How small businesses can win globally

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By Mona Pearl

Guest columnist

Mona Pearl is a global strategic business development expert as well as the founder and COO of Beyond A Strategy,
Mona Pearl, the Chicago-area author of “Grow Globally,” discusses mistakes to avoid when expanding internationally.

Business leaders today have the skills and  finesse to identify and execute great deals globally. It the soft issues that surface  on the international stage that cause unanticipated and disastrous problems. Most of the challenges occur when executives don’t  understand  the business culture and customs of the target market and don’t do sufficient due diligence.

Seeing  opportunities in the global marketplace requires the right perspective. Acting  on those opportunities requires the right skills and entrepreneurial instincts.  These take time plus experience to develop and mature.  They  also require intentional learning and curiosity to explore.

How  can corporate leadership  look into the global  marketplace to discover and assess new opportunities and new avenues to  generate future growth?

The Challenge is Mindset

It  starts with a whole tweaking of the mindset: The U.S. is a huge country, but  it not self-sufficient anymore. Executives  in charge of operations and  growth  need to look at the global market as an opportunity.  Going global is no longer an option.  Ready or not,  almost every U.S. company competes with  foreign enterprises right  here on U.S. soil. In a technologically connected world, the United States can  no longer afford the luxury of global isolation, but must learn to play in the   sandbox and launch successful international ventures.

American  businesses fail at  three to four times the rate of other countries in  their ability to expand globally. Even worse, the majority of U.S. businesses  never make an attempt.  Our entrepreneurial drive, vision and expertise just  don t compensate for our lack of global perspective. In less than 10 years, 95  percent of consumers will be outside of the United States, and 73 percent of  the purchasing power will be outside of the United States.

Avoid Top Three Costly Mistakes

The  opportunities for global expansion are infinite. However, attaining success demands a  well-conceived global expansion plan that is grounded in accomplishing specific  corporate goals through the careful formulation of business development  strategies.

Mistake  1: Lacking Clear Objectives

The  reason to go global must come from a legitimate need based on  accurate data, starting with the present and looking into the future. It begins  with asking the right questions and researching the market and the competition.  Then set clear objectives, timelines, milestones and metrics and use this  research to create a roadmap to success. And of course, all this information  has to be analyzed and interpreted in context. Data alone will not suffice.  Make sure you define the right target markets for your product or service and  choose the appropriate mode of entry.

Mistake  2: Forgetting the Importance of Cultural Differences

Ultimately,  a successful global expansion is dependent on a company ability to view the  world in a new way and adopt appropriate polices and strategies to cope with  different cultures: These are the sensitivities that can make or break a deal.  Consider language, negotiation styles, gender issues and local business  practices.

I ve  witnessed many business transactions that come to a screeching halt and fall  apart due to cultural misunderstandings and cultural ignorance. Don t assume  anything, and do your homework. Many times the way to handle issues are counter-intuitive to the American way.   Business  people in an international business environment must be sensitive to  differences in culture and languag and  learn to adopt  appropriate policies and strategies for handling these differences.

Mistake  3: Underestimating the Time-to-Market for Your Products and Services

Don t  put expansion plans at risk by budgeting too short a timeline. When this  happens, inevitably, the business depletes available capital and the upfront  investment of time and money is wasted, while your international reputation is  blemished. Resist the temptation to be overly optimistic. Look at the “Ease  of Doing Business” index for planning purposes, and focus on interpreting  that information correctly. You cannot put a time frame on building  relationships and trust.

Get in The  Global Game

In this increasingly complex and competitive global environment, exceptional skill  is needed to evaluate the options, manage the risks and execute a winning expansion  strategy. Winners will reap the benefits, while expanding and executing growth  strategies more quickly and more effectively than their competitors. What was  won t return. There are new players and new rules, and it is a global  economy.

The new frontier is that there is no frontier, and  how middle-market businesses respond to this reality may have a significant  impact on the economy as a whole. Savvy entrepreneurs will likely see  opportunity where others see impasse. Be fast, flexible, innovative and  motivated — and enjoy the adventure.

This post includes excerpts from “Grow  Globally: Opportunities for Your Middle-Market Company Around the World.”  Copyright (c) 2011 by Mona Pearl. Reprinted with permission of John Wiley &   Sons Inc.

Mona Pearl is a global strategic business  development expert as well as the founder and chief operating officer of Beyond  A Strategy Inc., a Chicago-area company providing expertise to plan and implement cost-effective  and sustainable global growth. Pearl also has founded and operated two  additional businesses and sits on the board of several organizations.