Doing international business is no holiday!

Doing International Business is no Holiday!

David Jenkins; i2i-management.com

St John’s Innovation Centre; 25 Feb 11

February 2011 doing business internationally 1

An outline of today’s workshop

• In today’s business world, doing business internationally

is essential. This training session will give you an

understanding of the basic principles of being successful

internationally. On this profitable international journey

the emphasis is on action and not just on theory.

– Key questions include:

• Why do you wish to export?

• Is the company fit for this?

• What are the big issues you need to address and what little things can trip you up on the way?

• Where do you go for help?


This is how the workshop will

proceed

• Setting the scene– Options for doing business internationally

– Why might we want to export?

• Hard issues– How should we use marketing to facilitate exporting– How should we use marketing to facilitate exporting

• Soft issues– How might we avoid cultural clashes?

• Practical matters– What extra functional skills will we need?

• Getting help


And what right have I to be here

today?

• Been there ... done

that ... got the gold

cards

• Lived in a few places

• Worked for a couple

of companies

• Run some

international

businesses


And forgive me ...

• My background is B2B with a focus on products

• This workshop should not be so limited and

should embrace BtoC (and in fact CtoC) and

services as well.

• My language is going to be tilted towards BtoB

and products but that will not be to exclude the

rest.

• Please challenge me if you think that I’m not

getting the balance right.


The topic is doing business so

let’s explore what’s possible

• This is the value chain which I’ve just

rediscovered

discover or design

develop deliver market sell supply service

• Just about every business can be represented

this way. Just change the sizes of the boxes

• So if this is what a business does what business

can be done internationally ... discuss!


Where does marketing fit into

this scheme?

discover develop deliver market sell supply service

inbound marketing

strategic marketing

Internal marketing

tactical marketing

operational marketing

relationship marketing

• Marketing people will hate me for this but

marketing is a resource function like HR and

finance.

• It takes place where ever the marketing

resources need to be managed


Your can do just about

everything internationally

• Links to universities;

• In-licence of technologyDiscover or design

• Using foreign design partners

• Putting your badge on a foreign productDevelop

• Out sourced manufacturingDeliver • Distributing a foreign productDeliver

• Selling into foreign marketsSell

• Maintaining foreign stock positionsSupply

• Employing local service peopleService


But the focus today is on the

sell, supply and service end

• David Frost, director general of the BCC,

recently said:

"Our survey reveals some uncomfortable truths

for British business and for the Government

about our ability to export. Too many of our

• http://on-msn.com/eYTrgq

February 2011 doing business internationally

about our ability to export. Too many of our

companies lack an exporting culture, even

though they produce high-quality goods and

services. We cannot rebalance Britain's economy

when so many companies say they're simply not

ready or able to take their products overseas."

9

So should we export: isn’t it

rather difficult?

• It’s never been easier

– The internet enables all companies, and in fact

private individuals to offer their products for sale

world-wide;

– Globalisation: the media, education and travel result – Globalisation: the media, education and travel result

in markets becoming increasingly standardised; and

– The oft maligned EU and the Euro: barriers to doing

business across Europe are almost non-existent

• But should we export?

• Why would we want to ... discuss!


But because it’s easy/possible

isn’t sufficient reason to do it

• Why should you export?

– To increase sales

– To respond to a competitive threat

– To be able to supply an international customer

– To get access to better market information– To get access to better market information

– To develop partnerships with eg key OEMs

• But most important:

– Because we’ve thought about it and it’s an important

part of our strategy


Making the key decisions

(Kipling’s honest serving men)

• This is the big strategic question and you should have just addressed itwhy

• Decide where you’re going to go?

• Immediately global, programmed entry into Europe, specific countries?

where

• Web or physical?

• Direct or in partnership?

• Distributors, agents or franchiseshow or who

• Products and services?

• Complete range or just a selection?

• Current products or something new or modified?what

• Don’t set artificial deadline but by all means use external events to help you to set targetswhen


Hard issues are easy to define

• The business climate

– Market size and requirements

– Competition

• Marketing: the 4Ps are always useful:

– Place/partners: routes to markets

– Communications: in its broadest form; language

– Pricing and margins

– Products: quality and standards

• How should we use marketing to facilitate

exporting ... discuss!


Keep it simple: stay with the 4Ps

Place and partners

Meet local service

standards

Promotion or communications

Material in local language

Pricing and margins

Pricing to reflect local

Products

Meet local regulations

standards

Establish appropriate

management

Employ the right people

Material in local language

Ensure internal

understanding

reflect local value

Margins to reward activity

Meet local regulations

Understand market needs


Soft issues: they may be soft but

that doesn’t mean they’re easy

• What are the soft issues which we need to

consider?

– Language and nuance

– Attitudes to women in the work place

– Local negotiating practices– Local negotiating practices

– National chauvinism

– Inter-personal communication etiquette

– etc etc

• But all of these are a part of a bigger picture


Fact is that there are different

cultures and they pervade

• Geert Hofstede is one of the gurus in this area.

Let’s not take his ideas as gospel but they do

alert us to some of the difficulties we might have

• Geert talks about

– Power distance

– Individualism

– Masculinity

– Uncertainty avoidance

– Long term thinking

• www.geert-hofstede.com


Let’s take a look at some of our

near neighbours: France

• Very different profile

but it’s what we’d

expect isn’t it?

• Lots of hierarchy and

lots of thinking.lots of thinking.

• Surprisingly ‘feminine’



near neighbours: Germany

• Surprisingly similar

• Emphasis on

uncertainty avoidance

is to be expected



near neighbours: Netherlands

• Surprisingly different

in some respects

• The high ‘femininity’ is

shared with the

Nordic countriesNordic countries


The US is similar ... as

expected?

• As expected and

echoed in other work

• Biggest challenge

with the US is not

being caught out by being caught out by

the similarities


Whereas China is very different

• Quite different as

expected

• Long term view is

typical of Asian

countriescountries


7 cultures of capitalism

• Hampden-Turner and

Trompenaars looked

at 7 ‘dilemmas’

(dimensions) which

largely overlapped largely overlapped

those of Hofstede.

• One interesting

question: what image

do you aspire to?`


Neutral vs affective;

Analytic vs integrative

Approval

• Sweden

• Netherlands

Esteem

• Japan

• Germany


Enjoyment

• United States

Love

• France

• Italy

• Spain

How might we avoid

cultural clashes? ...

discuss

Practical matters: organisation,

management and resources

• What’s your new organisation going to look like?

• Who are you going to employ and where are

they going to be located?

• How are you going to manage the activity?

• What changed and additional functional skills do

you need? ... discuss!


Practical matters: organisation,

management and resources

• What’s your new organisation going to look like?

• Who are you going to employ and where are

they going to be located?

• How are you going to manage the activity?

• What changed and additional functional skills do

you need?


Changed additional

Customer service Supply chain

Marketing Finance and credit control

Sales management Legal

There’s plenty of help around

• UKTI: www.ukti.gov.uk

• The Institute of Export: www.export.org.uk

• Business Link: http://bit.ly/fGk4RO

• HM Revenue and Customs: http://bit.ly/eLtdJ1

• British Chambers of Commerce: http://bit.ly/e0Rt1X

• Industry associations such as Gambica: www.gambica.org.uk

• Trade shows eg Interpack www.interpack.com

• Coaches, consultants and non-execs


and finally .. .if you want to know

more about sales channels

Come along to ‘sometimes you’ve got

to meet your customer’


to meet your customer’

11.00 Tue 8 Mar 11 St John’s

http://bit.ly/eIl4v5

David Jenkins

[email protected]

www.i2i-management.com

+44 1223 236232 or +44 7739 759859

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