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The International Entrepreneur – Globalization Bashing and other Populist Pastimes

Globalization

 

Globalization and the lowering of trade barriers has been a defining force for more than a generation. Freer trade has meant expanded business opportunities for large and small companies alike and an expansion of wealth that has reach from the richest to some of the poorest people on the planet. From centuries ago when Adam Smith originally explained why bilateral trade benefited both countries involved… to today where exports raise the standard of living for many… the overall effect of globalization is a net positive for human kind.

As a free trade advocate, I feel like I should have seen this latest populist anti-globalization movement coming. Last year when Congress cut funding to the U.S. Export-Import Bank, this was a proverbial “canary in the coalmine” – an omen of bad things to come . There was literally no legitimate policy reason to do this. The ExIm Bank provides services to American exporting companies both large and small. It guarantees some foreign transactions that benefit US business. And it provides loans to bridge the time between shipment and payment from foreign markets. It acts as oil to grease the wheels of trade.

And here we have it… in the U.S. both American major party candidates are vocally protectionist instead of actively looking for ways to expand markets for American products and services abroad. It’s a populist notion without a strong basis in the facts. It plays on people’s real pain of losing jobs and whole factories in parts of the country, then blaming China or Mexico instead of technology gains and shifts in global competition. Instead of looking forward into the future full of evolving technology and market needs, populists of all stripes look to the past for some nostalgic sunny version of a bygone era. They pine to bring back jobs that no longer make sense in today’s technology-filled world. There are no longer rooms in companies filled with secretaries typing letters. There are no longer factories teaming with workers performing repetitive functions. Many other countries are experiencing their own populist backlashes against globalization in favor of protectionism.

 

So how do we prepare ourselves for this future that by all accounts is already here?

  1. Education. Yes, that’s right. We need serious retraining for those most affected by the shifts of globalization. Smart governments provide these programs for free or nearly free. For those still in school: get a college degree of some type, do at least one study abroad program to better understand the world, learn technology, languages and critical thinking skills. We don’t know what jobs will be created tomorrow, but we do know that they all need these skills instead of the ability to manually tread a tire or transcribe dictated business memos.
  2. Look Outward, Not Inward. It’s easy to get focused on one little corner of the world. But globalization compels us to look to other markets for customers. That means understanding culture and languages. The American-only market limitation is passé.
  3. Learn about Big Trends and Keep Focused on the Future. When I meet with a new company, I can usually tell within minutes if they are more focused on their own past history or on the future. Those in the past tend to get stuck in the past. Those looking forward watch for industry and global trends to leverage their company’s strengths to take advantage of trends in their favor (ex. Exchange rate fluctuations or a fast-growing country’s economy) or prepare for a coming threat (ex. Presidential candidates espousing populist rhetoric to buy a few more votes from scared citizens).

 

Before anyone chooses to warm up their keyboard with an angry rebuttal about globalization’s impact on the environment, please let me confirm that globalization is far far from perfect. There are products created and shipping overseas that truly have no value to most people. As a human race, we need to make smarter decisions about what we choose to consume. We need to keep production in many cases closer to consumers to avoid unnecessary ocean and air shipping. No where is this truer than in our global food supply. Working within this imperfect system still allows us to balance politics, economics and the human condition around the world.

With free trade, we allow each country, each company to find their markets and create jobs to support their society. As a wise futurist recently shared with me, technology may eventually mean that there literally aren’t enough jobs to sustain our capitalist-based economic system. He suggests that we may as a world eventually move beyond the need for money, where people will have more leisure time to pursue other non-work interests and projects.

I don’t know if such a world will exist in our lifetime, but I do think that trade helps to improve the standard of living for many. Open trade encourages sustained peace over long periods of time. And it encourages innovation in the face of competition. Let’s be smart and globally move forward.

The International Entrepreneur – Why Globalization Needs to Survive and Thrive

International Entrepreneur - Why Globalization

This is the year when Globalization Backlash is reaching a fevered pitch. It’s been building for decades as whole groups of workers are excluded from the windfall profits of trade. As a Midwestern girl, I have seen my region of the United States come to known as the “Rust Belt” for all of the abandoned factories and displaced low-tech manufacturing jobs sent overseas to lower-paid workers.

All this while, company CEO compensation has increased on the whole to obscene levels and Wall Street barely skipped a beat during the Financial Crisis of their own making. Income disparity is now at levels not seen since the Robber Barons in the early 20th Century. American culture demands some level of fairness and access to opportunity. Politically we see the wave of anger fueling Brexit, Donald Trump’s candidacy and the backlash against trade agreements.

 

Dont’ Write an Obituary for Globalization Yet…

Business Insider reporter, Ben Moshinsky, recently wrote an article: Globalization is slowing dying. Trade has been part of commerce for centuries. There have been other time periods when trading has shrunk. Protectionism and rising tariffs are normally associated with troubled times. When U.S. leaders heeded the calls for protectionism in the early 1930’s, they helped to deepen what in the U.S. is called the Great Depression.  Eventually cooler heads prevail back towards more open trade. Now globalization is fueled by technology, communications and capitalism. We won’t see globalization die except in an extreme scenario, like a zombie apocalypse

 

Time to Speak Up for Trade

Never has it been more important for business professionals around the world to speak up for the net positive benefits of trade AND to fight for fairness and to assist those who globalization leaves behind.

  • Opportunities for Companies of All Sizes The reality is that the U.S. enjoys relatively high employment rates and that is part due to globalization. Selling goods and services to customers in other countries means jobs back at home. According to the U.S. Small Business Administration, over 90% of American exporters are small businesses. Trade agreements and globalization mean that companies of all sizes have access to world markets.
  • Globalization is NOT a Zero-Sum Equation Many populist politicians today treat trade like it’s zero sum. That means that for you to gain, I have to lose the same amount. The reason why globalization is such a powerful force is that the net gain is positive for all. I sell you my tomatoes and you sell me your radios and we both again something we want and don’t otherwise have. This production specialization is the foundation of globalization.
  • World Economic and Political Stability is Not a Trivial Matter The world has not experienced a global-scale military conflict since 1945. One factor in this relatively peaceful period in history is globalization. There is greater motivation to work through conflicts when countries would lose trade. It also gives us a greater interest in working together on economic issues. Mark Zuckerberg and Facebook are actively working to increase global access to the Internet for billions of people. Those people could become Facebook users and also consumers of a variety of online products and services.
  • Going Backward is Not an Option A few years ago, there was a big “Buy American” movement. I think they largely gave up and realized that consumers and businesses were less interested in where a product was made and more interested in the value received compared to relative cost. For all of those interested in “bringing jobs home”, it would come at a tremendous price and still not achieve what you want. Those jobs are gone. The good news is that there are new quality jobs in their place for those willing to learn new skills. I don’t mean to trivialize this – it’s a daunting task to radically change your career. But it can be done (I know because I need to do this).
  • Globalization Allows for Sharing of Knowledge and Ideas By doing business in other countries, companies gain new perspectives on how to approach a challenge or opportunity. Sometimes smaller strategic partners will share technology and resources in order to go after larger deals. There are of course risks in sharing, but also gains and insights to be had.

 

A Final Few Thoughts on Fairness…

The negative effects of globalization need to be much better managed than they are today. Displaced workers need training for new in-demand jobs. The environment has paid a heavy price for our increased consumption, leading to many damaging and potentially irreversible effects. I think that a carbon tax on goods (based on the energy and other resources needed to produce them) is a step in the right direction. And finally, executive pay needs to better align with the rest of the company. Capping compensation on the top side of the company as a reasonable multiple of the lowest pay rate may be a good place to start. With some smarter policies, globalization’s negative effects can be tempered.

 

A Manifesto to International Entrepreneurs Everywhere:

I encourage you to continue to go forth to: 
Invent new ways to make the world a better place
To find opportunities wherever they may be in the world
To build strong, ethical companies to support your families and the families of your employees
And to learn from new people and places things in order to gain insights and wisdom.

 

Onward & upward,

Becky DeStigter,

The International Entrepreneur

The International Entrepreneur – What’s Missing Globally in the “Connection Economy”

International Entrepreneur Global Connection Economy

A few years ago, Seth Godin famously introduced the “Connection Economy” into our lexicon to describe how connecting people, companies and resources was a source of increasing value creation in our world.

Since you’re reading this article, that means that you are part of this global technology revolution and probably interact with it frequently. Here are just a few of my own examples of engaging this Connection Economy from this past week:

  • I collaborated via email with my client’s Malaysian country manager to reach her target leads using calls, emails and social media.
  • I took a call from a company in New York looking for a Uruguayan business culture expert. They found my website through Google. I referred them to a Uruguayan contact whom I have never met face to face, but regularly network with in social media.
  • I Skyped to mentor a Canadian rising star in the international marketing field, who is building a consulting practice.

On a personal level:

  • I sent my teenage son, Nathan on a foreign exchange with AFS Intercultural Programs. That means that he will stay with a host family in Italy for 5 weeks whom we have never met before, but were vetted locally by AFS.
  • My Brazilian exchange student, Matheus came home safely from a gathering with friends via a ride from an Uber driver.
  • I took a few daydreaming moments and surfed AirBNB for a nice house rental near the beach in San Diego for Labor Day Weekend in September.

 

When Seth Godin originally described the Connection Economy, he said that it required four pillars:

  1. Coordination. This may be coordinating between people as in the case of Uber. It could coordinate the exchange of money as is the case of crowdfunding. And often it’s the coordination and exchange of information.
  2. Trust. The parties involved need to have a reason to trust each other. Trust is normally built on a foundation of consistent words and actions by people and companies. Now we are trusting partners and vendors whom we may have never actually met before in person.
  3. Permission. In the Connection Economy we voluntarily surrender our information, but only after trust is established.
  4. Exchange of Ideas. This blog (and everyone else’s blog) are part of that exchange of ideas. So is a review site that tells me what current and past employees think about working for a company I’m considering as a partner.

 

Without these pillars, companies like Amazon, Google, Facebook, and countless other Connection companies including my own would not exist. But let’s get out of the American-only point of view and expand to…

 

Bringing a Global Context into the Connection Economy

This may seem confusing to some. After all, isn’t the Connection Economy by its very nature borderless, allowing for seamless access to markets and resources from anywhere in the world? Ideally – yes, but in reality – no. Here’s some context:

 

Access to Connectivity is Far from Universal

As Mark Zuckerberg will tell you, there are 4 billion people in the world with no access to the Internet. 4 billion is roughly half of all people on the planet. There are some sizable barriers to improving access to conduits of information and opportunities that include education, disposable income to buy the necessary tools and services, and even interest.

 

Language and Culture Create Information Silos

The Connection Economy had the perfect solution to bridging language gaps and reaching new markets: Google Translate and other translation widgets that could quickly convert English content effortlessly into dozens of other languages. How clever! Those who tried it soon learned that language is much more nuanced and complex than first thought. Literal translations yield some major mistakes that have cost companies dearly.

Culture is even more complicated. It underpins what determines whether a company or person is worthy of Pillar #2: Trust. Cultural rules run deep and when someone unwittingly violates these rules, the business relationship might never resume. Think of it another way… for all of the interactions you have had over the years with international contacts where you thought the other side was being unreasonable and disagreeable – 90%+ of those negative reactions were probably cultural misunderstandings. The solution is to hire a culture coach to help navigate the norms in key markets and relationships.

 

Regulations Often Protect Entrenched and Local Interests

The Connection Economy has displaced more than a few cab drivers and telephone book printers. It has upended whole industries. In many places around the globe, those who profit from keep things as they are have invested in supporting laws that protect their interests. Before doing business in a new country, be sure to consult with country specialists who can advise you of any problematic restrictions.

 

Expect the Next Great Connecting Concepts to Come from Anywhere in the World

While we tend to see many Connection companies rise out of industry clusters like Silicon Valley, London, Boston, Santiago, Mumbai and Tel Aviv, ideas can come from anywhere. As part of the exchange of ideas, we need to encourage and support new startups with great concepts with our patronage and investment capital – regardless of location.

 

As the beneficiaries of the Connection Economy, it’s important to keep in mind that there is no global standard. We need to increase overall access to the Internet worldwide, providing new opportunities to billions of people. it’s important not to mistake your home market’s perspective, language and cultural rules as the world’s norm. Be prepared for reactions to change in various corners of the world. And watch for the next great advancements in our technology revolution.

Onward & upward

Becky DeStigter
For more information about growing and supporting your international company, join the International Trade Tribe:

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The International Entrepreneur – International Trade 2016 Twitter List!

International Trade Experts on Twitter 2016

It’s been 6+ years sharing and trading advice on international trade from those involved on the ground. We have held weekly conversation on #GlobalBizTalk.

For 2016, here are my recommended Twitter Follows in the field of International Business:

@HoeferleChristian Hoeferle is an international business consultant and cross-cultural expert. Currently based in Tennessee, he hails from southern Germany. Definitely read his blog, The Culture Mastery.

@edbmarsh – Best B2B international marketing & sales expert I’ve found, Ed Marsh is a prolific writer on a variety of international business topics. His blog at Consilium Global Business Advisors is a must read.

@DavidMarkNoahDavid Noah is the founder of Intermart, Inc. which makes export management software. David has collected a strong set of blogging experts on his site, Shipping Solutions. Definitely worth combing through for content. Some of the best articles are in areas of international logistics and finance.

@jht4x4 John Treleaven is a former Canadian ambassador turned international business consultant, currently based in the Vancouver area. He is highly opinionated on international trade policies but I rarely ever think he’s wrong.

@shull  – Sean Hull is a senior level IT project manager who has led multinational projects around the world. When not on international assignment, he can normally be found in either Washington DC or Columbus, Ohio.

@uklatinamerica – Gabriela Castro-Fontuora has lived in the UK and is currently based in her native Uruguay. She is a great resource for anyone needing market research or marketing campaigns focused on Latin America or Europe. Gaby also writes extensively on international marketing and Latin American markets on her blog: SunnySkySolutions.

@introcasoEmiliano Introcaso is the National Program Director for the Canadian Manufacturers and Exporters (CME). This organization puts out a lot of content as webcasts and articles as part of their Export Success Program.

@SandraCravero – Sandra Cravero is in translation and is based in  Argentina. Follow her tweets and you’ll know why a great translator is worth their weight in gold.

@dirkhinze Dirk Hinze is a world-class professional international communicator. He is currently based in Lausanne, Switzerland and is a leader in IABC Switzerland.

@VerbaccinoKathrin Bussmann from Toronto is relatively new in international marketing social media circles, but is quickly making a name for herself as a great Twitter and producer of great international marketing podcast interviews on the Verbaccino site.

@LarsLinLars Lin is based in Copenhagen, but has been involved extensively with tech projects around the world.

@NatalyKellyNataly Kelly is the VP of International Operations and Strategy at Boston-based Hubspot. Before Hubspot, Nataly was VP Marketing at Smartling, a translation automation software company. 

@EricSnethkampEric Snethkamp focuses on international payroll and human resources. His background includes international recruitment firms. He is based in Austin, Texas, USA and develops new strategic partnerships for Safeguard World International.

@arlenemarom – You’ve heard of Super Connectors: people who seem to know everyone and connect them with the right resources? Arlene Marom is a Super Connector in international trade. She is well connected in her home market of Israel, as well as in Europe and the U.S. Arlene specializes in helping tech entrepreneurs with marketing. Her blog & company: Tech River.

@FITTNews Forum for International Trade Training (FITT) is a forward-leaning non-profit organization based in Ottawa, Canada. FITT also gathers great bloggers to its site. Watch for FITT to continue growing as the world standard in international trade training & certification. FITT is also hosts a blog of international trade experts from around the world at TradeReady.

@globethoughts Doug Taylor has been tweeting international business news and insights for years. He has the pulse of international trade in Canada and abroad.

@MLeitzmannMatthias Leitzmann is the International Channel & Business Development Director for VXi Corporation. He tweets on a variety of international trade, manufacturing and logistics topics.

While I’ve described some of the great international business tweeters, there are many more. Here are more great resources if you’re looking to expand your international business knowledge and contacts:

@3D2B

@AAG_AllamAdvGroup

@albertaguirreca

@AlfonsoDiaz

@AssafLuxembourg

@AzaharaMonllor

@chbrandt

@CreativeEMarket

@crowdmics

@ebodeux

@ExternalExp

@FreightArea

@GlobalTradeData

@How2Go_Consult

@LoueiAli

@mirzazbaig

@MuhichCom

@park_tim

@roxana_escu

@SamSturges1

@SandraStrong

@SH_Intl

@SultanGhaznawi

@UrsulaBrinkman

@vkozacek 

@webport_global

Thank you, Everyone, for your excellent content. Please keep Tweeting!

For more information about growing and supporting your international company, join the International Trade Tribe:

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The International Entrepreneur – How to Manage International Ignorance in Business

Mexico City ready for international trade

“Marie” has been traveling frequently between clients in Tucson and nearby Phoenix, Arizona, USA. She works with mid-sized expanding technology companies and has for many years around the globe. But Marie confessed to me that lately she is struck by the lack of interest in and understanding of Mexican markets that sit just minutes or hours from a company’s door on the other side of the U.S.-Mexican border. These company leaders seemed locked in a limiting assumption that Mexicans are all poor, uneducated and certainly could not afford American technologies.

For anyone wondering, Mexico is the 15th largest economy in the world as ranked by the IMF, United Nations and World Bank. It’s GDP per Capita is $17,000, which is above the median country by $5,000 (IMF 2014). Every year more Mexican professionals join the workforce in fields like computer science, engineering, and business. And Arizona’s share of this lucrative export market in both B2C and B2B industries is disproportionately low especially considering it’s a state bordering Mexico.

 

Now before any of us should start judging these or any professionals about their world business knowledge, I think it is critical to start with the following truth:

 

We are all operating with an imperfect set of information formed by what we have learned and then understood within the context of our cultural framework.

 

No one can be a true Know-It-All because it is just not possible to learn all that can be learned. Nobody really likes people who act like they Know-It-All, because it’s incredibly annoying. But we can manage ignorance in those we work with and especially in ourselves to the benefit of all. Here are a few key tips:

 

How to Handle Wrong Assumptions in Others

When I last lived abroad, I heard plenty of stereotypes about Americans. We live in skyscrapers. We watch TV all day long. We all wear cowboy hats and boots. And we eat McDonald’s hamburgers every day. These all sound ridiculous and narrow to anyone who has lived in the U.S.. Luckily these stereotypes are all fairly harmless. If you heard someone say that all Dutch people live in windmills or wear wooden shoes, you would probably react with a chuckle. But a word of caution… no one likes to have their limiting assumptions exposed. We all have these assumptions and risk losing face. Here’s how to help others while staying professional:

 

 

  1. Ask Questions About the Assumption

 

      Instead, consider asking questions around the false assumption.

     “Have you visited the U.S.? Did you see more apartments than houses where you visited?”

    “Do we as a company know the size of the Mexican market for our products or industry? Could we find out?”

Open-ended questions like these allow the person to rethink their statement and its underlying assumptions. It lets them have the chance to evolve past the assumption based on some new information or additional research. This is particularly important and sensitive when the faulty assumption is coming from your boss, investor, or client.

 

  1. Provide Published Data Supporting the Myth Bust

While some assumptions are trivial, others may be significantly limiting the growth of your company. If there is a chance that you may have a Mexican-size market nearby that is currently underserved, then gathering data and opinions about this opportunity can help to build interest to internal stakeholders.

 

  1. Ask Permission to Take it Further

Once it’s been established that the assumption is false, now there is a brief window of time to reframe understanding around the clearer picture. I like to also change pronouns from “you” didn’t understand this before to “we” didn’t understand the implications. But now that we do, we can take full advantage of this new understanding to excel further as a company.

 

Confronting Our Own Limits

To become better global business professionals, we need to constantly be challenging our own limitations. I would encourage you to:

  1. Read magazines, newspapers and other media from a variety of sources that are likely to share contrary points of view. A local newspaper can be supplemented with The Economist Magazine or a translated online version of another country’s main newspaper. Even exposure once a month will quickly show the variety of points of view on a single subject.
  2. Put yourself in new situations where you will meet people from different backgrounds. Travel is a great way to do this. So are local ethnic meetup group events.
  3. When new information challenges your previous assumptions, stop to think through all of the implications. Let your understanding of the world grow just a little bigger in that moment.

 

I think most of us in the field of international trade run into this false assumptions issue much more often than we would like to admit (certainly to our clients and bosses). The goal is to help clients be more globally competitive. That starts with the clearest possible understanding of the global environments in which companies operate.

 

Wishing you success in all of your global markets!

Becky

 

The International Entrepreneur – The Globalization of American High Tech

international trade, information technology, globalization, international entrepreneur

This week I wrapped up a 3-week project researching American IT companies that expanded into international markets. Normally my clients hire me to focus on markets outside the U.S., so it was interesting to study the industry I serve.

Honestly, I thought I knew all about the American IT industry. I have spent the better part of the last 22 years working for American IT companies as an employee and contractor. What I learned about my home market and industry surprised me and I wanted to share it with my readers.

 

Market Insights from Studying American IT Firms

I identified 200 American IT companies that had less than 1,000 employees worldwide and were actively internationalizing into new foreign markets. Most of the companies picked for my study were recruiting staff both in the U.S. and in overseas offices. I did not choose any companies that were clearly locked in a 2-country model for outsourcing or similar purposes, with no plans for global domination. I did not target specific states or metro areas. I understand that this is not a study with full academic rigor, but still it was hard to ignore the trends.

Here’s what I discovered:

  1. Not all American IT industry clusters are producing internationalizing companies. Almost HALF of the internationalizing IT companies were based in 2 metro areas: Silicon Valley/Bay Area (68) and Boston (26).
    Then came Tier 2 Clusters of internationalizing tech companies: Los Angeles/San Diego (18), New York City (16), Seattle (8), and Chicago (6).
    What was just as interesting were the metro areas considered to be strong in IT companies that are disproportionately low in internationalization: Denver/Boulder, Phoenix, Portland (Oregon), Philadelphia, North Carolina, Twin Cities and Washington DC.
    Two notable additional bright spots were Manchester, NH and Salt Lake City, UT both coming in with 4 internationalizing IT companies apiece. Here is a map showing where the U.S. high-tech markets are. Clearly the internationalizing clusters are a subset of the whole.

  2. Internationalization seems to take place between 100 and 200 employee counts across a wide variety of IT markets. This includes companies doing everything from developing gaming platforms to offering SaaS business processes to security networks to storage technologies. There are 2 noteworthy exceptions: healthcare IT and B2G (business-to-government) industries. After reviewing dozens of both types of companies, neither internationalize until much later in their product cycles. It’s a shame, really, since both government and healthcare technologies are bought and sold all over the world.
  3. IT services offshoring companies rarely made the list of 200 companies even though their entire business model is based on globalization. The truth is that these companies may have Indian or Mexican operations, but they don’t sell into any market except the U.S. Opportunities are being missed.
  4. There is no standard international expansion market pattern. Companies literally had a patchwork of offices and operations around the world. While there are definitely popular overseas office locations: London, Singapore, Toronto, Sydney, Amsterdam; companies seem to be weighing options in various markets instead of following a predetermined step-by-step rollout. In my option, that’s proactive and positive.

What is internationalization?

For quick reference, here’s my practical definition of company internationalization:

  • A company that is PROACTIVELY entering new foreign markets to sell products and services. This also applies to the supply management side – sourcing materials and services from around the world.
  • A company that is actively engaged in understanding the market potential in various parts of the world.
  • While many companies begin their international expansion using in-country local representatives or distributors, I think true internationalization is when companies begin to expand directly to new markets with new offices and hiring in-country staff.

Why is internationalization important?

Globalization is a defining force of our time. Its momentum rides right along with the other primary drivers – technology and entrepreneurship – as changes that will affect our grandchildren’s grandchildren.

For companies, internationalization is a game changer. It means:

  • Having the choice to expand into international markets (“internationalize”) at much earlier stage than ever before.
  • Increasing your overall market size by somewhere between 100-500%.
  • Learning industry advances and operational efficiencies in one market that can be applied to the rest of the company’s markets (called “arbitrage”).
  • Access to investment funds and other resources not necessarily available in your home market.
  • Country portfolio risk reduction – not all markets go through downturns and upturns at the same time. Multiple markets balance out the risks.
  • Access to the global talent pool to help drive smarter decision making and better leadership and management.

As I often discuss with IT company leaders, internationalization is like your planet developing “warp drive technology” on the TV/movie series “Star Trek”. Pre-warp-drive planets have a single planet view of what is possible. But once the planet’s scientists and engineers develop this high-speed capacity for travel, Star Trek sends an envoy to meet your leaders and welcome you into the larger intergalactic realm. Internationalization in a similar way opens up the business environment to the other 95% of our planet’s population.

So if you are an IT company leader or someone invested in a local IT cluster’s success, what does all of this mean for you?

  • It means that clusters like Silicon Valley and Boston have investors/VCs who expect internationalization as a company’s “Warp Drive” when they reach their growth stage. These industry clusters cultivate available resources to help make that happen. This can be developed in other markets as well.
  • It means that if your company has a headcount of 200+ and you don’t yet have international operations in at least 2 foreign markets, you may be late to internationalization and should actively be researching the advantages and risks involved. To expedite this, hire outside international business expansion consultants.
  • It means there is no one best way to expand internationally. Use your own competitive advantages and market research to optimize this process.

Now, in the immortal words of Star Trek’s Mr. Spock: Live long and prosper!

Becky DeStigter, The International Entrepreneur

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The International Entrepreneur – The Growing War for Global Talent

global talent, global HR, international trade

I see it expanding every day…

  • Engineering teams sent to implement a project on the other side of the world.
  • A medical student from a developing country applying for residency after graduation to ensure a higher quality of life for herself and her family.
  • A multinational company offering a rising star employee the chance for an overseas assignment to gain key experience
  • Governments trying to either slow their “brain drain” effect or recruit talented foreign workers

Never before in the history of the world have so many people decided to live and work outside of their country of origin. This means that talented professionals can move to where the best jobs are. But at the same time, there’s a trend to search the world for the best talent and then employ locally – essentially moving the job to the talent. A quick view of heavy-hitting multinational, IBM’s career website shows this in full view. IBM and many of its peers are opening up to the wider talent pool by offering extraordinary numbers of remote-based positions.

It’s challenging to get worldwide numbers on immigration. But here’s an example: In the U.S. alone, immigration has reached 41.3 million people representing over 13% of U.S. residents. [source]  On a global level, the Economist reports the highest countries in 2014 losing talent aka the “Brain Drain” to immigration were:

1) Myanmar

2) Bulgaria, Serbia & Venezuela

5) Moldova & Yemen

7) Burundi

8) Croatia

9) Haiti & Kyrgyzstan

11) Algeria, Lebanon, Mauritania & Ukraine

15) Chad & Slovakia

 

Those doing best at keeping their talent home?

1) Switzerland & Qatar

3) United States

4) Finland & Norway

6) UAE

7) Hong Kong

8) Singapore

9) Germany & Malaysia

11) Luxembourg & United Kingdom

13) Canada, Chile, Costa Rica, Netherlands and Sweden

 

All of this comes back to one basic question:

 

How do we come out on the winning side of this war for global talent?

 

I’m going to break it down to three levels: country, company and individual.

 

For countries…

Examples to follow:   If you want to win the war for global talent, first focus on your own citizenry. What will they need to compete with the world’s best minds? They’ll need a strong education foundation.

They’ll also need infrastructure like broadband, transportation and other foundations upon which to build new companies as entrepreneurs. Speaking of which, the 24 highest-rated countries for entrepreneurial activity – none of them are on the brain drain list. That’s no coincidence, especially some of their neighboring countries are hemorrhaging talent. Cultivating entrepreneurship can engage many smart homegrown talent. For the record, the U.S. doesn’t crack the top entrepreneurial activity list either.

Examples to avoid:     One of the worst mistakes to make is restricting smart, talented people from immigrating to your country. The United States, for instance, is a university destination for thousands of bright talent from around the globe. But instead of trying to engage those graduates to stay on and take jobs (or create startups) in our country, we often promote their return to their home countries. Australia and Canada are not making that mistake.

 

For companies…

Examples to follow: In the past few years smaller, agile companies can access talent from anywhere just like their larger competitors. Free communication and low-cost collaboration tools make virtual teams a common fixture in business.

Now SMEs can take it a step further and hire employees regardless of national boundaries. There is a new service called GEO – Global Employment Outsourcing that allows a service provider to be a company’s Employer of Record in country. This means that you pay to have your employee hired in Finland and that employee is paid in local currency, complies with all local employment laws and practices, and is billed back to you. It’s a game changer because it doesn’t require having a local subsidiary set up in Finland.

Examples to avoid: Those company leaders who assume that the best talent is locally grown will lose the global talent war. Xenophobia and closed market options tend to lead to a more limited geographic market too.

 

For individuals…

Examples to follow: To be a part of the global talent pool, you just need to keep options open. Nowadays you can search job listing sites for remote-based positions and jobs on the other side of the world. Jobs that directly involve trade and global markets tend to on average 10% more than jobs that are domestic only. And experience with international roles can pave the way to career advancement. We live in exciting times and you can be a part of it (if you’re not already).

Examples to avoid: If you want to work on the sidelines of the war for global talent, don’t update your skills to match what international employers need. Don’t network and for gosh sakes don’t learn any cross-cultural skills or languages.

 

We live in times of great global changes. Countries, companies and individual workers all have choices to embrace the shifts in world economic dynamics or resist them. I hope you’ll choose to see this as a tremendous opportunity for all!

For more Tips and Tools on International Business, join the International Trade Tribe.

The International Entrepreneur – Selecting the Right International Trade Shows

international, trade show, B2B marketing

Image courtesy of wikipedia & Taiwan World Trade Center

I was talking recently with the Vice President of Marketing at one of these B2B technology Silicon-Valley-wanna-be companies. If you have spent time in any tech industries, I think you might know the type – lots of curious employee perks and silly team-building games, reinventing core business functions in some unique way that doesn’t conform to how the rest of the world does it, and of course a workspace that any teenager would aspire to work in.

The VP and I were talking about marketing channels for B2B enterprise software markets. But when I brought up the time-tested international marketing channel of trade shows, he balked at my old-fashioned notion. Instead, the VP wanted to double his investment in paid media. Here’s my perspective:

B2B marketing and sales all basically boil down to having the right conversations with the right people at the right time. These conversations can be with one of your commission-based channel partners, with a current client, with one of your marketing staff on a social media platform, or in a sales call. The higher the price and commitment of your product or service, then the higher the level of trust needs to be to complete the sale. That is even more true for international markets, where NOTHING happens without an existing trusted business relationship.

Industry trade shows are a great venue to meet in person many potential clients within a short time. Face-to-face conversations GREATLY speed up the trust-building process and deepen the chances of a long, fruitful business relationship. In international markets, marketing messaging and other communications can easily be misinterpreted. In person conversations allow you to gauge the reaction of the listener. You can clear up any misunderstandings immediately and in many cases just continue on towards success.

Those of us who have made a career in marketing know that trade shows are not necessarily the most budget-friendly channel. So here are my tips on how to not only pick the right trade shows, but to ensure that they fit your budget:

  • Find trade shows in markets where you want to target. This may sound obvious, but many companies get caught up in the expectations of going to certain tradeshows. If you have no prospects in your home state or country, you don’t have to show your local ties. If you see great potential in the Indian market, search for Indian events. It may sound obvious, but on a limited marketing budget every show has to generate results – leads, partners, etc.
  • Choose events where the primary audience are your key decision makers. Nothing is more frustrating than doing a great job of cultivating a relationship with a potential client only to find out that their role has nothing to do with your product or service purchase. Everyone loves a product champion in an account, but a decision-making champion signs the contract and authorizes payments.
  • Do your homework on the conferences. Conferences and conventions are BIG BUSINESS. As such, they market heavily to both potential attendees and exhibitors. Definitely talk with others in your industry to find out how well the event is run and any hidden charges. Anecdotal evidence should support the statistics provided by the event organizers.
  • Size your event investment on the show’s potential (and your budget). I once worked with a software company that literally could trace 30% of their revenue to the HIMSS conference. With this knowledge, they would rent a large exhibiting booth space, sponsor a dinner for clients and prospects, a meeting suite, and other investments to capitalize on this large healthcare informatics event. At least in the beginning, the investments are likely smaller – a smaller booth, or even a few attendee tickets for key company staff to meet potential clients.
  • Use local language/cultural resources. If your company already has a local presence in the form of local reps or staff, you should try to include them in the trade show staff. This helps with the language issue as well as any local cultural nuances as most attendees come from the region around the event location. If this country is new to you, consider hiring a pair of professional interpreters. This will allow your staff to build rapport faster crossing language boundaries.
  • Don’t forget to meet the press! Most of event preparations focus on leads, clients and partners. But trade shows normally have a contingency of journalists writing for industry media. Even smaller exhibitors can often take advantage of this with the right media messages and interviews. Plan accordingly.
  • Prepare a game plan, schedule meetings and for gosh sakes – send the right people. Trade show time is expensive and fleeting, so have a plan on what your staff is going to do there. Are they able to attend conference sessions and meet people in other rooms? Can meetings be scheduled with key prospects? Ideally you are sending your best networkers – the staff who can talk with anyone and build instant rapport. The worst are the booths manned by a junior staffer consumed by his mobile phone while potential clients walk by ignored. Setting expectations is a key part of preparations.

 

As far as the trade-show-avoiding VP of Marketing goes, I hope that he and others trying to automate away face-to-face interaction always work for the competition. For the rest of us, a well-planned international trade show marketing program has the potential to accelerate our entry and potential in new B2B international markets!

For more Tips and Tools from The International Entrepreneur, please join our International Trade Tribe here.

The International Entrepreneur – 5 False Assumptions That Can Hold You Back from Global Success

international assumptions, international business, international marketing

 

I have been fortunate these past 10 years to mentor a promising international marketing professional. “Quinn” recently went back to university to complete his international MBA. He just accepted a position in Tennessee where he will be building international channels from the ground up in B2B & B2C markets. It’s an exciting opportunity for anyone in our field of international marketing.

Quinn knew where to start when he was hired last month. He worked with engineering to define the product changes required in order to meet international standards (CE, etc.). He developed a selection criteria to pick the right early international markets where the company would focus resources (UAE, Mexico & Australia). He identified a freight forwarder who will provide the right kinds of logistic support. And he started to identify opportunities to meet the right kinds of in-country partners to facilitate business deals and new client acquisition. Quinn seems to be on the right track towards providing a solid foundation to his international expansion.

But others are often not so fortunate. What is much more common to find are one or more of the following false assumptions underlying early-stage expansion decision making. A failed international expansion can scare a company’s leadership for years away from what should be lucrative international markets.

 

Assumption #1: We are focusing on the right markets.

To get to the heart of where this assumption can steer leaders astray, ask the question “how did we come to decide on which countries to expand to first?” In Quinn’s case some of the main factors were: one or more hot weather seasons and markets that could serve as a gateway to a larger region. Mexico is a great entry country to Latin America and the Caribbean. The UAE is closely economically linked to the rest of the Middle East. And Australia has New Zealand and Southeast Asia as neighboring trade partners.

Often companies instead choose countries where they have a contact or is a key staff member’s country of origin. Companies might follow a language to markets that really don’t make sense based on a more strategic criteria that focuses on long-term profitability.

 

Assumption #2: Our staff is ready to engage with international clients and partners.

To find out if your staff is ready, start with questions like: “Who on staff has experience working with international clients?” “How does staff feel about taking on international clients?” While the international expansion leader may be excited about his role, this does not mean that others share his background or attitudes.

Be sure that staff hear about the importance of the international expansion from company leaders. Informally, the international expansion leader should be having conversations to hear any concerns or questions from colleagues. After all, there is nothing worse than generating international sales leads only to have sales reps quietly leave international calls unreturned.

 

Assumption #3: Business moves at the same speed everywhere.

In my home country, the U.S., we typically create partnerships and close sales deals faster than in other countries. Now before you pat yourselves on the backs about our superior business skills and efficiency, please understand that this does not mean that ours are always well-built deals. In fact, misunderstandings and untrusting partners are far less likely to yield the same long-term profitability.

You can ask yourself, “Does my entire leadership team understand that the international expansion will move slower than we may be used to in our home market?” “Am I willing to invest in direct professional relationships including in-person visits to solidify and maintain strong and successful business ties?”

 

Assumption #4: The same rules apply… everywhere.

Definitely no. This is one of the biggest challenges in international business. The rules most definitely change based on country and local market. Rules that change include product standards, packaging requirements, forbidden marketing tactics, expectations of “gifts”, and how local businesspeople conduct themselves.

To prepare for these new rules, definitely do your research before that first contact. There are many sources of culture and legal information available online. There are also consultants who specialize in a particular region or country who can help.

 

Assumption #5: We already have all the answers.

There are international business professionals who spend a great deal of time staying current on how to do business effectively around the world. And they don’t even have all of the answers. What the great ones have is a strong network of resources who specialize in areas of international business and geographic regions.

As a company leader, ask yourself “what do we need to know in order to be successful and lower our exposure to risk?” “what areas are we already experiencing challenges?” Again, you can save budget by doing online research with reputable sources or else hire competent international expansion specialists.

Either way, your company will be much better positioned to reach its full global potential!

 

I hope you found this article useful. For more Tips and Tools from Becky DeStigter, The International Entrepreneur, sign up here.

The International Entrepreneur – Improving Agile International Project Management

agile global project management, international trade,
This week I caught up top global IT project manager, Sean Hull. Sean leads global teams on enterprise system implementations. His latest project involved a U.S.-American company implementing a customized system for an Australian customer that was developed by a South Korean team. I wanted to hear Sean’s insights about how agile management practices are used in global project implementations.

Like Sean, I have spent much of my career in and around large-scale technology industries. I know that any company selling enterprise-level customized software or other technologies needs a high-performance professional implementation services team – the company’s competitive edge.

I recently worked with a tech company that did not yet have such a team. Projects lost money instead of providing much-needed profit margins. Fulfilling the contract meant commandeering product development resources away from core product (that was already late to market) in order to write custom code. It was a first-class mess. Any improvements to project management methods literally hit the bottom line for the company.

“Software is worthless until it is used by a customer.” ~ Sean Hull

Sean went on to say that, “in Agile Project Management, software is delivered in iterative code and documentation. Feedback from the customer is built into short “sprint” cycles. This requires vendor and customer staff to have instant contact. Tight delivery cycles and collaborative communications need to be exceptionally managed for all of this to be successful. One of the benefits of agile project management is that the customer helps to discover any issues much earlier in the implementation process. This saves time and resources overall.”

 

Here are some of Sean’s tips for effective global project management:

Tip 1: Enforce your project management processes and tools. A project manager can choose from any number of processes and online tools to manage the project. Enforcing that nothing happens on the project unless it is communicated and documented according to the project rules is especially critical when the team is spread out geographically. One of Sean’s favorite project collaboration tools is Basecamp, which scales from small to very large projects.

Tip 2: Get to know your team. Meet in person, if you can, even if that means traveling to the same location. Be sure to draw up a process that would work for all involved. It is extremely helpful to know how your team members currently approach their work. Together with his team Sean likes to define: “What does the baked pizza look like?” It’s also a great idea to look for ways to make life easier for all involved.

Tip 3: Know how to collaborate with all cultures involved. In some cultures, the boss tells his or her team exactly what to do. In others, team members are expected to take more initiative and share their expertise openly within the team. Incorporate the various styles into how you work with your team. Sean recommends using the SCARF Model.

Tip: 4: Take advantage of the tactical tools from Agile methodologies. This includes how to run meetings, monitoring progress, etc. These work well as long as you take into the variation needed for culture and personality.

As global project management competency grows as a critical factor for business success, these skills will be critical to securing profit margins and loyal customers. I hope you find these tips useful in your company and projects.

For more information about how to expand your company internationally, please contact me for a 30-minute complimentary consultation.

Becky DeStigter

The International Entrepreneur

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