For senior executives across modern Europe, it is a challenge: attracting the best employees, whether to write software or to market pet food. Recruitment is one of the new corporate art forms, yet another measure of a company competitiveness and management ability. Bruce Dorskind’s specialty is global recruitment strategy. His New York City-based Dorskind Group has worked with companies in 40 countries over the past four years and helped an advertising agency TMP conduct acquisition of 24 recruitment advertising firms and Internet sites, many of them in Europe. It turned TMP into the largest recruitment communications firm in the world, with a market capitalizalion of $1 billion.
Speaking about the trends in European recruitment, Bruce Dorskind states, that there’s consolidation in every industry and globalization. Companies need to introduce their brands or products to new markets. So there is a move towards cross-border recruitment, where the demand for talent is spreading across markets. Europeans used to sell products only in their own local markets, but now they are selling them all over the world. And they are looking for people to do that.
For example, now there are four or five pharmaceutical markets and one common language, English. Despite high unemployment rates in Europe, there is also a shortage of people in certain disciplines, especially in information technology, sales and marketing. Another example is consulting. Andersen Consulting in Germany recruits from Switzerland and Austria. Consulting firms are among the largest recruiters in absolute numbers.
Many young graduates in Europe seek international experience. They want to move to a foreign country, deal with a new language, mostly within Western Europe. Something else to consider is that most jobs in the US are created by new companies that are less than 10 years old. In Europe the majority of jobs still come out of older companies, or are a result of mergers.
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Marketing
Marketing can be defined as human activity which is directed at satisfying needs and wants by creating and exchanging goods or services. The marketing concept has replaced the selling concept. The “selling concept” means that consumers have to be persuaded by selling techniques to buy non-essential goods and services. The “marketing concept”, on the contrary, means that the producer should produce the products which the customers need.
Marketing can be approached in terms of marketing mix. Its components are four Ps — product, price, place, promotion, that is selling the right product, at the right price, through the right channels, with the right support and communication.
Let’s consider the case of the company “Harley-Davidson”, the company in the USA which produced bikes. For a number of years the company had serious problems. Its profits decreased, and the company was facing a possibility of bankruptcy. In its operation the company was orienting to a rather narrow market, that is young people in “black leather jackets”.
In order to survive, the company had to use the main principles of marketing. 1. Determine the customer groups or segments. 2. Determine their needs. 3. Position the product in a proper way. While the company was trying to determine a new group of customers, it identified a numerous group of baby boomers, born after World War II. At that time they were in their forties. The second stage of this work was determination if these rather grown-up and conservative people could become buyers of bikes. The company studied this group and the features of its buying behaviour and came to a conclusion that it was possible. These people were experiencing the crisis typical for people of their age, and they had to get new opportunities, new experience and relaxation.
The company decided to launch a new model and position it in such a way it could meet the needs of the target group. The new model was meant for top-end, or upmarket (Am. upscale) instead of mid-range market. The motorcycle was made large and reliable. A lot was done to improve the image of the motorcycle. A shift was made from “hard metal” to a more soft variant. Such famous personalities as Kurt Russell and Elizabeth Tailor were advertising the new model. The company was successful. Its sales have risen, and its profit has grown more than three times. Now the company is looking for new markets at home and internationally. It didn’t suffer from foreign competition, as many automobile and electronic companies did. The company survived and began to prosper as it followed the principles of marketing.
Marketing has become a key factor in the success of western business. In the 20th century, marketing has played an increasingly larger role in determining company policy, influencing product development, pricing, methods of distribution, advertising and promotion techniques.
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1.9 Teenage marketing: word-of-mouth approval
The natural habitat of Japanese teenagers is a small area of central Tokyo between Shibuya and Harajuku stations which is full of boutiques and music shops. At weekends, teenagers from the city and the surrounding provinces go there to spot the latest street fashions.
The area is also a magnet for anyone researching or selling to the teenage market: fashion and cosmetics companies, record producers, editors of young fashion magazines, soft drink and snack promoters, and makers of games and gadgets.
One such company was Bandai, the toy company responsible for Tamagotchi, the egg-shaped, pocket-sized virtual pet which swept the world in the late 1990s. Tamagotchi’s first appearance was in a test marketing exercise on the streets of Shibuya.
The schoolgirls that saw it were so impressed that told all their friends, and the first Tamagotchi in the shops sold out immediately. Such is the power of word of mouth. Normally, word-of-mouth promotion is free, but impossible to arrange. In Japan it can be arranged — at a price. There are agencies with hundreds of teenagers who receive new products and tell their friends about them, others are paid to queue for a new product, creating an “artificial buzz” about it. Mr. Morita set up the agency Teens Net-work Ship which is the best specialist in the teenage market, and often uses informal, word-of-mouth style marketing methods. It has a register of 2,000 senior high pupils in the Tokyo area, and is now expanding nationally. Information spreads more rapidly among the 15 to 18 age group than at any other life stage. A teenager tells on average 50 of his or her friends about the “discovery”, so that a group of 1,000 can spread the word to 50,000 or more.
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Advertising
Advertisings is a message to promote a product, a service, or an idea. The purpose of most advertising is to sell products or services Advertising plays a key role in the competition among businesses for the consumer’s money. In many businesses, the volume of sales depends largely on the amount of advertising done.
Manufacturers advertise to persuade people to buy their products. Large firms also use advertising to create a favourable image of their company. The company can advertise in many ways depending on how much it wishes to spend, and the size and type of the target audience. If the company wants to enter the market or launch a new product, it often starts an advertising campaign.
Such campaigns are usually very successful because people learn about new products or services.
When South African Brewery (SAB) started producing beer “Zolotaya bochka” in Russia, it invested lots of money not only in production, but in advertising the product. The advertising campaign was aggressive, and as a result this brand of beer is among the most popular ones.
There are different ways of advertising:
• newspapers
• television
• direct mail
• magazines
• outdoor signs
• other ways (transit advertisements, window displays, telephone directories and novelties).
Television is the chief medium used by advertisers. In the USA 100 largest advertisers spend on average 75 per cent of their advertising budgets on television. Food companies spend about 80 per cent on television, and candy, snack, and soft drink companies spend about 85 per cent.
Advertising on TV is often criticized. People don’t like it when programmes are interrupted every fifteen minutes. Of course, advertising revenues are important, but there are international norms which recommend ad breaks every 45 minutes. These days outdoor advertising is popular in Moscow. Many people think it makes the city more beautiful. It is especially widely used by car manufacturers, clothing and telecommunications companies. Such advertising attracts wide audience and is effective
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1.11 What is the brand?
A brand is a special trade mark, sign, symbol, design of the product that distinguishes it from other products. Products can have sub-brands. People have some beliefs and perceptions about a particular product, that is they have the brand image.
Consumers get used to some brands, and prefer to buy them. Some people drink only Nescafé, prefer mayonnaise produced by Moscow fat-producing plant (MZhK) and chocolate of Krasny Oktyabr factory and so on. In this case we can speak about brand loyalty, that is commitment to a particular brand, which people regularly buy.
Some brands have names of people. Tea brand Dilmah is composed of the parts of names Dilhan and Malik, sons of the tea producer.
Some brands have mistakes in their names. Brand of vegetable oil is called “Zolotaya semechka”, but according to the rules of the Russian language, it should be called “Zolotoye semechko”.
It takes up to ten years to create a brand in the West. In Russia it can only take two years. It is known that 80 to 90% of new brands fail within their first six months.
If a company gives the name of the brand to its other products it’s called brand-stretching. By putting their familiar trademarks on attractive and fashionable new products, companies can both generate additional revenue and increase brand-awareness. So there is Pepsi Maxwear, Camel watches and Cadberry jewellery. Brand-stretching is not always successful.
A brand like Coca-Cola has been around a long time, and dominates the fizzy drink market in almost every country, outselling local brands. One of the exceptions is Scotland, and their marketing specialists are trying to find out why this is. One of the possible solutions is that people in Scotland are more conservative and keep to their traditions.
One of the most successful brands in the world is the Barbie. Created in 1959, it targeted girls who wanted to have dolls which were like young women. Its unique selling proposition is that Barbie looks like a young woman, not a baby. Barbie has had seventy five careers — from astronaut to presidential candidate. In 1961 Ken, the man in Barbie’s life, was introduced. She has got little sisters and friends from different ethnic groups. Now there are 15,000 different items for Barbie. Costume variations and brand-stretching have been the key to her continued popularity. Her life cycle never ends. One Barbie is bought every two seconds.
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Job search
Job search is a long process which needs lots of time and effort. You can’t start it without a resume. You present the most important information about yourself in it: your background, your work experience, skills and special knowledge. You should write your objective too, that is what position you are aiming at.
With your resume drawn you start direct research. You study business magazines and newspapers and look for the companies that regularly hire in your field. You can send your résumé to these companies. Employment and recruitment agencies are aimed at assisting you in finding a job. State employment agencies are funded by state labour departments. The most effective way to use their services is to visit the local office. Only employment agencies and some recruitment agencies will actively market you to a large number of companies. The most part of recruitment agencies only present the credentials on the existing position.
It is useful to visit job fairs and career days, ask your family, relatives, friends, neighbours and acquaintances to help you in job search. You can use web pages on Internet, such as www.jobs.ru and other special web sites.
Interview is an important part in your job search. It is important to make a good impression and to wear proper clothes. Make sure your shoes are clean, well polished and in good condition. Don’t fiddle with your hair, your hands or your clothes, don’t cross the arms. Sit up straight. Keep long hair under control, don’t wear too much jewelry. Try to keep eye contact with the key person in the meeting. It is not proper to ask about the salary at the first interview or criticise your former boss or company. It is not recommended to discuss personal or financial problems with the representative of the company. It is important to assure the company representatives that you are the right person for the position.
If you are offered a position, you can negotiate about the offer and ask about your salary. As you can see, the process of job search is rather difficult, but it can be a rewarding too if you get the position which you have been dreaming about.
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Business Etiquette
The turn of the 20th century saw great interest in business etiquette in the USA. It can be surprising, but in this era of take-out foods and dress-down Fridays, etiquette is becoming very important. There are lots of signs of it. First of all, the bookstores are filled with different books on multicultural ways of doing business, on e-mail manners, table manners and more. Colleges and universities are giving their graduates special courses. Businesses are spending hundreds of thousands of dollars for seminars with such names as “Customs and Protocol for Doing Business in the Global Marketplace”, “Business Basics for Professional Polish”.
An etiquette expert Dorothea Johnson tells the story of the businessman who came to her for help after he was not employed by a big corporation. At a lunch meeting with a senior executive in the company, he sat down and immediately started eating the salad in front of him. He looked up to see his boss, who hadn’t picked up his fork yet, and was staring at him. “I knew right then they were going to send me out,” he said. If he knew the manners, he would have known to wait until his host started eating.
The recruiters do not offer jobs to candidates who salt their food before tasting, because it shows a tendency toward hasty decision making, or to those who order very expensive food at the restaurants.
Today’s parents are realizing that good manners will help their children get along in life, and they teach them. Etiquette hasn’t been a priority during the last two decades. Unfortunately, family mealtimes are a thing of the past, when children learnt not to butter all their bread at once, or, more important, how to hold polite dinner-table conversation. Top corporations hire specialists to teach “client development skills”, which include anything from how to place a napkin to how to present a business card to a Japanese businessman.
The important thing to remember, though, is that good manners are more than a code of behaviour. They can make life easier. It’s methodology by which people can get along with each other.
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Banking
There are several ways in which consumers and businesses can use their savings or idle funds. They deposit them in a commercial bank, they can take them to a savings bank or to a savings and loan association, or they can buy stocks and bonds.
They can also keep excess funds completely idle by holding their cash in a safe place.
Since there is competition for savings, the bank must offer an attractive rate of interest. The higher the rate, the less likely it will be that savers will bring funds to the bank because people will prefer a more profitable way to save. Besides being saving institutions, banks serve another vital function. They act as a market for money. People and businesses in need of money are willing to pay for the use of it, just as people pay rent for the use of a flat or for a car which they need only for some time. Banks provide facilities for the movement of money Businessmen borrow to expand their factories or stores, to increase their inventories and to buy machinery. They expand in the expectation that they will increase their profits. Businessmen must consider interest on loans as an added expense of any expansion.
Businessmen and consumers may postpone actions that require borrowed money when in their opinion the interest rate is too high.
There is another side to the bank’s role in the economy Since the prosperity of a bank is tied directly to the prosperity of the community in which it does business, bankers usually take an active interest in local development efforts to bring new industry to the area. They help and advise businessmen who are interested in setting up or expanding businesses. These businessmen are the biggest buyers of local government bonds. By buying these bonds they lend money for local improvements that will make their community a better place to live and to do business.
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1.15 What is Russia’s greatest asset?
When Russia’s economic resources are discussed, stress is often placed on its reserves of oil, gas, iron, non-ferrous metals, gold, etc In actuality, neither is an economic asset of the first importance. The majority of the most successful econo-mies in the last half century have been small and extremely poor in raw materials — Japan, South Korea, Taiwan, Singapore, and Hong Kong
This is not surprising The chief path of development for any economy is to shift from production of raw materials to more advanced manufactured goods and services. Raw materials prices historically fall relative to manufactured goods. Raw materials will be even less important in the information-based economies of today and the near future.
In reality, Russia’s most valuable asset is its people. That is not meant in a sentimental, moral sense, but as an economic reality In the prosaic language of economists — the most valuable asset in Russia is its educated and skilled workforce. Educationally, Russia has one hundred per cent “first world” standards. The Soviet Union possessed more engineers than the US. Soviet space technology was more advanced than that of the US, and Russian programmers are sought around the world. The educational level of the Russian population is high, as it is acknowledged in the world. That is a gigantic achievement, created at enormous cost. One of the chief problems, holding back all economies is lack of such skilled and educated workforce. It is impossible to use modern methods, machinery or software without qualified workforce.
The success of the Asian tigers was largely due to their decision to invest huge resources into education, creating a workforce that could operate in constantly upgrading economies. In developed economies this is even more critical. In many sectors of an advanced economy it is cheaper to replace machines than people. All advanced economies are in a conscious economic race to upgrade the educational 1evels of their population.
In international terms, it is not difficult to see that the only strategy is to concentrate on industries using large quantities of skilled labour and low quantities of capital. This determines that manufacturing is the strategically decisive sector. Internationally, the average consumption of capital per unit of output in manufacturing is around 16—18 per cent and 70 per cent of labour. In contrast, in extractive industries, such as oil, gas and mining, consumption of capital is 40—55 per cent and 70 per cent is labour.
Russia has chosen raw materials industries as a priority. As a result, the price of capital went up extremely high, that is interest rates rose to such unreal levels, and the price of skilled labour fell to the point where it was more profitable for an engineer to become a shuttle trader.
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Retail sector in Moscow
Moscow is traditionally seen as a retail heaven and is becoming more and more attractive to both local and foreign investors as well as shopping centres’ operators. Moscow population of 12 million accounted for $22 billion (or 30 per cent), of the country’s total retail turnover last year. Retail giant the Turkish Ramenka is operating a chain of supermarkets and shopping centres. The company is planning to invest $200 million to dominate the local retail market. Druzhba Trading House, a Chinese state trading company opened two supermarkets and invested $150 million in the retail sector.
Swedish furniture retail giant IKEA occupied Moscow retail market by storm when it launched its $100 million retail outlet in the Moscow suburb of Khimki. IKEA is currently planning several retail outlets in Moscow and St. Petersburg. It has also plans to open a $25 million furniture factory near St. Petersburg.
The growth in retail is linked to what experts call a peculiar predisposition of Muscovites to frivolous spending that is unseen in developed markets.
The studies conducted by a group of Russian investors found that Russians spend from 75 to 80 per cent of their disposable income on goods, almost twice as much as consumers in Britain.
Market analysts explain this uniqueness by the fact that unlike most Westerners, the average Muscovite is not bound up by any type of long-term credit payments, such as home mortgages, car payments and credit card debts. So he or she is likely to buy goods and services. Shopping centres are springing up around the city. Moscow started a 20-year plan to invest $3 billion in reconstructing existing shopping facilities.
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