We had the pleasure of being called upon as Speaker by the Sorbonne Symposium association during a symposium on the theme of globalization.
Why did we arrive at globalization as we know it today?
One of the main reasons is that the United States, from 1982, wanted to change the world and adapt it to their own needs, especially with the Reagan-Thatcher agreements. The movement of capital has been allowed, and all immigration has been restricted: there has never been such a small movement of labor factor than today with globalization.
On the one hand, there are global imbalances: the rich countries are now indebted, a debt so important that it sometimes exceeds the GDP for certain countries.
On the other hand, poor countries are becoming the lenders, a phenomenon that has been observed for only twenty years.
Another explanation is that the world economy is affected by the dollarization of the planet, which is the currency of the most indebted country vis-à-vis the outside world. The consequence is that the policy of the Federal Central Bank becomes a world policy, affecting the entire global economy. The United States therefore remain leaders despite the crisis.
Moreover, wages in the Western world have never been so low in GNP. Paradoxically, profits seem to be at an all-time high. The climate has never been so calm and people do not seem to revolt. For what ? Because we are experiencing an aging of our population. There are many departures to the retirement, especially in France and Germany, and this is one of the factors that makes unemployment much less galloping. The time will also come for China to experience an aging of its population in a few years. We are going to witness a rise in the power of nation states that had been neglected until now, and with less liberalism.
In a globalized world, what are the balance of power?
A priori, “American imperialism”, where the archetype remains the McDonald’s fast food chain, imposes a
homogenization of product consumption. However, brands are changing their marketing strategy by changing logo, color, using international celebrities or by placing their products in blockbusters popular movies to make themselves known globally.
Moreover, what about the evolution of consumers? Are they local or transnational? “Think global, act local” is a leitmotif of these years, encouraging people to consume local, organic and ethics.
Faced with the explosion of these phenomena, the Europeans governments responded by launching the
“product made in …” in order to stimulate exports and improve the reputation of national products. Certainly, being “French”, for example, helps to sell, especially in the field of cosmetics. However, outside France, this French label is often used excessively, particularly by foreign companies.
Is the “Made here” label so important?
We all agree that this label has little or no impact, unlike the world of luxury and fashion. What remains predominant is the product quality. However, the adaptation of goods and services to the world demands is an aspect not to be overlooked. It creates the development of local production, plants, industrialization in order to reduce the impact on the environment, as well as a presentation of the offer in many languages.
What is the role of emerging countries?
There is a real westernization of the world but we points out that people appropriate Western culture by mixing it with their own culture. Just look at the Television series which are based on the American model. There are many commonalities between the countries but there remain notable divisions, particularly in technology.
We shall divides technophile and technophobic countries, in particular in relation to the rate of digital mobile equipment which is around 10 to 15% in some technophobic countries, while the Americans, technophiles, are 85% equipped. One thing is certain, there is no vital need for capital, nor to be American to be known worldwide.
A service offered only in English in the BRICS, a major consumer of high-tech products, is a mistake that amounts to 90% loss of potential users of their products, software, applications, services. There are consumers who are more committed than those in theindustrialized countries and it is therefore essential to adapt to them. It is important to conquer these countries – with large populations and economic growth – taking into consideration their financial impact on the cost of raw materials. Beyond the adaptation of the products, it is necessary knowing how to adapt one’s own structures.
It leads to niche marketing?
We have to distinguishes B2C from B2B. In the first case, it is possible to have mass marketing: for example, everyone can have the same application. However, in the second case, it is absolutely necessary to position oneself in a marketing of niche and be very specific in relation to the need that is being met, such as the uses of the product and the message conveyed.
Notwithstanding, we prefer to proclaim the death of mass marketing. Content and cycle of products are constantly adapted fortnightly, something market leaders have understood. It is also possible to talk about
product ecosystem: each universe captures the needs of a specific geographical area.
Nevertheless, it is impossible to customize a product 100%, because it would drown any business in cost and labor.
What is the message for future international marketers ?
In the world of start-ups, you have to engage internationally from the start because it is possible to do so at low cost, especially in the digital world: communication is done in English and you have to travel because “the world is a village”. We must highlight a little-known element : the customs code. This allows you to know the companies that import or export the products that concern you. So you have to do market research and go where you have the best chance of winning. On the other hand, the simplification of presentations is an undeniable aspect. Forget the boring PowerPoints: get straight to the point and talk about the customer’s problem instead of talking about yourself and providing an answer. These are the keys to success.
What place does the brand occupy in globalization?
We can respond by defining the brand as a response to a need for emotion, pleasure. To break through, it must pay attention to its e-reputation, while setting up quality and environmental standards. Furthermore, a global brandmust include a diversified strategy according to the markets: the company adopts either an innovation strategy or a diversification strategy (higher quality or low-cost product) compared to its competitor, the ideal being to juggle these strategies. To become global, many companies are applying the white label strategy. For example, Tech start-ups makes themselves known via the App Store thanks to SEO. By typing dedicated keywords in search engines, one can easily find their applications, while this sector is struggling to make itself known to the general public despite its 20 years of existence.
Should we rather favor standardization or adaptation?
We emphasize the importance of the language choice to offer. Communication is naturally in English to reach the most possible people, but the multilingual versions are gradually growing in, thanks to its efficiency and low costs. It is essential to adapt by integrating the subcontractor’s design office into the client’s one, thus gaining in terms of efficiency and eco-design.
The intercultural dimension in a negotiation.
This dimension has, depending on the country, more or less influence on the purpose of the negotiation. Several parameters must therefore be taken into account here: the importance given to bargaining in commercial relations, the relationship to time which will determine the speed of progress of a negotiation, both in discussions and in decision-making, but also the relationship to standards and hierarchy.
From this last parameter, the relationship to hierarchy, results the value given to experience and the importance given to human relations, varying completely from the Americas to Asia for example, with a changing definition of the notion of trust between partners.
In any case, there are two golden rules to follow:
- You have to listen, which is the first quality to have as a negotiator.
- You have to be flexible and open-minded, to be able to adapt to changes while showing firmness because the goal is above all to achieve one’s ends.
Despite everything, we must be vigilant because clinging to a goal can also make us miss out on great opportunities, especially in certain countries where trading partners are often unpredictable.
It is absolutely necessary to seek a good agreement with your partner, which brings us back to the notion of listening, which is essential in order to be able to meet the expectations of your client, who is often the first source of information for the negotiator.
Moreover, a good negotiator has strong interest in adopting a cooperative attitude if he wants to establish a long-term relationship with his partner. However, a he is above all one, who, at the end of a negotiation, will leave with his signed agreement and for that he will have to be both realistic and pragmatic.
Is there an international negotiation language?
There are two profiles here: “formatted” negotiators because they have integrated a form of international culture by studying in Western countries (this is particularly the case in many Asian countries) and those who have learned in the field and who unconsciously apply this international culture and language.
There is a key and cross-cultural element: the desire to do business.
Regardless of his origin, the negotiator will have as a priority to sign his contract. So there is a universal way of thinking about that. The cultural dimension, habits and customs of the host country, will only influence certain details of the negotiation such as the place for example, as in India where one can negotiate in a living room around a tea.
In international negotiations, who adapts to whom?
This question is recurrent insofar as everyone wonders why it would be up to them to adapt and not to their partner. To use the notion of pragmatism, it is often the person who has every interest in seeing the contract signed who adapts, even if in the end it is often the two parties who make the effort. It is important to be respected, and, beyond respect for the culture of the other, what will count is the relationship that will be established between the negotiator and his partner. It is therefore necessary to adapt according to the balance of power with your partner.
Egos always play an important role in this case, and especially on the fact that depending on the negotiator objectives, medium and long term, the compromise is not necessarily a bad thing. A good marketing strategy is helping the negotiator since, in some cases, carrying out a simple market study can be a game-changer.
Is the pressure of the balance of power changing?
It is above all the product, its competitive advantage and its added value that count. The importance of preparation is key for a negotiator. It is indeed important to be well informed about your partner, to know his national and corporate culture, to learn some facts and key figures in the history of his country to be able to feed a banal conversation which could turn the negotiation in your favor. You have to be modest and prepared, but at the same time remain vigilant so as not to let your partner taking you down.
You shall avoid national ethnocentrism at all costs and adopt an objective position in relation to your culture of origin. Never forget that “racism” rife in certain regions of the world with regard to other origins. On the other hand, in the case of certain industries, it would be in your interest to claim your origin which is part of your added value abroad and can also be a guarantee of quality for your customers in the face of other countries offering similar products at lower costs.
Is patience a fundamental negotiator quality ?
Considering the costs incurred by traveling abroad, it shall be indeed. The notion of adaptability is important. Patience is undoubtedly the best weapon of the international negotiator. You must differentiates between two types of country here.
- There are therefore countries that will prioritize the accomplishment of the task and in which the negotiation generally does not last long since everyone is focused on the points to be discussed and the signature of a contract.
- There are also countries where the human relationship is essential and where the business is intimately linked and above all dependent on the relationships woven between people, in this case the negotiation will for a certain time take a back seat. You have to know how to lose time to gain it.
What is a good negotiator?
No one is born a negotiator. It is a profession that is learned gradually, with experience. Each negotiation is an opportunity to enrich its knowledge and to take stock of its positive points and things to improve for future negotiations.
Some personality traits are essential for be a good negotiator ; have a good ability to understand geopolitical affairs, be a good prospector, have a great open-mindedness and above all, be flexible. However, be careful not to fall into submission in front of your partner, you have to have empathy without submitting.
We also recommend that negotiators try to favor an integrative negotiation strategy that tends towards win-win. Be careful though, this strategy, although attractive on paper, is not realistic. With the price war that rages nowadays, salespeople are forced to reduce their prices to a minimum and it is therefore the supplier who finds himself aggrieved, resulting in a winner/loser situation.
Globalization in few words
Globalization represents a form of injustice between countries because some gain more than others. However, the balance of power tends to reverse. In addition, new technologies are pushing for internationalization but also for automation.
Some barriers have disappeared, thus accelerating interactions. Today, to succeed in negotiating, you have to understand these international changes and the intercultural factor in order to be able to adapt.
“Where globalization means, as it so often does, that the rich and powerful now have new means to further enrich and empower themselves at the cost of the poorer and weaker, we have a responsibility to protest in the name of universal freedom.”
Nelson Mandela
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