Vodafone Idea

BBC reported that Vodafone has potentially given up on the Indian market. Even though Vodafone is a big company, it is facing the difficulty in the market. Also, India is the world’s second biggest telecoms market, so it seems natural that the UK company sticks to it.

However, Vodafone is not an only company that is struggling in the Indian market. For example, our media has already reported that Ford is the latest company to stop manufacturing vehicles in India. Ford’s local rival, General Motors, had already withdrawn the market faster than it.

Therefore, we can say that to expand business in overseas is easier said than done. In fact, there are many articles, researches and theories about how to enter the new country. However, the reality would be different. For instance, our research correspondent interviewed a Japanese company that has its subsidiaries in China, Thailand, Singapore and Spain.

The interviewee thinks that there are several challenges such as language barrier, cultural difference and human nature.

Language barrier

In general, most of us want to talk to other people in our native language. Of course, there are people who can speak several languages fluently, but it seems sometimes difficult to express details of their ideas. In the case of the interviewee’s company, all of the management team to run subsidiaries are Japanese. It means that they are discussing important issues in only Japanese. How many non-Japanese people can speak Japanese very well and communicate with all Japanese colleagues?

On the other hand, it also difficult for Japanese companies to find people who can speak local language and have capability of running a company. Therefore, communications would be difficult more and more, when companies enter more new countries.

Cultural difference

It seems very natural but very important that culture is different from country to country. For example, in the case of the interviewee’s company, each country has different perspective about punctuality. Even in five countries, which are Japan, China, Thailand, Singapore and Spain, there are different perspectives about many topics.

In this sense, the management team of the parent company has to understand these differences and to see a big picture. If the team does not take a big picture into consideration, the company will lose its direction. However, it does not mean that locality is not important in terms of management.

Our media believes the proverb “think globally, act locally” is true. If we do not value local culture, we will not be able to manage people there. Thus, we have to balance between a big picture and locality to enter new countries.

Human nature

Also, we think that it is human nature that local people want to buy local products. For instance, the Japanese people want to buy Japanese automotive such as Toyota, Honda, Nissan, Suzuki and Mazda. The American people want to buy American vehicles such as General Motors, Ford and Tesla.

Therefore, if companies want to sell their products or services overseas, they must consider this human nature. In other words, they have to find reasons why local people want to buy products and services that are from overseas. Brand? Price? Functionality?

We think that we gradually understand these challenges when we are experiencing. This is a reason why theories and researches do not work immediately. It does not mean that theories and researches do not work. We think that theories and researches are not solutions but tools. Thus, we should take and modify our actions based on our experiences, theories and researches.