How to Exploit the Asian Opportunity at Arm’s Length

I strongly believe that “Think Global, Act Local” is the key to doing business in Asia. This means you need to have a presence on the ground in Asian markets to be truly effective.

There are many examples of companies who have tried to run their Asian operations while based in their home country. Their management assumes that everything will be fine because they have put a good team in place who visit Asia once or twice per year and talk on the phone frequently with their customers, suppliers and partners. From my experience this assumption is wrong.

You cannot run a successful Asian operation spending most of your time in your home country! It is not possible to run it at arm’s length. If you cannot operate on the ground in Asia, you need travel regularly there and spend extended periods of time. You need to be there four or five times a year and for at least two weeks at a time.

Why is this so? You need to understand what is happening on the ground in market. You can only achieve this by meeting your Asian partners face-to-face. This will allow you to continue the development of your relationship with them and allow you to really understand what is happening on the ground.

Unless you visiting the Asian marketplace on a regular and consistent basis you will not be really successful in Asia.

If the possibility of operating on the ground in Asia is not an option, you should be very careful whom you choose to represent you and your company. They need to have the level of experience, passion and dedication that you have to bring to your Asian business.

My advice when hiring a senior manager who you want to be your company representative in Asia is that person must have worked in an Asian country. The person you are looking for will have enough knowledge of the Asian market and culture so they can make effective, informed decisions on how you need to operate in that country. Experience in travelling to that country a few times is not the same as having worked and lived in that country. It’s only then that a person can truly understand what is happening and will be able to anticipate the result of any strategy or action your company implements.

The other golden rule when hiring you company’s Asian representative is their ability to travel to Asia on a regular basis. As an example let’s say that your business is importing products from a number of countries in South East Asia. You decide you need to hire an experienced Purchasing Manager to deal with the suppliers who you purchase from in these countries. This person can work out of your home country office, but they are going to have to be travelling to Asia on a regular basis possibly up to four times per year. You have interviewed a candidate with strong credentials. They tell you they have a young family and so they are not able to travel internationally more than twice per year. They may be the nicest person in the world with great experience in the Asian markets, but are they the right person for the job? We both know the answer is no.

While focusing on the people who represent your company in Asia it is critical that you and your senior management supports this person by travelling to the Asian markets yourselves. It is important that your Asian business partners are seeing the key decision makers in your business on a regular basis. This could even mean that your Board of Directors have a board meeting in Asia each year. This will demonstrate a serious commitment to your Asian partners.

In summary, if you wish to take advantage of The Asian Opportunity you can do it at arm’s length while operating out of your home country. However you need to have the right people with the right skill sets and understanding of the cultural differences to represent you in the Asian region. They must be committed to travel on a regular basis and an ability to develop relationships with your Asian partners. Your senior management must also be committed to supporting your Asian team by insuring the travel budget is sufficient and they themselves are committed to visiting the region.

Campbell MacKintosh 16th June 2019