Environment Interpretation for Business Continuity in a Project Supplier’s Networks – Critical Factors in International Industrial Upgrades

Abstract

Project suppliers operate in temporary networks of stakeholders with limited visibility outside of the project’s dyadic relationships. Environment interpretation can reveal opportunities but also fatal risks in complex networks. Therefore, a wider view is needed for the project supplier to develop their business continuity in networks.<br/><br/>Environment interpretation and business continuity of project suppliers have been given limited attention in project business and industrial networks literature, especially from business opportunity and risk recognition perspectives. This research pursues an increased understanding and introduces the concept and process of network picture alignment in a temporary project’s business as a possible tool for environment interpretation and a source of business continuity in networks. The goal is to construct a framework for a project supplier’s network picture alignment in a value system. A qualitative, constructivist research design was selected to study a real life problem, and to advance the scientific knowledge in management both in international project business and in industrial marketing in networks.<br/><br/>The market research collects and analyses data to comprehend the significance of a business environment change in the paper industry and its influence on the paper machinery business. Thereafter, as a special case, six similar paper machinery upgrade projects from Finland to Italy are empirically studied to perceive critical factors in temporary projects. The critical factors are deductively established for the development of network picture alignment framework. The developed framework on network picture alignment is evaluated with three industrial change cases as post mortem analysis.<br/><br/>The market research revealed that the competitive situation among three dominant paper machinery project suppliers changed significantly between 2008 and 2012. The Austrian Andritz suffered the most from the economic downturn but they were capable of interpreting the business environment and rapidly reached the two market dominators, the Finnish Metso and the German Voith. Andritz concentrated successfully on uncertain upgrade projects and managed to change the situation in competition.<br/><br/>The empirical contribution was the map of the critical factors and steps to construct the framework of market-driven network picture alignment. The theoretical contribution is that a project supplier needs to critically interpret the environment and broaden their temporary projects’ and project business boundaries outside of the focal project networks for business opportunity recognition and risk reveal. Moreover, a supplier or other focal stakeholder in the value system is suggested to align its situated network picture to other stakeholders’ network pictures in dyadic, triadic and extended networked collaboration and relationships for continuous cooperation, with the constructed market-driven network picture alignment framework. In addition, network pictures are conceptually suggested to become flexible and dynamic, with market-driven mindsets and consecutive successful network picture alignments in the context specific value system.<br/><br/>The business opportunity identification for a machinery upgrade requires tight interactive technical collaboration in a customer’s production process. Continuous cooperation can be reached with harmonious relationships and repetitive network picture alignments between stakeholders. However, cultural distance matters in the reach of business objectives. A project supplier’s organization and persons have to follow a market-driven mindset in context specific network picture alignment. A market-driven mindset attached to collectivistic, and entrepreneurial activities advances the business performance. Thus, a supplier can create their own path for continuous business utilizing market-driven network picture alignment framework as the core of the strategic market management in networks.<br/><br/>Forthcoming research should study the question “why” salience is caused in global level environment interpretation in addition to “what” and “who” cause stakeholder salience. Moreover, network picture alignments should be studied in other social interaction processes, for example in business acquisition integrations. When the situated network picture version is the focus of this research, the representationalist and mentalist alignment versions would need further understanding. As the dissertation reveals network picture dynamization and consecutive network picture alignments as features of evolving project businesses, they are suggested as topics of future research.