It is quite something to successfully run a company in the ASEAN region. Even experienced business professionals with a depth of knowledge about the place can still be stymied, so imagine what newcomers tasked with business growth in South-East Asia must feel!
In order to understand the problem and find a solution to give to newcomers the respect they deserve and get the most of their potential, the works of Geert Hofstede are here to the rescue.
The Hofstede’s Cultural Dimensions Theory for Business Growth in South-East Asia
Under this name hides a simple theory: we can analyse all society’s cultures. And every analysis can explain the impact said cultures have on their members. In that regard, there are 6 points to reach the result:
- Power Distance: The less powerful people’s will to accept that power is not distributed equally. The higher it is, the more respected the hierarchy is.
- Individualism vs. Collectivism: Are you by yourself or part of a group? Do you think “I” or “We” first? That’s the difference.
- Uncertainty Avoidance: This title is quite self-explanatory. People who don’t tolerate uncertainty, ambiguity and to an extent, creativity are going to rank high.
- Masculinity vs Femininity: A tricky point, as we don’t see if people are acting one way or another, but what are the values they…well, value. Heroism, assertiveness and personal success are masculine. Modesty, compassion and shared success are feminine.
- Long–Term Orientation vs Short-Term Orientation: This one might get an article for itself down the line. But today, it is just another point to study. Basically, traditions are the big thing in STO countries while adaptation and willingness to experiment get the preference of LTO countries.
- Indulgence vs Restraint: Are you indulging yourself in pleasures and joys or are you restraining yourself, your emotions or even your life, for a greater purpose?
How can this tie in with the main issue: Business Growth in South-East Asia? Well, it is quite simple, and you already know everything you need to know!
The Cultural Impact on Business Growth in South-East Asia
Unfortunately, Hofstede didn’t study all countries of the ASEAN zone. But he did enough to get an average of the area. Such an average is relevant thanks to the mutual history those countries share, and the same challenges they face.
But enough waiting! Let’s get to the results:
Not every country is the same, but many results appear quite similar. Let’s have a final tour to find out what a company must expect to face and do to ensure business growth in South-East Asia:
- Power Distance: When it comes to power, people easily accept the status quo. Therefore, it is difficult to disrupt it. Society must stay stable. A new solution or service disrupting the habits will have difficulties to go through, as there is no perception of a challenge or opportunity. It will only create doubts on its efficiency.
- Individualism: The collectivist way of South-East Asia strikes again. It is useless to convince the individual, you have to understand the group. Only when the group comes to an agreement can you find success. A side effect is that it will be much more difficult to convince the first customer than normal. But once you do, expect a stairway to heaven. The group will have spoken.
- Masculinity: On the low side, except for the Philippines. Chance is Cambodia and Laos follow their neighbors so at the end, femininity prevails, which is sad news for competitiveness. A newcomer cannot bank on the will of its potential customers to surpass the others. Care, quality, and cooperation are what you must enforce, unlike success, growth, or achievements. It can completely go against your habits, but there you go. Thankfully, it’s not that pronounced.
- Uncertainty Avoidance: South-East Asia defines itself by not minding uncertainty, with Singapore literally loving it. It means newcomers bringing uncertainty will at the very least find an ear for their speeches. You might not go through, but you will have a chance. Still, stay sharp, as the results are not that low. To fight against uncertainty, your project must be crystal clear.
- Long-Term Orientation: A bit on the low side, with half of the countries reaching the middle. Nevertheless, they are leaning on Short-Term Orientation. People there have difficulties to see benefits if they are far. The profit must be almost immediate. From our experience, a training course must bring knowledge that can be applied quickly. Teach about the paybacks of a 3 years marketing plan, and your dreams will go down the drain.
- Indulgence: The ASEAN zone is not one for restrain, knowing full well how to please itself. It is a good thing, as it means a pleasurable service or product, making life easier, will be favorably seen. To bypass all of the difficulties mentioned before, put a HUGE emphasis on that.
A bit disappointed by the results? Don’t be! South-East Asia is thirsting for development, growth, pleasure, and profits, with overall growth hovering around 7%/year. It is only a matter of getting to know the local people, and how to answer to their ideas, challenges, views and values.
- Marketing a new service or product is hard. People are used to the same habits and environments, don’t project themselves much in the future, don’t care for competition, and mind uncertainty to some degree.
- There are three tools to manage this: appealing to the group, highlighting the pleasure and profits they will get out of it, and ensuring it is going to happen fast and efficiently.
To learn more about South-East Asia and how the CLPD can help you for your marketing actions and business plans, we join you to discover the Marketing Essentials Course, right here.