1.
MAFCON is a European business developer. We make it easy, fast and safe for production companies to set up cost
efficient production, and for exporting companies to enter the emerging markets in Eastern Europe.
MAFCON
www.mafcon.com
Aarhus office: J.M. Mørks Gade 1 . 8000 Århus C . Denmark. +45 70 22 84 55. mafcon@mafcon.com
Lviv office: 37a Petlury St. Lviv 79021 Ukraine. lviv@mafcon.com
1
BUSINESS EXCELLENCE IN THE CIS REGION
Adding an external resource for bypassing and
utilizing “institutional voids” in the former
Soviet Union
“Emerging Markets” is no longer just an academic
concept, but is becoming a part of the daily
operations and the only realistic growth engine for
more and more Western companies. The middle
class with its consumption patterns represent the
key, and leading analysts points out that in 2030
more than 90% of the world’s middle class will be
living in emerging markets.
Long gone are the times, when activities on
emerging markets were a tactical experiment, which
could easily be reversed. Underperformance or
failures on emerging markets has today a clear
impact on the consolidated performance of the firm.
Performing well in Emerging Markets is ultimately a
question of profit, but the organizational and
individual competencies needed to succeed in
Emerging Markets are different from what we know
from the developed markets in the West. It simply
takes another way of thinking and another set of
experiences to be profitable in Emerging Markets.
Furthermore, it is highly unlikely that “they” soon
will become like “us”. Consequently, we therefore
need to adjust in order to perform better on their
playing fields.
The emerging markets are not at all a uniformed set
of countries with the exact same characteristics.
They are arguably more diverse than the mature
markets, but they are all characterized by
“institutional voids” – governmental and market
imperfections, which affect the framework
conditions for doing business.
The former Soviet Union is a special sub category of
Emerging Markets. A sub category where the history
seems more burdensome for the present and for
future development, than it does in most other
emerging markets. It is an area where the
“existence of the old” is more challenging than the
lack of “existence of the new”. The CIS is also a
socioeconomic region in which the framework
conditions for doing business - the challenges and
opportunities - are practically identical all over the
region. Independence created new legal entities, but
20 years did not delete the obvious structural,
organizational and legal similarities. The
establishment of a Customs Union in 2011 and
progressive ideas of a free market area with unified
technical regulations will furthermore reverse the
diversification process between the countries.
The justification for any business interest in the CIS
area is the 250 million consumers as well as the
immense amount of natural resources and
agricultural potential combined with a dynamic
economy catching up with the rest. The major
barriers for most business activities in this
neighbouring area are, as in all other emerging
markets the “institutional voids”. Without
understanding the special post-communist
institutional voids, the company will stumble on its
day-to-day operations, and therefore underperform
by not being able to utilize the potential.
On top of the many market imperfections comes
furthermore the question of how to service a
generally low-cost and often low-priced market with
products engineered and developed for, and often
even produced in, high cost countries.
Working under unknown institutional voids or
imperfections, to which our way of thinking business
is not accustomed creates some general questions
and problems, known to all companies with
experience from the CIS area:
Why are we mostly “fighting to be” instead of
“developing to become” and how can we stop
fighting the imperfections, but instead use them to
build our own competitive advantage?
The general picture is very clear: Companies well
established in the region find that all their internal
resources are absorbed into solving day-to-day
problems and that their strategic resources from the
head quarter is at best useless there, since it is
placed in another commercial context and does not
manage to bridge the two worlds.

2.
MAFCON is a European business developer. We make it easy, fast and safe for production companies to set up cost
efficient production, and for exporting companies to enter the emerging markets in Eastern Europe.
MAFCON
www.mafcon.com
Aarhus office: J.M. Mørks Gade 1 . 8000 Århus C . Denmark. +45 70 22 84 55. mafcon@mafcon.com
Lviv office: 37a Petlury St. Lviv 79021 Ukraine. lviv@mafcon.com
2
It simply takes specific soviet competencies to excel
in the former Soviet Union - Competencies that are
not easy available in the West. We believe that we –
MAFCON - have these specific competencies and
that we can bridge the two worlds, creating a better
company performance in the former Soviet Union.
Based on more than 20 years as change agents and
business advisors in the former Soviet Union, we are
now offering our advisory service as a solution to
bridge the two worlds and creating resources, which
can direct the company towards further growth in
the CIS area.
MAFCON’s service package exits in two
variants:
A) Redesign of business activities with the
purpose to improve the client’s business
performance in the former Soviet Union
B) Second opinions regarding business plans
and operations, not influenced by internal
policy considerations, and focused at existing
line of activities.
The MAFCON offer is to grow your business – in
volume and profit – And our service package is
designed for companies already operating in the CIS
region. We believe that the strengths of our service
should be measured on the financial performance of
the company only. We are therefore willing to make
the larger part of our fee be dependable on
improved financial performance of the company’s
activities at the specific location in question.
By linking to MAFCON’s unique pool of experience,
network and competence, we will become your extra
resource for business excellence in the former
Soviet Union. By other words; we will be the pool of
accumulated body of knowledge, which your
business can plug in to and grow your internal
competencies both locally as well as in the HQ.
Long term corporation benefits will be an upgrade of
both the local and HQ’s business skills and
standards.
MAFCON