Background Information

Selecting Internationalization Strategy for Russian Healthcare Market Entry. With special reference to International Service Template for Occupational Healthcare.

Thesis 2015

Table of Contents

1. Introduction.. 4

1.1 Background Information.. 4

1.2 Objectives. 4

1.3 Research Questions. 5

1.4 Research Method. 6

1.5 Theoretical Framework. 7

1.6 Delimitations. 8

2 Case Project Decription.. 8

3 Internationalization Strategies. 11

3.1 Theoretical Information.. 11

3.1.1 Licensing. 12

3.1.2 Franchising. 13

3.1.3 Management contract 15

3.1.4 Global Strategic Partnership. 16

3.1.5 Joint Venture. 18

3.1.6 Mergers and Acquisitions. 19

3.1.7 Wholly Owned Subsidiary. 22

3.2 Entry Strategies Analysis. 23

3.2.1 Licensing in a Healthcare Services Market Entry. 25

3.2.2 Franchising in a Healthcare Services Market Entry. 26

3.2.3 Strategic Alliance in a Healthcare Services Market Entry. 27

3.2.4 Joint Venture in a Healthcare Services Market Entry. 29

3.2.5 Mergers & Acquisitions in a Healthcare Services Market Entry. 30

3.2.6 Wholly Owned Subsidiary in a Healthcare Services Market Entry. 30

3 Market Description.. 32

3.1 Russian Occupational Healthcare System.. 32

3.2 Current Market Situation.. 34

3.3 Possible Market Challenges. 36

4 Differences in Occupational Healthcare Systems. 37

5 Entry Modes Selection Criteria. 38

6 Evaluation of Entering Modes. 40

6.1 Evaluation According Criteria. 40

6.2 Market Situation Influence. 41

6.3 Systems’ Differences Caused Challenges. 42

7 Conclusion.. 43

List of References. 46

Introduction

Background Information

The objective of this report is investigation and selection the best way of entering foreign industry of Occupational Healthcare Services. Decision to choose this topic came from the OCCSET project which aims to explore Russian Occupational Healthcare market for further business establishment. Intensive work on the project has encouraged my interest in this sphere, therefore topic for the thesis is related to the project and the industry they work in.

Since the system of the chosen industry operates in a completely different way in Russia, a lot of questions appeared within the process of market investigation. Apparently, the major question of the whole project is, roughly speaking, how to enter the non-existing market.

The topic is absorbing and research results are important for the project’s development and final decision making. Therefore, I have decided to investigate and evaluate different ways of entering Russian occupational healthcare market by foreign companies, considering current market situation and challenges, choose two most perspective ones and build a comparison matrix in accordance with the selection criteria generated. For the outcome of the thesis the final decision is to be generated through deep analysis and comparison of foreign market entry strategies for the purpose of bringing value for the project.

Objectives

Since the aim of the project is establishing a new business in St. Petersburg and project managers are Finnish companies and public organizations, I suggest that efforts of a Russian-speaking St. Petersburg citizen will appear to be maximally useful for resolving some key factors of the project. Interviewing representatives of Russian Healthcare and Occupational Markets is also critical in terms of invaluable information that can be explored straight from the tin. Involving local experts in a decision-making may appear to be crucial success factor for the trustworthiness of the decision on Russian Occupational Healthcare market entry strategy selection and thus bring success for the project. Therefore, the idea of this thesis research seems to become advantageous for the OCCSET project from any perspective.

Moreover, deep research will strengthen my knowledge and expertise in a subject of internationalization strategies, namely characteristics of all possible ways of entry to the foreign market, possible outcomes of various, deep understanding of advantages and disadvantages of each entering option, criteria for selecting the most appropriate ones, ability to evaluate significance of some criteria against others, to measure the extent of market situation impact on success of various entry modes. I hope to find it beneficial for my future career in terms understanding and possessing enough skills to make critical decisions for my own business or for a company I will work for.

Investigating the current market of occupational healthcare services in Russia and in Finland, deep comparison of those ones, searching the niche in a market where creating a new kind of enterprise is the most applicable and ambitious, legislation analysis will improve my research skills and again, bring more useful information to increase a project’s scope.

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