Download Results for the P5: Marketing

1
Results for the P5: Customer
Orientation and Marketing
Olga Tretyak, Marina Weck, Ekaterina Buzulukova,
Alexander Rozhkov, Nikita Popov
10 February 2009
STROI network – project presentation. Discussion seminar. 9-11 February 2009
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Results for the P5: Marketing
The research on Marketing perspective is organized in three parts:
developing a network of partners, implementing CRM and SCM
Participant
supplier
(RU)
Participant
buyer (RU)
Participant
supplier
(RU)
Participant
supplier (FI)
Focal
company (FI)
Participant
buyer (FI)
Participant
buyer (FI)
Part 1
1a. Nurturing network of partners on the Russian market
1b. Building trust in counterweight to risks
Part 3
Supply chain management
Part 2
Customer relationship management
STROI network – project presentation. Discussion seminar. 9-11 February 2009
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Results for the P5: Marketing
Insights from the interviews on Market entry strategies
•
Two types of Russian market entrance strategies:
– Developing representative office -> extending market presence
– Mergers and acquisitions of Russian companies
•
Two marketing strategies:
– Developing customers (project development, proactive product development)
– Profit-seeking behavior
STROI network – project presentation. Discussion seminar. 9-11 February 2009
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Results for the P5: Marketing
Can competitive advantages be used to cope with business environment
challenges at the operation stage?
Vision of competitive advantages
by the Finnish firms
Business environment
challenges
Developed and improving technology
Legal risks that are rarely understood: high
administrative and criminal liability of the
general director in Russia
Higher quality of products
Local production
Long and unclear procedure of construction
project negotiation and agreement
Active support of the parent company
Difficulties in land purchasing
Financial stability
Trust to the Russian partners from Finnish side and
disbeliefs from Russian managers
Comprehensive solutions for the customer
Need for permanent control of Russian partners
High reputation and strong brand name
Trust, honesty and responsibility for results
Often it is that the general director is the only
right person to communicate with to achieve
quick and quality results
Helping customers in solving their own problems
STROI network – project presentation. Discussion seminar. 9-11 February 2009
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Results for the P5: Marketing
Building trust in counterweight to risks. What are the risks?
•
While the empirical research is not fully
completed, the acquired data allow
illustrating only intermediate results
•
Please, see the diagrams 1, 2 and 3 (in your
handouts) that show the probability of
identified risks involved in
inter-organizational relationships and
their negative effect on trust between
partners as well as conditions associated
with positive changes in trust
STROI network – project presentation. Discussion seminar. 9-11 February 2009
6
Results for the P5: Marketing
On the customers side, Russian sales staff is the main adaptation
instrument at every stage of relationship development
Stage 1
Initial contact
Stage 2
Initial transaction
Very high entry barriers
Difficult to embed into existing
relations
Dealing with complex construction
legislation and certification
Initially very strict requirements for
on-time delivery and quality
assurance
Stage 3
Repeated
transactions
Payment delays
Contract fulfillment
Coordination challenges when the
deal has been secured
Customer representatives
demanding bribes
Solutions:
Solutions:
Solutions:
Customer intelligence
Signaling to suppliers
Getting a sense of customers’
occasion
Getting straight to the CEOs
Securing suppliers’ commitment
Reaching compromise
Bribery reporting to CEOs of
customer companies
Russian salespeople as a main vehicle for problem solving
STROI network – project presentation. Discussion seminar. 9-11 February 2009
Loyal
customers
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Results for the P5: Marketing
Although marketing people deny that they differentiate between
customers…
Declared: no differentiation
“The number of customers decrease
because of the crisis in construction”
“Demand shrinks, so customers gain
more market power”
“All customers are equally valuable”
“All benefits and discounts are delivered
on unified contract terms”
“All customers are only seeking lower
prices”
“Contracting in Russia is always
formal”
STROI network – project presentation. Discussion seminar. 9-11 February 2009
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Results for the P5: Marketing
… there is proper strategic prioritization in place
Actually, there is strategic differentiation
“We prioritize customers on the basis
of…”
“Benefits provided depending on the
customer’s status in terms of…”
- Sales volume
- Price reductions
- Growth potential
- Fast delivery
- Size of the business
- Ready to adapt contracts to
requirements of highly important
customers
STROI network – project presentation. Discussion seminar. 9-11 February 2009
9
Results for the P5: Marketing
Purchasing side: how customer orientation imperatives translate into
requirements for suppliers
Stage 1
Make or buy
decisions and
supplier selection
Stage 2
Managing supplier
relationships
Higher in-house share of production
due to knowledge-sharing hostility
and relational uncertainty
Managing social and contractual
relationships in Russia is an area of
weakness
Supplier capability, reputation and
trustworthiness are the 3 musts
Certain relationship management
capabilities should be developed
Both delivery time and variability are
advantages for suppliers
High influence of social networks:
relations with key people
‘Finns prefer Finns’
vs.
‘Committed Russian partners’
CEOs personal influence on decisions
is not strong in purchasing
Stage 3
Organizing for
effective
purchasing
Purchasing is not highly centralized
STROI network – project presentation. Discussion seminar. 9-11 February 2009
Marketresponsive
supply