Running Lean (part 1): Foreign MNCs and Structuring the Communications Function in Asia
Updated: Jul 11, 2019
When I first moved to Asia from Europe a few years ago, I was struck by the leanness of foreign MNCs’ communications functions in this region, and how thinly spread the members of those functions were compared to their counterparts in the home markets. I saw individuals single-handedly managing a vast range of markets that were at once culturally distinct, geographically disparate, and with little in common politically as far as policy making and frameworks are concerned. The diversity, complexity and sheer scale of the Asia Pacific region, as it has been defined by most MNCs, far outweighs that of Europe or the US – the corporate centres for most MNCs. Not to mention that it is largely comprised of emerging markets on a path of rapid change and development, adding yet another layer of complexity. And while there are many sensible reasons for a business to have strong communications support at the group centre, I was nonetheless confounded by the relative dearth of resources encountered by communications leaders in supposedly important Asian markets.
During my time here, however, I have witnessed some businesses pivoting away from the traditional Asia Pacific framework in their deployment of communications resource. This has generally taken three forms:
Remodelling the region into smaller sub-regions (Greater China, North Asia, South Asia, South East Asia, ASEAN, etc.).
Grouping markets across the world along lines of economic similarity (e.g. growth markets) rather than traditional geographic lines.
Creating and appointing heavy-hitting market-focused roles that previously would have been subsumed into a broader regional remit.
Now this could simply be a pendulum swing and those businesses who have decided to disband their Asia Pacific regional centre may well return to this structure in the future. However, I anticipate that this is less of an elastic trend and more an indicator of larger forces at play. In January, The Economist suggested that we may be witnessing “the new, prudent age of the multinational”, one characterised by “a more fragmented and parochial kind of capitalism”. (Full article here)
“the further you get from the corporate centre, the leaner the resources tend to become for a function like communications”
It is certainly the case that many MNCs who sought to internationalise years ago are not seeing the profits they had envisaged outside of their home markets. Instead, a more focused, localised business structure appears to be winning out. This would explain both the adjustments to the traditional regional structure that we’ve witnessed, as well as the tame level of investment in communications functions by foreign MNCs operating in this region.
While some MNCs have come to terms with the fact that Asia Pacific is too big to manage as one region, others are yet to embrace this idea. No matter which way you cut it though, the further you get from the corporate centre, the leaner the resources tend to become for a function like communications. And, if we really are now in the age of the prudent multinational – indeed, team expansion is rarely a feature of the leadership roles that we manage in the region – then running lean is something that foreign MNCs’ communications functions need to be equipped to do.
By Sarah Crawshaw (Managing Director, Asia Pacific)