“How can you catch tiger cubs without entering the tiger’s lair?” (bù rù hŭ xué, yān dé hŭ zĭ? 不入虎穴,焉得虎子)
Many companies – including those with world-class brands and a wealth of international experience – still enter China with a seemingly half-hearted commitment to the new venture and naivety that often underestimates the complexities of the marketplace; needed capital, human, and institutional resources; and required time frame for their businesses to achieve a reasonable amount of financial and strategic success.
Initially introducing some form of its content, product, or service into China managed indirectly from overseas may be a prudent way to “test the waters,” but once a company determines that it is worth moving forward, it should do so in a much more concerted, focused way and be willing to allocate the needed resources to enable the business to have a fighting chance to survive and thrive. As the ancient Chinese proverb states, “How can you catch tiger cubs without entering the tiger’s lair?”
It is crucial to have at least one executive champion of the China initiative at company headquarters with the credibility, enthusiasm, and political capital to help nurture and support the company’s China business, particularly in the early years as it strives to achieve proof of concept and establish its own independence.
Choosing a qualified individual for the on-the-ground leadership role, one who can serve as an effective bridge to headquarters and shares the company’s cultural values and overall vision, is also of critical importance.
In the interim, however, until talent with a good mix of sector expertise, engagement level, and suitable temperament is brought on board to manage the local business, it may be necessary to employ a trusted interim General Manager who understands your sector and the China market well, can commit to leading the China business unit through its infancy, and, ultimately, is willing and capable of “letting go” after finding and engaging his or her own replacement to build the local business through subsequent stages of growth and maturity.
One of the major inherent weaknesses of the current China market is a shortage of qualified talent, so selecting, training, and retaining a strong on-the-ground team will undoubtedly be an ongoing challenge for those championing the cause of the local business in China.
Finally, it is prudent to regularly reassess how the business and team are doing and course correct, as needed, along the way. And remember… unless you are willing to cede the market to hungry competitors – both domestic and foreign, always maintain some measure of forward momentum. Placing your local business in
a holding pattern or, worse yet, pulling out of the market “for the time being” not only sends terrible signals with long-lasting repercussions, but likely negates any positive ground secured to date and opportunities for a leading, meaningful competitive positioning in the market going forward.