President Franklin D. Roosevelt (1882-1945) and some of the close advisors in his brain trust (c. 1932)
As the world’s second largest economy with a massive, increasingly sophisticated consumer base spending heavily both at home and abroad, China represents a tremendous opportunity for companies seeking growth. But the path to profits is highly complex, fraught with potential pitfalls that are best avoided and lessons learned from others who, typically, enter the market unfocused, unprepared and, ultimately, pay a heavy price in missed opportunities and wasted resources.
There is a more practical approach that, if followed, will mitigate many inherent risks and greatly increase one’s chances of success in China today. Before allocating significant effort, resources, and time to launch or ramp up growth of their businesses in China, executives should first seek to gain a deeper appreciation of the competitive landscape, market dynamics, and local talent pool and better understand consumer habits, unmet needs, and willingness-to-pay as they might apply to their own company’s products and/or service offerings. One of the most effective ways of gathering such relevant, targeted market intelligence and making educated, timely business decisions to better position the enterprise for success is by first establishing a small China brain trust.
The original concept of forming a brain trust or kitchen cabinet for strategic advantage first took popular hold in the political realm as the informal group of trusted advisors assembled by President Franklin D. Roosevelt to help him develop innovative solutions to the pressing challenges the United States faced during the Great Depression and Second World War. Years later, President John F. Kennedy (1917-1963) borrowed this great idea as an effective complement to his own Cabinet in similarly complicated, uncertain times in our nation’s history. From a business perspective, much may be gained by applying this time-proven concept to determine the best way forward for your enterprise not only in China, but also in any circumstance where disruptive competitive threats, fickle consumers, and uncertain markets may undermine your company’s efforts and performance and
non-traditional approaches will, likely, better overcome obstacles and lead to the most promising outcomes.
In an era of economic globalization, interconnectedness, and interdependence, where China often represents their second largest and fastest-growing market with the greatest potential investment return, most companies still stubbornly operate in the outdated, rigid mindset of “deliberate” strategic development. Employing proven tactics from their developed markets typically prevails over a more agile, flexible approach based on real-time knowledge and guidance from reliable, on-the-ground sources. Inevitable challenges due to language barriers, cultural sensitivities, the need to instill shared corporate values, and communication hurtles caused by physical distance to headquarters further complicate matters. In launching or building your business in China’s complex, rapidly changing market, therefore, it is wise to form your own China brain trust of locally-based, engaged, and trustworthy individuals with a relevant track record of performance and put them to their best and highest use.
To be continued…