Can strategic plans survive in emerging markets?

“One of our senior corporate strategic planners just took on a general management role in India.  Now he gets it!” –Head of Asia, Healthcare Company

In the late 19th century, Prussian military officer Helmuth von Multke famously remarked that, “no plan survives first contact with the enemy.”  Many managers in emerging markets might agree with Multke.  Strategic planning is often a frustrating and time consuming process, which is complicated in emerging markets by heightened volatility, scarcity of data, and front-line communication hindered by distance and time zones.  These three challenges often converge and result in strategic plans that do not last for more than a few quarters before being scrapped or forgotten.

Multke, however, was actually a meticulous planner.  He developed a planning process that considered a wide range of variables and potential outcomes in order to provide front-line officers with a framework to guide battlefield decisions, despite rapidly changing and unpredictable front-line developments.  As a general manager in emerging markets, your mandate is similar: to implement a planning process that results in plans that 1) guide day-to-day decisionmaking of employees, 2) are robust enough to withstand volatility, and 3) are reflective of local market dynamics despite the scarcity of granular data and the fog of distance.

Last week, I met with a group of nine senior Asia executives from a range of industries over breakfast at the Fullerton Bay Hotel in Singapore to discuss their best practices for strategic planning in emerging markets.  Much of the conversation centered on recognizing and responding to the capabilities and constraints of local teams relative to corporate teams.  We spoke a bit about incentives.  And, we touched on the question of how to best make the case for investment and additional “plus plan” funding.

I’d like to take a few blog posts to share some of the key takeaways of our discussion in the coming weeks.  Watch this space.

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Comments

  1. I fully agree with that. After leaving and working in both “worlds” (emerging markets and 1st world) it’s easy to see why some companies fail implementing the strategic planning – If I could name two most important piece of this process / situation I would say: Communication and “The Guy”
    You have to have the right person in the right place – if you have someone that could understand the global corporate strategy and in the same time able to understand and deal with local volatility, scarcity of data and most important the local culture of your target emerging market such organization will more than double the chances of success in this territory.

  2. Ganesh Selvarajah says:

    I have found from my experience that strategy for new market development or entry is developed by people isolated from the dynamics of the market place. Having seen at first hand the panic by multi-nationals to be in the market causing poor strategic decisions that have have long term and costly implications.
    You are absolutely right Chris, when saying the lack of information and data impedes developing and implementing detailed plans. However if the strategy itself is correct in the first place, the battlefield tactics should be adaptable to work with the first and subsequent contacts (to put it in military terms), if they are properly equipped and have the decision making devolved to enable dynamic change.
    Emerging markets are more about the soft issues usually influenced by politics and culture than hard data.

    I look forward to seeing the other points from your discussions.

  3. Chris Moore says:

    Hiring and retaining the right local leadership and management is definitely a big key to success. People in emerging markets with deep local expertise PLUS the capabilities required to be an effective manager within a multinational company will always be in high demand. Later this week I am going to be putting up a post speaking to the question of incentives.

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