BSI - Business Strategies International

Pursuing Opportunities in Asia

The New AsiaWhen pursuing opportunities and interests in an Asian country, whether you are a non-Asian or an Asian from a different Asian country, there are some important pathways to follow.  Below are some of the best.

Study the Target Country and its Culture.  Learn what you can before you make a move.  There are books, websites, chambers of commerce, consultants and government trade development agencies in your own country and the target country, and other resources.

Find a Local Partner or Representative for the Work You Envision.  You should consider a number of candidates.  Consultants, trade development agencies and chambers of commerce can help with this.  Plan to personally interview the finalists.  Learn what you can about their existing activities and relationships.  (See also the Case in Point “Trusting Relationships” in Chapter 7.)

Arrange an Introduction.  Unless you are a famous person, or represent a well-known company that almost anyone would love to do business with, it will help immensely if you are first introduced to the person with whom you want to meet.  The higher the importance of the person you want to meet, the more important this is.  Government trade offices, banks, accounting firms, law firms, and consultants will often provide this service at little or no cost.  The introduction need not be made by someone known personally by the person to whom you will be introduced, although this is preferable if it is possible.  It is enough that there be a relationship between the introducer’s organization and the organization of the person to whom you will be introduced.  Even if there is no such relationship, it is sometimes enough if the introducer is a person of high status, such as government official or a corporate executive.

Arrange a Personal Meeting.  After an introduction, although much is done online and virtually today, try to arrange a personal meeting with the key people with whom you want to interact.  Asians, being from collectivist cultures, place a high value on the personal side of a relationship and tend to discount people who are not members of their family, clan, organization, or nation.  A personal meeting enables both parties to gain a better understanding of the other, to communicate their messages better, and to garner information from the other that will assist in building a continuing relationship.

After a relationship is established, communications often become informal and very efficient.  Some years ago, a senior executive of Cleveland Cliffs Iron Ore Company negotiated substantial long-term “take or pay” contracts with Mitsui & Co. to supply iron ore to Japanese steel mills from Cleveland Cliffs’s Robe River mine in Western Australia.  The relationship began with a formal introduction of the Cleveland Cliffs executive to Mitsui through Mitsui’s bank, followed by several social visits.  Detailed contracts were eventually concluded, and Cleveland Cliffs began supplying the ore on a regular basis.  Production and contract problems sometimes occurred, and the Cleveland Cliffs executive would visit Mitsui in Tokyo to discuss them.  “The formal introduction and those early personal visits were crucial,” said the Cleveland Cliffs executive.  “After a few years, our relationship was so good that all I had to do was pick up the telephone or send a message to Mitsui to resolve a production or contract problem.”

Observe Rank.  Many Asians are highly sensitive to status and rank.  Communications to senior Asian officials, and meetings with them, should clearly recognize their status.  Junior executives of your own firm should not be paired in meetings with more senior officials of an Asian firm.  Little will be accomplished.

Business Negotiations.  When the time comes for primary business negotiations with a prospective partner or representative, have a clear negotiating plan that will minimize potential conflicts and augment the chances of reaching an agreement – and a good business relationship – that will stand the tests of time.  For negotiations with Asians, if a relationship has not yet already been built between the parties, it is often a good idea to host a social event – for example a meal the preceding day – to exchange personal information and get to know the other party.

If a good relationship has not yet developed, there is a risk that one of the parties may take advantage of the other party’s time constraints – for example if the other party needs to complete the negotiations by a certain date.  And some Asians may take advantage of a Western party’s culture of “getting things done and moving on” by insisting on a protracted meeting schedule or dragging out negotiations until the Western party concedes points in frustration.  But tactics like this are not likely to occur if a prospective partner or representative has been carefully selected and steps have been taken to develop a good relationship.  Negotiating points that are won by gamesmanship are Pyrrhic victories.  They sacrifice long-term success for short-term gain.

Interpreters.  With primary business negotiations, when the negotiating parties do not share a common language, it is sometimes helpful for the parties to engage a trustworthy independent interpreter experienced in the language of each party.  An interpreter can assist in clarifying points of discussion.  If a mutually-chosen interpreter cannot be agreed upon, each party should consider having an interpreter on its team who is experienced in the language of the other party.  The party’s own interpreter can advise on the best way to present certain points and can help resolve issues and misunderstandings.

Build a Structured Communications Plan.  For ongoing communications with an Asian partner or representative, a structured plan for reports and communications should be organized.  Telephone conferences between managers of operational activities, and separate conferences between top executives, should be scheduled to occur at regular intervals.

Be Clear and Concise.  If the language used in a communication, meeting or telephone conference is not the mother tongue of both parties, it is important that the party for whom it is the mother tongue should endeavor to be especially clear, explicit and to the point.  If one is communicating in writing in a language that is not the recipient’s mother tongue, short, declarative sentences should be used, and jargon, difficult words, and idioms should be avoided.  In face-to-face meetings, the same applies, and the mother tongue party should be careful to speak deliberately and enunciate clearly.

Avoid Surprises, Get Down to Business, and Follow Up.  By virtue of a strong work ethic, most Asians are diligent and do not like to waste time, except perhaps when socializing to build a relationship and a foundation of trust essential to business.  Communications to Asians should result in no surprises for the persons with whom you communicate.  If a face-to-face meeting is arranged, its purpose should be communicated in advance, you should appear on time, and the discussion (apart from social pleasantries) should not stray from the meeting’s purpose.  Be precise about what you will do next.  After the meeting, a thank-you letter should be sent promptly, and you should do anything you committed to do during the meeting as soon as practicable.

Cross-Culture Training and Learning a Language.  There is the belief in some quarters that “Business is business wherever you are.”  Yet it is more accurate to say that “Business is different wherever you are, and there are bottom line costs to ignoring the differences.”  If you or your organization’s staff are not of the same culture and mother tongue as your Asian partner or representative, you should consider arranging some cross-cultural and language training.  This is especially important if you or your staff members will be living and working in an Asian country that is not your own.  And learning the language of the host country is not difficult if you are living there and interacting daily with native-speakers.  Often the spoken language is quite easy to learn, sometimes not requiring pronouns, tenses or conjugations.  Moreover, it is a business advantage to be able to communicate with counterparts and workers in the host country.  Even if you do not develop a facility in the host country’s language, your effort to speak it will be tremendously appreciated by the native speakers with whom you interact.

Start Small.  When entering markets in Asia, it is best to first enter a small market and limit the products and services offered.  You can then expand the breadth of the market and offerings as you learn from successes and failures.

Think Ahead.  Depending on the nature of an opportunity or business, it is well to consider at the outset what your next steps will be after starting up – including what will be the stages of development of the enterprise, what further investments might be made, and how you would go about terminating the enterprise and recovering your investment.  In general, starting up, developing and maintaining an enterprise in Asia is the hard part.  Recovering an investment can also be difficult.  Terminating an enterprise is normally easy but often results in leaving money on the table.

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