New Zealand businesses are failing to capitalise on growing opportunities in Asia, a new report commissioned by the Asia New Zealand Foundation has found.
Business commentator Rod Oram interviewed senior executives at Fonterra, Tatua Co-operative Dairy Company, Beca, Icebreaker, Snowy Peak and Comvita and concluded that most companies did not have the management skills to succeed in Asian markets.
While “soft” skills, including language and cross-cultural understanding, were important, the bigger issue for New Zealand companies was their hard business skills were "very inadequate when it comes to working overseas”.
“We really need to focus on ways to help companies develop those hard skills. Yes, we want to develop the soft skills as well, but not in isolation," Oram said.
“You could learn about language, you could learn about social customs and how people think in a different country. But it seems to me it’s going to be far more effective if people are doing that whilst they are also learning about market development in a particular country, or strategic analysis in a particular country.”
He said businesspeople could do a lot to develop their skills in New Zealand.
According to Oram, recent immigrants and students from Asia were a “barely tapped” potential resource.
Getting to Know the Neighbours: Building New Zealand-Asian business relationships drew on the knowledge and experience of New Zealand businesses already engaged with Asia, including building Asian connections in New Zealand; working with various business cultures; hiring staff in Asia; and language and culture issues.
The report states that manufacturing in Asia is not simply about low-cost production but increasingly about accessing technology not readily available in New Zealand.
In the year ended February 2011, New Zealand merchandise exports to Asia were worth $17.65 billion, 19 percent higher than the previous year.
Oram said China could overtake Australia as our largest trading partner within a matter of years.
Auckland mayor Len Brown has said Auckland must recognise its maturing relationship with China.
He will lead a trade and investment mission to China next year, meeting with potential investors and looking at transport projects.