Retreating after expansion abroad
The withdrawal is motivated by a lack of potential or the need to lower the company’s fixed cost base. Taking into account the strategy, it appears that additional efforts to achieve growth add insufficient value to foreign activities. The conclusion is that (partial) dismantling is the best option.
The future of individual parts of the foreign organization is scrutinized. Personal interests and accompanying emotions may mean that some stakeholders will frustrate the planned withdrawal of the organization instead of supporting it.
Orientation
There are various possible reasons that may lead to the decision to reduce the activities abroad. Disappointing results, a change in focus or the desire for a more flexible model are just a few of them. When accessing a market, elements of risk analysis that should keep the cost of possible withdrawal to a minimum are already used in the scenario analysis. This should lead to a maximum flexibility, taking into account the company’s culture.
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Decision
A withdrawal is a disappointment of course. It remains a balancing act when to decide that the proposition is not robust enough, the execution below standard of mistakes irreparable.
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Action
Biting the bullet often leads to ‘solving the issue no matter what the consequences’. Frequently, this means that the company is obstructing an evenhanded solution by ignoring country-specific sensitivities and offending the local organization.
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Explanation of the solution
Internal organization
Daily affairs demand a considerable amount of attention, which means that internationalization may end up with a low priority.
That is unnecessary if one is willing to accept flexible solutions. During the course of the project the company should make sure internationalization obtains a secure place within the organization. Therefore, at least one of the company’s employees should fulfill the role of internationalization champion and act as a linking pin between the internationalization project and the rest of the organization.
Access to a network
Building a network requires substantial efforts. Gaining access to an existing network in which one is able to make use of established links can save a lot of time and increase the chance of success.
Corridors BV is happy to open up its network to its clients.
Competences: The necessary competences and sectors are covered.
Partner: jellow and its corresponding structure.
Budget
Government subsidies and other support have become increasingly rare. It would be unwise for the company to proceed with a project that is not viable without such help. A sound budget is called for, even if the project is staffed entirely by the company’s own employees.
Explanation of the solution
Decision-making and uncertainty
Decision-making is up to the company’s management of course. However, based on our knowledge and experience we can contribute the necessary elements. This is merely to facilitate the process.
A transparent environment contributes greatly to a solid decision-making process. The highly pragmatic Corridors Connecting Plans Method© is particularly suitable to support proper sharing of information.
The company is the focal point.
Effects difficult to estimate
The environment is dynamic and the decision making process is not a science. The characteristics are the same as for other strategic decisions. A well-thought approach, monitoring progress, is the maximum one can do.
Although a company withdraws from a country, it still has the responsibility to execute this in a careful way for the company itself and the stakeholders.
Solution : Keep the project highly adaptable and plan for milestones at which an evaluation will take place, to facilitate an adjustment if necessary.
Explanation of the solution
Value Creation
Looking for financing? Make optimal use of the momentum by strengthening the company’s team and giving it access to financing based on a sound plan with strong execution power.
Team
Corridors Connecting Plans Method© focuses on the company’s management team. A network of independent professionals can supplement the team if the company so desires. A company may also source additional human resources from its own network if these professionals meet the necessary criteria and feel comfortable with the methodology.
The activity plan
The activity plan is an essential part of the Corridors Connecting Plans Method©. It establishes commitments that should lead to concrete actions. This is a good way to ensure that everybody is on the same page. Moreover, it provides a basis for evaluation and, if necessary, adjustment. Everything is oriented toward optimizing the chance of success through proper preparation.
Intercultural setting
Team building in an intercultural setting, testing and developing intercultural skills and managing intercultural risks are instruments that management has at its disposal to obtain the best result possible.
Advising and liaising
The activity plan is an essential part of the Corridors Connecting Plans Method©. It establishes commitments that should lead to concrete actions. This is a good way to ensure that everybody is on the same page. Moreover, it provides a basis for evaluation and, if necessary, adjustment. Everything is oriented toward optimizing the chance of success through proper preparation