I have seen too many people fighting battles, wasting resources and impoverishing the end results, just for the pleasure of winning. In other words, engaging in “lost” battles. And what are “lost” battles? You are asking. Well, lost battles are all of those situations that one cannot change and that are not critical to achieve the end goal. Imagine the following situation, you are implementing a project and suddenly something that puts the project at risk happens. How do you react? Would you prefer to fight to revert the situation although you have to spend more resources; or would you prefer to “lose” that battle by not engaging in reverse it but instead use your time and resources to find an alternative way so that you can be able to deliver alike results with no additional “pain” (higher costs, miss deadlines, etc) ? As a manager, I have seen too many situations where people fought just for the sake of winning, ending up with a missed Goal and higher costs. I also know that not engaging in a battle it is not as straightforward as we would like it to be. Securing the “war” it is much more important than winning a battle, unless that battle is critical to winning the “war”. Thinking in the long-term and focusing on the big pictur are, at least for me, “right” moves if you want to achieve goals, otherwise you may be wasting resources and increasing the likelihood of missing the goal.
Doing business domestically is not the same as going abroad, new challenges and issues will arise and they can easily break your business if not controlled. Thus, it is of the utmost importance that you fully understand what is at stake and which aspects will differ from your domestic business. By listing and analysing this new challenges and differences you will be protecting yourself from unexpected costs and risks that may lead you to losses rather than profits. Sorry for me being blunt, but along the times I have seen too many amazing products and businesses failing to succeed due to this kind of mistakes – bad forecast of costs and revenues; fail to master the documents and licenses needed, payment methods, and sales conditions used in international trade.Therefore, I am here today to introduce you a checklist of domains you should cover while doing your business case for your export operation.
In order to do it in a systematized way and saving time, I like to divide the checklist into four main areas and although there is no special order or preference, I prefer to start with the Management and HR, followed by Marketing, Operations, and end with Finance – as you can see in the figure.
Management and HR you should assess everything impacting the way you manage and organise your business domestically: extra time to start-up the export operation, new organizational needs, new decision-making processes, and new activities that you will need to implement. IP rights along with special licenses are aspects underestimated that can easily put your business in a tough position. Human Resources are also critical, assessing the key personnel and special training needs for this new venture is therefore crucial. You should start asking if the actual team is enough in quantity, skills and competences, and what kind of training they, and you, will need.
Marketing, in this area you should assess everything related to the market and the differences of going to an international market. Exporting is highly challenging because you need to find new markets and customers, and therefore it is critical to have information and data. Assessing the kind of Market Intelligence you will need, in oder to comprehend how the market operates, the customers’ needs and habits, and the local way of doing business is critical. Along with that you will also need to understand if your Product needs to be changed in order to penetrate the market. The Trade Marketing – sales materials, promotion campaigns, point-of-sale merchandising, and other materials and strategies – will probably need to be customised for the market. Along with this it is also important to understand that the trade marketing strategies and tactics will also need to be tailor-made for the market and region, and that may bring new needs. Cultural distance is a highly critical variable for any export business, understanding the market you are exporting its cultural differences it is crucial. I can tell you that this is one of the most underestimated aspects by the companies that can easily spoil the whole operation.
The third block of your export challenges checklist is the Operations side, in here I put everything related to executing on the field the business plan. Meaning, managing your production capacity and other special product customizations in time and linking it to an international supply chain that efficiently delivers your goods to the market, designing a distribution plan (distributors, reps, agents,etc) that meets your demands, preparing and handling special documentation and other needed certifications and licenses in order to be able to export and sometimes import your products into the new markets (depending on your distribution choice), and the needs for a tight project management and control of all the different variables involved when exporting. By project management I mean everything going from the moment you sell to the moment you deliver and collect the payment. A lot of small firms underestimate the importance of handling the part of collecting and sometimes delivering correctly what means not get paid in time or at all. As you know with the Incoterms is easier to be on the same page with your buyer concerning sales and payment conditions, and therefore is important to choose the correct Incoterm to use in the contract along with the correct execution otherwise it does not work.
The Financial aspects are the last but not the least export challenges in your checklist. Exporting means extra costs (trade marketing new needs, credit costs, transport costs, etc) different credit and payment methods, and extra risks (exchange rate, payment methods, default of payment, scams, etc). Thus, It is important that you understand all the changes so that you can have a competitive and profitable operation.
Be aware and prepared, and you will be fine. Good Luck!
Along the years to many were the occasions where I knew beforehand that no matter what the conditions were – team readiness and competences, or corporate culture and organization -, my objectives were impossible to achieve. Why? Because they had been set in such incomprehensible and unrealistic terms that they were completely impossible to achieve. Therefore, I keep wondering, how can unreachable objectives help companies being competitive? Well, I strongly believe that they CANNOT!
Why setting objectives? Answering to this question must be the very first thing to do, immediately followed by answering, “Why these (objectives) and not any other?”.
Objectives must be aligned with the business strategy, execution plan, available resources, and time span. If companies do not take any of this into account, how can they set objectives that make sense? The more randomly objectives are set the more impossible are to achieve them.
So what do you need to know, or have, in order to be able to set relevant and coherent objectives? Objectives must bring value into the company not only in the short but also in the medium and long run. Objectives must be always aligned with business strategy, major goals, and an execution plan. Objectives should not be limited to financial, profit or cash related indicators, they must translate also the company’s “health” in other areas such as operations, sales profitability, innovation, competitiveness, readiness and flexibility toward future challenges, people development and talent management, suppliers quality and capabilities, or customers satisfaction and loyalty. In order to have a strong, complete and cross-section set of objectives and KPIs (key performance indicators) several methodologies can be used and built. I am particularly fond of the balanced scorecard approach along with a strong mapping of the strategic areas that should be impacting or being impacted by the business strategy. This strategic mapping help defining the strategic objectives that must be monitoring, after that is key to define the way of measuring them and set a target/deadline to be achieved. The important aspect to highlight here is that what ever approach one takes, it must take into account the following aspects: business strategy; strategy execution; top/bottom and bottom/up analysis; cross-section KPIs (include more than just financial, profit and cash related KPIs); KPIs must be set by area only after the integrated analysis (strategic mapping, top/bottom, and bottom/up analysis); resources available and needed; talent and human resources needed; reporting and control system (that helps mitigating risks, taking decisions, and learning).
I see objectives as key to competitiveness! If one does not have a set of KPIs and targets to be achieved, how can this person know if it is working well, evolving, and adding value? In my perspective, well defined objectives are a strong motivational tool. How can companies stay in the market and be competitive if they do not measure their achievements and set targets to be achieved? However, objectives should not be the end goal of a company, but rather a way of knowing if the company is in the right path toward its business strategy and vision. Obviously, business strategy or vision are changeable, though they should be set for a horizon of 4 to 5 years, and not yearly, and be more than just a profit statement. A multi-annual execution plan accommodating objectives for the period must be designed before going setting objectives. Objectives are a too important tool to be misused! Objectives must be a strong motivation booster rather than a motivation killer!
In a world that is changing fast and facing amazing challenges, namely a war for talent or globalization, Team Spirit can work as a Competitive Advantage! I am one of those people that believes that having a strong and engaged team can make the difference. So, I prefer to have a team committed to a common goal, and working together, than a group of amazing stars working individually. When choosing your team members, what kind of people would you like to have? I know that a lot of aspects must be equated before going on choosing members for your team. Nevertheless, I believe that to build a real Team, one needs to have people who are able, and willing, to work above their egos, individual agendas, and anything that inhibits a truly open and sharing environment. I am not saying that you should not have the best of the best (stars) in your teams, or that stars are not able to work as truly team members. What I am saying is that having a team it is much more than having a group of stars. And that team spirit can work as a competitive advantage, helping companies being the leaders of their industries or niches.
In order to ignites team spirit it is important to have a corporate culture that enables openness, sharing, cooperation, recognition, and motivation. Although all of these aspects are important, motivation is specially important to create the right environment and conditions, and contrary to what is believed, it is not only about money! Several studies mention that above a certain wage level, motivation is mainly about challenge, recognition, opportunity to master, ability to share, work-life balance, autonomy and responsibility, rather than cash prizes and bonus. Therefore, I believe that team spirit and corporate culture can have also positive effect on motivation levels.
Having the right people it is not enough, a “head” is needed to coordinate and motivate them. Hence, companies must have more than just talented people with team spirit, they must have a leader to shape them into a team. Stir people toward a common goal and to excel it is not easy but is crucial. If companies do not have the right Leader, they are missing a strong source of competitive advantages, team work.
How many times haven’t your boss asked you: “Hmm, this team of yours is not working! How about changing it?”. Only a couple of months after you have started working with them? Too many, right? Practice it is the last ingredient I would like to mention. By practice I mean routine, time working together, and experience. In order to have the best out of a team time is needed, time to experience, to adapt, to learn how members work, think and behave. Like a sports team, a team needs hours working together to reach their best.
Summing up, Team Spirit can be a competitive advantage! In times of war for talent and highly competitive markets companies cannot forget to keep investing on having people working together. and the why is easy, Teams work better and achieve more than individuals. A company with a culture that stimulates team spirit, people performing at their best and to master, to share and cooperate, are much better prepared to face successfully the 21st century. Although Team Work and motivation are linked and must be seen as the two faces of the same coin, it does not suffice. A company needs to have a corporate culture that helps cooperation and openness, and Leaders to ignite the right behaviors. Last, but not least, “practice” must be also present in order to have a team working at their best and creating real competitive advantages! Teams need time to work together and fine tune internal dynamics.
I strongly believe that a company does not need to spoil resources to have a strong brand or be competitive Yet, we keep seeing companies spending and spoiling more than they can afford. Working for cost sensible companies gave me an insightful position on this matter, but never inhibited me of focusing on quality or brand image. Therefore, I still believe that if a company wants to face successfully the challenges ahead, it needs Leadership not vanity, and a culture of cost sensibility and frugality, instead of one based on waste .
Cost sensible does not mean less quality or weak brands, it means instead a sensible management of expenses. A company does not need to have expensive offices, latest state of the art fleet, or exquisite furniture to run a business successfully! It needs instead an informed and well trained team willing to be creative and innovative without a millionaire budget, and always committed to be lean and customer-oriented. More important, it needs a leader who uses the companies assets wisely and productively.
A cost-sensible and frugal culture can work as a way of freeing up resources to invest in new capabilities and gain stronger competitive advantages. Obviously, for this to happen the company must re-invest the freed-up resources in crucial areas such as innovation, creativity, uniqueness, talent management, R&D or other that can add uniqueness and factors of differentiation.
I strongly advocate that a cost-sensible and frugal culture as a competitive advantage factor and a brand saviour.
Complexity is everywhere, I know! However, I sometimes feel that some companies want a piece of this complexity to feel like God, omnipresent and omniscient. This companies believe that by making use of a puzzled language and complex processes they are differentiating themselves from their competition and being unique. Not True!
We, human beings, have a problem with simple things, we believe that to be good and better than others one needs to be complicated and complex. I advocate that complexity leads only to a false sense of superiority, and creates a feeling of suspiciousness in consumers. Consumers do not like to be tricked or fooled by incomprehensible language and processes, though. Complexity does not lead to any competitive advantage, but it can cause damages! It generates difficulties in handling and optimizing processes, and in designing business strategies.
Being simple does not mean simplistic, like complexity does not mean competitiveness! Please avoid shortcuts and keep it simple, invest in uniqueness, creativity and innovation instead!
What I like more in the social media and all these internet and web stuff is the easiness of sharing, connecting and commenting on each others’ ideas. Social Media is doing its job and helping people getting more into sharing, communicating, and building up on others’ ideas. People is becoming more open to exercise their own creativity and innovatory abilities. People like to share and comment on other’s work, obviously that this is much easier today than it was a couple of years ago, nevertheless, this social change brought by the advancement in technology is boosting the whole phenomenon. Commenting, sharing and building up on other’s ideas is for me the basis of Brainstorming! Online or Offline, Brainstorming is a powerful tool and in my point of view, a competitive advantage for those doing it. Brainstorming has become a tool to generate a higher level of innovation and boost creativity. Honestly speaking I am a huge fun of brainstorms! I know that sometimes one ends up with a bunch of people trying to brainstorm and nothing happens. Though, the right question here is the Why! Why is it not working?
For several different reasons like, wrong people or place, or more important, wrong leader. So, another key question is, How can you take fully advantage of its amazing potential? For starters, Brainstorming only works if people is doing it in fully awareness of what it is at stake and able to speak freely. Meaning, only if you have a strong team spirit, a motivated team and you rewards their participation and willingness to share you will be able to profit from it. However, not having the “right” leader in charge of stirring, coordinating and conducting the whole meeting it is also a common and the most important mistakes! Even for brainstorms you need some order and rules, and nothing better to do that than having someone capable of leading the whole discussion. If you want to have a good, efficient, and fruitful brainstorming you must appoint a Leader to be in charge.
Another key question again, What kind of traits must be present in a Brainstorm Leader? In my point of view, first of all you will need someone with a good sense of what a Shaper and an Evaluator are. A Shaper will challenge people, be dynamic, provide the drive and courage to overcome obstacles and take some action. On the other side as an Evaluator, she will be sober, strategic, logical and more important she will see all the options and keep track on the good ones. And on top of everything, you will need someone who has a good sense of humor, a sharp common sense, an ability to stir ideas in order to think outside the box, a good moderator and communicator. Someone who knows how to ignite innovation and creativity, motivates people to build up on others ideas and suggestions, and more important someone who does not judge or inhibit people to take risks or share their opinions!
If Brainstorming can be seen as a competitive advantage, and I believe it can, companies must pay more attention to it and have better leaders to manage it. I have seen amazing brainstorm sessions where solutions are found, new ideas brought in to the table and a boost in creativity and innovation accomplished! If companies must innovate and be creative nothing better than start using social media to do it but also never forget to do it offline, in-house with your company’s employees. You will be surprised with what you end up with, an amazing set of creative and innovatory ideas.
Tip: Include brainstorming in your weekly tasks, do it at least once a week and you will see the changes after a couple of months! Your company will be much more open to new ideas, creating and innovating more, and your team will be more motivated and productive than ever.
Do not hesitate in contacting us if you want some more tips on Brainstorming or Share tips with us!
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