ASEAN – A comment on McKinsey’s “Seven things you need to know”

Monorail System in Kuala Lumpur

As mentioned in my reply on Xing on McKinsey’s Understanding ASEAN: Seven things you need to know, I can’t repeat it often enough: ASEAN countries as well as other Asian countries are extremely diverse and require a completely unique and individual approach to tap into the market. For someone who has never been in Asia or in any of the ASEAN countries one’s opinion on either ASIA or ASEAN is often formed by media and the general impression that Asians are somehow similar. Countries that are not featured daily in e.g. German news, such as Indonesia, Phillipines and Laos are unknown components in a manager’s knowledge.

Hence the best way to approach these countries is to get the required knowledge inhouse, either by hiring an expatriate who has lived in both your own home country and the target market country, or by acquiring the help of locals that have worked / studied / spent considerable time in your home country and understand your culture. Because without a basic understanding of the similarities and differences between e.g. Germany and China or Germany and Hongkong (yes, China and Hongkong are VERY different), one will loose money. Money is being lost in misunderstandings, miscommunications, wrongly set up business deals and just lost in time spent in training personnel.

Just imagine that you sent a young manager of 35 years along with his family for the first time to Malaysia on an assignment. If he or she has never spent any time in that country, all mistakes someone can make who never came in contact with Malaysian culture, will be made. That will cost this particular manager at least a few months in effective working time inside Malaysia. Surplus depending on the mistakes he or she is making, local employees might feel frustrated (reduced productivity), sabotage or leave the company. Do you think that is exaggerated? Just think back on your own first days in a new environment and how efficient you would have been if you would have known what you do know now.

Hence, I repeat my final comment on the article linked to above: ASEAN / Asia is a very diverse continent with animosities between individual nations, histories that have NOT been taught in your high school and of which you have no knowledge whatsoever. Get yourself the required knowledge to survive in these markets, because one of your competitors is certainly doing it. Want to know more? Contact me.

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