Author: danmaj

Working in Virtual Environments

January 13, 2021 / danmaj / 0 Comments

Virtual work has been a choice and part of the modern business culture for three decades until at least March 2020. Along with many other spheres of life, the year 2020 also changed how businesses operate. Virtual work environments are not anymore merely an option to overcome national boundaries and enhance productivity but have become a necessity. There are multiple quick guides available online that highlight important factors that enable smooth functioning in virtual environments. For example, this Forbes article from 2014, “How to Manage A virtual Work Environment”, highlights the importance of role clarity, establishment of workflows and other processes, setting ground rules, regular meetings, and measurable tasks with clear expectations. This and other similar articles highlight such factors as the key ingredients to setup and run virtual environments. However, a rarely highlighted yet most crucial factor is the individuals working in these environments. The importance of how these individuals interact with each other (form and develop relationship) has a huge influence on the outcomes and performance within such environments.

One way to understand virtual work environments is to perceive them as three-layered entities, consisting of organization, groups, and individuals. The organizational layer provides the basic enabling tenants for these environments such as technological resources, staff training, productivity management and collaboration enhancement tools. The second layer consisting of groups deals with the factors highlighted in most of the articles such as the one mentioned in the earlier paragraph. The last layer consists of the group members who get together to achieve whatever goals are decided at the organizational and group level. While there are individuals involved at every level of decision making, in our quest for performance and productivity, we tend to become more mechanistic than human and hence the focus shifts to the virtual environment enabling tools and setting up the rules of the game within which individuals have set roles.

Integrated within the organization, group, and individual levels is a human layer and understanding this layer can help us tackle the issues recently faced by many during this time while we have had to resort to virtual work environments. The following figure shows that to have fruitful interactions, every individual has to first realize their own role not based on the job specification only (which is highlighted by the individuals sensemaking of the task), but also how they think and perceive others in their group and how do they see themselves as part of that group. Such realizations and introspections lay the foundation for positive future interactions. At a group level, the collective actions of the individuals would translate into a team climate. A team climate is the individuals’ shared perception of organizational events, practices, and procedures[1] and a positive team climate would lead to psychological safety where individuals are able to able to show and employ themselves without fear of negative consequences to self-image, status or career[2]. Individuals will not have positive relationships all the time and therefore the role of team leadership is to ensure positive team climate and psychological safety rather than being a manager or coordinator for the tasks.

We, in the Marketing and International Business department of Turku School of Economics, are actively involved in research on multiple facets of Virtual Work Environments and more specifically, Global Virtual Teams. Our team currently is focused on topics such as Relationship development in global virtual teams, Learning in Global Virtual Teams and the Role of Dynamic Capabilities in Global Virtual Teams. Our project details are available here.

Majid Aleem

[1] Anderson, N. R., & West, M. A. (1998). Measuring climate for work group innovation: development and validation of the team climate inventory. Journal of Organizational Behavior: The International Journal of Industrial, Occupational and Organizational Psychology and Behavior, 19(3), 235-258.

[2] Kahn, W. A. (1990). Psychological conditions of personal engagement and disengagement at work. Academy of management journal, 33(4), 692-724.

Change or be changed – the interplay between multinational enterprises and host country institutional environment

December 18, 2020 / danmaj / 0 Comments

International business scholars have long acknowledged the central role of institutions – ‘the rules of the game in a society’, as Douglas North put it – on firms’ performance, strategies and behaviors. However, IB research has mostly focused on formal institutions, the written rules, laws and regulations, leaving the informal institutions with their usually unwritten but socially shared rules and constraints with much less attention. Yet, informal institutions may have equally strong impact on determining firms’ success on a given market.

Lidl’s entry to Finland 18 years ago in 2002 serves as a good example of this. Maybe you still remember how Lidl’s entry created a big buzz in the media, and astonishment ‒even suspicion‒ among the Finnish public, as the company seemed to be doing it all wrong, or at least in a very strange manner. For instance, it did not accept credit cards as a method of payment, or bottles that were not of its own brands in its reverse vending machines. It filled its shelves with almost only foreign products and brands unknown to most Finns and tried to teach people how to operate at the short checkout counters typical in Germany but completely unfamiliar to Finns, who were not used to scooping their groceries back into their shopping trolleys to pack them elsewhere. The company did not advertise to the public, refused to give interviews to the media and did not even allow reporters to enter its stores. And it soon acquired a negative employer reputation by exercising an authoritarian management style, with excessive use of warnings, a lack of trust and communication, a strict hierarchy and an oppressive working atmosphere. No wonder Lidl Finland operated at a loss for many years.

Hence, while Lidl complied with formal institutional environment in Finland, many stakeholders, like the media, customers, employees, labour unions etc., would not accept its behaviour that so clearly was not according to the shared norms and customs, in other words, the informal institutional environment of the host country and sector.

Indeed, it wasn’t until the company made major changes in its strategy and behavior that its operations In Finland finally turned a profit: Lidl increased the amount of domestic brands and products in its product range, it started to accept credit cards as a payment method and other brands’ bottles in its reverse vending machines. It worked closely together with the Finnish services union (PAM) and corrected its HRM practices; it changed its no comment policy to open communication with the media, and introduced clever and humorous TV advertising campaigns. And it finally gave in and changed those annoying short checkout counters to longer ones, similar to what other Finnish grocery stores had, with plenty of room to pack one’s purchases at the counter.

The example of Lidl in Finland emphasizes the common viewpoint in International business research, according to which firms’ survival and performance are determined by the extent of alignment with the institutional environment. Hence, when operating in foreign markets, multinational enterprises have to comply with external pressures of the host country institutional environment if they wish to succeed. However, this viewpoint does not acknowledge the important agency role of MNEs as they also construct their institutional environments.

Indeed, despite having to adapt its original strategies in Finland, Lidl also introduced some new-to-the-market practices that were welcomed by Finnish stakeholders, and eventually became institutionalized in Finnish grocery retail sector as domestic companies adopted similar practices. For instance, Lidl taught Finns to require good quality with lower prices and introduced consumers to many delicacies and new products, such as prosciutto, duck breast and proper bratwurst, forcing domestic competitors to follow suit.

Hence, the interplay between organizations and their environments is characterized by co-evolutionary development where organizations influence their environments, and environments that consist of other organizations and populations in turn influence those organizations. This dynamic is orchestrated by stakeholder responses but is also linked to how well established the existing institutions in the field are. You can read more about the interplay between MNEs’ entry and the host country informal institutional environment in our forthcoming book chapter in the series ‘Progress in International Business Research (PIBR) ‒The Multiple Dimensions of Institutional Complexity in International Business Research’. (See: https://books.emeraldinsight.com/page/series-detail/Progress-in-International-Business-Research/)

Chapter details: Pelto, Elina & Karhu, Anna (2020) Chapter 13: Stakeholder responses and the interplay between MNE post-entry behaviour and host country informal institutions. In: Progress in International Business Research ‒The Multiple Dimensions of Institutional Complexity in International Business Research, eds. Verbeke, A., van Tulder, R., Rose, E. and Wei, Y. Emerald Insight.

Elina Pelto PhD
University Lecturer

Image by Miroslava Chrienova from Pixabay

Is our open and globally connected world turning into a more closed one?

September 17, 2020 / danmaj / 0 Comments

Year 2020 proved to be very different from any predictions. Although there has been a number of pandemics throughout the human history, only the emergence of the latest, COVID-19, can be labelled as a Black Swan. The virus itself was not rare or unpredictable but its impact was – for the first time the interconnected world came to a halt at the same time. Global networks froze and the entire world stayed at home, due to the measures taken in response to the COVID-19.

The enforcement of social distancing, lockdowns and restrictions on mobility of people had immediate effects on the society, such as increase of online shopping, social media use and teleconferencing. International travel bans affected over 90 per cent of the world population and with widespread restrictions on public events, tourism more or less ceased. Almost overnight, the globally-connected world turned into a stay-at-home economy, and it is likely that restarting mobility – particularly nonessential movements – will be challenging and we will be experiencing a period of lower mobility for years (Benton, 2020).

What next? The global business environment has been volatile, uncertain, complex and ambiguous for quite some time and different anti-globalization tendencies have gained momentum aside global networkedness and interdependencies. However, compared to financial-based crises, the economic crisis due to the coronavirus is fundamentally different. One of the key differences is its focus on individual. Therefore, when experts say that the society returns to a “new normal”, they refer to the change that happens at the grassroots level. Additionally, on the individual level, each individual experiences crises and vulnerabilities differently and the length of crises and thereof their influence varies individually.

Recovering from the external shock due to the pandemic will be particularly demanding for cosmopolitan entrepreneurs. The global lockdown and stay-at-home economy confront the core values of cosmopolitans and jeopardises the identity and life style they cherish. With our interview-based research, we shed light on how COVID-19 has changed the lives of Finnish-born cosmopolitan entrepreneurs, discussing what they feel about the changes and how they see their future. Our findings indicate that after the emergence of the pandemic, these cosmopolitans may not be as open to opportunities as before. Link to the article on the journal website: https://journals.sagepub.com/doi/full/10.1177/0266242620954127

Professor Niina Nummela

Public actors as market shapers

August 4, 2020 / danmaj / 1 Comment

Some people think that markets are efficient and governments should let enterprises act freely in the market. In reality, public actors often intervene in markets and it is practically impossible to find a market that would not be guided by governments to some level. Partly, this is due to negative (e.g., pollution or addiction) or positive (e.g., education and welfare) impact of market activities that require brake or boost from public actors on a daily basis. Partly, the intervention is justified during the time of a shock, such as COVID-19 that encouraged governments to guide market action worldwide. Despite the importance of public actors shaping markets, there has not studies to develop our understanding of how public actors can shape markets, if they wish to do so.

We studied how public actors shaped three interesting markets, namely (1) the betting market in Finland, in which public actors retained the domestic monopoly: (2) the open district heating market in Sweden, in which public actors changed the competitive landscape; and (3) the peer-to-peer lending market in New Zealand, in which public actors actively set up new structures and symbolic systems to facilitate new patterns of activity. We identified twenty granular mechanisms of institutional work that public actors employed to shape markets. These mechanisms are all potentially employable in creating, maintaining, or disrupting markets. Moreover, the idea of market shaping public actors is not limited to these three unique contexts. https://www.emerald.com/insight/content/doi/10.1108/JSTP-08-2019-0176/full/html

A forthcoming special issue on renewable energy in international business initiates discussion on the theme, and consequently the role of governments in supporting (and sometimes hindering) the market development. Governments for instance create and discard incentive policies for solar energy production and consumption. While these measures can have great impact, multilateral agreements are often criticized for not leading to changes in the market to diminish the amount of greenhouse gases. https://www.emerald.com/insight/content/doi/10.1108/cpoib-08-2019-0062/full/html

In another ongoing project, we study the business implications of coronavirus. It is evident that public actors took again a large role from closing restaurants to banning exports of masks and ventilators. The crisis bought new interesting questions from ’what is essential service’ and how can public actors determine and create metrics for defining ’essential’ to the questions on what kind of legislation is needed to limit free trade and secure national interest in forthcoming crises without deteriorating international competitiveness between the crises.

By having a better understanding of how public actors shape markets, it is possible to first guide them in making more informed decisions about market shaping as well as help companies in utilizing public authorities in driving the preferred market agenda. While interventions may hurt some market actors, for others political decision-making can be beneficial. We just need to make sure that the politicians are aware of various market-shaping mechanisms, make informed decisions in employing them, and ensure that the benefits of the intervention overcome the cost in the long run.

Valtteri Kaartemo
Postdoctoral Researcher, International Business D.Sc. (Econ.)

Tea, biscuits and Brexit

March 9, 2020 / danmaj / 0 Comments

Greetings from Yorkshire! I moved here in January, with the help of a Tutkijat maailmalle -grant from Liikesivistysrahasto, to work on a project on cross-cultural management. For an international business researcher in general and a cross-cultural researcher in particular, this experience has already been an eye-opener into the reality of crossing borders.

Beginning from renting an apartment, more things are different than you might first imagine. I got some good advice when I was running in open houses: touch the walls to see if the paint is wet (a big no-no in the land of the mould), check if the taps actually work (as water pressure on this island can be horrible), ask about heating costs (which are huge and not included in the rent) and city council tax (which allows you to use the bins), and so forth. Setting up electricity and water bills, finding home insurance, getting in touch with the building manager in case something goes wrong, you name it – it is more difficult, when you are not exactly sure whose responsibility everything is. Luckily my landlord is very helpful and has so far sorted out a leak and a broken oven in record time.

Everyone at the University has been very friendly. However, as people tend to live a bit further away, not many come to the office daily, which can make the place feel a bit lonely at times. Nevertheless, once a week we meet for an international business faculty coffee break to catch up on the latest on research and teaching. In addition, I have joined a paper development circuit, which is basically a series of mini seminars, as well as a qualitative research reading group, which is also basically a series of mini seminars, but explicitly focusing on qualitative studies. Cooperation with my hosts Professor Jeremy Clegg and Associate Professor Hanna Gajewska-DeMattos has been intense yet rewarding. The work is running smoothly, albeit coming up with a new theory of cross-cultural management is not the easiest thing I have attempted. I am lucky to have such innovative co-authors and mentors on my visit.

Of course, I was here for Brexit day. Despite raucous parties going on in London, Leeds remained no more pub-going than on any regular Friday. In central Leeds, according to voter maps, most voted against Brexit. However, Yorkshire as a whole is rather rural. The traditional business here is sheep farming. Thus, once outside the central city area, you are more than likely to run into brexiteers. Like my cab driver, who said he preferred a new British colonialism to a Fourth Reich. While I have never had any trouble with anyone, you can sense the country is deeply divided. The atmosphere reminds me of the first five minutes after a fight with a sibling, when you think you will never be friends again. I think it will take years for these wounds to heal.

Brexit has had so many dates now, that people really are fed up with it. The first time around, my Yorkshire friends were stalking up on toilet paper and food like there was going to be an immediate shortage. When Brexit eventually happened, I heard of no-one hoarding. It is like a never-ending story, which even now is in sort of limbo, as we cannot yet tell what the EU-UK relationship will look like in the future. And of course, we never know what might happen. The scariest scenarios are that healthcare runs out of medicine and workers – which, according to some projections, is not as far-fetched as it sounds. Nevertheless, there is much advice available to whomever needs it. For example, the University of Leeds hosts Brexit seminars often to give advice to foreign employees and students on how the changing situation will affect them. Luckily, I will move back to Finland before the transition period ends, so should be safe and sound.

There are two things I have learned since moving to Yorkshire. First, there are many, many more variations of not raining than you thought. There are the tiny droplets that fall rapidly but are so small that they do not make you wet. There are the huge droplets which fall so slowly they do not make you wet. There are the medium-sized droplets that fall at a medium speed, again not making you wet. Basically, anything short of soaking you through in five minutes flat is not considered rain. Second, I finally understand, why the call it a howling wind. My windows in Finland, no matter how much draft they tracked in, have never made such a sound. Think of a strong wind caught in a pipe. Double glazing here means a second window has been built in a bit inward from the original. The glazing layers are basically unconnected, leaving the air in between to do whatever it wills. And sometimes, it howls. Luckily there’s much tea and biscuits to be had to keep you warm. Betty’s of Harrogate, which you may know through their export brand Taylor’s of Harrogate, is apparently the place to go for afternoon tea around here. Their scones are definitely worth a try.

Dr. Riikka Harikkala-Laihinen
Postdoctoral Researcher, University of Turku
Visiting Researcher, Leeds University Business School

The Dark Side of International Business

February 27, 2020 / danmaj / 0 Comments

Our perspectives on International Business are constantly evolving and broadening as we accept that the world is more complex than what a narrow perspective on the ‘international success and failure of the firm’ can explain. The global business environment is composed of systemic force fields where events forming initial conditions can produce a multitude of new phenomena and outcomes in very short time. It is the dynamic and complex interconnectedness, interdependencies and interactions of political, economic, social, technological and environmental systems, among others, that we call globalization, which has brought to us unprecedented wealth, but also new problems, and of course also potential solutions.

But, sitting in Finland looking out of the window, how skewed is our perception of the big wide world really? According to Hans Rosling’s (Rosling et al., 2018) book, Factfulness, we tend to believe that the world is poorer, less healthy and more dangerous than it really is and that the way we perceive global events through media biases our shared picture of the world. One current example is the recent novel Corona Virus outbreak in Wuhan, China. When following the news coverage and discussions in social media, this provides a very good case of globalized systems and how events very far away arrive, by plane or media, and affect the way we go about our daily lives, affecting stock markets and threatening the functioning of value chains. Or a speech of a Swedish teenager who requests to do something about a looming catastrophe is sending shock waves around the political and corporate establishment is another example of the interconnectedness and interdependencies.

However, there is an array of topics that usually are on a blind spot, at least where we are sitting and that should interest us as much as many other topics. We have started to discuss these under the label ‘the dark side’ of international business, some time ago. It consists of topics that seem very far from our perception and are nevertheless part of the systems we live in. For instance, having recently reviewed an article on Modern Slavery was a revelation. According to the International Labor Organization and the Walk Free Foundation (2017) for every 1000 people in the world 5.4 are considered victims of modern slavery, being exposed to the effects of another person having control over one, being in a relationship suffering structural power or physical violence with the objective of being economically exploited. Some of the global value chains that produce many of the products and services we might consume daily are using questionable practices. These require more attention.

Over the past years, our research interests have turned towards these less popular but hugely important issues. TSE has made business ethics and critical engagement key strategic organizational values that should partly define who we are as an organization. As a result, we have many researchers who have been investigating these kinds of topics. For instance, Salla Laasonen (doctoral defense 2012) has written about stakeholder dialogue as a tool for corporate responsibility and accountability. Frederick Ahen (doctoral defense 2015), critically examined the corporate social responsibility narrative in the context of global health urging to make responsibility a key strategic dimension rather than a public relations activity. Irfan Ameer (doctoral defense 2019) has been investigating the broader social context of institutionalized bribery in developing countries and he discussed corruption practices of Multinational firms. Emilia Isolauri (current doctoral student) investigates the sources, mechanisms and outcomes of international money laundry and Isabella Galvis (current doctoral student) researches the competing pressures under which social enterprises in different institutional contexts have to balance their goal attainments. These are just a few of many examples and we can see that critically engaged international business scholarship is an important movement, which is further taken up in numerous Masters theses and which is increasingly becoming a strong integrated part of our courses in the Bachelor and Masters programs.

The goal is to include other than mainstream topics in international business to form some of the important foundations when the next generations of graduates join the constituencies they choose to serve and eventually one day steer.

Dr. Peter Zettinig

University Research Fellow

Adjunct Professor in International Business

From North-South- experiences of internationalization

December 3, 2019 / danmaj / 0 Comments

In the spring of 2018, I knocked on the door of TSE, department of International Business (IB), with my doctoral research proposal. After approval, I was able to enter the IB community. Embarking on a Ph.D. is unique, and we all take up our own paths towards accomplishments. For me, though, having previously been working on various development cooperation projects, this is where I move from. The work I did involved traveling across continents mostly between the EU and the developing world. But I will narrate a bit more about my experiences and the valuable insights I gained from it. It is from here that I intend to explore further through acquiring scientific knowledge, and IB this the right place to be.
Since 2012, I have been part of international expert teams implementing and doing various development cooperation projects especially in developing countries. As you may know, project is tendered and bid for; thus, it is a game where you either win or lose. My main area of expertise is broadly in Private Sector Development tasks, that is, formulating strategies for economic growth and poverty reduction in developing countries. Perhaps before I continue narrating, it’s better that I describe in brief about the types of projects. Actually, the essence of development cooperation projects is to render support and complement efforts of developing countries to guarantee the provision of universal social basic needs of their citizens along and fundamental human rights. Development cooperation projects that are not profit-driven, but some try to seek a lower profit.
Perhaps, for now, let me share with you a couple of my experiences and field missions which are synonymous to data collection as in research, but this requires onsite presence. Field missions are performed in academic research or other and consultants, as for me. Normally, before the onset of a field mission, experts are selected to implement a project with timeline. So, about a couple of years ago, we won a tender where I was admitted to an international expert team. I was on a Global Environment Facility (GEF) project funded by the African Development Bank (AfDB) and UNDP, which was to be implemented in and around communities of Lake Tanganyika in Zambia. The primary purpose of the project was to provide a baseline scenario of Lake Tanganyika, livelihoods, socio-economic, and environmental situations. So, our tasks were to examine existing strategies and constraints faced by local communities living around the Lake in pursuit of economic activities for sustaining their livelihood and income opportunities
The journey to the field began early morning in order to cover 800km to Kasama town. It was indeed a long trip, tiresome but exciting as we drove through beautiful landscape, as you can see in the photograph below. I selected this photograph from my album because I find it meaningful. In the sense that our lives, careers, and just like research, are journeys with curiosity and where you can encounter the unknowns on the path to your future. But as we all know, at least I think so, staying focused on the road can guarantee a safe arrival to your destination, similarly for our undertakings. So, we arrived at our destination safely and we straight away went to doing our field activities with our first meeting in one community. While in village residents gathered, and we divided theme into groups by age and gender. As such our questionnaires had an open-ended question, for interactive discussion. Before we began the activities, we first had to pay courtesy to the village chief, for permission. Doing so is a standard protocol to get the right to interview people in the community, you may sort of call as data protection. But we needed to explain the purpose of our visit, study, why it’s needed, and the benefits it will bring to the people. Well, we managed to collect data and successfully prepared our findings with recommendations to be implemented. It was an exciting mission and our finding was that there was significant depletion of natural resources such as forests across the region. But the thing which baffled the most within our findings was that of all the communities we interviewed, about 95% of the people, had not heard about Climate Change, as of 2015. One of the main reasons was the poor outreach to rural areas and weaknesses in the institutions. In brief, our recommendation included strategies that focused on supporting conservation of natural resources, adoption of land management and support to SMEs, young men and women entrepreneurs in the fish value chain.

In June 2019, I embarked on a unique field mission to Mogadishu, Somalia , to perform a feasibility study on the Business Incubation ecosystem to be supported by the European Commission (EC) for international development cooperation or Europe-Aid. This was a unique mission because it was my very first time to travel to a country that is on the recovery from decades of civil war. I spent ten days in Mogadishu, and in safe hands. The next day, I was driven to the city of Mogadishu in an armored car with my security guard, to go and conduct my first interviews at an iRise Innovation Hub. Although I was uneasy during the whole mission, I was glad that the whole mission went well. What I find more interesting was that, despite of the global news about Somalia, it was business as usual and life looked normal. In brief, our report proposed capacity building from top to down of all key actors involved in entrepreneurship ecosystem based on the context of the country.
I will conclude with my recent visit to Berlin, where I attended the 18th Academy of Business in Society (ABIS) colloquium, where I presented a conceptual paper. The seminar was hosted by The European School of Management and Technology (ESMT-Berlin), the theme was Business in Society; Measuring and Creating Change. The event was exciting, with good vital speakers and panel discussions. There was a good representation from academia, corporate, and non-governmental organizations. The opening speech and panel discussion included Professor Yury Blagov, St Petersburg school of management, Dr. Ivo Matser, CEO for ABIS, Professor Tamer Boyaci ESMT Berlin, Associate Professor Lin Lerpold, Stockholm School of Economics and Katariina Stenholm, Senior Vice President, Danone Corporation among others. The debates and arguments hovered around the best practices on impact investing and mainly on the trade-off issues of social impact versus market-rate returns. In a nutshell, our homework as researchers is to investigate further how an investor can do good for society while doing well in business.
On this note, I will end here. Such have been my experiences in international business, and with these, that’s the path of my research. As such, most development cooperation programs embed the theory of Change, filling in the gaps of change initiatives.

Ephraim Daka,

Ph.D. Student, International Business