Outsource Magazine

Prologue

If you think you’re business is not a global business and prone to global events, think again.  In today’s business world, it’s a much different place than what most of us were originally taught in Business 101 or even in our years of experience in business management.  Today, all of us are in a global market.  A global market does not mean that our end target market is global.  However, since our products or services require a global element somewhere in the business process, then we are in a global market and we are affected, impacted and even driven by global events. 

All products or services require some element of a global requirement.  The financial markets of the world can and will affect all of us, as will other global industries.  Even the most local or regional businesses out there are impacted by a global element.  Challenges from all around the world affect every individual and every business, whether you’re a business manager or a consumer.  At the simplest level, a prime example is the price of oil, which affects us all in daily travel, home comfort (home energy), food production and delivery, consumable production and delivery, etc.  As a business, it affects us in similar ways; affecting labour, overall production or operations, utilities (power, heat and air, brick and mortar, lights), equipment access and utilisation, transportation (receiving and shipping), taxes, supply chain (material access and others), production timing and much more.  And, if we think just about oil, the impact is huge, but, if we look beyond, it goes into the actual global countries providing parts of our everyday existence.  Think about the other products or services we use for business and consumer goods such as labour, business supplies, textiles, customer service, technical support, food (fruit, vegetables, meat, flours, spices, herbs, beverages) and many other items from global sources.

This all adds up to a global impact and has an effect on our daily lives and business.  It also affects our economies that drive prices, profits, production and operations and has an immediate effect on our ability to stay within the boundaries of our budgets and plans.  As business managers, these challenges affect our ability to make product or deliver service as well as our ability to support that product or service and our overall marketing capability.  A line manager might not see the detail but might be asked to make cuts in spending due to one or more of these issues.  A senior business manager or executive might see the cause, but the answers to the solution might not be apparent, especially if they were unforeseeable, unpredicted or unplanned.

Consider the global changes going on now in Egypt, Libya (and the Mid-East in general) as well as Japan’s horrific catastrophic events and challenges (Japan is the third-largest economy).  Even New Zealand’s earthquake, Chile’s from two years ago and Haiti from last year all have an impact on global business.  Think about the terror attacks in India which shut down many call centres in the US and Europe for several days two years ago.   Events can directly or indirectly affect our abilities for days, weeks, months and even years.  Events in China, Russia and any large populated and large economic area have the potential for a global impact.

As an experienced business manager, we must consider all of the geo-political, geo-economic and geo-environmental events.  Even the technology advancements on the consumers’ front-driving user behavioural modifications can drive changes both regionally and globally (consider smart phone utilisation in the larger economic zones and the impact from traditional phone usage). These global events and changes will impact us as well as how our competitors are handling all of these changes.  These events and the impacts will change competitive stack ranking, company valuations, brand equity, overall company capabilities - as well as suddenly steer companies in new or different directions.  This can affect overall market trends, buying patterns, customer attrition and retention and, ultimately, overall company performance and value.

Beyond the global events, there are business concepts we must, as managers, follow to ensure that success in our roles are met.  As a business manager, we have made commitments to those concepts and created business plans we must follow to ensure success to our company, which pay us our paychecks, reward us with bonuses or commissions and provide us and our families with benefits for life-sustaining requirements, such as health benefits, retirement funds and income for daily survival.  The question is: how do we manage these business concepts, plans and commitments within these ever-changing global influences and challenges?

Business Concepts

The three fundamentals of any good business are very obvious to most business managers:

• Have a good product or service that is competitive with other offerings, which is desirable at the market level because of some value proposition
• Develop and continually produce product or service within a controllable budget to ensure profit
• Support the product or service with customers to ensure customer satisfaction where they will buy and use the product or service continually and depend on the vendor of said product or service (resulting in Brand Equity)

Many others have touted much more complex plans and concepts, but the basic fundamentals here, if met, will ensure initial and sustainable business with customers and producers.  Anything less will not ensure the success and could eventually lead to failure.  With the ever-changing challenges and influences of a global economy and a global impact, one other concept must be added. That fourth concept is simply:

• The ability to forecast, predict and manage to global changes to the first 3 major concepts

Practice

Most experienced managers will read the Business Concept above and say, “tell me what I don’t already know”.  However, in experience, the practice of the concept is challenged by many other pressures.  In practice, most managers and decision-makers are often faced with personal fears of losing their jobs if the wrong decision is made.  This is not abnormal; however, sometimes it can drive one concept component over the others, which can drive the wrong decision or direction of the product or service.  I always followed an old adage in my own words: “to do what’s told is obedient and may be good for today, but if it’s not correct based on what you know, to push for what’s right is smart for tomorrow”.  This still works and, in most successful organisations, is a key to that success.

Boardrooms and CxO’s are only a handful of people far above the inner workings of a corporation.  The worker bees often know what really works, and not to elicit their knowledge and experience is like ignoring the sound of a flattening tire in your car while traveling at the speed limit.  However, budgets are typically the driving force; not necessarily resulting in a good product or the support of that product.  As business managers, the handling of these Business Concepts in an ever-changing global environment is important to the success of any company.

A great manager will seek out the balance and defend each conceptual component so that all are represented equally.  This is crucial to true success in products and services, which have succeeded and thrived in the markets in history, both past and present.

Summary

The key to survival in today’s business world is not that obvious.  It consists of an adoption of a global influence into our existing business concepts and practices.  This may mean major changes but, if planned for properly, can be achieved.  As an example, considering new technologies available from emerging markets can be important if it assists in turning one of the key business concepts into a lesser risk or even just a positive contributor to managing to existing plans if done properly.  This could be alternative energies or even virtual agents (artificial intelligence), or some other new technology, which could be a game-changer from your current practice of doing business.

The world around us is changing in ways none of us ever witnessed or probably predicted.  Considering news of global events is just not news, it’s a sign for us to be looking ahead as how it will affect us as business managers that is imperative.  So our reactions, predictions and planning of global changes must be incorporated into our plans and must be adhered to in our practices.

Success is within our reach during global changes, if we plan and react properly.  It will require good business concepts and solid practices directed by great managers with the ability to break away from the standard.