In business, it is widely acknowledged that those companies best positioned to capitalize on their own sources of leverage – financial, human, and strategic – are typically the ones able to achieve profitability and scale the fastest and overcome obstacles with the greatest ease and flexibility relative to their competitors. Leveraging your company’s global assets, talent pool, and institutional knowledge will increase the chances that the business thrives and prospers in China; it is equally important, however, to remember that this is also a valuable, often untapped, two-way street. The China business can and should be positioned as a “growth engine” for your overall global enterprise.
Given the complex, fast-paced nature of the China market in which your subsidiary will need to navigate, much will be learned there in a short time frame relative to more mature, stable markets. There will likely be assets developed and fresh, new ideas generated that provide competitive advantage and strategic value for your company in its other emerging and, perhaps, even most developed markets in terms of talent management; the further development of organizational expertise and new business ideas, processes, and relationships; and product, service, and technology innovations. A recent article in The Wall Street Journal on Twitter Chief Executive Dick Costolo’s visit to Shanghai highlights how, rather than lobby for his blocked service to gain access to the China market, Costolo “may well be the first wave of Americans doing the reverse, coming to China to look for new features, business models, and even products that could do well if brought back to the U.S.”
On the talent front, providing growth opportunities for your most promising local executives to apply what they have learned in helping to lead other initiatives and business units across the entire enterprise will likely keep them more deeply engaged and motivated, continuing to contribute as outperforming, productive members of your extended team. Experience teaches that compensation comes in many forms – not merely financial reward – and that such career development opportunities and increased responsibilities within the organization are typically two effective motivators for high-achieving executives. This is particularly relevant when seeking to attract the most qualified talent to lead your business in highly competitive markets where the local playing fields always seem to be somewhat tilted in favor of the domestic players, whether deserving or not.
Honing your company’s ability to overcome external constraints and the inevitable obstacles along the way should make it more agile, pro-active, and sensitive to the market, its challenges, and opportunities. Further, customizing your company’s content, product, or service to the China market will inevitably create more efficient ways of getting things done internally and form new strategic relationships that may be capitalized on in other geographies and, perhaps, related industry sectors as your business grows and diversifies over time.
With an open mindset and the right systems in place to capitalize on this two-way street, your China business will not only be accretive to your company’s top and bottom lines, but will serve as a critical strategic engine to drive growth for your global enterprise in an increasingly global marketplace.