Why US startups triumph over Asian family businesses
When you think of the competition in the international market, companies in Asian countries such as China and Japan seem difficult to beat.
However, there’s a distinct advantage that we have over those businesses. And although they’re catching up, American companies, especially startups, have a lead over companies in the east.
Several of the successful businesses in Asia are family-run, and lead by the older generations. As a result, they find it difficult to deploy new-age solutions and make the most of new technologies.
In fact, according to a recent The Economist Intelligence Unit (EIU) study which assessed the readiness of family businesses across Asia-Pacific, families understand the importance of technology and are confident about being able to add new technologies to their business – but fail to take action.
“Family businesses cannot last beyond this generation if they do not innovate,” explained Annie Koh, Academic Director of the Business Families Institute at Singapore Management University.
“Although the survey shows that family businesses are aware of emerging technology trends, it remains to be seen whether they are actually taking advantage of these given the questions surrounding the need for greater professionalism,” added Koh.
On the other hand, US startups are digital natives, born in the digital age.
Using Evernote to organize your notes and boost productivity or using Slack and Trello to communicate with colleagues and manage workflows usually comes naturally to you.
From your perspective, investing in a holistic CRM that ties into the customer journey on your e-commerce portal and feeds the chatbots suggesting new products to customers based on their past choices is not something you’ll feel uncomfortable about. You’ve grown up seeing companies do that to you.
Similarly, building an omni-channel experience will almost come naturally. Of course, customers on your website must be recognized via facial recognition when they walk into your store, especially when seeking medical advice and help with customized prosthetics.
As a result, startups in America, or rather, businesses in the country, are more skilled at incorporating technology into their workflow and their offering, wowing customers along the way.
When we expand our coverage and cross geographic boundaries to do businesses with the millions of buyers in Asia, they find that companies from the US often exceed their expectations – which is why it’s easy to win quickly in new markets.
A quick search on Google will tell you that a lot of Asian companies aspire to US brands – many times its because of the experience we’re able to create with the technologies we have at hand.
Asian companies, especially family-run businesses, find it hard to adopt technologies that improve the lives of customers. However, this isn’t true in all cases.
Several family businesses are finding ways to partner with specialists or delegate responsibility to younger members of their family in order to quickly get to grips with new technologies.
“In our partnerships across the region, the best-run family business is a result of a good balance between promoting the unique business culture of a family-owned business and openness to implement new technologies,” said McMahon,” explained Anthony McMahon, Senior Vice President, Small & Medium Enterprises (SME), Asia Pacific and Japan, SAP.
This is a unique advantage that US startups have – and although the tables may turn soon, it’s something startups must take advantage of right now.
10 June 2021