Just how do entrepreneurs make decisions about entering international markets? And what can we learn from New Zealand’s most successful high tech exporters? That’s something a three-year University of Otago Business School project funded by the Marsden Fund is pinning down.
Australia may have been the conventional stepping stone to international markets for New Zealand businesses, but Professor Sylvie Chetty’s study into how international markets are created, is already revealing a very high level of innovation and creative solutions to create new global opportunities in non-traditional markets.
Hi tech businesses in particular must go beyond New Zealand and Australia to survive, but in-depth interviews with leading experts in the first year of the study show they’re not just surviving, they’re thriving and successful leaders in their field. This success in countries like Latin America, India, Dubai, and increasingly into China comes from leveraging from one market into another, by being open to markets they know little about, by being interconnected, and by utilising all opportunity coming their way.
“The ability of the entrepreneur to exploit opportunity is a common element of success - serendipity is surprisingly important. We have come across many examples where a chance meeting has resulted in a shift into new partnerships, changes in products, or lucrative new international markets. What we’ve found so far is that being open to surprise, to have that ability to recognise it as opportunity, and the initiative to alter course, have produced the most successful businesses.”
Often such opportunity comes from networks or relationships. Professor Chetty is finding successful SME’s that are resource-poor invest time into developing business partners and relationships with suppliers to leverage what they have to create an international foothold.
What this means
The key finding so far is flexibility. Businesses will always need plans, market research and a sound understanding of what they want to achieve, but growth is not linear and structure needs to be flexible. The answer is interweaving plans alongside developing capabilities to deal with unplanned opportunities.
Understanding how opportunity is co-created with partnerships will help export market policy makers understand the needs of future business. The knowledge will also help up and coming start-ups to set their sights well beyond traditional stepping-stone markets. Alongside business planning and goal setting, we also need to teach budding entrepreneurs and new students about identifying and leveraging opportunity that emerges unexpectedly.
The research project, being carried out with the assistance of a post-doctoral fellow and a PhD student, comprises a large quantitative survey, which includes New Zealand, Australia, Sweden and Finland over the next two years.