Tom Homer, Head of EMEA and Americas, Telstra Global
The golden opportunity of Asia
Succeeding in Asia is not a given; many UK companies have boldly stepped into the region and sometimes failed to gain the traction they are looking for. However, these failures haven’t dissuaded competitive organisations, and as Asia’s economies continue to grow, the region remains an important target for UK companies looking to go global.
And it’s not surprising why.
Half the world’s population lives in the many diverse nations that comprise Asia, and every day the number of people living in Asian cities grows by more than 120,000. With figures like these, very soon Asia will not just be the biggest global producer of goods and services; it will also be the biggest global consumer.
UK businesses outperforming international peers
With the world’s economic growth expected to continue in Asia over the next decade, our report, entitled ‘Connected Countries,’ shows that UK companies are at the forefront of financial performance within the region.
The research taken from a survey of over 4,100 multi-national business executives, identifies that UK businesses are not only performing well within Asia but they are in fact outranking their international peers within high growth regions. UK companies were overrepresented among the star performers in the research, coined as ‘Asia Business Champions’: the top five per cent of companies operating in Asia based on high performance and future promise of success.
With three quarters of UK businesses achieving their financial and strategic objectives over the past three years, many respondents were optimistic about the region’s outlook presenting a golden opportunity for UK headquartered companies wanting to expand its network overseas.
However, before businesses take the leap of faith, it’s important to address and adapt to challenges that expansion involves. Among the many challenges noted in the report, ‘adapting to local culture’ and ‘ways of working’ were the most significant. It is vital that companies find the right mix of local and global talent, and to do their homework on culture and customs before doing business in Asia if they are to be successful.
The secrets to success
So why are UK companies outperforming many of their peers worldwide? The research identified specific traits among the top performing UK headquartered business executives which provides an insight into what is making them successful.
For one, British employees are much more likely to stay in the region or at least continue working overseas than Asia-based expats from other countries. Considering that the sourcing of local talent is a major challenge for companies within Asia, UK companies are able to benefit from an existing and experienced talent pool that are willing to move around the region and, more importantly, stay there. This is emphasised by the fact that UK companies in Asia place a higher value in bringing senior leaders to local offices than those of other countries.
Communication is also king. UK businesses believe that the right personality traits and communication skills are more important than experience, knowledge or local language skills in order to be a successful senior executive in Asia. This does not mean hard skills including experience, knowledge and technical abilities, are not important. The key is to find the right blend of soft skills and hard skills in multinational executives.
Finally, it was identified that cultural sensitivity was a driver to success for UK companies. 98% of UK companies profiled in the report, felt that the most important trait of those seeking to manage businesses in the region is an understanding, appreciation and consideration of different cultures.
The future of the Asia market
When looking at the sector breakdown, over the next three years both financial services and insurance companies, along with those in the ICT sector, are bullish about exceeding their objectives in Asia, with 55 and 51 per cent respectively expecting positive growth compared to 41% across the board. With financial and professional services leading the economic revival back home, it is unsurprising that the industry is confident of its chances further afield.
Asia presents significant opportunities for the UK and international business market, and the report shows that companies headquartered in the UK are taking a long-term approach to entry. It is essential that businesses stay flexible and adaptable, and lean on the wisdom of trusted partners to ensure that expansion into Asia is a seamless and profitable venture.
Telstra’s complete Connecting Countries report can be downloaded here.