–No nation was ever ruined by trade.
The world economy has become increasingly interdependent and in recent decades the process of globalisation has accelerated due mostly to trade liberalization, increased labour, capital mobility and the internet revolution. New opportunities are emerging constantly and as part of this process new markets and new players are challenging current business practices.
But how do companies, especially small and medium-sized enterprises, which lack the resources and global structures of larger groups, go about circumnavigating the troubled waters of slowing economies and depleted sources of financing, in their search for growth wherever it may lay?
After many years of involvement in trade development and export promotion, Claude Cellich and Michel Borgeon, professors at Geneva-based International University in Geneva have a clear view on the past, the present and the future of the tool box available to companies seeking to widen their horizons and discover new markets.
In 2012, they co-authored “Trade Promotion Strategies – Best Practices” (Business Expert Press) which critically delves into the best available practices and descriptions of those organizations that are meant to support export-oriented companies.
During a recent conversation at the International University in Geneva campus, Messrs. Cellich and Borgeon sat with Swiss Style to outline these solutions. “Growth for companies is becoming a constant challenge that needs to be addressed in a consistent manner”, explains Prof. Cellich. “When companies reach limits to growth in their own country or comfort zone area, they have to look outside the borders to further develop their business.
But by contemplating the entry into an international market outside their comfort zone, they face multiple challenges”.
“Language and legal considerations are just part of the problem”, adds Professor Borgeon. “Issues such as lacking knowledge of networks in the target market, facilitation to identify and meet the right partners and finally receiving the right support to translate opportunities into real business leads are major hurdles”.
Both academics agree that going it alone can be an important risk: firms pursuing cross-border economic opportunities must engage in a costly process of identifying potential partners and assessing their reliability, trustworthiness, timeliness, and capabilities. Although diplomatic foreign missions and trade promotion organizations, by informing on foreign markets and disseminating information on domestic products, may contribute to overcoming this problem it is much more productive for the firm to participate in national trade promotion programs designed and implemented with government assistance. Most Trade Promotion Organizations (TPOs) are either fully financed and controlled governmental organizations or public organizations under government control, with only a small proportion being operated as private organizations. They can be local, regional or national, with national TPOs providing the most important role in coordinating and managing national export strategies.
In the past though, this type of assistance too often resulted in very sporadic and uncoordinated involvement of the business community and of non-trade related government agencies. But for a TPO to be strong and effective, it must be the product of a coordinated effort by all interested parties and be linked to other economic and developmental initiatives in order to fulfil its mission.
“In recent years” explains Claude Cellich, who is also a guest lecturer at various trade promotion organizations and universities, “we have witnessed a significant shift from traditional promotional activities to innovative trade tools, instruments, and measures. As a result of increased globalization, the Internet revolution, and intense competition, TPOs have been forced to restructure and reorient themselves to remain relevant and to stay abreast of an ever-changing commercial environment: they are retooling and recalibrating for the future, reflecting the need to provide exporters with sophisticated and targeted advisory services to compete successfully in foreign markets”. Michel Borgeon, who has been involved in trade promotion for over three decades, mention that “TPOs have proven their worth over the last decade in the rapidly changing nature of world trade. This is demonstrated by the experiences of countries with successful exports, many of which have strong centrally organized national TPOs: the Japan External Trade Organization (JETRO), the Korea Trade Promotion Corporation (KOTRA) and the Singapore Trade Development Board.
The higher the hurdles, the greater the value TPOs can deliver. They can guide guide their companies into the most appropriate sectors and highlight areas of national competitiveness, and enables exporters to gain access to foreign markets.
The co-authors believe that TPOs can also assist in accurately assessing the market-readiness of potential exporters. “It is instrumental and vital if resources are to be used effectively” clarifies Professor Borgeon, “for companies to ensure that they are objectively ready to make the leap into foreign markets. This can be done skilfully, as in many cases one is dealing with ego-driven entrepreneurs who may not take kindly to what they may consider direct criticism”.
Claude Cellich clarifies this point: “A means for providing efficient advice while removing this subjective part of the advisory role of a TPO is to use computer software, in order to identify potential deficiencies of a given company. For example, some TPOs in Canada and Australia provide self-assessments online, which are useful because they take participants through a step-by-step process that uncover key issues which may have not even occurred to them.
According to the KOF Swiss Economic Institute, Switzerland is one of the most globalized countries regularly ranking amongst the top 5 of their surveys. Although considered a somewhat conservative and risk-averse breed, Swiss companies, large and small, have learned to grow outside their limited market, with SME’s often choosing the less challenging course of trading with neighbouring countries. Perhaps not surprisingly, export sentiment among Swiss SMEs at the start of third-quarter 2013 is the most optimistic it has been since mid-2011. All sectors are expecting a rise in exports. One reason is the positive impact of the improved economic situation in the euro zone but more and more firms are expecting growth to come from Japan, the US, Eastern Europe and the major emerging-market countries.
Recently OSEC, Switzerland’s better known TPO, was rebranded as Switzerland Global Enterprise with “Enabling new business” as its value proposition as well as its motto. Apparently, this is one instance were marketing DOES reflect reality.
International University of Geneva’s New MBA/BA Programs
The International University of Geneva (IUG) reached a new milestone in 2013 by being included in the Higher Education guide International Handbook of Universities (IHU) published by UNESCO and the International Association of Universities. In an effort to offer more diverse programs as well as providing a an practical learning experience, IUG is now offering three new programs as of this September, two graduate and one undergraduate: Master of Business Administration (MBA) in Entrepreneurship, an Master of Business Administration (MBA) in Sales & Marketing, and a Bachelor of Science (BS) in Computer Science.
The new MBA programs reflect current management trends geared towards company creation and sales development. The MBA in Sales & Marketing is designed for professionals who wish to progress their career in sales within a merchandising context. The program builds managers who master the marketing and sales process, including how to design and manage successful strategies.
The MBA with a focus on Entrepreneurship is designed for professionals who wish to redefine the way of doing business. This focused MBA supports entrepreneurs who wish to develop their entrepreneurial skills. The program addresses all the challenges of following the entrepreneurial path: generating new ideas and managing innovation, financing start-ups, bringing new ideas to market and leading the business successfully.
Along with the MBA programs, IUG is launching a BS in Computer Science. The program is designed for high school graduates interested in pursuing careers in information systems programming and IT management. The program covers all key aspects of systems analysis, design, implementation, testing, deployment as well as IT services, security and project management. The key benefits of the program will be the learning in a dynamic environment in Switzerland with a multicultural student body and faculty from academia and international business thereby gaining an effective, comprehensive understanding of information systems design and programming.
Following this launch of new programs in critical areas in business, IUG’s new programs should prove to attract more students in their new school years as the University provides educational opportunities with a global outlook.
Article by Raymond Langley