The world of global business development is exciting. Taking concepts, capabilities, capital and teamwork and turning them into profitable revenue streams, happy customers and rewards for the team. That is a worthy goal.
The rules/strategies for executing effective business development will often run headlong into the 800 pound gorilla twins: Bribery & Corruption. This is not meant to single out any one form of bribery or corruption, or any place in the world. These things happen everywhere, to varying extents and sometimes in subtle ways.
Bribery can be defined as either giving or taking something of monetary value from another person-of-influence, in order to gain an unfair advantage in a transaction, and to create an uneven, opaque economic playing field. Corruption is related, but can be looked at more broadly as the abuse of power by an individual or group to obtain a benefit not available to others (fellow citizens, common shareholders, etc).
This blog post is really meant to help those of us at the “sharp end” of the knife of business development-strategy and practices-to be alert and wary. We have the point, and many others are dependent on what we do and say. This is also this blogger’s personal opinion based on experience around the world over the last 30+ years.
When you are scouring the globe for business, inevitably you will run into the twins.
So, how should one deal with this global problem?
Well, in no particular order one can look at it this way:
- Corporate Capabilities and Innovation – How does my business differentiate itself in the world? Do we have unique strengths (benefits, cost advantages, brand perception, etc)? This matters because a perceived advantage can be used to effectively reduce and nullify competitive threats, and to combat negative business practices. If we really do not have any major advantages, then it will become extremely difficult to succeed without resorting to other unofficial means.
- Due Diligence on Entering Specific Markets – In the search for new growth, companies can blunder “lemming-like” into markets with their heads down and get knocked out cold. Has your company effectively assessed the rewards and risks of entry into certain markets? Limit reliance on third-party experts – get your own feet on the ground and get a sense as to what the business terrain, opportunities and obstacles really look like. Is it really worth going into Market A or Market B?
- Corporate Standards and Board Governance – The standards by which your company and board behave are critical to your success and career/personal reputation as a developer of international business. It is not what is written and posted on the website in terms of Ethics, Integrity and Code of Conduct, but the actions of the Directors and the Officers of your company that matter the most. How do they guide and assist you in winning new business under difficult circumstances? Sure, we are always under pressure to win new business and that is to be expected. However, when you run into the gorilla twins does the board have your back? If yes, then you have a chance to respond and innovate and develop positive approaches to winning the business. If no …. Well then what to do?
- Understand The Laws and The Legislation – We all need to understand our native country’s rules with respect to bribery and corruption as well as those of the markets we participate in. The various official anti-bribery acts of countries such as the U.K., Canada and the U.S. are very aggressive. “Buying the business” as opposed to “Selling the business” is very bad for business. So, it begs the question – “Why do it in the first place?” This is not a naïve question. Far from it. In terms of the big picture, bribery and corruption hurt everyone. Our margins, our reputations, our citizens and our trust. Those are all bad for business.
- Your Own Personal Standards – Each of us needs to understand how to confront the issue discussed above. The solution each person chooses is a personal one in the end. My advice would be to find a way to sleep well at night knowing that one had sold the business in the most professional, transparent and competitive manner. Make that your brand and you will have an edge no matter where you go.
If you liked this blog entry, you may like to attend our upcoming “Emerging Markets Risk Management” webcast seminar on Thursday, 25 June at 11am (Eastern-New York). It covers several of the issues discussed here and other topic matter of interest to Board Members and Senior Management. Click Here to see the details.