Advice on business literature from Helen Edwards

A new selection of business literature from SKOLKOVO Library Project Manager Helen Edwards will help you know better BRIC countries. Read about what is in store for India, why Chinese consumers are worth special attention, what N-11 is and how global energy is forecast to develop.

1. India inside: the emerging innovation challenge to the west
Nirmalya Kumar and Phanish Puranam
Harvard Business Review Press, 2012.
xv, 177 pages
ISBN: 9781422158753

This book asks the question: can India transition from "outsourced and made in India" to "imagined and owned in India". Despite India's success at becoming the back office of the world, there are not yet Indian innovations to match Google, iPods and Viagra. But there is much invisible innovation including R&D centres for multinationals and for outsourcing; process innovation especially the injection of intelligence to how routine operations are carried out; and management innovation in global service delivery. Using comprehensive research into data and interviews with Indian managers, the authors show how these strengths, and the focus on frugal engineering and making affordable products, constitutes very real innovation with much more to come.

2. As China goes so goes the world: how Chinese consumers are transforming everything
Karl Gerth
Hill and Wang, 2010.
vii, 258 pages
ISBN: 9780809034291

At the time of writing Chinese consumer spending was less than half of that of the United States, but already more than Japan and are closing in on the European Union. Chinese consumers are rapidly acquiring western tastes from eating meat in fast food outlets to luxury vacations. This book explores the collective implications of individual consumer choice for China and the rest of the world. Chapters cover the new car culture, wealth and inequality, modern retailing, the rise of brands and the parallel industry of fakes and counterfeits, extreme market such as endangered species and foreign adoptions, and the environmental implications.

SKOLKOVO graduated MBA

The original text in Russian is available on Finparty.ru

Last Friday the Moscow School of Management SKOLKOVO second intake celebrated its graduation party. Andrei Rappoport, President of the School, and Gor Nakhapetyan, managing director of Troika Dialog, saw the graduates off to their freewheeling.

The graduation party started almost half an hour later – unprecedented Friday traffic jams kept several parents back, so they didn’t manage it to the diploma presentation, and some prominent guests arrived later than it was planned as well.

Elegant graduates who had just passed their final examinations were seated in the familiar Singapore auditorium where they were presented with their student IDs by Lee Kuan Yew, Prime Minister of that country. On the other hand the diplomas were presented in a working atmosphere; the School Founding partners were represented by Gor Nakhapetyan only. The graduates await a more festive ceremony in summer.

The opening speech was delivered by Andrei Rappoport, newly appointed President of the School. “SKOLKOVO as a school can only realize itself when you become successful. So, bring all you opportunities to life, be an example for the future students, and we are going to promote ourselves with your help”, declared Rappoport. Lots of shots flashed on a big screen: school weekdays, trips to China, India and the USA and, surely, parties. Frames with Ruben Vardanyan, Ex-President of the School, and Wilfried Vanhonacker, who recently left SKOLKOVO, beloved by everybody, were perceived especially warm.

ALMA-ATA Module

The student life on the Executive MBA programme is not limited with only educational modules. In the course of studying students gather in groups of interest, create their own clubs and go on different trips.

We have already told you about the rally from Moscow to Vladivostok and the round tables dedicated to various infrastructures, about the trip to Hong Kong aimed at assessment of business opportunities in Asia, etc.

Today we would like to tell you about the first foreign trip of the SKOLKOVO EMBA fifth group that started their studying in November 2011.

Taking the advantage of a break between modules, the students set off to the sunny Alma-Ata. The destination wasn’t chosen by guess – there four representatives of the Republic of Kazakhstan in the group. Yerlan Balgarin, Dastan Abdulgafarov, Yerbol Ismailov and Baurzhan Baymukhanov initiated the so called Alma-Ata module that took place over 8-11 December, 2011.

The EMBA-5 group was represented by 10 students: Konstantin Mashansky, Pavel Zubkov, Grigory Golubnichy, Alexander Zaytsev, Vasily Kuztetsov, Andreas Savvidis, Andrey Shein, Oleg Dyatkevich, Nikolay Lebedovsky, and Andrey Tokarev.

Investors Day at SKOLKOVO

The final and the most serious module of the SKOLKOVO MBA programme is the drafting of individual start-up projects by students. The theoretical basis given during the first four months as well as projects in the corporate, state and social spheres were only a kind of preparation and training for the major individual work – creation of their own business.

Within two autumn months the students had to mobilize all their crafts, skills and knowledge and to present a made-up project by December. Entrepreneurial grasp, sconce, new bonds and experience – all these are brought in action with full force in order to present an actual, competitive, demanded and important for the society project.

Lawrence Wright, SKOLKOVO Start-up Project Director, manages this complicated stage of the studying and helps the students. Understanding the significance of creation of an entrepreneurial ecosystem, where new ideas and projects would be born, brought up and formed, this year Lawrence Wright has established the SKOLKOVO Entrepreneurs’ Club, an open community that now spreads beyond the School as well. Perhaps you’ve already attended one of the Club’s meetings, haven’t you? In November the final event of this year took place, but starting from the next year the Club will go on with its meetings on the hospitable SKOLKOVO Campus. Follow up the news and join us!

The key event of the start-up module is the Investor Day when teams present their projects directly in front of those who may be interested. On December, 2, representatives of large investment funds and private investors gathered n the Campus in order to express their expert opinion concerning each of them and to name the winners. Among investors were Gor Nakhapetyan and Andrei Vakulenko (Troika Dialog), Phillipe Delpal (Orient Express Bank), Alexey Belyakov (i2BF), Denis Alexandrov (SKOLKOVO Executive MBA graduate, Investment company A1), etc.

What chances do brands take to conquer emerging markets? - an article by Helen Edwards

Here is the translation of the article by Helen Edwards, SKOLKOVO Library Project Manager, published on Slon.ru. The original text in Russian is available here.

What chances do brands take to conquer emerging markets?

Multinational corporations producing foodstuff will not expend by means of developed markets. If your strategy doesn’t include emerging countries, you are already lagging behind. In the October issue of Harvard Business Review Bill Johnson, CEO of Heinz, notes that the interest of emerging markets in the company’s common income will make 20% this year. For instance, a couple of years ago it was less than 5%, under the Heinz calculation, by the year 2015 will exceed 30%. However even in case of global brands you have to adjust them to the tastes, needs and preferences of the locals. Otherwise nobody will buy your cow.

According to Datamonitor more than 20 000 new foodstuffs emerge in the world every year. The majority of them will disappear haven’t even managed to make a statement. Martin Lindstrom, brand expert, notes that the aim of a really successful global brand is to become identic in the whole world and share the same core values. And it does not only concern the same logo for all world countries, a brand must have a global meaning. In his books “Brand Sense“ and “Buyology” Mr Lindstrom highlights that a brand values exactly because of its emotional bonds with people.

It’s generally assumed that the majority of brands strives to influence visual perception. Meanwhile it’s time to focus on sounds, smells, taste and tactual sensations as well. Have you noticed the sound of an opening lid in beer advertisements? And Coca-Cola tries to express via sounds sensations from the first gulp; Pringles is advertised by means of crunching crisps. A try to influence all the five senses at the same time is of great importance because the taste of the same product may vary in different countries. And they may be served differently as well. For instance, in Korea ketchup Heinz is usually used to complement pizza but not fries. And in Papua-New Guinea the Johnson&Johnson baby dust is never applied to children as it is meant for funerals.

SKOLKOVO Entrepreneurs’ Club meeting: “Strategy is a dream confined by a deadline”

On November, 30, the fifth, and the final one this year, SKOLKOVO Entrepreneurs’ Club meeting took place (read about the previous one here). We are glad that every time our Club gathers a large friendly company united by common interests and strivings. We’d like to thank all our guests and speakers for a wonderful evening!

This time two visiting experts performed at the meeting, they are Alexey Komissarov and Alexey Kapterev.

Alexey Komissarov, head of the Department of science, industrial policy and enterprise of Moscow, shared his own experience of creating of a technological business from the ground up, told the guests about mistakes and challenges he had to face on his way from the first laboratory in a small room with secondhand equipment to a large company with revenue more than $50 million that has made a technological breakthrough.

“Strategy is a dream confined by a deadline”

The Rapid Ascendency of the Emerging World’s Financial Market - a new SIEMS research

It is clear that the global financial markets have already entered a new era. For most of the past thirty years, their rapid growth was driven by today’s developed world. In the course of less than a decade, however, a new set a players, the emerging market economies, are driving much of the new growth in global financial activity. While the consequences of the global financial crisis will take many years to play themselves out, it is clear that the crisis has greatly quickened the relative ascendency of the emerging world’s financial markets.

We present to your attention a new report of the SKOLKOVO Institute for Emerging Market Studies (SIEMS), which examines a large swath of financial market indicators to assess just how far the emerging economies have increased their financial development and strength over the past decade. This brief review will give key theses, analysis data and SIEMS experts’ conclusions.

The Great Risk Compression

By far the most important development in the emerging financial markets over the past decade has been the massive compression in perceived risk. Emerging markets (EMs) have traditionally been characterized by having much higher levels of financial risk relative to developed economies.

For the first time, some EM market countries are now judged to be less risky borrowers than several western European countries. Some analysts have voiced concern over the scale of the inflows into EM debt securities since the end of the global crisis, viewing the risk premiums as entirely too narrow for economies that are still “emerging”. Others, however, believe that fundamentally, EMs are just a lot less leveraged now and simply have the financial strength to repay their loans.