Bill Scheessele

COMMENTARY

The ABCs of international BD

The ABCs of international business development
With the federal budget under the threat of sequestration, government contractors are seriously considering alternative opportunities for growth. Developing business in the international marketplace is perceived as a hedge against shrinking revenue opportunities in the U.S. arena, particularly in defense.
This may be a good strategy to consider. However, it entails more than merely assigning your lead business development professional to scout out opportunities with our allies.
If this initiative is on your radar, start off by reviewing some ABCs of international BD.

A. “A” Game.
Be serious, and bring your A-game. Before you act, know why you’re knocking on doors in the international market and bring all the resources you need to do it right. Once you start, don’t let this initiative languish. Some firms are now attempting an international re-start. While the domestic defense market was gushing, they shifted focus and resources and allowed their international operation to deteriorate. Rebuilding bridges and shoring up fractured relationships is not easy in the current economic climate.


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B. Buy-in.
Secure leadership buy-in and support up front. Ensure everyone from the C-suite on down is seriously committed to an international strategy for the timeframe it may require. Garner sufficient support to provide all of the resources needed. Buy-in over the long haul is the most limiting factor to success in this initiative.

C. Culture.
Become a student of Culture. Study the history, traditions and business customs of the countries and regions you are targeting. Make every effort to learn and understand the cultural marketplace you are attempting to engage. Doing so is a sign of respect and is a crucial first step in building trust.

D. Diligence.
Be diligent. Do your homework and develop an experienced team. Don’t assume you can learn all about international markets and competitors by asking your prospects to share what they know with you. Do your homework upfront with a market analysis, gathering information from the Defense Security Cooperation Agency, regional military commands and embassy resources. Even while using local agents for access, handle all of the business development aspects yourself. Source experienced international professionals for your team. You can’t install your best, domestic business developers in these roles and expect them to work wonders in a foreign environment.

E. Earn trust.
Study psychology and learn how to earn trust-based partnerships. It’s all about them. It’s not about your firm, your services or products, and how technically superior they may be in performance and reliability.
Business development revolves around building long term relationships that demand more time, resources and diligent attention to detail than buy/sell transactions. Winning business requires a deliberate and ethical methodology from the first hello, to follow through, to delivery.
Be careful of displaying what might be seen as American arrogance by flaunting superior business knowledge or best-in-class technical expertise. Our allies are aware of U.S. know-how, and they understand your offerings are usually more expensive than other alternatives.

F. Follow FMS, FCPA, ITAR and Arms Export Control Act directives.
As an enforcement official shared, “Ignorance of the law is not a valid defense. Inexperience with defense export regulations is no excuse.”
For example, complying with State Department licensing under ITAR is as complex as designing cutting edge electronics or engineering technology and bringing it to market. There’s no room for error on either end.
Paradoxically, while technology makes transactions faster, the global government contracting business is more complex, requiring time-consuming attention to details. Per the phrase former President Ronald Reagan repeated often, “Trust, but verify.” This caveat is particularly true when offering technology products and services to international markets.
Additionally, corruption opportunities abound. Don’t get ensnared.

G. Go abroad and meet frequently on their turf.

Understand stakeholder needs and priorities from their perspective through regular person to person visits to their country.
In developing international business, the focus should be on one purpose: delivering the best services and products to solve customer problems. In addition, judiciously handle compliance and regulatory issues concerning any far reaching implications that might be involved. If you adhere to this business development purpose, you’ll reach your revenue goals and become an irreplaceable partner to clients around the globe. You’ll be trusted and verified.

Reader Comments

Tue, Dec 4, 2012 Trond Peersen North America, Europe

This article is spot on for a number of points. They key is to "internationalize" your company -- customize your operations and information systems to handle foreign business - train your existing staff on conducting international business and on cultural aspects (from the receptionist to the shipping manager) - integrate your trained international staff into the overall operations - above all, bring your international activities in-house where you have control.

Mon, Jul 9, 2012 JT Europe

I think this article is a good start to discussing the topic of international expansion. I realize that WT is a DC focused website, but more international insight is highly appreciated, especially for those focused on international government BD. Taking into account the short length of this article, there are several important nuances of international BD that were not covered. In my experience, (2.5 years doing BD on the ground in Europe for a US headquartered company, the rules of the game in government procurement are much more difficult on this side of the Atlantic. This makes it very difficult for a US firm to break into the market without local company acquisition. There are unofficially no proper channels e.g.: procurement offices, contracting officers, time and materials contracts, etc. This coupled with no incentive to award contracts to small businesses and rampant collusion both legal and illegal, mean that doing BD in Europe is significantly more challenging than in the US. Doing BD in Europe isn't as simple as looking up the local Govwin site, identifying opportunities, meeting with the procurement office, gathering intel, and coming up with a great proposal. there is no Govwin style site and virtually no such thing as a "full and open procurement" set forth months in advance, so knowing your competition and upcoming opportunities involves some serious hunting. A European BDer has to roll up his sleeves, utilize whatever contacts he/she has, employ out-of-the box methods to identify potential leads, and be prepared to meet with dozens before he/she gets to a decision maker. That's when, believe it or not, the real work begins. If you happen to connect with one of the few innovative clients who has a decent budget, then you are fortunate. The rest are working with limited budgets and are not necessarily open to change. Without an innovative client with a good budget, one must be open to adapting their business model and be blessed with considerable patience, as the road to procurement is a long and tedious. In summary, BD in the US is like going hunting in a hunting preserve armed with the most advanced rifle, while BD in Europe is akin to hunting in the jungle armed with only a machete.

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