Aihearkisto: Articles in English

A Strategic Guide to Business Model Excellence in Local Food Business – Case: Baltic Sea Food Project

The Baltic Sea Food project was undertaken due to various challenges faced by local food businesses in the Baltic Sea Region. The main objective of this project was to improve the operational effectiveness by collecting and analyzing the data in the Baltic Sea Region. Development of business model(s) was critical for creating improved business solutions for these local food businesses. This article proposes an approach for conceptualization of business models through business excellence model and provides a strategic implementation framework for achieving operational effectiveness and business excellence. This innovative approach is aimed at prioritization of strategies to yield better outcomes.

Authors: Shrusti Jarde & Brett Fifield

Baltic Sea Food Project

The EU and Interreg funded Baltic Sea Food (BSF) project aims at developing more systematic approach to bring value to all the possible stakeholders involved (Interreg Baltic Sea Region 2017). BSF project is divided into phases. Phase–I to collect information about local food business scenario, challenges faced etc. In phase-II, business model(s) are developed while in the last phase piloting and remodeling of these business model(s) is undertaken to develop most financially viable approach.

Problem Space

Market orientation and awareness of market strategies have become more important not only for investors but also for the local food businesses in order to succeed (Lund & Noell 2002). This article serves as a guideline for how to implement business models successfully and how to measure their performance (Jarde 2019). The strategy framework and recommendations provided through this article can guide local food businesses in strategically prioritizing and implementing developed business models. Hence, research objectives are to first map the current situation in local food business in Baltic Sea Region (BSR) and then to provide innovative approach in conceptualizing business models through business excellence model (BEM) for achieving business efficiency.

Business logic and Strategy

The big difference between business model and strategy is, the focal point of business models is creating value for target customers. Operational effectiveness and sustainability is important but not sufficient (Porter 1996). It is important to know that, strategies come in planning as well as in implementation phase of business logic (Osterwalder & Pigneur 2010) and based on objectives strategic tools are chosen. Below image reflects, how various excellence models and strategy tools, are applied in the business logic triangle throughout this article. This aims at understanding the purpose of business model while connecting it with business strategy and progressing it towards the business excellence.

Image 1. Business study logic developed for BSF project (Jarde 2019)

Business excellence model

Prior developing BEM, it is important to develop a basic operational business framework. The local food businesses can adapt two different approaches as their basic business operations to generate revenue. Direct approach connects local businesses directly to the end consumers. While an indirect approach establishes a link with businesses as well as private customers.

To develop a business excellence strategy model, inputs from strategic factors identified and the list of existing barriers to overcome are considered. By using EFQM model, the framework of business excellence strategy model is presented. The model is developed based on the collective findings from all 10 countries’ empirical study.

Business model implementation

This article proposes an innovative strategic approach for BSF Phase III i.e. ‘Conceptualizing business model through BEM’. Many practitioners get confused with how to implement these business models to achieve desired results or to gain competitive advantage (Casadesus-Masanell & Ricart 2010). Some businesses are more profitable than their competitors, even if they apply same strategies (Nielsen 2010). Hence, conceptualizing business models using BEM plays a significant role in not just achieving business excellence but also in effective implementation of these business models to achieve desired results.

The various components for Business model canvas (BMC) and BEM are analyzed to identify some common aspects and to fulfill their respective objectives, so that they can be mapped with ‘Enablers’ and ‘Results’ of EFQM.

After business excellence strategy model is developed, it is important to prioritize the strategies identified. Evaluate market competitive position of each factor. Rate and position these factors in the business strength and market attractiveness framework for developing GE-McKinsey nine-box matrix. The positioning is done based on market and business understanding, past experiences, importance of factor etc. Once strategies are prioritized, determine the category for each factor for developing strategic implementation guidelines and set the measurable objectives. Analyze this matrix in timely manner to measure the results. Update, eliminate, add, reposition these strategic areas on the matrix based on achievements.

Evaluation and Conclusion

Businesses always struggle to know how to execute their business models and value propositions successfully to achieve desired objectives (Casadesus-Masanell & Ricart 2010). The approach proposed through this article, can also be adapted by other businesses to implement their business models effectively. A simple strategic analysis tool – SWOT analysis, is used to analyze the strengths, weaknesses, opportunities and threats associated with this approach.

Table 1. SWOT analysis of proposed approach (Jarde 2019)

Achieving business excellence through strategy innovation in local food business is about reimagining their own growth strategy through a focused and multi-functional approach. It is not a one action step to achieve something, but it is creating multiple iterations towards achieving operational effectiveness and business excellence.

References

Casadesus-Masanell, R. & Ricart, J. 2010. From Strategy to Business Models and onto tactics. Long Range Planning 43. pp. 195-215. [Cited 1 Oct 2019]. Available at: http://www.businessmodelcommunity.com/fs/root/8oex1-casadesus_et_ricart.pdf

Interreg Baltic Sea Region. 2017. Baltic Sea Food Application Form.

Jarde, S. 2019. Driving Business Excellence in Local Food Business Through Strategy Innovation. Master’s thesis. Lahti University of Applied Sciences. Lahti. [Cited 8 Nov 2019]. Available at: http://urn.fi/URN:NBN:fi:amk-201904245903

Lund, M. & Noell, C. 2002. The Balanced Scorecard for Danish Farms – Vague Framework or Functional Instrument? Farm Management. Proceedings of NJF Seminar No. 345. October 2002. Norwegian Agricultural Economics Research Institute. pp. 187-204.

Nielsen C. 2010. Conceptualizing, Analyzing and Communicating the Business Model. Aalborg University. Department of Business Studies. No. 2. 2010. [Cited 18 Nov 2019]. Available at: https://www.researchgate.net/profile/Christian_Nielsen3/publication/228842227_Conceptualizing_Analyzing_and_Communicating_the_Business_Model/links/02e7e5214f40525653000000.pdf

Osterwalder, A. & Pigneur, Y. 2010. Business model generation: A handbook for visionaries, game changers, & challengers. John Wiley & Sons, Inc., Hoboken, New Jersey. [Cited 8 Sept 2019]. Available at: https://profesores.virtual.uni&es.edu.co/~isis1404/dokuwiki/lib/exe/fetch.php?media=bibliografia:9_business_model_generation.pdf

Porter, M. 1996. What is strategy? Harvard Business review. 1996-2000. The Harvard Business School Publishing. pp. 61-78. [Cited 17 Mar 2019]. Available at: https://www.academia.edu/10366737/Operational_Effectiveness_Necessary_but_Not_Sufficient

Authors

Dr. Brett Fifield has been actively involved in developing Business Schools for the Finnish Universities of Applied Sciences since 1994. Most recently he has been responsible for courses in Futures and Strategies, Innovation and Creativity, and Leadership and Management of Projects in Distributed Organizations.

Shrusti Jarde has completed Master’s Degree program in International Business Development in 2019.

Illustration: https://pxhere.com/en/photo/1061452 (CC0)

Published 20.11.2019

Reference to this publication

Jarde, S. & Fifield, B. 2019. A Strategic Guide to Business Model Excellence in Local Food Business – Case: Baltic Sea Food Project. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/11/20/a-strategic-guide-to-business-model-excellence-in-local-food-business-case-baltic-sea-food-project/

Customer-driven marketing penetration strategies for Nordic-Baltic eight academic segment

This article concerns proposing B2B customer-driven marketing strategies for a software company, Statzon, to penetrate Nordic-Baltic Eight (NB8) countries’ academic segments following the subscription business model. In a more in-depth perspective, the study discusses the search engine optimization tactics regarding marketing strategies.

Authors: Shima Edalatkhah and Tiina Pernanen

To examine customer-driven B2B marketing strategies for Statzon, as market data and forecast provider, the research aims to enhance the number of subscribed users by figuring out:

  • Statzon service Key Performance Indicators (KPIs) for NB8
  • The potential competitive advantages that Statzon can provide
  • NB8 penetration process
  • Suitable pricing policy for NB8
  • Marketing promotional strategies for Statzon
Research Methodology and Data Collection

After an Economical, Social, and Technological analysis of NB8 (table 1), a ten-question questionnaire was emailed to 273 subjects to fulfill the study goals. The survey subjects were library directors, vice directors, and the head librarians of NB8 universities as the authentic source for data collection. The collected result presents the demanded data categories in the NB8 academic segment, the KPIs of data service platform, the decision-making process, and pricing indications from NB8 academic users’ point of view. (Edalatkhah 2019)

Table 1. NB8 Economical, Social & Technological Analysis (adapted from WorldBank 2019)

Key Findings

According to the study results, Statzon’s biggest potential markets among NB8 countries are Sweden, Denmark, and Finland considering population, the number of academic centers, and the Research and Development (R&D) share of Gross Domestic Product (GDP) as shown in figure 1. (Edalatkhah 2019)

Figure 1. NB8 biggest Academic Markets

The research results indicate that the principle faculties in the target market are Business and Hospitality as well as Social Sciences and Technology. Based on survey results, the most popular data categories are Education, Finance, Health-Social work, and Manufacturing. The essential features of data service in NB8 academic users’ point of view are the variety of data categories, regular data updates, and downloadable visual data. Thus, it is recommended to Statzon to specify its core concentration on mentioned above countries, faculties, in-depth data categories, and the service feature at preliminary steps of market penetration phase. (Edalatkhah 2019)

The potential competitive advantages of Statzon

Amadeo (2019) believes, competitive advantages do not root only in more competitive price, quality, and speed of responsiveness, the role of innovative and high-tech service is very sensible in the current technology age. Statzon already benefits from competitive advantages, including modern, user-friendly, and engaging design, downloadable and printable visual data, regular updates, and market forecasts for all industries (Statzon 2019.) Study outcomes indicate that Statzon content needs to be revised by more detailed niche data classification, also the applied technology of Statzon needs to be automated (figure 2).

Figure 2. Statzon Potential Competitive Advantages for NB8 Academic Segment

Penetration Process to NB8 Academic Segment

To penetrate in NB8 academic segment, Statzon should reflect on the decision-making process. According to the study results, decision making in the NB8 academic segment, highly (70 %), depends on students’ feedback. The dominant decision-makers are library managers who decide about data service; however, in less than half (40 %) of academic centers, the university’s managing team decides about the data service. The study recommends Statzon does not confine targeting library managers to contact. The figure 3 declares how to convince the academic segment, Statzon first needs to build awareness among university teachers and research staff, before giving trial access to the university. In this way students as dominant end-users, would engage more efficiently in trying Statzon service, and then by providing feedback, they will influence the decision-making process. (Edalatkhah 2019)

Figure 3. Penetration Process to NB8 Academic Segment

Pricing Strategy for NB8 academic Segment

The study results imply that there is a correlation between GDP and R&D expenditure share of GDP of the NB8 members with academic users’ price consciousness. The study outcome shows while the average data service fee in NB8 is €5,194, fair annual subscription fee in the Nordics is considered to be €5,000-7,500, while in the Baltics users had more diversified anticipations (€2,000-10,000). (Edalatkhah 2019)

Recommended Strategies for Statzon in NB8

First, Statzon needs crystal clear goals as pillars of its marketing campaigns and content. The selected and filtered content should be adjusted based on customers’ demanded data categories. The second determining step is lead nurturing by creating a branched content funnel to drive leads toward fitting content, targeted video ads, engaging market data quiz, and communicating with leads in a friendly and innovative way. The third tactic is increasing visibility by other people’s networks (OPN), including academic experts and prominent influencers. The fourth step for Statzon to penetrate the educational segment of NB8 is setting barriers for the competitors and taking the market leader role. To do so, Statzon needs to create a big gap with competitors with its leading technology, massive academic niche data scale and ongoing innovation.

By limiting the access of trail users to all data categories, Statzon will have more professional and niche data provider image; likewise, as subscription bonus, Statzon can offer further access to more detailed data class, subcategories, or relevant data categories during the limited time with specific price bid to meet the needs of different academic users by setting Budget, Premium and Customized tiers. 

Tactics to avoid penalizing by Google Panda

As Search Engine Optimization (SEO) profoundly matters for the data service provider’s credibility, it also is crucial to be aware of the content types for which Google Panda algorithm penalizes the websites. Many websites after being penalized fail to retrieve their previous ranking. Panda updates are a big surprise to SEO and webmasters. Statzon should consider Google Panda sensitive hints including thin content, duplicated pages, lots of advertisements, unintuitive or poor navigation, automatically generated content, squeeze pages, doorway pages and meta-refresh technology which are respectively explained in figure 4. (Google Support 2019)

Figure 4. Tactics to avoid Google’s Panda Penalization (adapted from Google Support 2019)

Final Remarks

This study highly recommends Statzon to build a relationship with its subscribers by offering unique loyalty programs and having a “Honey Pot” service plan (Morris 2015), which leaves no excuse for potential users not to subscribe. The “Honey Pot “service package of Statzon should contain limited yet tailored niche data classifications, with the price range the target users consider fair. While Statzon is applying the suggested strategies toward increasing its credibility and visibility, it should be cautious about Google Panda content-sensitive guidelines.

References

Amadeo, K. 2019. What Is Competitive Advantage? Three Strategies That Work. Blog [Cited 25 Jun 2019]. Available at: https://www.thebalance.com/what-is-competitive-advantage-3-strategies-that-work-3305828

Edalatkhah, S. 2019. Customer-driven B2B Marketing Strategies for a Software Company. Case: Statzon. Lahti University of Applied Sciences. Thesis [Cited 30 Oct 2019].  Available at: http://urn.fi/URN:NBN:fi:amk-2019101419940

Google Support. 2015. Thin content with little or no added value. [Cited 9 Oct 2019]. Available at: https://support.google.com/webmasters/answer/9044175?hl=en&visit_id=637054460074608101-2546530961&rd=2#thin-content

Morris, J. 2015. The Right Way to Launch a Subscription Business [Cited 19 Jun 2019]. Available at: https://www.youtube.com/watch?v=qdWT7WA4aFk&t=534s

Statzon. 2019. What Is Statzon? [Cited 20 Jun 2019]. Available at: https://statzon.com/what

Worldbank. 2019. United Nations Comtrade Database Through the WITS Platform [Cited 28 Jun 2019]. Available at: https://data.worldbank.org/indicator/TX.VAL.TECH.CD

Authors

Shima Edalatkhah, International Business Student at Lahti UAS

Tiina Pernanen, Lecturer at Lahti UAS

Illustration: https://pxhere.com/en/photo/1431185

Published: 6.11.2019

Reference to this publication

Edalatkhah, S. & Pernanen, T. 2019. Customer-driven marketing penetration strategies for Nordic-Baltic eight academic segment. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/11/06/customer-driven-marketing-penetration-strategies-for-nordic-baltic-eight-academic-segment/

LAB: Boosting Startup and SME Ecosystems in the South Karelia and Päijät-Häme Regions

Startups and SMEs are considered the backbone of any growing economy. As a collaborative entity, research-oriented universities (LUT) and polytechnic schools (LAMK & SAIMIA) can boost business ecosystems by providing fuel in the form of innovations.

Authors: Afnan Zafar and Marja Ahola

Why are startups and SMEs important for regional and national growth?

There is growing interest in innovations across the globe, irrespective of the size and origin of the country in question (Ghisetti et al. 2015). While multinational companies (MNCs) struggle to find innovative products (Jay 2013), the focal point has shifted toward startups and small and medium-sized enterprises (SMEs) (Rosenbusch et al. 2011). The freedom to explore new ideas in startups and SMEs is becoming ever more important. They are acting as drivers for regional and national innovation systems and leading to economic growth for emerged or emerging markets (Hessels & Parker 2013). After the 2007 economic crisis, most economies learned the important lesson of not relying solely on MNCs for economic growth (Helleiner 2011).

Countries have shifted their focus more towards promoting startups and SMEs to achieve longer and more stable economic growth (Ciravegna et al. 2014). There has also been a shift observed from industry-driven, incentive-based to regional and national economic policies with long-term planning (McCann & Ortega-Argilés 2013). Groupings of similar SMEs, strong funding bodies for innovation needs, single governing bodies and openness among firms to collaborate are the most important initiatives many countries have followed to achieve remarkable growth (Gunasekara 2005). Many countries have formed clusters of startups and SMEs at the regional level, referred to as ecosystems (Kanter 2012). These ecosystems have been proven to function as factories of new ideas and innovative products over the last decade (Triguero et al. 2013).

In Europe, it is evident that startups and SMEs are key players when it comes to their economic contribution at the national and EU level (Mrva & Stachová 2014). Finland is not an exception; after the well documented problems faced by Nokia, the need to expand startup and SME ecosystems both vertically and horizontally became apparent (Zafar 2018). Startups and SMEs produce approximately 60% of EU GDP, employ around 100 million people, generate about € 3,934 billion and are considered as an innovation powerhouse of the EU (Eurostat 2015). The main players in startup and SME ecosystems are Malta, Cyprus and Estonia (Eurostat 2015) while Finland, one of the world’s most innovative countries, lags behind (Filippetti & Archibugi 2011).

How can LAB boost development of startup and SME ecosystems?

Research-based educational institutes in any country are always considered the lifeline for innovative ideas (Bozeman et al. 2012). In Finland, institutes play a vital role in developing entrepreneurial competencies and have introduced many programs at bachelor and master levels to train future entrepreneurs. Due to changing dynamics, it is now time for institutes to merge and collaborate on a single agenda of economic growth with the help of startups and SMEs. LAB is now the flag bearer for such open innovation collaboration (Zafar & Ahola 2019). LAB is the result of the merger between LAMK and SAIMIA and will influence R&D in the South Karelia and Päijät-Häme regions and then later at the national level. These regions have great potential to develop, align and enhance startup and SME ecosystems (Ministry of Employment and the Economy 2019a & 2019b). As mentioned earlier, startups and SMEs have the natural ability to bring innovative products to the market. However, initially it is very difficult for them in this region (South Karelia/Päijät-Häme) to take the initiative alone. Here, LAB can play a key role in boosting the creation of startup and SME ecosystems by fueling them with initial research-based innovation and helping them to develop business plans.

Figure 1. LAB as a booster of business ecosystems (Figure: Afnan Zafar 2019).

At the backend, LAB can enable startup and SME ecosystems (Figure 1) to materialize product plans and service development and at a later stage market them (service/product) successfully. LAB can also play a role in post-market surveillance with firms for innovative products.

How can LAB be a game-changer at the national level?

It is evident from the literature that educational institutes are an important pillar in the growth of a country’s economy (Bozeman et al. 2012). They not only educate the nation but also play an important role in knowledge creation. When LAB successfully helps to develop the regional ecosystems in South Karelia and Päijät-Häme, which are just 150 km apart from each other and 90km from the Uusimaa region, it will start to emerge as a major national game-changer for the economy. LAB will act as an umbrella, under which regional strategic focus will be discussed, evolved, implemented and analyzed (Zafar & Ahola 2019). The well-aligned strategic focus will influence national policymaking and strategic focus and vice versa. However, as a bigger influencer in the future, more responsibility will fall on LAB’s shoulders to initiate, develop and execute R&D and business activities.

Startup and SME ecosystems are a win-win situation for all stakeholders

The level of knowledge and innovativeness is a key factor for the success of SME and startup ecosystems. The competitive advantage of such ecosystems is directly related to the role of each stakeholder (Gunasekara 2005). In this case, LAB (LAMK and SAIMIA) and the startups and SMEs themselves all are stakeholders. LAB has extensive experience related to entrepreneurship and innovations. It will play a lead role in future business ecosystems. Nevertheless, firms also have to respond positively to make this happen. LAB can learn the practical aspects of industry from firms, and firms can have initial R&D support from LAB. All growing economies have active collaborative ecosystems among various research institutes, startups, SMEs and MNCs (Kanter 2012). Responsible roles played by each stakeholder (LAB & firms) can lead to a win-win situation for all as the ecosystem will provide an open innovation environment so all stakeholders can learn from one another and grow together (Zafar 2019).

Conclusion

This article explores the possible future influence of LAB at the regional and national levels in Finland. The overall discussion shows that LAB can boost the creation of startups and SMEs due to its extensive collaboration with three main institutes. These three institutes have experienced RDI experts and extensive accomplishments in research. It is important to align the strategic focus of research with the needs of regional startups and SMEs. There should be set guidelines and SOPs before the actual collaboration starts to get the best results in the form of successful business ecosystems. The well-planned execution of LAB and its scope will definitely prove to be a game-changer for regional and national economic growth in the long run.

References

Bozeman, B., Fay, D. & Slade, C. 2012. Research collaboration in universities and academic entrepreneurship: the-state-of-the-art. The Journal of Technology Transfer. Vol. 38(1), 1-67. [Cited 6 Sep 2019]. Available at: https://doi.org/10.1007/s10961-012-9281-8

Ciravegna, L., Lopez, L. & Kundu, S. 2014. Country of origin and network effects on internationalization: A comparative study of SMEs from an emerging and developed economy. Journal of Business Research. Vol. 67 (5), 916-923.  [Cited 8 Sep 2019]. Available at: https://www.sciencedirect.com/science/article/abs/pii/S0148296313002762

Eurostat. 2015. Small and medium-sized enterprises: an overview. [Cited 10 Sep 2019]. Available at: https://ec.europa.eu/eurostat/web/products-eurostat-news/-/EDN-20181119-1

Filippetti, A. & Archibugi, D. 2011. Innovation in times of crisis: National Systems of Innovation, structure, and demand. Research Policy. Vol.40 (2), 179-192. [Cited 9 Sep 2019]. Available at: https://www.sciencedirect.com/science/article/pii/S0921800913001389

Ghisetti, C., Marzucchi, A. & Montresor, S., 2015. The open eco-innovation mode. An empirical investigation of eleven European countries. Research Policy. 44, 1080-1093. [Cited 10 Sep 2019]. Available at: https://www.sciencedirect.com/science/article/abs/pii/S0048733314002194

Gunasekara, C. 2005. Reframing the Role of Universities in the Development of Regional Innovation Systems. The Journal of Technology Transfer. 31, 101-113. [Cited 10 Sep 2019]. Available at: https://eprints.qut.edu.au/1008/

Hessels, J. & Parker, S. 2013. Constraints, internationalization and growth: A cross-country analysis of European SMEs. Journal of World Business. Vol. 48 (1), 137-148.  [Cited 11 Sep 2019]. Available at: https://www.sciencedirect.com/science/article/pii/S109095161200051X

Helleiner, E. 2011. Understanding the 2007–2008 Global Financial Crisis: Lessons for Scholars of International Political Economy. Annual Review of Political Science. 14, 67-87. [Cited 8 Sep 2019]. Available at: https://www.annualreviews.org/doi/abs/10.1146/annurev-polisci-050409-112539

Jay, J. 2013. Navigating Paradox as a Mechanism of Change and Innovation in Hybrid Organizations. Academy of Management Journal. 56, 137-159. [Cited 9 Sep 2019]. Available at: https://journals.aom.org/doi/abs/10.5465/amj.2010.0772

Kanter, R. M. 2012. Enriching the Ecosystem. Harvard Business Review. Vol. 90 (3). [Cited 11 Sep 2019]. Available at: https://www.hbs.edu/faculty/Pages/item.aspx?num=42372

McCann, P. & Ortega-Argilés, R. 2013. Smart Specialization, Regional Growth and Applications to European Union Cohesion Policy. Regional Studies. Vol. 49 (8), 1291-1302. [Cited 9 Sep 2019]. Available at: https://www.tandfonline.com/doi/abs/10.1080/00343404.2013.799769

Mrva, M. & Stachová, P. 2014. Regional Development and Support of SMEs – How University Project can Help. Procedia – Social and Behavioral Sciences. 110, 617-626. [Cited 8 Sep 2019]. Available at: https://core.ac.uk/download/pdf/82362862.pdf

Ministry of Employment and the Economy. 2019a. South Karelia’s regional programme 2014−2017: South Karelia to be Finland’s most success region by 2030. [Cited 12 Sep 2019]. Available at: https://www.rakennerahastot.fi/web/en/south-karelia   

Ministry of Employment and the Economy. 2019b. Päijät-Häme regional programme 2017: Internationalisation and expertise networks. [Cited 12 Sep 2019]. Available at: https://www.rakennerahastot.fi/web/en/paijat-hame

Rosenbusch, N., Brinckmann, J. & Bausch, A. 2011. Is innovation always beneficial? A meta-analysis of the relationship between innovation and performance in SMEs. Journal of Business Venturing. Vol. 26 (4), 441-457. [Cited 13 Sep 2019]. Available at: https://www.sciencedirect.com/science/article/abs/pii/S0883902609001232

Triguero, A., Moreno-Mondéjar, L. & Davia, M. 2013. Drivers of different types of eco-innovation in European SMEs. Ecological Economics. 92, 25-33. [Cited 12 Sep 2019]. Available at: https://www.sciencedirect.com/science/article/pii/S0921800913001389

Zafar, A. 2018. Aivovuoto Suomessa – todellinen uhka vai myytti? Siirtolaisuus Migration 4/2018. Siirtolaisuusinstituutin julkaisu. [Cited 12 Sep 2019]. Available at: http://www.migrationinstitute.fi/files/pdf/siirtolaisuus-migration/sm4_2018.pdf

Zafar, A. & Ahola, M. 2019. Merging and Collaboration of Educational Institutes: New dimension of Open Innovation. LAMK Pro. [Cited 11 Sep 2019]. Available at: http://www.lamkpub.fi/2019/09/09/mergingand-collaboration-of-educational-institutes:-new-dimension-of-open-innovation

Zafar, A. 2019. The Outsourcing Innovation Paradox: A Company’s Growth Option or a Risk to R&D Capabilities. Doctoral dissertation. University of Vaasa, School of Technology and innovations. Vaasa. Acta Wasaensia, 418. [Cited 8 Sep 2019]. Available at: http://urn.fi/URN:ISBN:978-952-476-853-5

Authors

Afnan Zafar, Ph.D., works as a research fellow at the University of Vaasa, Finland and as a private research consultant. His areas of expertise are innovative solutions, innovative product and service development, brain drain problems and its solutions in developed countries

Marja Ahola, MA, works as an RDI expert at Lahti University of Applied Sciences, as an expert in entrepreneurship education for highly educated immigrants (Kokoma ESF) and as a project manager in the Ossi 2 – Skills for a Work project

Illustration: https://pxhere.com/en/photo/1433463 (CC0)

Published 26.9.2019

Reference to this publication

Ahola, M. & Zafar, A. 2019. LAB: Boosting Startup and SME Ecosystems in the South Karelia and Päijät-Häme Regions. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/09/26/lab-boosting-startup-and-sme-ecosystems-in-the-south-karelia-and-paijat-hame-regions/

Merging and Collaboration of Educational Institutes: New dimension of Open Innovation

The best use of resources is to share them and build something new. When institutes start to work together for good, rather than competing, innovative miracles can happen.

Authors: Afnan Zafar and Marja Ahola

Why institutes are merging and collaborating more?

Globalisation, internationalisation, innovative approaches towards teaching, improving research quality and competition of available resources in given circumstances direct educational institutes to merge and collaborate (Bartell 2003). Gathering a bigger pool of students and researchers under the same umbrella can really help institutes to use available resources in the best possible way. The bigger bodies are always able to influence society and set a strategic focus that can help everyone (Ripoll-Soler & de-Miguel-Molina 2013). Europe has been observing this trend of university mergers from last decade, and more recently these agreements are speeding up (Estermann & Pruvot 2015).  Collaboration is not something new for European institutes, as universities have been collaborating within their respective countries and the EU with other universities in projects from many years (Bozeman et al. 2012). Many universities even apply for research grants together and work together to deliver final projects. However, the merger is the type of setting that is more complex in which new legal institutes formed and differentiate them from general collaborations (Wohlin et al. 2012).  These mergers always bring several institutions under one umbrella.

The university mergers are a bit different from the commercial cooperate mergers because later, they mainly focus on business aspects. When universities merge, they have to look into the most important factors such revamping the education standards, enhancing the level of research and their role to set the strategic focus of the given area, city or country (Ursin et al. 2010). There are other economic and financial factors also involved, but at the end of the day, the hustle is for better teaching and research results (Aula & Tienari 2011). Another important point of such mergers is to avoid duplication of programs within specific radii from facilities for better utilisation of resources (LAMK 2019). Finally, yet importantly, is the improvement in national and world ranking for their newly formed bigger university. This helps to improve recognition and visibility.

LAB is also not very different from the above-described phenomenon of the merger of educational institutes. The board of LUT universities announced the merger of Lahti University of Applied Sciences and Saimaa University of Applied Sciences into a single entity named LAB, which will start its operation from 1.1.2020. The merger will have campuses of polytechnics in Lahti and Lappeenranta with around 8500 students, and 360 teachers and researchers under a single umbrella of LAB. The focus of LAB, which is the brand name of LUT group of colleges, is to improve Business innovation and working together with companies (LAMK 2019).

What are the open innovation implications when educational institutes collaborate?

The mergers and collaborations provide the share spaced to connect and develop together. It is a step ahead towards more openness towards globalisation and internationalisation (Zafar 2019). Dynamics of such mergers can easily be related to the concept of Open Innovation. Chesbrough first introduced this concept and defined it as combining internal and external ideas as well as internal and external paths to market to advance the development of new technologies (Chesbrough 2003). The close observation of the open innovation concept clearly supports the mergers of schools and universities, if the purpose is to advance the development of new technologies by using external and internal ideas represented by different educational institutes. In this model, collaborating universities, companies and researchers as stakeholders develop new products, services and innovations in an open environment. The way in which these stakeholders overlap and help each other is represented in figure 1.

Figure 1. Representation of stakeholders of LAB (Figure: Afnan Zafar)

How effective can it be to connect and develop a concept for LAB?

LAB will be Finland’s sixth-largest university of applied sciences in terms of the number of students. Covering the huge number of students under a single innovative umbrella itself it a leap ahead, but it will also be the sharing of new ideas on a bigger platform. When research, development and innovation (RDI) staff will connect in the form of LAB then ultimately they are going to develop new products, services, courses, platforms and strong collaboration with industry. This concept is exactly aligned to the concept of “connect and develop” used by Procter & Gamble (P&G), developed during a time when P&G was desperately looking for innovative ideas and new products (Huston & Sakkab 2006, 1-10). Adoption of this concept made the company today around a 67.68 billion USD revenue entity with a net worth of 293.57 billion USD (Macrotrends.net 2019). It is also the fact that consumer products based commercial organisation cannot be compared to an educational institute, but the point to ponder is that the concept used by the two of them is to “connect and develop” with one mission which is innovative future growth (Zafar 2019).

Next-generation of the innovative ecosystem of dynamic institutes

There are mixed opinions about the mergers of educational institutes from academia. Some believe that it is a very healthy practice and enhances the possibilities to develop (Estermann and Pruvot 2015). However, there are researchers who believed that a merger is good from a business perspective, but not from an educational viewpoint (Ursin et al. 2010). Nevertheless, the last decade’s results of mergers from EU universities support the first argument with practical positive results. There has been huge growth observed after all major mergers of universities in terms of business, research, teaching and students (Wohlin et al. 2012, 67-73).  The universities, which are merging mainly to develop innovations, can be the key players for future innovative ecosystems. These next-generation innovative ecosystems, in collaboration with industry, can be the powerhouse of innovations (Bozeman et al. 2012).

Conclusion

The purpose of this article is to observe the upcoming LAB formation from the lens of the open innovation concept. The overall analysis shows that this merger is very close and similar to open innovation, connection and development, concepts. The utilisation of internal and external resources of two institutes to develop new technologies, products and innovations is providing open space for RDI teams. Internationalisation and openness is the future of research, which needs strong national players to contribute. These mergers are providing a strong base and starting point for the internationalisation of RDI and attract more international students and staff. 

References

Aula, H. and Tienari, J. 2011. Becoming “world‐class”? Reputation‐building in a university merger. Critical perspectives on international business. Vol. 7(1), 7-29. [Cited 25 Aug 2019]. Available at: https://www.emerald.com/insight/content/doi/10.1108/17422041111103813/full/html

Bartell, M. 2003. Internationalization of universities: A university culture-based framework. Higher Education. Vol. 45 (1), 43–70. [Cited 27 Aug 2019]. . Available at: https://link.springer.com/article/10.1023/A:1021225514599

Bozeman, B., Fay, D. and Slade, C. 2012. Research collaboration in universities and academic entrepreneurship: the-state-of-the-art. The Journal of Technology Transfer. Vol. 38(1), 1-67. [Cited 28 Aug 2019]. Available at: https://doi.org/10.1007/s10961-012-9281-8

Chesbrough, H. 2003. Open innovation. The new imperative for creating and profiting from technology. Boston: Harvard Business School Press.

Estermann, T. and Pruvot, E. 2015. The Rise of University Mergers in Europe. International Higher Education. (82), 12. [Cited 27 Aug 2019]. Available at: https://doi.org/10.6017/ihe.2015.82.8867

Huston, L and Sakkab, N. 2006. Connect and Develop: Inside Procter & Gamble’s New Model for Innovation. Harvard Business Review. March 2006, 1-10. [Cited 25 Aug 2019]. Available at: https://hbr.org/2006/03/connect-and-develop-inside-procter-gambles-new-model-for-innovation

LAMK. 2019. Boards decide on merger of LAMK and SAIMIA. [Cited 24 Aug 2019]. Available at: https://www.lamk.fi/en/news/boards-decide-merger-lamk-and-saimia

Macrotrends.net. 2019. Procter & Gamble Net Worth 2006-2019. [Cited 27 Aug 2019]. Available at: https://www.macrotrends.net/stocks/charts/PG/procter-gamble/net-worth

Ripoll-Soler, C. and de-Miguel-Molina, M. 2013. Are mergers a win-win strategic model? A content analysis of inter-institutional collaboration between higher education institutions. Tertiary Education and Management. Vol. 20(1), 44-56. [Cited 25 Aug 2019]. Available at: https://doi.org/10.1080/13583883.2013.860187

Ursin, J., Aittola, H., Henderson, C. and Välimaa, J. 2010. Is Education Getting Lost in University Mergers? Tertiary Education and Management. Vol. 16(4), 327-340. [Cited 24 Aug 2019]. Available at: https://doi.org/10.1080/13583883.2010.533379

Wohlin, C., Aurum, A., Angelis, L., Phillips, L., Dittrich, Y., Gorschek, T., Grahn, H., Henningsson, K., Kagstrom, S., Low, G., Rovegard, P., Tomaszewski, P., van Toorn, C. and Winter, J. 2012. The Success Factors Powering Industry-Academia Collaboration. IEEE Software. Vol. 29(2), 67-73. [Cited 26 Aug 2019]. Available at: https://ieeexplore.ieee.org/document/5963631

Zafar, A. 2019. The Outsourcing Innovation Paradox: A Company’s Growth Option or a Risk to R&D Capabilities. Doctoral dissertation. University of Vaasa, School of Technology and innovations. Vaasa. Acta Wasaensia, 418. [Cited 25 Aug 2019]. Available at: http://urn.fi/URN:ISBN:978-952-476-853-5

Authors

Afnan Zafar, Ph.D., works as a research fellow at the University of Vaasa, Finland and as a private research consultant. His areas of expertise are innovative solutions, innovative product and service development, brain drain problems and its solutions in developed countries.

Marja Ahola, MA, works as an RDI expert at Lahti University of Applied Sciences, as an expert in entrepreneurship education for highly educated immigrants (Kokoma ESF) and as a project manager in the Ossi 2 – Skills for a Work project.

Illustration: https://pxhere.com/fi/photo/548225 (CC0)

Published 9.9.2019

Reference to this publication

Ahola, M. & Zafar, A. 2019. Merging and Collaboration of Educational Institutes: New dimension of Open Innovation. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/09/09/merging-and-collaboration-of-educational-institutes:-new-dimension-of-open-innovation

A comprehensive investigation of local food systems in the Baltic Sea Region

Growing a business and operating sustainably in an ever-competitive landscape is a challenge well known to micro business owners and entrepreneurs in any business sector. Within the spectrum of alternative local food systems (LFS) challenges and opportunities are unique. The Baltic Sea Food project was initiated to investigate these LFS, build and pilot business models for them, and simultaneously promote awareness of local food in the Baltic Sea Region (BSR). The following article presents the research project and takes a look at the feasibility of implementing the recommendations.

Authors: Lydia Rusanen & Brett Fifield

Baltic Sea Food Project

The EU and Interreg funded Baltic Sea Food Project was initiated with the aim to optimize the B2B performance of local producers within the Baltic Sea Region (BSR). The action points included, undertaking in-depth research across ten countries, formulating workable business models from the findings, piloting the business models, and promoting awareness of local food through workshops and promotion of business opportunities to networks and other local food representatives. (Interreg Baltic Sea Region 2017.) The thesis upon which this article is based, deals with work package two of four, undertaking the research stage of the project (Rusanen 2019).

Local Food Systems: Development opportunities

Local food systems (LFS) are alternatives to the mainstream, high yield focused, food systems, that in recent years have come under criticism for their unsustainable methods, negative environment and social impacts, and lack of support for local economies. LFS can be defined in a number of ways. According to most consumers, LFS are understood to be providers of food grown using sustainable and often organic methods, within a close geographical proximity to where it is sold. Additionally, they should support the local community, building close relationship between producers and consumers. (Roy 2006, 9-12.)

Producers within LFS face unique challenges exacerbated by their lack of business knowledge and financial resources. These challenges include connecting with B2B buyers and building mutually beneficial relationships with them, finding economical distribution channels that can meet the needs of B2B customers, and complying with the stringent and continually evolving regulations. Regulatory control extends to all areas of the business, in particular, labelling of products, food hygiene safety, and transportation requirements. These challenges represent significant opportunities for growth.

A fundamental part of value chain in LFS is the origin of the food, the story behind it is the intrinsic value. This justifies the comparably higher price of local foods. Blockchain is an emerging technology that optimizes this. It is a decentralized, chronologically recorded chain of transactions, a secure system that promises to replace the middlemen in multiple business situations. Blockchain is already being used in food systems for optimizing delivery routes, whilst sending real time location updates to buyers and sellers. It also replacing the costly and time-consuming certification processes for proof of origin, organic labels and food hygiene. Additionally, instant tracking of source in cases of outbreaks is realised. (Crawford 2018.)

Research methods

The research was implemented using a multiple case study strategy with data collection taking the form of surveys for quantitative data and focus groups and interviews for qualitative data. Stakeholders across all ten countries were included in the research.

The first phase of data collection comprised of two versions of an electronic survey, one for completion by the distributors and the other by the networks. The surveys themselves were translated into the ten local languages and made available on the webropol service. In the second phase of data collection, stakeholders took part in semi structured interviews or focus groups, covering five key themes; pricing, distribution, communication, ordering, and future challenges.

The Business Model Canvas by Osterwalder & Pigneur (Osterwalder 2004) ) was used to bring the results together and develop a scalable business model that would be piloted in the ten countries.

Research Findings

The research unearthed a vast amount of information, from which business models could be drawn up, implemented, and finally tested. The outcome of the research thesis itself was a hybrid BMC aimed towards producers within the BSF (Rusanen 2019, 77). As producers become more integrated and grow within the local food networks, they can turn to the BMC to gain a better understanding of the factors that should be considered as they grow. An interesting and important recommendation that effects all parts of the business model is that of building an e-platform upon blockchain technology. The question that arises at this point is, how feasible is the integration of this technology system into existing e-platforms.

The research indicated that many forms of e-platforms are being used throughout the BSR. These platforms vary in the way they have been implemented and used, some are government run platforms, others are privately run, for profit businesses. Not all platforms are used for ordering and payments. The key element is that the platforms are region wide, in other words they allow access to all LFS stakeholders within the local region.

Moving forward to implementation

Ultimately, the study answered the research questions and additionally presented a recommended best-case scenario situation for LFS. In theory, implementing the recommendations promises great gains for all members of the value chain. However, in practice, making such changes to existing systems is less than straightforward. The producers who are at the core of this change, typically face barriers such as time constraints, lack of business knowledge, and lack of financial resources. Some LFS whose capacity is too small to warrant expansion might also resist implementation of the recommendations. It is clear that support is needed from government sources in order to ensure producers are receiving sound business advice along with tools for pricing and marketing their products.

Figure 1. Best-case scenario (Figure by Lydia Rusanen)

The best-case scenario shown in image 1 was based on an e-platform run using blockchain technology, however, EU funding is needed to initiate its use and help producers and distributors make the changes to their existing practices so that they can fit in to the blockchain system.

There is a real risk that the recommendations made will not be implemented if this ground work is not laid. If sustainability and security is sought after by EU policy, it might be necessary to consider incentives for local stakeholders to follow this route. Especially if the initial investment is a trade-off with profit.

Undeniably sustainability and blockchain are two trends that promise to take the business world by storm in the coming decade. LFS are part of a growing environmental movement and rather than focus on well known, age-old systems, the way needs to be paved for smarter technology.

References

Crawford, E. 2018. From 7 Days to 2 Seconds: Blockchain Can Help Speed Trace-back, Improve Food Safety and Reduce Waste. [Cited 13 Nov 2018] . Available at: https://www.foodnavigator-usa.com/Article/2018/11/06/From-7-days-to-2-seconds-Blockchain-can-help-speed-trace-back-improve-food-safety-reduce-waste

Interreg Baltic Sea Region. 2017. Baltic Sea Food Application Form.

Osterwalder, A. 2004. The Business Model Ontology: A Proposition In A Design Science Approach. PHD Thesis. Universite de Lausanne. [Cited 13 Nov 2018]. Available at: http://ip1.sg/pub/BMcanvas/2004-Osterwalder_PhD_BM_Ontology.pdf

Roy, H. 2016. The Role of Local Food in Restaurants: A Comparison Between Restaurants and Chefs in Vancouver, Canada and Christchurch, New Zealand. PHD Thesis. University of Canterbury. Christchurch. [Cited 23 Oct 2018]. Available at: https://ir.canterbury.ac.nz/handle/10092/12694

Rusanen, L. 2019. Sustainable B2B Business Models for Local Food in The Baltic Sea Region. Bachelor’s Thesis. Lahti University of Applied Sciences. Lahti. [Cited 16 May 2019]. Available at: http://urn.fi/URN:NBN:fi:amk-201905027326

Authors

Lydia Rusanen has studied Business and Administration at The Faculty of Business and Hospitality Management at Lahti University of Applied Sciences and has graduated and received a BBA degree in May 2019.

Brett Fifield has been actively involved in developing Business Schools for the Finnish Universities of Applied Sciences since 1994. Most recently he has been responsible for courses in Futures and Strategies, Innovation and Creativity, Digital Services and Leadership and Management of Projects in Distributed Organizations in Lahti University of Applied Sciences.

Illustration: https://pxhere.com/fi/photo/810606 (CC0)

Published 9.9.2019

Reference to this publication

Rusanen, L. & Fifield, B. 2019. A comprehensive investigation of local food systems in the Baltic Sea Region. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/09/09/a-comprehensive-investigation-of-local-food-systems-in-the-baltic-sea-region/