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Kupujmo Razom 2.0 - an innovative increasing of Ukrainian firms' competitiveness through concentration and optimimalisation of deliveries, cooperation of non-governement organisations and e-learning

The Association Agreement with the EU has not brought any significant increase in exports. At the same time, Ukrainian firms are facing the challenge of coping with imports in a situation of uncompetitive production costs.

Because labour costs are low in Ukraine, another factor is of significance – the delivery costs and the costs of building the sales offer. The Ukrainian SMEs are applying an inefficient purchasing model, based on small batches of goods and a multitude of intermediaries. The result is low purchasing capacity and high supply costs. Moreover, the model of aggressive and ad hoc competition is losing in the long run with the European approach, based on long-term goals and cooperation.

The project edition for the years 2016 – 2017 is an extension of the Kupuimo Razom project of 2015. Purchasing groups had been practically unknown in Ukraine until the 2015 implementation of the pilot project for Ukrainian entrepreneurs in Lviv.

The project is focused on proposing modern solutions to the problems outlined above – dissemination and improvement of model schemes worked out in the 2015 edition. For this purpose, innovative instruments were implemented for effective dissemination of the idea of purchasing groups and the methods of implementing this scheme, above all on the basis of trained staff of Ukrainian advisors and ambassadors of purchasing groups. In order to speed up changes in the applied business model and raise the competitiveness of Ukrainian firms, the basic activities were addressed to entrepreneurs through business organisations (NGOs) and through the creation of a trained team of Ukrainian advisors for purchasing groups.

The experience gained from the 2015 project showed that it is necessary to firmly embed the methodology of purchasing groups in practice. Meetings as well as contacts of the beneficiaries with Polish entrepreneurs and experts are important. It remains a challenge, however, to gather entrepreneurs from various countries/sectors in one place and at one time, then to create the conditions needed to maintain an appropriate level of cooperation among them. Another challenge is the access to (foreign) experts following the completion of the standard seminars/workshops and the assimilation of knowledge and material by those who are interested but were unable to attend or who want to learn at their own pace. A good solution is e-learning, which reduces these limitations of time and space, ensuring regular access to knowledge in a given field. However, one must remember that e-learning by itself will not bring the expected results without any support from experts. Hence the appointment of a group of Ukrainian advisors who can develop their own business on the basis of the accumulated knowledge concerning purchasing groups.

Kupujmo Razom 2.0 - an innovative increasing of Ukrainian firms' competitiveness through concentration and optimimalisation of deliveries, cooperation of non-governement organisations and e-learning

The Kupuimo Razom 2.0 2016-2017 project (hereinafter also: KR 2.0) was an expanded and two-module continuation of the Kupuimo Razom 2015 project, implemented in 2015 in Lviv and adjacent administrative regions of western Ukraine. KR 2.0 was addressed to beneficiaries of the whole of Ukraine and the central location of its implementation was Kiev. The more significant project beneficiaries or cooperating entities included: USPP (Ukrainian League of Industrialists and Entrepreneurs - УКРАЇНСЬКИЙ СОЮЗ ПРОМИСЛОВЦІВ І ПІДПРИЄМЦІВ), UCCI (Ukrainian Chamber of Commerce and Industry - Торгово-промислова палата України), KMBS (Kiev Mohyla Business School - Києво-Могилянська Бізнес-Школа) and UESMPE (СПМСППУ- СОЮЗ ПРЕДПРИНИМАТЕЛЕЙ МАЛЫХ, СРЕДНИХ И ПРИВАТИЗИРОВАННЫХ ПРЕДПРИЯТИЙ УКРАИНЫ), UNDP in Ukraine.

The main project objective was development of enterprise in Ukraine by raising efficiency and durability of the private sector with the use of innovative tools in the following areas:

  • financing and reduction of supply costs,
  • building social capital on the basis of organisations of entrepreneurs and new groups of advisors,
  • implementation of e-learning to achieve the maximum possible reach for the transferred contents and impact.

These goals should be achieved through the supply of professional knowledge and practical instruments, with optimisation of purchasing costs by joining entities into purchasing groups. These in turn should become a binder that changes mentality, opportunities and horizons of activity of Ukrainian private firms of the SME sector. Cooperation of entrepreneurs within purchasing groups, aside from having an economic effect, makes it possible to overcome trust deficits and build social capital. Particular emphasis must be placed on cooperation with organisations of entrepreneurs and consumers (NGOs), to enrich their activity with competences related to the establishment and operation of purchasing groups.

In the course of the project, the following activities were carried out:

  • designing the e-learning portal Kupuimo Razom at the domain www.kupuimorazom.org.ua, and filling it with courses on optimisation of purchases, purchasing groups, purchasing groups consultancy methodology etc.,
  • making use of the knowledge base from the previous edition, Kupuimo Razom 1.0, in the project portal,
  • pilot project for NGOs in 2016 and full implementation in 2017,
  • drawing up model schemes for NGOs during workshops and training Ambassadors of purchasing groups in NGOs, via e-learning,
  • consultancy for purchasing groups on the basis of solutions found in the manual from the Kupuimo Razom 1.0 edition, together with subsequent editions in the years 2016 – 2017,
  • publication of Kupuimo Razom magazine and annual conference opening/summing up the individual project stages,
  • establishment of two Competence Centres for Purchasing Groups, in Kiev and in Lviv, to serve the emerging groups of Ukrainian advisors for purchasing groups.

The project was initiated and implemented by the Family Business Initiative association, based in Warsaw. On the Ukrainian side, the project partner is "Практика управління"/"PRAKTIKA UPRAVLINNiJA" Ltd, which is the managing entity of the media group "Промінфо."

Kupujmo Razom 2.0 - an innovative increasing of Ukrainian firms' competitiveness through concentration and optimimalisation of deliveries, cooperation of non-governement organisations and e-learning

The project was implemented in 2016 – 2017 (two modules). It comprised five key objectives that were achieved with certain modifications, in answer to the demands of the market and project participants:

  1. Cooperation with entrepreneurs
  2. Dissemination of knowledge on purchasing groups (publications, internet)
  3. Conferences, workshops, webinars
  4. E-learning
  5. Creation of purchasing groups

1. Commencement and development of cooperation with organisations of entrepreneurs and entrepreneurs themselves formed the basis for gathering and transferring knowledge on purchasing groups. Results of these activities included the following:

  • the establishment of a group of Ukrainian purchasing group advisors who will expand their knowledge and activity on the basis of the resources of the Kiev Mohyla Business School (KMBS),
  • two Purchasing Groups Competence Centres, established in Kiev and in Lviv, as a hub for activities related to the establishment of purchasing groups in Ukraine,
  • launching the activity of several purchasing groups, established by Ukrainian entrepreneurs, project participants.

An incentive to take part in the Project was the involvement of the Anti-Monopoly Committee of Ukraine (hereinafter: AMCU) which, as a project partner, opened the way for effective and open cooperation with entrepreneurs. The presence of AMCU in the Project (conference, manual, educational modules at an e-learning platform) showed the opportunities inherent in thinking about business activity focused on cooperation and synergy, instead of solely on competition.

2. The project significantly developed activities aimed at presenting methodology and knowledge on purchasing groups and their use to improve competitiveness. Continuing and expanding the activities carried out in 2015, a series of publications were issued:

  • four editions of the Kupuimo Razom Magazine, describing various aspects of creating and using purchasing group methodologies,
  • two new editions of the Kupuimo Razom Manual – (2016 and 2017),
  • a practical guide for purchasing group advisors, on the creation of a B2B purchasing group as a profitable start-up (2017).

A website of the Project was created (www.kupuimorazom.org.ua), based on its own domain, and a FB page was started (https://www.facebook.com/KupuimoRazom/), with information on current activities and new educational material.

The Project website is at the same time an entry to the e-learning platform, containing 24 educational modules on purchasing groups (in three language versions) that can be used by any registered Project user (http://kupuimorazom.org.ua/moodle/login/index.php).

An additional element of the platform is the Knowledge Base, containing films and written material describing matters related to purchasing groups and family businesses.

3. The Project included a number of conferences, workshops and webinars, where in direct discussions with the participants, solid foundations were built for the creation of a group of advisors for purchasing groups, Competence Centres and the purchasing groups themselves.

4. E-learning and the related knowledge resources are serviced on the basis of the applied Moodle e-learning platform, adjusted to the needs of the Project. The e-learning platform is generally accessible, but addressed to the Ukrainian recipient (above all to Project participants). The greater majority of training material is available in three languages – Ukrainian, Polish and Russian. This allows for wide access to the material, throughout the entire multi-lingual Ukraine.

The platform was created with the aim of:

  • reaching out with knowledge on purchasing groups to the widest possible group of recipients,
  • offering an innovative form of transferring knowledge, ensuring durability of project results,
  • reaching a broad group of recipients in all of Ukraine, without geographical or time limitations,
  • presenting diverse forms of transferring knowledge, in accordance with the individual needs of recipients, such as businessmen, managers or employees of enterprises or organisations of entrepreneurs:
    • information pills,
    • thematic lessons,
    • films that educate and transfer experience,
    • tests and exercises,
    • training material gathered in the knowledge base,
  • creating a tool that can be used in the future to transfer knowledge and methodology from various domains, ensuring durability of project effects.

At the close of 2017, the platform contained a total of 24 information modules (lessons) and a number of additional elements (knowledge base), expanding the basic scope of the training.

5. The creation of several purchasing groups was initiated and launched by entrepreneurs taking part in the project. The groups will develop, basing on cooperation with purchasing group advisers who are professionals trained under the project.

An additional effect of the project was the presentation of Polish innovative economy at a number of conferences and fairs, held in Kiev and in Lviv. This was an opportunity not only to present the project itself, its idea and results, but also to meet Ukrainian and Polish entrepreneurs, whose future contacts will be using the methodology of purchasing groups, instilled in Ukraine.

Polish purchasing groups were also promoted in Ukraine, as this market is seen as an opportunity to increase the range of their activity. Ties were established with the Ministry of Development to promote Polish enterprises in Ukraine, recommended as suppliers for the Ukrainian purchasing groups established in the Kupuimo Razom project.