Editor’s note: “International Business Corner” is a new weekly column written by Joan Keston that will be providing information for people involved in or considering international operations. Keston is an international business consultant. Over the next several months she will be writing about important issues that international businesses face as they compete in the 21st-century global business environment. This article is the first in a series about building international bridges.
CHAPEL HILL – When you do international business you are in essence doing the same transaction that you were doing domestically. You are now just crossing national borders. So if you are buying and selling products or services, you are still buying and selling products and services. If you are developing software, you are still developing software. Although international business embodies the same fundamentals that domestic business encompasses, it is much more complex, cumbersome and costly. The difficulty is even greater when you are working in developing countries.
There is no magic or mystery to international business. You are actually conducting two pieces of domestic business; one piece in the United States, subject to the United States business culture; one piece in a foreign country, subject to that country’s business culture. The connecting piece to those two domestic businesses is the international bridge that you build. The steel and concrete of that bridge are the individuals and resources you employ.
Good Communication Is Essential
Communication is the most vital contributing factor to the success of your efforts. The type of communication is based upon the knowledge and experience of dealing internationally and, increasingly important, the experience of having done business in a developing country as a local. In addition, if you are dealing with a foreign language issue than obviously you will need translations. However, the translation you will need is not just a language translation. You will need someone who will be able to translate the essence of the business, the terms, the concepts, etc., into the foreign language and foreign business culture.
Who Is on the Bridge?
Two important executive functions are essential components of your international bridge. These are the individuals you will rely on to achieve the proper communications and are vital for the success of your international endeavors. It is critical that these individuals report directly to the highest executive level in your management structure that is responsible for the success of your international business.
• Corporate Development Executive: This person will help you develop your international strategy, corporate structure, strategic alliances and international team, and is essential in the development and coordination of all of the international elements. He or she must be able to recognize the issues involved and be able to address them or involve the necessary professionals to assist.
• International Executive: This person will help coordinate and integrate your international business within your corporate structure. He or she will integrate your corporate culture and the foreign business culture, and work with the foreign divisions or offices to meet company goals and objectives. You may have several international executives depending on your size and geographical reach.
How Is the Bridge Financed?
In addition to the domestic financing in each of the countries involved, international financing may be available for your transaction or project. The entire financing of your global operation must be in place or your international initiative will fail.
In conclusion, you need to have the right executive team creating the management and communications channel for your foreign operations, also having the financial resources to get the international operations underway.
Joan Keston is a Senior Managing Principal of Keston & Associates, Ltd., an international business consulting firm located in Raleigh, NC, and a partner at Paladin and Associates, Inc. She has over 20 years of corporate business experience, including as a corporate attorney. Her firm assists companies establish business operations throughout the world. She can be reached at (919) 881-7764 and firstname.lastname@example.org.