Skill Profiling Tool for Companies Operating in Business Networks

6. Phases of the network lifecycle and potential CASE-companies (€) Cash Flow Time Introduction Ncc, KPM- engineering, … Growth Lassila&Tikan- oja, CRAMO, KoneCranes, … Maturity … Developed concept Decline

7. Phases of the research and perspectives Setting Development targets Present situation (3.../08) P1 P2 P3 P4 P5 P6 Stage 3 : Result Developing Strategic Agility Stage 1: Setting dev. targets Developm. activities Networked Company Local Network Centre Networked Company Networked Company (Hub) Stage 2: Perspectives of the operating research (P 1-6) in networked companies: P 1: Selection of the network business sector (VTT) P 2: Definition of the network vision (VTT) P 3: Competence of human resource (HAMK) P 4: Internal development of the network and culture (HAMK) P 5: Customer perspective and marketing (HAMK) P 6: Measuring the network performance (TTY)

8. Research approach 1) Theoretical models 2) Observations in Companies and Business Networks for Pilot models. 3) Academic piloting within research group 4) Piloting with adult students 5) Piloting within Companies involved in STROI- project 6) Future development and tailoring of management models 7) Dissemination those results which are accepted for publication in management Group of the project

9. Perspectives (P1 - P6) P 1: Business sector P 2: Vision P 3: Competence of human resource P 4: Internal development P 5: Customer orientation and marketing P 6: Measuring network performance Objectives of network Growth is bigger than average Vision is based on derivative action Managing staff and learning Network growth and strategic development Developing customer- based network Continuous develop- ment of network performance Research questions 1.1, 1.22.1, 2.23.1, 3.24.1, 4.25.1, 5.2, 5.3, 5.4 6.1 ResultsOperating in profitable sector Making visions based on customers needs Competitive and developing working conditions ”Agile” and learning network Functioning CRM system and risk manageme nt System for measuring the performance of the network Research institutions VTT HAMK GSOM HAMK HSE HAMK HSE TUT HSE OBJECTiIVES, RESULTS AND RESEARCHERS OF THE NETWORK Perspectives of research, objectives, results and research institutions Management and leadership models of business for Russian oriented networks

10. P 1: Selection of the network business sector Researchers: Markku Riihimäki, Anna-Leena Perälä, Tuula Grönfors. Research questions:  1.1 Preparing a forecast model for a total demand of the markets for different kind products of building, real estate and environmental sector in Russia, primarily targets for St. Petersburg and Moscow regions.  1.2 Topical knowledge of different perspectives (political atmosphere, supplying the products and competition situation, customer behaviour and decision making, technology development, taking environment into consideration…) Research objects: Products / networked companies / business lines  New regional building – Small houses (wooden houses) – Residential buildings  As single targets business and industry building  Service business (life cycle services and maintenance, services during building) Outcome: Forecast model for a total demand of the products which are as a target for the research. Working model for defining the product range and reliazation network for companies operating with building, real estate and environmental sectors.

11. 1. 2. 3. Customer profiles – prioritizing, grouping 4. 5.Clearing differentiating vision and crystallizing 6.Switching the vision in practical operating and its controlling Clearing the competition benefit similar to the needs P 2: Definition of the network vision Researchers: Markku Riihimäki, Anna-Leena Perälä, Tuula Grönfors and Kalle Kähkönen Research questions:  2.1 Building up a model to produce a vision for a network working in Russia.  2.2 During vision processing, the common carrying idea as well as more detailed strategic part objectives and guidelines are developed for the operating networked company. Applying Vision building model improved by VTT  Preparing a co-operational model for supporting the vision fulfillment. The model helps to receive the marketing situation information for conclusion base from customers and network.  Which kind of vision working model can be applied in strategic networks operating in Russia and their target visioning? Outcome: The internal competition strategy developing tool and working model for building up network vision. Forming the visioning group – parties and targets Recognizing the point of departures – base for need-based vision

12. P 3: Competence of human resource Researchers: prof. Vera Minina, Seppo Niittymäki, Lauri Tenhunen, Anastasia Krupskaja and Elena Dmitrienko Objects and research questions:  3.1 Human capital in Finnish construction oriented companies in Russia  How the competition benefit of human capital can be reached?  How the employee competence and human capital are measured? Outcome: Profiling tool of human capital  3.2 Human resource management in Finnish companies in Russia: cross-cultural aspects / differences between HRM in Finnish and Russian construction oriented companies  Differences of HR management in Finland and Russia  HR management and leadership differences becoming from culture, motivation base, education and recruiting Outcome: Model of HR management applicable in the Russian market

13. P 4: Internal development of the network and culture Researchers: Lauri Tenhunen, Seppo Niittymäki, prof. Nikolai Filinov, prof. Alex Settles, prof. Nedejda Bek and Nina Vladimirova Research questions:  4.1 Strategic Management and Organizational Behavior: Have Russian Firms Adopted the Learning Organization Model?  How in a limited sample of Russian firms the concept of learning organization has been developed? Which kind of practice of strategic planning and execution is nowadays in Russia?  4.2 Strategic process of business networked companies, strategy planning and implementation  What are the specifics of Russian and Finnish companies `strategic process?  Does network configuration influence strategic behaviour of Finnish and Russian companies and strategic decision-making during Russian market capturing?  Does strategic behaviour depend on specifics of particular business segment of Russian building industry?  4.3 Strategy implementation and BSC (Balanced Scorecard)  What are the best ways of strategy implementation?  What significant tools of strategic management can be added to BSC?  Can the scenario planning be examined as one of the relevant methods of bringing in balance strategy and operation systems in companies?  What are the peculiarities of all of the above in contemporary Russian environment?

14. P 5: Customer perspective and marketing 1(2) Researchers: prof. Olga Tretyak, Marina Weck, Seppo Niittymäki, Ekaterina Buzulukova, Aleksander Rozhkov and Nikita Popov Research questions:  5.1 Building Trust in Counterweight to Risks in Inter-Organisational Relations of Business Networks in Russia  What are the risks in the inter-organisational relations of networks in Russia?  What is the relationship between trust and identified risks?  What are the preconditions and managers’ actions for trust-building? Outcome: The model that outlines the trust-building process in counterweight to the risks involved in inter-organisational relationships of networks in the Russian business environment.  5.2 Supplier relationship management organization: structures and people  Supply priorities (strategy/policy). Criteria for supplier selection and evaluation.  Supplier relationship management organization: structures and people.  The content of relationships: communication with suppliers, collaborative planning process  Third party influences on individual relationships with suppliers. The role of government (industry regulators), competitors, customers, key suppliers.  The role of industry and macro environmental factors. Outcome: Operating model of building confidence for balancing the network risks relationships

15. P 5: Customer perspective and marketing 2(2)  5.3 Customer perspective in network business  Customer Relationship Management (CRM) in B2B (Business to Business) networks: theoretical presentation  Managing of customer relationships in B2B business: practical examples from Russia  Building a management model of customer relationships in B2B business in Russia (interconnection of the strategy, business processes, IT & organizational development)  Customer perspective in Russian business culture: inner and outer customer relationship in company network  Success factors & key performance indicators (KPI) of CRM Outcome: CRM model for building, environmental and real estate sectors  5.4 Relationship building and forming networks in Russian market  What are the steps of creating networks and relationships building ?  What are the key characteristics of ideal partner in network?  What is the shortest way of developing successful relationships in Russian market?  What are risk factors in Russia?  What is the role of key people and their links in creating networks and sustainable relationships? Outcome: Management model of strategic network for building, environment and real estate sectors

16. P 6: Measuring the network performance Researchers: Liisa Oksanen, Seppo Niittymäki, prof. Teuvo Tolonen and Antti Lönnqvist Result questions:  6.1 Measuring the performance of the network  Which kind of measuring tools are suitable for measuring the performance of the network in Russia?  How the benefits of networking can be measured and how the developing evaluation will be implemented Outcome: Performance measuring model for networked Finnish companies operating in Russia. 06/10/2015Liisa Oksanen16

17. xxx eFollow-up of the development of the sector expectations and their changes %-aimFulfillment of the growth Quality measurement tool, e.g. development of the expectation network Operating better than average in growing sector xxx eDevelopment of the parameters for forecasts and of evaluation of the applicability of these parameters. m2, m3, pcs,...Fulfillment of the expected amounts Quality measurement tool, e.g. co-operation partner The decisions are based in the forecasted models xxx €Follow-up of the salary development on the branch, surveying the new potential resources %, pcs < 5 % Netto addition of the key persons Permanence of the experts Fulfillment of the risks Work satisfaction… Permanence of the staff in the network xxx € Educating and rewarding the members of the network Removing the risk factor Defining the controlled tasks %, pcs <10 % Uncertainty (payments, times…) Joined in network./.. departed from network % turnover, pcs Fulfillment of the risks Quali tative measurement tools Amount and growth of the companies in the network Quick Response xxx €Effectiveness of customer relationship marketing Competitor analysis Expansion of marketing section Controlling the offers, CRM +10 % < 10 % of targets Reasons analyzed % Comparison prices for competitors, €/m2 Fulfillment of the risks Quality measurement tool… Contracts/offers Product positioned in high quality sector, Quick Response xxx eEffectiveness of budgeting and controlling systems +25 % + 20 % 10 % of turnover change-% Growth Turnover from new products Profit Uncertain claims Turnover Profit BudgetActionObject, e.g..Measuring instrument, e.g.Object, e.g.Strategic development of the network Perspective: Business sector selection (KK1=P1 =WP4) Defining vision (KK2=P2 =WP5) Learning and Gro wht (KK3=P3 =WP6) Internal develop- ment of the network (KK4=P4 =WP7) Customer (KK5=P5 =WP8) Network Perfo rman ce (KK6=P6 =WP9) Profita- bility Partners, Customer Trust Develop- ment Vision based in forecasts Growing sector Development of the strategic network