Planning and Launching Your Company's Global Sales Strategy
Chris Bruner, Partner, Mid-Atlantic Area Strategic Growth Market, Ernst and Young LLP
This is a term that was nearly unheard of a few decades ago. Today, you can meet two ambitious entrepreneurial college students, developing business plans that have yet to be executed, and they are already talking about going global.
A common belief underlying today’s business society is that, in order to be successful in the long term, you have to have a global strategy. The fact is that it takes a tremendous amount of coordination, effort, and savvy to launch a global sales strategy. Not to mention what it takes to execute a global strategy.
There are, however, a number of proactive measures and steps that early-stage, entrepreneurial companies should consider if a key part of their strategy and future success is tied to entering the global markets.
Ensure that You can Execute Domestically
Before ever considering a global sales strategy, ensure that you can be successful in a similar market that is, in all likelihood, much easier to penetrate than a global market. We’ve seen countless companies that tried to “go global” prior to executing in their own backyards. Not only is this strategy risky, it can be fatal to an emerging company that has significant capital needs and limited resources.
If you have successfully executed on your core sales competency domestically, ensure that you have the appropriate experience to explore a global market. Keep in mind, almost every global market is different in terms of culture, business acumen, language and expectations of the stakeholders. It is absolutely critical to identify and hire experienced individuals who have a history of being successful in global markets.
Measure the Results
It will typically take longer to penetrate a global market and attain results that are satisfactory than it does in local and domestic markets. Often times, a company will need to develop a new set of measurement metrics related to global initiatives as well as compensation strategies. Given the significant cultural differences between the U.S. and other countries, it is very easy to under estimate the impact of various degrees of success within a global market. Take sufficient time to ensure that the measurement metrics you put in place make sense in light of a new, untapped market.
Advances in technology over the last decade have clearly made doing business globally easier and more efficient. No doubt, the next 10 years will result in even more innovations that will allow domestic companies to operate globally with even further limited resources on the ground overseas. Working closely with your information technology team and coordinating these efforts with global representatives and customers is a tremendous advantage to going global that companies did not have 10 years ago. Make sure you take advantage of this.
Know When to Cut your Losses
As we all know, not every business endeavor is a success. Expanding globally has even lower odds of success and, as a result, a company needs to define clearly what success will be. If that measure is not achieved, you have to know when to cut back and, potentially, exit the global markets. Many successful domestic companies have been forever damaged by waiting too long to exit a failing global strategy.
Cautiously Leverage Success
Once your company has successfully entered a global market, ensure that you are financially and resource-ready to enter additional markets. The learning curve of operating globally is huge and companies will have significant opportunities to leverage success. Be cautious as you look at other markets, and understand that no two global business communities are the same. Each will take different skill sets and expertise.
The global business environment is an exciting one. Many global markets outside the U.S. are growing significantly faster than our market. For example, we’re seeing a number of high-potential companies that are considering global strategies in quickly emerging countries such as China. No doubt, the truly successful companies of today, and especially tomorrow, will have to expertly execute a global strategy. The $1 million question today is whether you will have the discipline and expertise to take advantage of this opportunity. Let’s hope so.