In a contemporary business environment, the ongoing improvement of external communi-cation between the companies and their customers (B2C) becomes a very important fac-tor because of the increasing competition on trade markets and raise of the customers’ expectations for the quality of services and goods. The topic of an actual research con-cerns the external organizational communication between Posti Plavelut Oy and its cus-tomers, and their insights for the new product development. Based on the Posti’s case study it will be studied and shown how internal and external organizational communication are interconnected and how they influence each other as well as new products are going to be suggested in order to improve Posti’s work. Furthermore, the steps for improvement of the communication between a company and its clients and potential customers will be rec-ommended.
The actuality of the research is due to the existing situation in the field of newspaper and parcel delivery in Finland, as the main carrier, Posti Palvelut Oy experiences the serious reduction of newspaper subscriptions in Metropolitan area, leading to the shortening of its functions, raising of operating costs and massive dismissal of employees. Therefore, the strengthening of relationships between Posti Palvelut Oy and its customers is required and the new ways of doing it shall be taken into consideration.
Research aims and goals
The main purpose of the research is to create the solutions to get a clear understanding of the customer insights for a new product development for Posti
The research problems are:
To observe the existing communication practices of Posti’s in B2C and internal scope;
To determine the weaknesses and strengthens of communication methods used by Posti;
To explore a numerous of theories and implement them to the actual situation of Posti’s;
To create marketing models helping to improve the communication and attract the new customers.
Research question – How can new product development change an existing Posti situa-tion and what else can be proposed to strengthen their business
To achieve the research aim, and answer the main research question it is required to famil-iarize with the theoretical material from monographs, study books as well as scientific and academic articles from Haaga-Helia database, Google Scholar and library resources relat-ed to design, product development and organizational communication. Besides that, it is crucial to pay attention to the information from statistics concerning Posti’s performance, annual reports and data about upcoming organizational changes of a given company.
To collect the public opinion data and evaluation of the actual performance from Posti’s customers, the Webropol questionnaire and actual interviewing will be conducted at Haa-ga-Helia and outdoors. Finally, the main expected result will be emanated from three cre-ated marketing models which are going to be completely described by the end of the re-search work.
In this chapter the basic information for the research is presented. To get the understand-ing about the aims, purposes, and methods used in the actual research project, the reader shall familiarize himself / herself with the common facts about Haaga-Helia Institution. In addition, it is vital to become aware of the existing situation of Posti Palvelut Oy organiza-tion as well as their blueprints for the fast and productive development of services and products in the future. Finally, this section includes relevant information which helps read-ers to understand completely what Posti’s position is on Finnish and international markets.
2.1 Information about Haaga-Helia University OF Applied Sciences
Haaga-Helia University of Applied Sciences is a modern institution with contemporary technology and resources to provide education for degree programmes such as: Interna-tional Business including Business Administration, Aviation Business, Sales and Marketing, Tourism, Restaurant and Hospitality, and It-Technology. The university has three campus-es in a metropolitan area with the headquarters located in Pasila, Helsinki. Also, there is another one focusing on Sport and Wellness located in Vierumäki and the newest campus in Porvoo. Despite of different locations, all the branches of Haaga-Helia Universitiy of Applied sciences have the common MyNet system, enabling students to access the library resources, online courses and find a work placement in Finland and abroad.
Each degree program includes a mandatory set of subjects the students must complete in order to collect credits and be able to choose the specialization field and according elective and free choice courses.
Research activities at Haaga-Helia University of Applied Sciences aimed at introduction of the new real-life projects which can be considered and implemented for the purpose of the improvement of an existing situation in the business environment. Thereby, the students of Haaga-Helia have opportunities to participate in working at globe’s famous organizations, both private and governmental. The diploma of this institution is quite valuable regarding the latest information that the Finnish higher education corresponds to the highest stand-ards and currently it is on the first place among the world’s universities of applied sciences (BBC: Finnish higher education standard among world’s best, 2016).
During the education process, students have a variety of projects, where they participate in improvement, marketing, advertising and creation of the new services and products for small-scale organizations, start-ups as well as for the large global organizations. Students perform different research activities such as: interviews, benchmarking, online surveys, meetings with managers or even directors to get a better understanding about the needs of an organization for a future improvement. The teachers of the institution aim to motivate students to become the experienced professionals in their field, giving them the insights about the various methods of strategic business analysis models such as SWOT, PEST, STEEP and STEEPLE, marketing tips, which can be implemented in modern changing business environment and information about the legal rules and regulations in the fields of trade and service arrangement domestically and abroad (for example, INCOTERMS, EU Laws and Directives on companies, competition and entrepreneurship in general). After the introduction and group discussions, the students perform the practical tasks in order to ex-ercise their understanding and implement the knowledge about the given topics and sub-jects. They perform an actual analysis on companies and situations and make the presen-tations for commissioners and large audiences of peer students as well as for the general public and guest visitors from other Finnish and foreign institutions. Besides that, a practical study approach in Haaga-Helia includes debates on various business-related topics, self-presentations, and arrangements on how to use the modern technological platforms such as LinkedIn, Facebook, Instagram, WhatsApp, SnapChat, etc. for marketing and advertis-ing purposes as well as for self-promotion.
The educational process also includes the meetings with the company representatives, and organization of events, business meetings and study trips. The board and teachers of Haa-ga-Helia UAS invite the business professionals and speakers to present the information on various topics such as their activities and products, motivation, self-discipline, etc. The stu-dents participate in workshops and interact with those business people during the discus-sions and practical tasks. To strengthen the organisational and networking skills, the stu-dents are given the tasks to organize the meetings with companies and their representa-tives, workshops, events as well as business trips and travels to domestic cities and foreign destinations. To make those activities more complex and real-life related, the students have to think about the ways to fund their trips and arrangements and implement those ideas in practise. So far, the groups of Haaga-Helia students have travelled to various des-tinations inside and outside the EU and met professionals and company directors from the different parts of the world. A lot of events taking place in Haaga-Helia have been orga-nized solely and with the help of students as well. The largest events include DuuniTehdas, which is a meeting point for students, graduates and common public with potential em-ployers and DigiDay, which takes place in Haaga-Helia Porvoo Campus for the last three years and directed at the broadening of knowledge on digitalization, contemporary tech-nologies and applications and the way they affect business environment and everyday life.
Haaga-Helia UAS constantly builds partnerships with foreign higher education institutions in EU, US, Mexico, Canada, Russia, China, etc. and, therefore, students have an opportunity not only to travel abroad, but also to take the exchange term in a foreign university and expand their international links as well as experience life in a different cultural society. The learning outcomes help to broaden the views and thinking and learn about the international business, economic, political and social norms and developments abroad.
With the help of another practical arrangement, which is a compulsory six month work placement students gain the real-life working experience in the field of their studies, per-forming tasks for company’s departments and meeting the insights for the future perspec-tives. One more point achieved by the means of work placement is to consolidate and im-prove the knowledge gained throughout the previous project participation and theoretical studies. Additionally, the students gain the knowledge about the business etiquette and for-eign cultures, especially if the work placement takes place abroad or a company they working for participates in the international business activities. The chances of the future employment increases as the students can show their potential to business professionals and implement their previous knowledge and skills in practice.
To sum up, Haaga-Helia UAS combines the theoretical studies with the practical training. The students not only get traditional education, but also experience working in groups and companies in the real-life projects and situations, which is a benefit to their knowledge and experience about the business world, entrepreneurial activities and networking. The studies and additional activities organized by Haaga-Helia and its students help them to become a professional in the study field as well as gain the motivation and insights for the future ca-reers.
2.2 Information about Posti Palvelut Oy
Posti Group Corporation (previously Itella Oy from 2007-2015) is the main Finnish postal service provider, delivering letters and parcels and arranging other postal services throughout Finland as well as operating in ten foreign countries. Within Finland Posti’s ser-vices are used in all the municipalities, except for Åland Islands, where Åland Post works as an independent postal operator.
The Posti’s headquarter is located in North-Pasila, which is a borough of Helsinki and in accordance with the public information the company employs twenty-two thousand work-ers. Posti Group is a fully governmental entity, remaining its sole shareholder. This organi-sation has a universal service obligation that entails weekday deliveries of parcels and post letters as well as advertisements in all municipalities of Finland (POSTI GROUP, 2016).
The company’s vision is to be the main customer’s choice in the fields of postal services, logistics and e-commerce. The mission is to effectively manage the stream of commerce and everyday life. The core values are to be the customer-oriented organisation, responsi-bly threating its business and bringing the innovations in order for its customers to benefit on the everyday basis.
Posti Group has recently made several changes in their corporate structure in order to ad-just their strategy to the core values listed above. The organisation in its actual form is di-vided into four business departments, such as Postal Services, Parcel and Logistics Ser-vices, Itella Russia and OpusCapita. Each department has its own set of tasks and activi-ties, but all of the structural units are united by the same idea of quality and efficient opera-tions and services, leading to customer satisfaction and loyalty. The focus on returning customers, both individuals and business ones, becomes more important in the last few years for the Posti Group as the number of newspaper subscriptions decreases gradually and level of competition in logistics and parcel delivery sectors increases due to the ex-pansion of large international courier companies such as, for example, DHL and PostNord to the Finnish market. Besides that, the recognition of the new trends and customer de-mand in the existing and emerging markets leads to the necessity of the new services de-velopment and promotion for Posti to stay the customer-oriented and modern innovative organisation.
The OpusCapita department is working on the development of the automated robotic ser-vices and software solutions, based on the newest technologies such as BlockChain and IoT (Internet of Things) for invoicing and sorting of orders and goods at the warehouses and at the different stages of delivery process. In January 2016 the OpusCapita system solutions has been sold to the BaltCap Corporation, to be implemented in the local markets of Baltic Countries. However, the system is still in the process of ongoing improvement and more opportunities to implement it can be found among the large organisations inter-nationally. The drawback is the cost of the software licenses that are needed for the con-stant improvement of this technological solution and the long-term character of the project overall. It requires a lot of financial decisions, considerations and the negotiations with the foreign leading developers to be held. Taking this fact into consideration, the theoretical research conducted in this thesis work and the solutions proposed to Post Group on the base of it are of more cost-efficient nature and can be implemented in the shorter periods of time.
Another factor that shall be considered while making an assessment of the current market position of Posti Group is the international cooperation, especially with another large postal and warehousing companies. Posti’s key customer sectors are commerce, services and media with ninety-six per cent of the net sales generated from businesses and organiza-tions. As it has been mentioned before, the company has partnerships and operations in ten countries, that are Latvia, Lithuania, Norway, Poland, Sweden, Germany, Finland, Denmark, Estonia and Russia. (Posti is Finland’s most frequently used and most widely recommended parcel delivery company, 2014).
The challenge of growing the business in European countries is due to the fact, that there is a lot of already established and operating postal and courier delivery companies, that have started to originate and improve their service level and brand recognition from the very foundation of European Union and as a consequence free movement of goods and ser-vices across the borders of Member States.
Recently due to the political and economic reasons there are some challenges in providing services for Russian companies and clients as well, as the cost of doing business increas-es and the process itself becomes more complex due to the importation problems as more accompanying documents, declarations and certificates are needed to be obtained in order for large international freight and shipments to enter the country and undergone the proce-dure of customs clearance. Itella Russia has started to operate from 1996, mainly in the field of warehousing and freight services. Currently it arranges services in seven Russian cities with the main economic regions in St. Petersburg and Vladivostok. The customer segment includes businesses in automotive and consumer electronic industries as well as pharmaceutical companies and fashion businesses.
The company has been growing the quantity of parcels delivered and the delivery finishes either by the door of a customers’ or local grocery stores such as; Valintotalo, Siwa, K-Ry-hmä’s shops and postal offices. One more thing is used by Posti that really facilitates a pick-up process is Posti pakettiautomatti which is located at S-Ryhmä’s shops, so it is very convenient to complete two tasks at a time, shopping and parcels picking up.
In addition, this Finnish company delivers newspapers at night named Östnyland, Lov-iisanSanomat, Kauppalehti, SipoonSanomat, HBL, Uusimaa, Keski-Uusimaa and different others according to the spot in Finland and the most famous newspaper named Hel-singin Sanomat which has been operating since 1889 with the name given Päivälehti when Fin-land was a grand duchy under the Tsar of Russia and brings fresh news to the Finnish citi-zens every single morning.
2.3 Other relevant information
In the previous section, it has been underlined that letter and parcel delivery account for half of Posti Oyj’s sales. The arrangement of services remains the main activity Posti exe-cutes since the moment of its foundation and there are a lot of service outlets in the na-tionwide network, dealing with correspondence, letters and parcels, 27 per cent of which are also originate from abroad. Results of the survey conducted by Posti in 2014 show, that “the company delivers some 75 per cent of all parcels received by consumers” (Posti is Finland’s most frequently used and most widely recommended parcel delivery company, 2014).
In accordance with the Posti Group Corporation Interim Report from October 31th, 2016 “Posti’s domestic freight grew by 8%, parcel volumes grew by 2% and the number of ad-dressed letters declined by 9%” (Posti Group Corporation, 2016). Therefore, Posti contin-ues to increase its presence on the market of parcel and freight delivery. The decrease of letter services can be explained by the Internet takeover. The newspaper delivery also proceeds to decline gradually as electronic subscriptions for mobile devices and comput-ers continue to gain the popularity among the younger segment of customers.
It is important to underline, that Posti continues to expand and invest in the set of new ac-tivities, such as, for example, the food logistics. Posti acquired Veine, a company that spe-cializes in temperature-regulated delivery services to offer the nationwide food logistics solutions. Besides that, Posti is planning to acquire some other food companies to strengthen its positions on this market.
Regarding international activities of Posti, it is necessary to mention, that company at-tempts to expand to the other regions such as Russia and Baltic States. For example, in March 2016 “Itella Russia acquired the Russian courier company MaxiPost” (Posti Group Corporation, 2016). However, at the same time Posti has terminated the operation of two warehouses in Russia as there are a lot of competitors on the market of delivery services there. Posti does not get enough recognition among other courier companies such as DHL, EMS, FedEx, Russian Express Post, etc. Also Posti has sold its businesses in the Baltic countries to BaltCap in January. Therefore, international operations of Posti in Russia and Baltic Region cannot be considered stable and successful.
At the meantime, Posti proceeds its cooperation with the big Chinese companies such as China Post and Alibaba in terms of international parcel delivery. However, in the China Mainland and Hong Kong regions there is a strong presence of international shipping and freight companies such as DHL, Swiss Post, PostNL, FedEx, EMS, etc., offering the simi-lar services, which makes it quite hard for Posti to enter the market and increase the amount of operations for both Chinese and international businesses as well as for individual customers locally or from abroad.
To sum up, the amount of Posti’s competitors in the mail and parcel delivery niche grew up drastically within the last few years. The quality of services remains on the high level, with shipments being processed quickly and for the affordable prices. The fact that Posti com-petes on global markets, offering logistics for the international shipments has a positive effect on its representation as a large-scale company, however, it keeps the leading posi-tion on the national market only. It has a lot of resources and a strong network nationwide to arrange the delivery of parcels through pick up points and warehouses, and, therefore, remains the main carrier arranging the delivery and shipping of parcels throughout Finland.