Gravity of reliable data:
Market research in emerging nations takes longer than in developed markets, and the results of information collection are frequently disappointing. Data in the majority of emerging economies is frequently inaccurate, ambiguous, and difficult to obtain. Needless to say, senior management and everyone else engaged are concerned. How can a company make a sound and costly business decision based on information that is only partially true and flawed?
A manager who depends entirely on desk research is like to a ship’s captain who only detects the tip of an iceberg; the enormous piece beneath the surface is what makes or breaks the business. This invisible aspect is where business intelligence should concentrate its efforts. Desk research can provide important background information and basic facts, as well as local intelligence, but businesses should be aware of local media stories, which are frequently more skewed than foreign sources. To reduce risks, emerging market managers should rely on primary research rather than secondary research whenever possible. Carrying out primary research in emerging markets is time-consuming and costly.
Government information can also be deceptive. A reality check with law firms and other market participants is more vital than knowing the language of the law. Consultants can assist, but because data is limited and untrustworthy, market research businesses frequently recycle and repackage previous material. In some countries, one or two sources are recycled repeatedly, frequently repeating information that is incorrect and misleading for decision-making. Primary research is the only approach to learn about the market’s realities.
Qualitative inputs V/S gut feelings:
By allocating resources to qualitative inputs, the dangers of poor market research can be considerably minimized. Many business decisions in emerging markets will be based on instinct and gut feeling, and there are two techniques to assure that these instincts and feelings are more than just guesswork. One approach is to put a small staff in charge of obtaining and analyzing company information. A well-organized and quick-thinking internal business intelligence staff maintains a company sharp and ready to act and react correctly. This is critical for staying ahead of the competition since it means managers are kept up to speed on business environment analyses and are better equipped to foresee emerging risks and opportunities. These teams can help acquire and share information on a regional scale, as well as convey information and insight from one rising market to another. People engaged to administer such coordination centers must be skilled analysts. “Based on this knowledge, this is the implication for our business, and here is why,” they should be allowed to say.
Networking is another approach to develop dependable intuition. Building and maintaining a strong network of connections is the most important business intelligence tool in emerging markets. It is equally crucial for enterprises entering the market for the first time as it is for those already established, because personal ties are far more important in developing markets than in developed countries. Networks deliver business intelligence that conventional research does not. They may assist with all parts of external market study, as well as benchmarking internal assessments and closing internal resource gaps. They increase decision-making comfort and reduce the likelihood of failure.
In all elements of networking, personal interaction is essential. In most emerging markets, business is very personal. Because of a lack of personal bonding, many managers are neglected by government officials and potential partners, suppliers, or customers. Many businesses make the mistake of switching their expatriate management every few years, causing their local business to suffer. The same is true for keeping essential local employees, because when they depart, they take their personal relationships with them.
Some important networks and their significance are stated below:
The best emerging market stories are never published; they are told over dinner and over tea breaks at national and regional levels manager meetings. Joining regional and local peer communities and associations allows you to gain fast access to relevant information. Managers from competing companies frequently socialize and discuss how to address generic business difficulties in emerging areas. The obstacles that these managers face are so daunting that exchanging information and ideas benefits both parties.
Even in advanced emerging markets, government policies can be difficult to follow and comprehend. Worst case scenario, new laws may be implemented before they are announced. Most successful organizations in emerging areas have an external affairs team comprised of managers primarily responsible for creating and maintaining relationships with authorities. Their role is to understand how government policy is formed and to predict any legislative changes that may have an impact on the business. They must also be aware of who has sway over significant commercial rules and regulations at all levels of government. This necessitates relationships with ministers, their deputies, and advisers, as well as lower-level bureaucrats with whom businesses work on a regular basis.
Miscellaneous Business intelligence contacts:
Existing and prospective consumers, suppliers, and business partners
Leading analysts and opinion leaders who watch the market on a regular basis and generally know more than they write. Their comprehensive knowledge of the market and its issues is priceless.
Local business leaders who wield significant power over government policies and the business environment. Such ties can result in significant additional business. However, if the regime changes and your contact does not agree with the new one, everything can go wrong. Achieving a balance that allows a firm to get the most out of its contacts while not exposing it too much to climate change is a challenge that must be assessed on a case-by-case basis.
Corporate conferences with interesting exchanges between government officials and business leaders. Networking at events is also essential.
Creating a personal learning community is neither cheap nor simple, but it is invaluable and goes hand in hand with having a strong local presence. It requires patience, effort, and corporate commitment, but it is at least as vital as investing time and money in more traditional research methods. Emerging-market enterprises must budget for this aim on a constant basis.