CHAPTER 13
Staffing the New Market THE FIRST STEP BINDS — FRENCH PROVERB
ONE TO THE SECOND.
may be crying out for a producer’s goods and services with cash in hand, ready to make purchases, but that same producer still faces risk. Preparing to enter a market requires that the marketeer prepare for the next step, which is managing the market. The same techniques and personnel that were used in the domestic market may be only partially suited for the foreign project. Proper selection and training of personnel, along with suitable direction from headquarters, will determine a company’s long-term success in a foreign market.
THE WORLD’S MARKETS
Personnel Restrictions: Your Country, My People All governments have restrictions on foreign persons visiting or working within their national borders. Additional restrictions are placed on foreign nationals owning or operating businesses within those borders. International companies are faced with the choice of training local management and staff for work with the new product line or using personnel from their domestic market to fill positions in the new foreign project. Added to this is the local governmental regulation of how many and how long foreign personnel can be used on a project. And as a market “heats up,” marketeers will also find that competition for competent local personnel adds another variable. (Four out of ten local management positions available with foreign companies in Vietnam go unfilled because of the lack of local talent.) From a small trader wanting to set up a representative office in Caracas to Microsoft setting up a programming facility in Bangalore, personnel restrictions are a universal problem in international business. A company preparing to operate overseas can negotiate a variety of deals with local governments to ameliorate this situation. Under normal circumstances, governments impose regulation in order to protect their human and natural resources from exploitation. Even powerful economies like the United States hound Japanese companies working in America to allow more locals into the upper echelons of management. Marketeers requiring the extensive use of their domestic personnel due to product or distribution complexity should negotiate the project on the basis that locals will be trained for promotion over a reasonable period of time. This may also involve a technology transfer or management training for local managers sent back to the marketeer’s domestic market. Another avenue to pursue is that of tax relief (or “breaks”) to cover the inefficiencies and cost of training local staff during a project’s early stages. Most governments in undeveloped markets prefer this latter choice because it puts their population to work immediately, not at some later (perhaps years) date.
144
