A company preparing to enter a foreign market has its work cut out for it in terms of sizing the market, evaluating pricing, determining channels of distribution, minimizing tax exposure, and staffing the enterprise. However, to lay the foundation for successfully entering a foreign market, a company also needs to build a solid corporate reputation with stakeholders like the media, legislators, regulators, unions, non-governmental organizations (NGOs) and consumers. While reputation management is the responsibility of all employees, it’s most often the corporate affairs department that is the charged with leading the effort.
Reputation management requires a well-thought-out strategy, a disciplined plan, and best-in-class skills. The exercise below can provide tools and tips for how a corporate affairs department can build an effective corporate reputation to support a successful foreign market entry.
Scenario: Your business development department has completed its homework and concluded the new market is indeed viable for entry. GDP per capita is rising, and the demographics favor your product set. Competition appears minimal. Senior management is inclined to make a capital investment, and has established an in-country exploratory office to conduct due diligence on target acquisitions.
Your task: Create the proper corporate reputation in order to secure governmental approvals and generate consumer demand once entry is announced. In addition, identify any reputation risks and implement a strategy to minimize or contain them.
Here is a suggested approach:
- Ensure corporate affairs is part of the team. Accountants and lawyers who specialize in mergers and acquisitions thrive on secrecy, and will endeavor to keep their teams small. That works fine until their activities are detected and the Wall Street Journal is looking for a comment. Corporate affairs needs to be in the loop and ready with a statement should any news leak out prematurely.
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