Wednesday, March 28, 2012

Developing MicroMutinationals

Let us consider two recent issues around Human Resources and new employees;

1. Submit your facebook password

2. Remove your resume from Linknd.

As a new employee what would you do?

As HR would you make such demands?

In my opinion HR needs to evolve into a consultant to the business with clear understanding of business growth while matching and recruiting personnel to meet those needs. Otherwise HR should face the axe in most establishment.

Micro Multinationals is a term used by Google economist Hal Varian; meaning small companies operating globally. I guess it is a good season to be an enterprenuer.

With mobility, internet access and cloud computing even the smallest companies can now afford the communications and infrastructural requirements that would be an envy of any bluechip company few years ago.

As mature economies continues to stagenate the biggest risk may be over reliance on domestic demands. Businesses and small companies need to look particularly at emerging markets (BRIC) and fast growth markets (Poland, South Africa, South Korea, Mexico and Indonosia)

The rising middle class promises sustained business growth and an opportunity to tap into a large consumer base; It may not be an easy leap for new entrants because business models for emerging markets are yet to be developed but keep the following in mind:
Go where your customers are going - Global wealth is moving from west to east

Use familiar territory as springboard - For intance if starting business in Asia, it might be a good idea to launch from HongKong

Reverse Innovation - Your approach to product development is critical, where products developed for emerging markets can be adapted to domestic needs

Leverage local Partners - Partnering with local knowledge and talents can boost competitive advantage

Perform Due Diligence - There are institutional voids in emerging markets, such voids can be both an opportunity and a risk, it s a good idea to watch where the big players are expanding.

According to PWC; Here are a few challenges you may face, finding the righ business partner 68%, cross cultural management 63%, finding adequate local talent 56%, security risks 49%, local regulatory requirements 48%, corruption 46%, local tax policy 42%, poor infrastructure 39%, supply chain 38%, contract dispute 36%, protecting intellectual property 32%.

With the challenges covered, what is the risk/ reward ratio?

Like the biblical lepers at the gate "if we stay here we would die, if we go we could die or we could live"

My Advice - Go