According to a recent study by Telstra Global, the multinational companies that do the best across multiple countries in Asia are often American. For professionals across all countries, the full report provides thought provoking analysis on company, senior executive and employee behaviors that help the Asia Business Champions identified by the report succeed across the Asian continent. Telstra’s Connecting Countries report on how companies and executives are maximizing opportunities in the Asian century synthesizes interviews of over 4,100 business executives across Asia into nine lessons multinational corporations can apply to their business practices in Asia.
Tom Homer, Head of EMEA and the Americas for Telstra Global, says the report reveals that top performing multinational businesses in Asia “are better at managing cultural differences and get the mix right between global and local.” The report’s Asia Business Champions are “the top 5% of businesses that are operating within the survey group.” While some points elucidated by the report may seem obvious, it is also clear from the report that all business are not executing to the same standard. Roughly 50% of employees at Asia Business Champions expect to stay with their employers in the future compared to 35% among other companies in the survey.
Telstra, an Australian-based telecommunications, media and consultancy corporation used multiple controls in the study to ensure a lack of bias to provide the best advice. Interviews were conducted in local language outside the workplace in restaurants and private settings that put interviewees at ease. To select a good mix of people to interview, Telstra employed market research firm GMI. Half the results came from Asian businesses and half the results came from multinational businesses based outside of Asia. Mr. Homer explains Telstra’s rationale for compiling this report:
“At Telstra, we have a large number of employees across Asia. It’s an issue for us as much as anyone else. Our raison d’être is to serve the needs of multinationals from the U.S. and from Europe that are growing into Asia and out of Asia with information and communications technology (ICT) solutions. The reason we undertook the survey is because we feel the better we understand our customers, the better we’ll be able to fix any problem they have from an ICT point of view.
A lot of the report resonates with us because we’ve been growing our business in Asia for the last few years so it is really good for us to validate some of the things we’ve been doing and learn a few things ourselves.”
One of the most interesting findings in the report is that soft skills, the right personality traits and communication skills, are more important than experience, knowledge or local language skills to being a successful senior executive in Asia (Executive lesson #2). This does not mean hard skills, experience, knowledge and technical skills, are not important. The priority is finding the right blend of soft skills and hard skills in multinational executives whereas one could focus simply on hard skills for a company operating in only one country or region.
Among the many challenges for multinationals noted in the report, many come down to some form of adapting business practices to local cultures and local ways of developing business. It is important to find the right mix between local and global talent. Explaining the value of communication and soft skills, Mr. Homer noted an Asian executive that described himself as an interpreter of his local office to their global headquarters, not linguistically, but culturally.
“Our report tells us that awareness is important and the characteristics of certain leaders in the most successful businesses are resilience, curiosity and creativity. That means you have to be tough. It means you have to want to learn more and understand more. Applying this to operating across different geographies, the more you want to understand about each geography, the more likely you are to be successful there.
If you’re curious and creative, you’re willing to accept your answer isn’t the right answer. It’s about listening and not arriving with a predetermined answer of what you’re operating model should be or what your style of communication should be.”
Two other important factors in the report were length of contracts and the value of face-to-face interaction. The length of the contract is key to making people “feel local” and fully vested in where they are even if they are from a different country. This is not a one-way street and global businesses need to bring Asian executives to western countries on long-term contracts just as well as they need western executives in Asian countries on long-term contracts. Each piece of the corporate structure enhances communications throughout the company.
As Telstra provides telecommunications services including video-conferencing, the importance of face-to-face meetings presents an interesting question. Telstra has expertise with high quality video. Both quality and reliability of video are key to its successful usage. Based in London, Mr. Homer uses video conferencing regularly with colleagues from Hong Kong to the United States which helps limit the time he spends traveling to interact with personnel face-to-face. That said, Mr. Homer gives his candid opinion that:
“The best way of engaging in a relationship in the first instance is face-to-face. I believe there is still a fair amount of weight placed on that by people in Asia, absolutely. You need that in order to create the relationship. Once that relationship is created, it’s much easier to sustain using video, voice, Skype and other communication tools.”
In the nine lessons of the Connecting Countries report, there are lessons for Asian, European, American and all global businesses on best practices for growing a business within Asia. The good news for American and European businesses expanding into Asia is that there are models of success, Asia Business Champions, from their regions. For Asian businesses scaling up to becoming multinational companies the road map for expanding is clearer. There is no one-size fits all solution to doing business in many countries across Asia, but Mr. Homer emphasizes, “The fact that you are aware that you need to adapt your style – your business operating model – according to the geography that you are in is absolutely the first step.”