Hidden Champions in CEE and Turkey

Frontmatter

The Context of Hidden Champions

Abstract

Books that search for the Holy Grail of “success” in the corporate world have been either light or heavy. Usually, the former derive from observation and anecdotal evidence and are written by consultants, reflective CEOs and journalists, and directed towards a target market of busy businessmen looking for the next quick fix. This is a volume industry where customers seem to have an insatiable appetite for the vast material offered in airport bookshops. These publications are purposeful and their beauty lies in their simplicity, which allows the material to be digested easily and applied quickly. Moreover, their large customer base means that the proposed techniques can take root over many sectors and so they can soon become the next contemporary fashion. The downside is that fashions come and go. Perhaps the finest example of the genre is Peters and Waterman’s (1982) seminal study In Search of Excellence, a book that triggered a generation of these “success”-based publications in the modern era.

Peter McKiernan, Danica Purg

Research Methodology

Abstract

This research project aimed to explore multilayer organisational behaviours of companies that successfully pursue leadership in a narrow market segment. In general, this is a subgroup of business organizations that follow a variation of differentiation strategy proposed by Porter (1980). Normally such strategy fits well in the contexts in which the target customer segment is relatively price-insensitive, the market is saturated, customers have very specific needs which are to a large-extent under-served, and the firm possesses unique resources and capabilities that are difficult to imitate, plus Intellectual Property (IP), exclusive technical expertise, talented personnel, a brand, or innovative processes (Porter 1980).

Melita Balas Rant

Leadership of Hidden Champions: From Vision to Communityship

Abstract

From Russia to Albania, Hidden Champion organizations (HCs) have many common features. Among these, as also argued in the original Hidden Champion work by Hermann Simon (1996, 2009), is the importance of leadership.

Ian Sutherland, Danica Purg

Three Bivalent Performance Factors of Hidden Champions: Ownership, Organizational Culture and Organizational Governance

Abstract

No specific reason can be identified to explain the success of Hidden Champions (HCs) (Flören 2002; Simon 2009). Nevertheless there are a series of factors that can offer partial explanations. This chapter will focus on three of them: Ownership, corporate culture, and organizational governance. Each of these is a double-edged sword. Depending on how it is managed, it can lead an organization to prosperity or ruin. This thin line between success and failure involves strategic choices: to expand globally or remain local, to follow popular business models or develop new innovative initiatives so as r to break into new markets. An appropriate choice often makes the difference between a successful and disastrous company leadership (See Breu 2001 or Fredberg et al. 2008). This research project deals exclusively with success stories. Yet, we also stress the fact that in certain circumstances success can turn into failure.

Arnold Walravens, Nenad Filipović

Innovation Behaviour of Hidden Champions

Abstract

Peter Drucker (1986) once wrote that a company has two basic functions: marketing and innovation. To win customers and stay ahead of the competition, to survive and compete, innovation is critical (Chesbrough 2003; Drucker 1986). The ability to innovate, and do so both effectively and efficiently, is required to achieve and maintain world market leadership. Outstanding and continuous innovative performance is the competency that firms have to master. The amount of money put into research and development (R&D) depends on the dynamics of the industry and the markets, yet it is not an indicator of success. In the early 2010s there are examples of key Western companies whose R&D expenditure is not related to profitability. For example Apple, doubtlessly a leader in the smartphone market, invests only 5.9 % of its profits in R&D, whereas the industry’s average is 7.6 %. As Procter and Gamble, a world leader in personal care and household items, decreased its investment in R&D from 4.8 % to 3.4 %, its product success rate rose from 35 % to 75 %.

Peter Baloh

International Marketing

Abstract

Within the discussion surrounding the Hidden Champions (HCs) from Central and Eastern Europe (CEE), this chapter will offer a brief international marketing perspective. Seeking to draw valuable conclusions from research that was conducted for more than 2 years in 17 CEE countries the authors will bring a blend of academic and business theory into a single workable frame of reference. The most prevalent and outstanding anomalies of this CEE HC cohort that have been studied in depth during this research will be emphasized and discussed in detail. This chapter will give a brief outline of major business environment dynamics in the last 25 years in CEE countries. It will demonstrate that this part of the world has become a popular source of business opportunity because of its emerging markets. The HCs support the argument that the business communities of the CEE countries’ consist of emerging companies that are becoming a threat to existing successful organizations.

Nenad Brkić, Denis Berberović

In Search of Sustainable Business in Central and Eastern Europe

Abstract

Any modern literature, be it the scholarly work of Porter and Kramer (2006) or Prahalad (2004), the entertainment sections of Glamour magazine (Sole-Smith 2009), or even MTV television (Think MTV 2009), sends the message that the world is deeply concerned with social and ecological issues. Topics range from CO₂ emissions, water rights, and de-forestation, to child labour, peace, and social equity. The needs of society and the environment present a telling tale. However this concoction can be the perfect storm for the business manager, complex, disorienting, and maddeningly inscrutable and contentious. Fortune Magazine (2007) may have declared “Going Green” to be the business story of the twenty-first century but many managers struggle to understand even the most basic points of sustainable business practices (Berns et al. 2009). This chapter is not only concerned with the question of which issues merit consideration. It also asks if a business should focus on environmental concerns, or social concerns, or both? How is one to navigate the vast landscape of seemingly disconnected literature? Moreover, at the end of the day, why does it all matter to business? How does sustainability affect the bottom line? How can managers respond sustainably in order to support their business goals?

Nadya Zhexembayeva

Financial Aspects of HCs Business Models

Abstract

An effective financial strategy is vital for the sustainable growth and development of any organization. It ensures that investment decisions align with the overall business strategy and allows the right mix of sources of funds to finance investments. Attracting finance is not an easy task for any company as it spills the risk-and-return discussion outside the boardroom to the premises of investors who are seeking an economically attractive investment on a long-term scale. At the same time, investors seek a transparent and understandable business. The quality of these factors, among others, affects important metrics such as the cost of capital and a level of dependency in managing a company.

Pavel Lebedev

Hidden Champions of Albania

Vasilika Kume, Anisa Kume

Hidden Champions of Belarus

Pavel Daneyko, Pavel Golenchenko

Hidden Champions of Bosnia and Herzegovina

Nenad Brkić, Denis Berberović

Hidden Champions of Croatia

Mislav Ante Omazić, Rebeka Danijela Vlahov

Hidden Champions of Estonia

Rein Riisalu, Anu Leppiman

Hidden Champions of Hungary

Miklós Stocker, Péter Szlávik

Hidden Champions of Latvia

Arnis Sauka

Hidden Champions of the Republic of Macedonia

Mijalce Santa, Ljubomir Kekenovski

Hidden Champions from Romania

Bogdan Rusu

Hidden Champions of Russia

Irina I. Skorobogatykh, Olga V. Saginova, Zhanna B. Musatova

Hidden Champions of Serbia

Vesna Rašković Depalov, Marija Todorović, Sanja Marinković

Hidden Champions of Slovakia

Janka Táborecká-Petrovičová, Jaroslav Ďaďo, Tamara Bobáková

Hidden Champions of Slovenia

Melita Balas Rant

Hidden Champions of Turkey

Türkan Yosun, Dilek Çetindamar

Hidden Champions of Ukraine

Nataliia Palii, Viktor Oksenyuk

Backmatter