Cost reduction is inevitably an important and- should be-ongoing issue, but to become a truly global company, enterprises need to be marketing oriented and address as well the opportunity of globalization by gaining market share even in highly developed and competitive markets like Europe and the USA. Here, the marketing keys to success are simple:
top quality – favorable cost performance – local market approach
The transformation from a national to a truly global organization can only be achieved if companies are capitalizing on new opportunities and new markets. “Think global and do local” is certainly an appreciated and common approach, but have to ensure that it will be implemented rigidly to avoid turning into a “Think local and do global” mindset.
If Japanese companies want to become more competitive in the export market they increasingly will confront the necessity to establishing their own sales branch and hiring foreign executive staff that can accelerate growth in key markets. Obviously, using a "one-strategy" approach to global marketing negates the flexibility needed to address the unique concerns of the market-place and regional business styles. This results in lost opportunities and failed products. The understandable concern of communication with HQ and financial control can best be ensured through the local support of an administrative staff delegated from HQ.
As Japanese companies compete more and more globally, they have to manage an increasingly global workforce and need to rely on executives with a global mindset to drive performance. Integrating different cultures within HQ will seize new opportunities and is creating an environment that allows senior foreign talent to contribute effectively. But at Japanese companies there is commonly a culture of lifetime employment and the focus is on seniority-based compensation programs, internal training and promotion systems rather than on merits only.
This will present a host of new challenges that need to be recognized to reap the benefits of a global workforce. Whereas large Japanese MNC (multinational companies) have commonly adapted their internal organization structure already, it is obviously more difficult for those small and medium sized enterprises that do not have the necessary resources. To benefit from the rapid growth of opportunities on the global market, those SME’s may want to set a regional/product focus and aiming to generate self-sustained growth in a certain and highly competitive and complex market, using it as a step-stone and expanding from there, following the rule:
“If we succeed in Germany, we can succeed certainly in other markets as well” - why not?
Japanese products are highly appreciated in Europe and covering those markets is best dealt with by having an on-the-ground presence. Not utilizing those favorable conditions means loss of opportunities which is hard to explain to any share holders.