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Successful Firms in Asia Manage Better, Duh!

TMCnet Feature

June 17, 2014

Successful Firms in Asia Manage Better, Duh!

By Gary Kim
Contributing Editor

Figuring out why some firms are more financially successful than others is an inherently messy and difficult challenge. What can be quantified only tells you that a firm is more or less successful. It doesn't tell you why.

But as often, the key attributes believed to lead to success are non-quantifiable, matters of organizational culture and skill, as much as anything else.

Telstra (News - Alert) Global’s Connecting Countries study of 4,100 senior executives in China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, Philippines, Singapore, Taiwan, Thailand, and Vietnam results in nine key lessons from the top five percent of firms, in terms of performance.

The study suggests the leaders were as likely to face challenging issues as less-successful companies. “So it is not that these leading companies have had an easier time in Asia than other companies – on the contrary they would appear to have had greater difficulties,” the study suggests.

Perhaps significantly, the leading firms also had multiple revenue growth strategies. That has advantages, including the ability to deal with uncertainty. Essentially, the leading firms place more bets, recognizing that some will fail.

On the other hand, a key issue is that it takes time to see returns; companies have to be patient. That is the contradiction: losing strategies must be abandoned, but it takes time before winners can be determined.

The study also suggests the best-performing firms had both a greater awareness of the challenges and a greater willingness to deal with them openly and honestly.  

The leading firms also seemed better able to manage staffing issues across countries.

Ironically, successful firms “fail fast” but also are “long term” oriented.

The most successful companies are “more likely to have a global footprint, with 82 percent of Asia Business Champions operating both in Asia and countries outside Asia, compared to 40 percent for other companies.

Information and communications technology and financial services firms are overrepresented among Asia Business Champions as a whole.

Those firms are “likely to be companies from the U.S. or U.K. rather than Asian companies, the study suggests. Some 32 percent of what the Telstra study terms “Asia Business Champions” are U.S. companies, compared with 14 percent of companies overall. About eight percent U.K. companies, compared with three percent overall.

Asia Business Champions are significantly more likely to employ more than 200 workers and less likely to employ fewer than 20.

"Manage more effectively" is likely to be the conclusion you are left with after reading the report. But you already knew that. You also knew such management excellence is difficult. 

Edited by Maurice Nagle

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