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School of Business | Department of Management and International Business | Entrepreneurship | 2014
Thesis number: 13635
Finnish hidden champions: analysis on strategy and performance of market leader SMEs
Author: Mäkeläinen, Risto
Title: Finnish hidden champions: analysis on strategy and performance of market leader SMEs
Year: 2014  Language: eng
Department: Department of Management and International Business
Academic subject: Entrepreneurship
Index terms: yrittäjyys; entrepreneurship; pk-yritykset; smes; menestyminen; success; kasvu; growth; strategia; strategy; suorituskyky; efficiency; arviointi; evaluation; mittarit; ratings
Pages: 103
Full text:
» hse_ethesis_13635.pdf pdf  size:2 MB (1167320)
Key terms: Hidden Champions; smes; business performance measurement; growth strategy

Hidden Champions are market leader companies in their narrowly defined market segments. The term "Hidden Champions" was originally coined by German business influencer Hermann Simon. They possess differentiated strategies, which can be observed from their distinctive characteristics. The characteristics can be encapsulates into eight aspects: strong leadership with clear and ambitious long-term goals, high-performing employees, depth in value chain, decentralization and continuity, focus on core competencies and core business, global orientation, high level of innovativeness and closeness to customer.


Identification of Hidden Champions has been conducted in most of the countries in Europe, but Finland has remained mostly untouched. Author's intention in this research is to familiarize the concept by identifying Finnish Hidden Champions among EY Entrepreneur of the Year Finland competitors. Moreover the research analyzes the performance of the identified companies. The theoretical part of the research establishes a five-folded framework for the purpose. The framework consists of an observational side and an action side. Observational side determines five objective key performance indicators, while the action side clarifies how these specific indicators will be measured.


The empirical part of the study then tests the established framework in action. Two sample groups are formed for comparison purposes. The other group consisting of Finnish Hidden Champions in manufacturing industry, while the other sample group consisting of Finnish non Hidden Champions in manufacturing industry. Finnish Hidden Champions are also compared against Hidden Champions identified by Hermann Simon.


The results of the empirical research reveal that Finnish Hidden Champions differentiate positively in terms of equity ratio and revenue per employees against both Finnish non Hidden Champion manufacturing companies, and their counterparts identified by Hermann Simon. In the study equity ratio was determined to be a yardstick of self-financing and long-term vision. High revenue per employee on the other hand signals of high productivity.
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