When choosing a business model, it's always a tradeoff between control and risk. Ironically, businesses create their own failure by withholding resources out of fear of failure.
Chicago, IL (PRWEB) June 30, 2010
After a “go-no go” decision has been reached regarding any one market, the next step is to consider how to enter that new market. In other words, what business model will generate the greatest success and move the middle market companies towards achieving their goals today and in the future?
The book will provide case studies as well as checklists as to how middle market companies can successfully compete in the global environment, make sensible decisions and overcome the challenges and barriers, mostly perceived by management, and realize success in global market.
" In response to a rapidly changing global marketplace, Middle Market companies must craft flexible business models that leverage the strengths from each global marketplace and that are suitable for their own unique capabilities. For instance, some may consider returning certain functions, like high-tech manufacturing in order to stay competitive. Then, collaborate with global partners on new ways of outsourcing, generating future innovations and product upgrades. Through this paradigm shift in mindset and strategy, businesses will create and foster a sustainable competitive edge", says Mona Pearl, Founder & COO of BeyondAStrategy, Inc., a Chicago based global business development firm specializing in the cost effective strategies for the middle market.
For many Middle Market businesses, globalization is a potential antidote to a shrinking domestic markets and a difficult home economy. But, not so fast. In any expansion effort, it is critical to ask and answer these key questions: Where in the global marketplace is the best market for our product/service? Why? What are the corporate goals for expanding across borders? What data supports these decisions? How does this global expansion fit in with the overall corporate strategy as it is today and as it should be tomorrow (i.e. as the company evolves and world trends and developments change)?
Before extensive due diligence is complete, many Middle Market businesses are hastily lured into specific global markets by competitors and a hunger for market share and quick profits. As such, they neglect to ask the right questions, do their research, gather data, and analyze that data carefully in order to establish a detailed strategy and comprehensive plan for international expansion. Erroneously, some businesses just assume they have to expand and fail to consider the long term versus short term implications of globalization. Consequently, over half of U.S. global ventures end in failure, and valuable resources are squandered.
The answers to these questions, and many others, come from gathering the right information from the right sources. It's easy to get misdirected or overwhelmed by the staggering quantity of available information. Stay focused on research that includes assessment of consumer demand, consumer profiles, competition, pricing, packaging, foreign regulations, shipping, and distribution to name a few. In addition, companies need to look internally at their strengths and weaknesses in relation to their action plan. That means evaluating corporate resources, manpower, internal knowledge and their own culture (perception, loyalty, motivation) before determining whether or not expansion opportunities are viable and warrant penetration into new markets.
No one business model is inherently right or wrong. Yet, when presented with a set of facts unique to one business and one global market, it becomes remarkably clear which business model will deliver the desired results. Likewise, it is equally clear which business model will only lead to trouble. Traditional business models like import/export, outsourcing, franchising, licensing, and joint ventures are still excellent options for today's economy; however, their ability to maximize the potential of certain markets may no longer be possible. After all, it's a new world order with new players and a new playbook that necessitates new tools like emerging business models such as innovation, collaboration and mergers and acquisitions (M&A).
" Unlike traditional business models, these emerging models are not mutually exclusive. It's a matter of blending different aspects of each model to customize an approach that meets the unique circumstances of the overall corporate strategy and prospective market. Choosing the right recipe is fundamental to success. There is no room for error. So, be prepared to do some homework. Start with an internal look at resources, commitment, experience, and goals. Then, look at the proposed business activities, market opportunities, competition, regulations, tax advantages and other key factors", adds Mona Pearl.
When choosing a business model, it's always a tradeoff between control and risk. Increased control requires greater financial resources, which in turn opens the door to financial risk. In addition to financial risk, there is what is known as market risk, which also needs to be assessed. It results from holding back the resources necessary to achieve success in the new market. Ironically, businesses create their own failure by withholding resources out of fear of failure.
Mona Pearl’s experience in international strategic development and global entrepreneurship has been vital in helping companies design and execute their global strategies. Ms. Pearl is known for her out of the box thinking and developing creative solutions to tough challenges which produce bottom line results.
Ms. Pearl founded and operated 3 successful businesses. From operations to organization to top line growth strategies, Ms. Pearl initiated and executed cost effective and creative opportunities for companies to make money across borders. From cultural due-diligence to integration processes in the M&A transactions, she helped companies increase global market share, enhance leadership and engage the stakeholders along the value chain. These activities led to companies growing their business across-borders, leveraging their global competitiveness and addressing diversity and cross-cultural issues in international markets.