It’s a Global Economy…
More and more, companies are heeding the battle cry of overseas expansion, assuming that because of “globalization” doing business overseas is a snap.
But just because you have wifi access doesn’t mean that you’re going to be well received in a new country. There are more examples of failures in overseas expansion than successes, but for whatever reason, leaders feel that since they can go overseas, they should.
Not Everyone Speaks English
A great example of this is that in Britain, to table a motion means to bring it to the table, to consider it. In American English, it means the opposite. Yikes.
One American business person expanded to Britain, where his company was reported in the press as a “scheme.” Though offended by this word choice, he soon learned that the British word “scheme” doesn’t hold the same negative connotations that it does in American English.
In fact, a full 68% of small and medium sized businesses who set up shop overseas without linguistic help fail.
And assuming that just translating your materials into a literal translation in the local language is going to do the trick is a serious mistake.
A near-blunder from Senegal recounted in the Wall Street Journal is a perfect example of this. George Ajjan, owner of Dakar Sushi, needed to write to a Senegalese government official. He composed the letter in French, but used his characteristic American directness. As he put it, “I’m direct and I shoot to kill.” Thankfully, he asked a Senegalese resident to read it over, who alerted him to the fact that his language was much to jarring for Senegal., and his business license would likely be denied. As Mr. Ajjan put it, “It wasn’t just about translating, but about adapting phrasing to make sure you are in line with what people expect.”
Enlist Local Help
Understand How the Local Market Buys
As the New York Times points out, one of Wal Mart’s problems is hubris: assuming that other countries will be happy to adopt American buying attitudes. But after failing in Germany, Japan, and South Korea, even after trying for a full decade in some markets, the leader of “Every Day Low Prices” is beginning to rethink this attitude.
In fact, Wal Mart’s experience in Germany is almost a template for how not to do business in a foreign market. It’s experience in South Korea also shows a lack of understanding for local culture. As one woman related as she sat with a reporter on the subway, “That may be good for some American housewives who drive out in their own cars.” But Koreans, she said, prefer smaller packages: “Why would you buy a box of shampoo bottles?”
Not to pick on Wal Mart…Best Buy is losing tons of money in its European expansion because of a failure to realize that Europeans don’t enjoy shopping in large box stores.
Don’t Assume Anything
Respect the Local People and Culture
A similar example is BP’s presence in the Gulf of Mexico. They put money ahead of safety, and after the oil spill, have severely damaged their previous brand as environmental leaders. Canadian company SNC is still reeling from its dealings in Quaddafi’s Libya. Bottom line for these two examples is to use the same standards you use in your home country with operating overseas.