How To Grow Your Business Globally
1. What Are 3 Top Reasons Middle Market Companies Positioned For Growth In Global Markets?
Middle market companies are more flexible, innovative and able to change and adapt much faster than the large multinationals. That is a combination of size, layers of management as well as corporate culture that are more entrepreneurial and forward thinking. Penetrating and developing an international market requires an entrepreneurial philosophy and drive—the same kind of philosophy and drive behind every successful start-up business. Following that logic middle market companies should be the champions and enjoy exponential global growth.
The leadership in middle market companies is more entrepreneurial, intimately involved and in-tune with the daily operations and by having fewer layers to go through, can adapt, move and act much faster. In many cases, the core team that started this venture is still around, and there is more of a tight and personal corporate culture.
In a global context, companies of this size are usually considered large, and can compete globally on a scale that provides them with a competitive edge. A $500 million company in the US may be considered middle market, but in most regions of the world, this is considered quite a large organisation. It offers credibility and demands attention in cross-border markets.
2. Why Should You Be Taking Your Company Global?
- Your competition already has tapped into international markets
- Diversify your market portfolio: when one economy declines another improves
- Access to innovation through new ideas and technologies
- Offset domestic risk
- It is increasingly a multi-national buying economy
- You might find new opportunities to sell your products and services that are not in your country
- Enjoy favourable tax and exchange rates
- Increase your market reach, grow exponentially and broaden your reach
- Attract and retain top quality talent worldwide
- Offer more attractive and stimulating employment opportunities
- You have no choice since your customers and/or vendors may be foreign owned by now
3. When A Business Is Looking To Expand Globally, What Are The Advantages In In-Sourcing A Corporate Development Strategy Expert?
Any decision to go global must start with developing a long-term action plan to capture opportunities around the world that aligns corporate vision, mission, and activities and leverages corporate strengths while identifying opportunities in desirable and compatible markets. Companies often do not have the time, expertise, or experience to develop the plans and prepare for global growth.
A global expert with hands on experience can focus the company on choosing the right country, region and markets, help negotiate with the government officials, avoid FCPA pitfalls, and overcome cultural differences. Also, since execution is a major part in successful global growth, developing the right relationships with the right people is a major recipe for success.
We help companies overcome a wide variety of issues throughout your global growth and expansion efforts, so they are able to:
- Develop strong and lasting relationships across borders
- Overcome cultural differences
- Offer a customised value proposition in each market and win sales
- Develop a competitive advantage and beat the competition
- Design and execute the best strategies and tactics to enter each country/market
- Take advantage of the most effective international and sustainable growth models
- Implement the most suitable strategies for your company that will leverage and sustain global presence
- Manage risk and diversify their sales & marketing portfolio globally
4. What Steps Should A Company Take When Considering Expanding Globally?
Laying the proper foundation for global expansion requires accurate and actionable information that is interpreted and applied correctly in context. Interestingly, 95 per cent of failures result from inaccurate or unreliable information. Unlike decades past, the challenge is no longer a lack of information—it’s too much information. Today, the real knack for dealing with information is sifting through the overwhelming abundance of it and harvesting what is applicable and significant to a unique set of circumstances. It requires knowing exactly what information is necessary, where to find it, when to use it, and how to apply that information to a specific set of circumstances.
- Make a commitment. Entering the global marketplace requires a tremendous dedication of resources, capital, time, and leadership. It has to become a priority.
- Perform a thorough market readiness assessment. Perform and research necessary to identify your potential customers and learn to think locally. A detailed assessment will get your expansion right the first time around and avoid costly financial and opportunity losses.
- Establish realistic goals – everything takes longer than expected. Do not underestimate the time and expense of launching products into the global marketplace. Set goals for establishing relationships, networks and channels of distribution, but expect delays.
- Deploy the right team.In some markets it is crucial to have a local trusted person. A successful vice president of sales in the United States may not employ the skills necessary to negotiate the global market. Get expert help and advice.
- Adopt appropriate polices and strategies to cope with different cultures. These are the sensitivities that can make or break a deal. Consider language, negotiation styles, gender issues and local business practices. Remember, there is no one way to do business.
5. Why Do Companies Fail At Global Execution?
- The plan does not support corporate goals and culture
- Corporate culture and resources are not able to support the plan
- Unrealistic goals for the focus market(s)
- Lack of tactical execution, accountability and understanding of the business environment
- Disconnect between c-suite and operations in the field
- No tools in place to measure progress and alignment between plan and reality in the field and plan
- Poor adjustment and adaptability to change
- Poor prioritisation
- It is all in the details: who is doing what in each step to support goal achievement
- Flaws in communication and coordination
6. With A Less Than 50% Success Rate Of Middle-Market US Companies Going Global, How Can Corporate Executives Successfully Plan For A Complex And Constantly Changing Global Economy?
Embarking on your journey to expand your business globally requires a significant investment of upfront resources to choose the right market(s) and target them correctly. “Be prepared” is not only a well-conceived Boy Scout motto but sound advice for companies considering global expansion. The move is intricate and starts with understanding cultural habits and perceptions in order to accurately forecast sales, interpret trends, and evaluate the existing competition and the potential for new rivals. It also involves understanding the region’s overall economy and how to best position your product/service in the present and for the future as well.
It requires effective strategic planning with a long-term strategy deployed with careful thought and introspection based on first of all, knowing to ask the right questions, and then getting the answers and being able to interpret the data as it may relate to global markets and in context. For example:
- Where to go and why.With 200-plus countries to consider, where in the world should you start (i.e., where in the world are your next customers)? Also, if you choose one country over another, why is that the right destination? Knowing the “where” and “why” makes it much easier to develop an effective strategy for the “how.”
- With whom.Will you go it alone, with partners, or follow a customer?
- With what and how to decide.Will you continue with the same domestic product, make modifications, or develop a new product/service to maximise appeal in the new market/region? Do you look at your product and choose a destination? Or, do you look at global market trends and modify your product?
- What are other considerations?
- And finally, what are the goals?How will you measure both the potential and overall success of your expansion?
While it may seem tedious and time consuming, the questions involved in this kind of upfront investment are key to avoiding costly mistakes and growing global successfully.
7. How Do Successful Companies Develop, Gain And Sustain A Competitive Advantage In Global Markets?
As competition continues to intensify both domestically and around the globe, so does the need to identify key competitive advantages and focus on core competencies. Quality products offered at competitive prices, although important, will not guarantee long-term success. Rather, businesses must answer a critical question: “Why should customers buy my products/services as opposed to the competition, and what is my long-term plan to remain competitive and succeed in growing the business globally?” If this question cannot be answered with clarity, it is time to step back and identify a position from which your product can gain traction and be distinguished from all the other competing products.
Developing the right competitive advantage is key, and will greatly improve your chances for success when launching into the global marketplace. Just remember that there is no one-size-fits-all solution.
Rather, the exact specifications of any strategy blend features from traditional models like cost leadership, differentiation, and focus to customise an approach suitable for the unique circumstances of your company, product, market, and culture of the target audience. Businesses with the skills to rapidly identify, innovate, and exploit new competitive advantages quickly and repeatedly will be formidable competitors both at home and abroad.
Conversely, by identifying a particular attribute that could appeal specifically to a new market and then developing a strategic plan to promote that attribute, a company can gain a competitive advantage. Or, another way can be identifying the market and then modifying your product to fit that market. Highlighting product differentiation, developing corporate recognition programs, and creating brand awareness are several methods that are tied directly to competitive advantages resulting in ongoing profitability. Fortunately, for globally minded U.S-based businesses, competitive advantages are unlimited and waiting to be discovered.
8. What Are Some Of The Emerging Players To Watch?
Vietnam’s shift from a centrally planned to a market economy has transformed the country from one of the poorest in the world into a lower middle-income country. Vietnam now is one of the most dynamic emerging countries in East Asia region. Best prospects/industries: power generation, transmission and distribution, telecommunications equipment and services, oil and gas machinery and services, IT hardware and software, airport and ground support equipment, air traffic management systems, environmental and pollution control equipment and services, education and training, Safety and Security, Medical Equipment, Architecture, Construction, and Engineering Services, Plastics Equipment and Machinery.
The Philippines, with opportunities in Information Technology, telecommunications, medical equipment, water resources equipment and services and electric power systems is an attractive market. It is an underdeveloped market, with vast growth opportunities for companies that are looking to branch into markets that have a great potential.
Latin America. The OECD-Eclac report predicts Latin America’s economy will grow by 4% in 2012. The IMF is predicting Latin American growth forecast to 4% in 2012.
For those companies considering investment in the region, there are solid prospects, thanks to shifting market dynamics and demographics. Throughout Latin America, two significant changes look promising and are likely to produce increasing opportunities for international business. One relates to sheer numbers. The portion of the population referred to as ‘bottom-of-the-pyramid consumers’ represents over 400 million citizens. Increasing consumer purchasing power and infrastructure development will create investment opportunities. Secondly, technology infrastructure projects are under way. The increased collaboration in building a modern network of telecommunications, power grids and undersea fiber optic cables will set the stage for more efficient and effective communications in the large geographical area.
Growth industries in that region include health care, packaging, wireless and mobile, food & drinks (organic), and many more.
9. What Are Some Of The Main Global Trends That Will Affect How You Do Business In The Years To Come?
No crystal ball needed, simply a panoramic lens, an awareness and openness and of course, the ability to understand and interpret events in context with an eye into the future. In order to plan your growth plan and benefits from cross-border opportunities, you may need to take into consideration the following trends affecting the world economy:
- Fast. Cheap. Good. It used to be that you had to choose two out of the three features.
- Social Media. It is happening every day and every minute as we witness revolutionary and diverse online action. The virtual gathering of crowds and armies will form before our eyes and draw us into their mission.
- Technology in the driver’s seat. In addition to social media that aims to connect beyond borders and beyond imagination, the technology of smart phones makes it possible. This is the tool that broke the rules and set new standards for technology developments, human interaction, how, where, and when we do business, socialise, decide on vacation venues, and so much more to come.
- China following in Japan’s footsteps. Some of us may remember when Japan used to “borrow” innovations and replicate them into a cheaper version. But China may take it one step further and improve on innovation to fi t their local market and other niche markets, as well as add features and create new products.
- Internet and beyond. It is becoming about real-time, instant, and constant. People want to know more, almost in an obsessive way, about what is going on in other parts of the country and the world.
- Managing complexity. More than ever, the top skill that everyone will need is managing complexity in a global economy and a global marketplace. The complexity of dealing with immense and rapid changes, the economic crisis, the job market, global competition, and new technologies will require a high level of complexity management.
- The megacity consumer. From China and India to Latin America and the EU, there is a new consumer demographic that is emerging and being driven by massive urban migration.
* This article includes excerpts from Grow Globally: Opportunities for Your Middle-Market Company Around the World. Copyright (c) 2011 by Mona Pearl. Re-printed with permission of John Wiley & Sons, Inc.
Mona Pearl’s experience in international strategic development and global entrepreneurship has been vital in helping companies design and execute their global strategies. Ms. Pearl is known for her out of the box thinking and developing creative solutions to tough challenges which produce bottom line results.
She is the author of “Grow Globally: Opportunities for Your Middle Market Company Around The World” (Wiley, Oct. 2011), and co-authored other books.
Ms. Pearl founded and operated three successful businesses and sits on boards of several organisations. From operations to organisation to top line growth strategies, Ms. Pearl initiates and executes cost effective and creative opportunities for companies to make money across borders. From actionable due-diligence to integration processes, she helps companies increase global market share, enhance leadership and engage the stakeholders along the value chain. These activities lead companies to growing their business across-borders, leverage their global competitiveness and address operational and strategic growth trends in international markets.
Projects across industries and across borders include: Deutsche Telekom, GM, Rover, Jaguar, Marriott, Hyatt Corp., IMF, Fermilab, The Export Institute, SES GmbH, A.B. Dick, Navistar, Accenture, Michelin, State of IL - DCEO, Philip Morris, Bacardi, United Airlines, American Airlines, Virgin Atlantic, Delta, Continental, and many more.
Ms. Pearl lived in three continents, and is proficient in six languages. She was quoted by CNBC, Oracle, Chicago Tribune, NPR/WBEZ, Microsoft, Bloomberg, Crain’s Chicago, Entrepreneur.com, and interviewed by media in the UK, Austria and Canada on global issues and strategies. She is a frequent speaker at global related conferences, as well as guest lecturing in executive MBA programs around the world.
Ms. Pearl authors a column on current global competitiveness issues in Manufacturing Today and in Management Today magazines, as well as publishes in other business related magazines.
Mona Pearl can be contacted by phone on +1 312 642 4647 or alternative via email at Mona@MonaPearl.com