Actually, small to mid sized companies have the potential to benefit most from the “globalization”.

Large corporations often are beaurocratic, slow, and require large quantities of resources or products. To produce large quantities, they also need to help with investments within the emerging markets from where they are buying. Countless meetings are required to discuss a project, increasing chances for cross cultural problems and slowing their response to shifting trends. A small to mid sized firm typically is flexible, with a smaller structure in which decision makers are closer to the “ground”. They can respond quickly and take more decisive actions. Smaller companies growing in developed markets should partner with somewhat larger companies in emerging markets. Such partnerships will allow smaller companies to acquire infrastructures necessary to support operations.

In business, as in many other aspects of life, lack of experience or knowledge, and fear are always bad advisors, and should never prevent taking action. Knowledge and experience can be acquired. If companies limited themselves to what they already know how to do, the consulting industry would not exist. However, we are here and doing very well as an industry.

From a consultants’ perspective, the first step should be for small to mid-size companies to precisely identify their needs and what they wish to achieve by dealing with international vendors. Is it to reduce costs of product? Expand production capabilities? Gain access to better talent (i.e, the best people of a country instead of the mediocre of their own country)?

Ideally, companies should determine which country is best suited to meet each specific need. For example, proven models exist for working with companies in Asia, but it is important to consider the impact of time differences on collaboration. Although the time difference does not present a barrier to working with companies in Latin America, effective collaborations are less common and the impact of political issues is nontrivial. There is no clear cut answer; the pros and cons for involving various countries must be identified and weighed on an individual basis.

Another issue to consider is whether to establish a long term relationship, a strategic partner, or to identify a one time only vendor. Most US embassies have commercial services that can help identify potential vendors or partners. However, they can’t do it as well as we can.

Each buck spent has to generate the largest bang possible, which can be achieved in the international marketplace. The key is to understand that in today’s competitive world, the agility of a small corporation can work as an asset. International consulting firms and strategic consulting firms are available to help small companies learn the ins and outs of dealing internationally in order to help them generate that bang.