I’ve been very interested in the challenges and opportunities companies face as they envision expanding out of their home or core (geographic or focus) market area. We certainly see a lot of them as they spread their wings and eventually come across NPIcenter in one fashion or another, and I’m sure that many of you have seen new industry entries at the various events. Whether it’s a research group with a new idea, a venture fund with capital to invest, or a CPG company looking at healthier alternatives, these organizations all require expertise and a logical industry entry point - the sooner the better, to minimize waste of resources and to prevent disillusionment or distraction from occurring.
Technology transfer sessions, summits and the litany of industry event opportunities are likely the first exposure these organizations will have. They’ll acquire market data, some sector reports and industry publications and typically begin asking questions about industry opportunities and paradigms. If there are language issues, chances are the road to success will become more difficult with several false starts as these organizations attempt to reach legitimate industry facilitators. In a few select cases, these companies will interact with visionaries that really understand what the group can and is trying to achieve in the new market area. In many cases, a short term, rush to market will only result in frustration. It’s ironic to note that at the same time as industry is crying out for new ideas and an innovative spirit, across the show floor, companies waste resources serving up ‘x’ to an audience that wants ‘y’. This happens in many sectors, so we are not unique in this. We are however unique, in that we are part of a small enough community to have visibility on this issue.
At WorldNutra in Anaheim, California this past week, I was struck yet again by the fact that for many of the attendees, it is the only show in North America that they attend. The number of visitors from Asia (Japan, China, South Korea, Vietnam) was very impressive and the interest in international business opportunities, in all types of relationships, was staggering. The quality of science presented was top-notch, if in some cases a bit removed from market viability. And in one specific case, an impassioned plea was made for Western-style innovation to team up with Asian-style execution to create new market opportunities to capitalize on the aging population trend we see right around the globe.
Some in the industry have expressed frustration at lack of market opportunity as a few sub-sectors languish. Many have complained about the lack of a blockbuster product to sell to clients. Having a blockbuster makes things easy – maybe too easy. It allows companies to ride the general hype rather than being creative and ingenious. It allows organizations to persist in their strategy of isolation, commoditization and a mix of tunnel-vision and short term thinking rather than exploring differentiation, value-add and non-obvious alliances that truly lead to sustainable business growth.
Many of the groups considering entry into the ‘space’ or considering expanding abroad have a unique and valuable offering or capabilities. The challenges they face, though, are multi-fold including:
1) identifying the right partner(s)
2) getting the ‘right’ snapshot of the opportunity including a practical execution timeline with milestones
3) crystallizing the vision into the proper sector context
Finding the right partner, whether it’s for compliance, marketing, sales or finance, is obviously imperative. Many companies fail at this step because they don’t know the questions to ask. Others fail through mismanagement and miscommunication of expectations.
Have you ever asked a question and got back exactly the answer you wanted to hear, even though you suspected that was exactly what was happening? The same behavior prevents companies from obtaining the ‘right’ perspective of the business opportunity which may or may not exist. In many cases, too, companies do not establish a relationship plan with strategy and milestones, rather considering deal execution and a few minimal performance criteria to be all that is required.
Sometimes, vision doesn’t translate. Sometimes vision needs to be applied. Successful relationship partners understand that a business plan needs to be massaged rather than driven into a vision.
With international trade and communications continuing to grow, with the pace of information exchange accelerating, and with organizations seeking new ways to compete and build their businesses, new success factors are emerging. We’re seeing these factors manifest by new inquiries and participation at some industry events. Companies destined for success will develop strategies to leverage these opportunities better than their competitors. Predictably, like-minded companies, grasping these concepts and working together will smash their opposition.