It might be reasonable for a western business person to believe that their counterpart in Asia is professionally motivated by similar aspirations and goals, and that there is sufficient commonality between them to deal with a common problem in a common way. That westerner would be wrong. For this reason, European companies are often tempted to consider an Asia-based western partner, however Jari Hietala, Managing Partner for Asian Insiders discusses why this might be a short-sighted approach.

While Asia, as a continent and region, varies from one country to another as widely as does Europe, there are some underpinning cultural behaviours that are broadly consistent and understanding how this plays out in a professional context is crucial to strong partnerships with Asian counterparts. A westerner based in Asia may understand this, and certainly will make it easier for a western company to communicate and direct from afar. But is this really the right choice from the end-customers perspective?

A successful partner search in Asia starts with understanding how professional people in Asia think and how to engage business owners in a manner where commonalities weigh greater than differences. To know where personal and professional imperatives differ and interplay. Asian people operate in an environment that is more hierarchical and generally collectivist and many senior business people function in a context framed by long standing relationships, often from youth. They rarely make business decisions in a vacuum, taking only the success of their company solely into account. Even western-educated business people come from families with long standing local bonds and loyalties that bear on their decision making.

Asia has become a dynamic business environment, where 60% of the world’s population resides in an increasingly positive, active economic environment. Western businesses simply cannot afford to ignore the size of markets in Asia and the most difficult choice is where to start. Whether procuring, distributing or selling, local partners are critical to success. Local partners provide market access, local knowledge and expertise, and the credibility that extends through borrowed reputation and prestige. Local partners also assist to navigate local laws and regulations, connections with officials and networks while also ensuring support in local language and customs.

But which partner is the right one? How to assess them properly and not accept them at face value? How to assess their capabilities, their performance in present fields, their relationship to your competitors and most importantly, their performance against your total addressable market? A successful market search in Asia must measure candidates by a defined range of criteria and certainly not just by what they claim of themselves. Many partners in Asia are adept in preventing western colleagues from properly viewing their market, allowing only a favourable view of selected locations to support an ongoing contract. It is our strong recommendation that even following the appointment of a selected partner, that independent oversight is maintained to keep them performing and on target.

Often it is worth considering more than one partner in an Asian market, both to allow for differences between local provinces in dialect, local customs and connections as well as to offer cover if one partnership doesn’t work out. In some cases, such as China and India, the country is so vast that each province or local state has its own importing, licensing, operational and tax regulations and must almost be treated as an independent market.

A successful partner search in Asia must start with an independent review of the criteria by which an ideal partnership is identified. An ideal partner profile. What is their existing market position and who are their clients? Do they serve competitor lines or brands? Are they able to service your entire market by segment or geography or are there contractual limitations? What are their financial resources, their technical capabilities and are they committed to full aftermarket servicing? How strong are their relationships to government officials and the key players in the market? These criteria should be independently, and competitively assessed and its impossible to do this by a simple Google search and review of their websites. They need to be measured against local competence and capability and this can only be done on the ground, in the country. We recommend that such a search be done with a wide starting point, with clear tools and measurables, then fine-tuned to a short list for meetings and interviews. Take time to do this properly as unravelling an unsatisfactory agreement will be a major loss of opportunity and potentially damaging to future growth.

An ideal partner fit will include their realities as well. Their own aspirations and commercial objectives and also, the more nuanced local circumstances within which they operate. Their own commitment to transparent communications and a long-term engagement.

A successful partner search in Asia must include some home realities as well, particularly the home office resources required to implement then support the new market as well as executive and production capacity. As mentioned previously, it is recommended to deploy local overwatch, particularly to early identify weaknesses or failings in order to remedy these promptly. Key to a successful long-term partnership lies in the resources applied to regular communication, where partners are empowered to communicate over issues, opportunities or where local politics or governance may present later challenges.

Even a selected partner should be tested before full commitment, to ensure an ideal long-term match and this of course will include various forms of support and commitment from the western side to ensure complete uptake by the local partner. Much of this will all seem like common sense, and frankly, it is however the difference lies in the experience of the guiding Asian business consultant, the robust methodology and tools employed towards that.

We are available always to assist our clients in finding a successful partner in Asia. For a no-obligation call, please contact Jari Hietala, Managing Partner: jari.hietala(at)asianinsiders.com