Five More Mistakes When U.S. Companies Go Global
By Guest Contributor, Philip Auerbach, President of Auerbach International Inc.
With two oceans on both sides of U.S., an enormous domestic market and another English-speaking country to our north, many American firms forget that expanding overseas is a great way to increase their revenue. But global expansion has to be done correctly and guided by professionals who are experienced and knowledgeable.
A previous article presented five common mistakes that U.S. firms often make. This article presents five more. These also can be prevented if companies do their homework.
6. Not relying on contacts and introductions
When Americans are seeking an overseas distributor, they might search the Internet and contact someone abroad. In most cases, that method will not work because there is no personal relationship. Most business overseas is facilitated through personal contacts: family, friends, schoolmates, and other business colleagues. Without personal referrals and formal introductions, you will rarely break through the invisible business barrier.
If you have no contacts or prior experience, it’s best to rely on a global consultancy with extensive reach and industry specialists in many countries to facilitate the needed introductions.
7. Not translating your brochures, manuals, contracts, etc.
A survey by the independent Common Sense Advisory concluded that:
- 72.4% of global consumers indicated that they prefer to use their native language when shopping online.
- 55% of global consumers said they only buy products from websites that provide them with information in their own language.
- 56.2% of these consumers said that obtaining information in their own language is even more important than price.
Whether your product is B2B or B2C does not matter. The impact is the same: Unless your brochures, guides, manuals and website are in the host country’s language, most natives will not bother with you. Would you buy a product if its user manual were only in Bulgarian? And Best Practices are for the U.S. company headquarters to manage the process using a professional language agency, and not to rely on overseas distributors to do it for you. Translations represent less than 1% of global business expenditure, yet most firms either ignore it, outsource to agents, or rely on translation software…. each of which is a mistake in itself.
8. Ignoring the need for in-country, after-sales service
Would you buy a refrigerator, a computer or a sound system if the manufacturer asked you to send the product back to China for any needed repairs? Of course not. Similarly, selling products in any overseas market requires that you have an after-sales service operation in that country or region with the repair technicians speaking the local language and working with translated product manuals.
If you are selling software or services, it is best at least to provide some way to handle customer queries posed in the local language. That too is how your trusted language agency becomes an invaluable partner.
9. Ignoring the work environment of foreign employees
Especially in East Asia, company employees are expected to gather almost every day after work at a local bar for drinks, with binges not ending until 9 or 10pm. Drinking along with the group is part of doing business. If your religion or values prevent you from imbibing, you can say that you are allergic or that the alcohol will interact badly with some medication you must take. It is at least important participate in the social activity, drinking water or juice if necessary. That is part of the company ritual to establish relationships and build trust.
Similarly, Commonwealth countries may serve office tea around 3 or 4pm. The office hours may be longer or shorter than in the U.S., and in most countries, the work load is not as intense and harried.
Europeans take longer vacations than Americans. But if East Asians take their allotted vacation time, they may appear disloyal to the company. This trend, however, is changing as younger people increasingly value personal time with their families and fewer are hired on life-long or long-range employment contracts.
10. Not respecting foreign firms’ hierarchies
Americans at their core think that all people are equal. Abroad, that thinking does not apply.
As discussed in Mistake 5, status and hierarchy are alive and well in most countries. Executives and business owners would not think of socializing with secretaries and junior managers. Shaking hands when entering or leaving the office every day is often part of the expected cultural ritual.
Learn in advance whether your host country expects employees to “kiss”, bow or shake hands when entering and leaving in the morning and evening.
In high-relationship cultures, people take the time to get to know or know about employees’ families and plans. An American returning from vacation might give a perfunctory five-minute summary. But elsewhere, such discussions are longer, co-workers show interest, and the process fosters commonality and relationship-building connections.
While Americans would close office doors for private discussions, many office doors remain open with an expectation that co-workers can enter to chat, ask questions or seek assistance. That practice rarely happens abroad. Office doors simply stay closed during the day with entry to higher executives granted by prior appointment through their assistant.
If the host country’s language has a formal form of the pronoun “you” [such as Vous, Sie, Usted, etc.], that is used when addressing one’s office superiors. Using the informal “you” is totally impolite, inappropriate and grounds for ostracizing … unless you are invited to do so.
Similarly, most U.S. firms sincerely or for show seek to solicit everyone’s input on important matters. Abroad, however, most cultures assume that managers make the decisions and staff is there to implement them.
As with any new experience, working and selling abroad can be frightening or exciting. Once you learn the basic rules and some in-depth customs, your venture is likely to succeed. But just as you would not entrust your broken car to your dentist for repair, always rely on professionals who can guide you through the process.
About the Author
Philip Auerbach is President of Auerbach International Inc., a global marketing consultancy and award-winning language agency. Since 1990, they have put all kinds of content – websites, manuals, books, guides, PPTs, conversations, etc. – from or into 80 languages using professional linguists, and have helped U.S. firms successfully navigate overseas expansion.