We had lunch with a colleague this week, which brought home once again how small
our business universe has become. She is an entrepreneur born and bred in
California, based in Atlanta, and is now providing cross-cultural training for
clients doing business in India. While many consultants are closing their doors,
she has never been busier. Another client of ours travels to China every month
to have her products manufactured. She is from Canada, has relocated to Atlanta
and had never stepped foot in China until she needed her products produced at
the right price point. Entrepreneurs like these are not a few: the number of
people building their businesses in the global marketplace is on the rise. Today
most large corporations are showing inordinate amounts of profits from their
non-U.S. operations. BRIC (Brazil, Russia, India and China) nations have now
overtaken United States as the largest importer of global goods. Clearly,
today’s growth potential exists beyond our own borders. Some key tips from the
successful folks who are navigating these waters daily:
1. DO get to
know the country and/or the marketplace that you are entering. Talk to other
businesses that are already there. Engage a local firm to help you with your
most critical functions. Hire a consultant if necessary. Language, religion,
gender issues and knowledge of current politics are key. You can spend the time
up front or you’ll be forced to, later, when a problem arises. Go prepared.
2. DO visit early and visit often. There is no substitute for knowing your
customer, vendor or employee in person. Holiday traditions, eating habits, gift
giving, and office attire are just some of the many differences that cannot be
appreciated or learned through Skype or Internet research. Plus, most cultures
still prefer to look their partners in the eye and over a cup of coffee.
3.
DO anticipate hurdles. It will be harder to do business in a foreign
environment—there’s no way around it. You should expect challenges. Time
differences, language barriers, cultural issues, cost of travel and learning
local laws and regulations are just a few of the many trials that you will have
to bear.
4. DO learn the language. Even though English is the universal
language of business, it is not only smart, but also polite, to learn the
language of the people you are supervising or trying to sell to. If time is a
factor at least learn enough to say hello, goodbye and order a meal.
5. DO
put together a multi-cultural management team. For all their talk of diversity,
many organizations, especially smaller ones, tend to ignore its competitive
benefits. Your team will have more life experiences to bring to the table and
the different backgrounds will foster creativity.
6. DON’T criticize the
hosts or the host country. Even if the locals make fun of their politicians,
utilities and drivers, don’t do it. If anything, go out of your way to highlight
the positives. If a street is dirty, ignore it; if it is clean, remark on it.
You get the idea.
7. DON’T try and replicate everything that works for you
at home in a new market. Take the advice of your local experts. Go back to Tip
#1, when needed.
8. DON’T ignore the importance of relationships and
contacts. These may be more important than the actual product or service that
your company offers. You may find it necessary to spend most of your resources
fostering those relationships than producing or selling.
9. DON’T invest all
at once. This applies to any business venture but test marketing is even more
critical when venturing into new territories.
10. DON’T expect time to be
important. Deadlines and schedules are not as valued outside the United States.
Plan on meetings starting late and running over.
The truth is that the
world has never been smaller. Even if the country you are doing business in
happens to be your motherland, things have changed since you or your parents
left. Plan well and success will surely follow.
[Sonjui L. Kumar is a
founding member and partner in Kumar Pathak, LLC. Her areas of practice include
general corporate law, complex commercial transactions, and trust and estate
planning. Kirtan Patel is a managing member of Kumar Pathak, LLC, with focus on
complex real estate matters, real estate finance, general corporate law, and
international transactions. Mr. Patel specializes in representation of clients
in the hospitality industry.]