1

Mission Statement and Values

• “Service Station of Choice”.• Environmentalism.• Customer and employee satisfaction

through TQM.• Respect Human Rights and the Laws.

– Equal employment.• Respect for other cultures.

2

Objectives

• Shareholder value.• Continuous training and development.• Image creation Growth in market share.• Future expansion into new markets.

– Managing political risks in going to Russia.• Build long-term relationships both

internally and externally.

3

Policies I

• Getting the Best person for the job!• Consistency between individual and corporate

goals.• Decrease culture shock by using local experts

and employees.• Managing cultural differences in styles of

Management, HRM, Marketing etc.• Corporate wide Code of Ethics.

4

Policies II

• Empowerment and knowledge workers.• Uniform, agreed corporate culture.• Flexible organization with open, two-way

communication.• HRIS for controlling and decision making.• Proactive change management.

5

Organizational StructureCEO

Human ResourcesFinance andAccountingMarketing Supply and

Logistics

RegionalManagerHelsinki

RegionalManager

Northern Finland

RegionalManager

Western Finland

RegionalManager

Eastern Finland

Facility Manager Facility ManagerFacility ManagerFacility Manager

CountryManagerFinland

CountryManager

Baltics

CountryManagerRussia

6

Baltics and Russia Organization

• Use the services of the Finnish functional departments

• Have their own operational level • Will have the same organizational structure

as in Finland in the future

7

Management Team• Members

– CEO– Country Managers– Functional VP´s

• Tasks– Planning– Organizing– Leading– Controlling

8

Benefits of organizational structure

• Regional Management has direct access to functional experts

• Emphasis on teamwork– Management team– Regional managers

• Open vertical and horizontal communication • Clearly divided duties

9

Personnel

Country Managers 1+2Functional Managers+staff

435

Regional Managers+staff

428

Facility Managers+staff

100500(+)

Total 674

10

Functional Departments

Marketing• VP, 5 Managers (FIN, EST, LAT, LIT, RUS)

HR• VP, 1 Manager +9 Assistants (3/market area)

Finance/Accounting• VP, 1+1 Manager, 4+4 Assistants

Supply/Logistics• VP, 1 Manager +9 Assistants (3/market area)

11

Regional Offices

Title People/region• Administrative Assistant/ IT Specialist 2• Public Relations Person 1• Clerks 2• Accountants 2Total 7

12

Facilities

Title People/Facility• Facility Manager 1• Associate (Head Manager in Training) 1• Assistant Managers 4• Assistants in Training (as needed)

Total 5-6

13

CEO Duties and Specifications

• Implements and monitors the vision and strategy

• Plans and implements future expansion with BPAmoco

• Facilitates communications

• MBA • Extensive managerial

experience• Strong goal

commitment and leadership skills

• Cultural understanding for all three country areas

14

Country Managers Duties and Specifications

• Implements and controls business plans

• Surveillance of economical and political situations

• Master’s Degree• Managerial work

experience• Knowledge of

language and culture

15

Functional Managers Duties and Specifications

• MKT: product, place, price and promotion

• HR: all HRM functions

• F/A: financial control, investment planning

• S/L: network

• Master´s or Bachelor´s degree

• International work experience

• Leadership and team work skills

• Negotiation skills

16

Regional Manager

• Controls and maintains regional operating activities

• Coordinates regional budget• Sets quality standards• Ensures standards are met• Sets policy for quality improvement goals

17

Regional Manager, Continued

• Functions as regional spokesperson• Researches and chooses new franchisees,

with country manager• Maintains contacts with local government

officials (Russia only)• Directs local administrative staff• Other duties as assigned

18

Regional Manager Requirements

• Masters Degree• Past management experience• Experienced in foreign trade• Knowledge of regional business and culture• Strong communication and interpersonal skills• Ambitious and innovative• Risk-management experience

19

Facility Manager

• Controls the everyday operations• Implements the strategies• Evaluates and initiates outsourcing needs• Reports to Regional Manager• Training Associate Facility Managers

(Finland only)• Other duties as assigned

20

Assistant Facility Manager

• On-site manager of facility• Oversees quality of franchisees• Oversees work of out-sourced labor• Make daily facility reports to Head Facility

Manager• Other duties assigned by the Head Facility

Manager

21

Facility Managers Requirements

• Bachelors or equivalent degree preferred• Extremely effective inter-personal skills• Knowledge of the industry• Fluent in local language and business customs• Ambitious and self-motivated• Some previous service work experience

preferred

22

Training

• Corporate culture• customs and standards• commitment to BP Amoco• team spirit and internal

communication• Environment differences• Cross cultural training• Networking for job rotation• Motivate for advancement• Keep low cost level!

• Orientation in Chicago pre-Finnish market entry

• Establish training center in Finland

• On-the-job training in Finland, Russia, and Baltic

• Cooperation with Consulting firms

• Continuos development

Objectives Schedule

23

Training

Objective Who trains Method

Orientation BPAmoco (Chicago) Mentoring

Stay in focus withcompany standards

U.S. HR department Initial MeetingVideo Conferences

Develop leadership andcommunication skills

OutsourceConsultants

ClassesVideo Conference

Russian and Baltic’sbusiness courses

Russian professor SeminarsCase studies

CEO, VP, HR

24

Training in Finland

Position Objective Who trains Method

Country andRegional Managers

Culture, Marketing,Leadership,Communication

HR team fromChicago

Seminars, Video,Role Play, Internet,Cases

Facility Manager( Finland, Russia,Baltic)

Culture, CustomerService, Leadership,Environment

RegionalManagers,Consultants

Job Rotation, CBT,Internet, VideoConference

Assistant/ Trainee Customer service,Teamwork, Technical

Facility Manager Under study, Jobrotation,Apprenticeship

Franchisees Standards, rules,regulations, coordination

BPAmocoConsultants

Seminars, Video

25

Future Expansion

• Cooperation with training Consultants– Fintra, ELC Finland, Business Link Consulting

• Internship program with Universities• Planned career progression

26

Recruitment of Management

Finland• Very good supply of

young entry-level managers

• Smaller candidate pool for mid-level managers

Russia and Baltics• Ample supply of

entry-level managers

• Sufficient supply of mid-level managers

27

Recruitment I

• CEO

• Country Managers

• Functional Managers

- Internal

- External- Headhunters

- External/Internal- Advertising- Internet

28

Recruitment II

• Regional Managers

• Facility Managers

- External- Internet, advertising

- External- Public agencies- Internet, advertising

29

Selection ProcessResume & Cover Letter

Employment Tests

Interview

Background Investigation

Psychological Test

Medical Examination

Final Interview

Hiring Decision

30

Employment Tests

• IQ-test • Teamwork ability • Job Qualification• Maturity• Attitude Toward Work

31

Interview Methods• Panel

– CEO, Country Managers, Functional Managers and Regional Managers

• Nondirective – CEO, Country Managers, Functional Managers, Regional

and Facility Managers• Situational/Behavioral Description

– CEO, Country Managers, Functional Managers, Regional and Facility Managers, Associate/Assistant Facility Managers and Assistant Facility Managers In Training

• Structured Interview– Assistant Facility Managers In Training

32

Background Investigation• References• Previous employers • Good citizen

Psychological Test • Motivation • Commitment • Leadership • Communication Medical Test • Physical examination • No Drugs

33

Validity and Reliability

• Combination of different tools used in selection process

• More than one interviewer • Amoco tests

34

Performance Appraisal in Finland

• Formal system still quite new in Finland– Traditionally has been informal: focus on weaknesses

• Start using MBO as a primary appraisal system– all employees involved– appraisals done semiannually– approaches to convince the Finns to accept a formal system

• development, not punishment• benefits and compensations• improve working conditions• motivation• from weaknesses to strengths• confidentiality

35

Appraisal ChartCEO

Human ResourcesFinance andAccountingMarketing Supply and

Logistics

RegionalManagerHelsinki

RegionalManager

Northern Finland

RegionalManager

Western Finland

RegionalManager

Eastern Finland

Facility Manager Facility ManagerFacility ManagerFacility Manager

CountryManagerFinland

CountryManager

Baltics

CountryManagerRussia

36

Cultural Modifications

• Appraising is a fairly unfamiliar concept• Finns tend to be discrete• Adaptation of the system to Russia and to the

Baltics• The firing process in Finland is long and difficult

37

Solution to CulturalProblems

Training by the HR department

• To the whole organization• To the raters• To the interviewers

38

Compensation Policies

• Pay for performance• Competitive base salaries• Salary ranges for each management level• Government legislation• Factors affecting wage rates• Indirect compensation

39

Salaries and Incentives

Base Salary (US$) Merit Bonuses Stock Indirect Annual options compensation

CEO 130,000

Country Manager 90,000

Functional VPs 82,000

Regional Manager 55,000

Facility Manager 37,000

Salary Range +/- 25%

40

Pay-for-performance - incentives

• MeritsRaise on base salary or lump sum

Based on percentage guidelines Expectations in inflation and purchasing power

• Bonuses Pay for performance Goals set by superior in charge - MBO Percentage of sales

• Stock Options For CEO, Country and Functional Managers Set by Chicago HQ Evaluation based on appraisal (HQ)

41

Indirect Compensation

• BenefitsHealth careCareer Development TrainingFlexible working hoursCellular phoneCompany car for top four level managers

• Expatriates to Russia and BalticBasic health care for the familyChild care and school placement20% premium on top of base salaryHousing arrangements