I promised last month to say a bit more about how Investment Promotion Agencies might approach their task given the less favourable international economic environment. Well here goes!….
1. First, do not pull back from promoting FDI. This is not the time to do that. On the contrary, IPAs need to work all the harder when economic
prospects appear more challenging. If your IPA is really involved in facilitation rather than promotion, ask yourself whether this is not the right moment to move into active promotion. You will need to position your IPA so that it can profit from the upturn – when it comes; and in the meantime competition for FDI is going to get tougher.
2. Review your target markets. Are you trying to target too many? Should you be looking at new ones, less impacted by the global slowdown? If you have not done so, develop a methodology for assessing the potential of overseas markets.
3. Marketing. Now is the time to define your offer more carefully. What are your economy’s unique selling points? How do they differ from those of your nearest competitors? It’s worth spending time and money on this. Remember that what you are trying to do is to sell the benefits of locating in your economy. Lists of life style advantages about locating in country x are unlikely to impress a hard-headed CEO. He/she wants to hear what impact location is going to have on the bottom line.
4. Upskilling the workforce. You are in competition with other IPAs. You may have a well-developed offer, but if your sales force cannot articulate this clearly to the right potential clients, then you have a problem. Other IPAs are going to eat your lunch! Do your staff have the right skills? If not, can you introduce training programmes that will help them develop their skills? Or is the problem more fundamental? Can you recruit more staff with the right skills?
5. Investor Development (“Aftercare”). Existing investors are a very precious resource. The CEO of the local subsidiary will often be a powerful ally in attempts to encourage the company to expand their operation. If you haven’t got a clear Investor Development strategy, develop one now. Identify companies that have the potential to expand, and start a structured relationship with them. How can you remove obstacles to expansion from their path.
6. Public advocacy. If your Government is taking measures that are likely to deter investment, warn them clearly about the consequences.
7. Get expert help. GDP Global would be delighted to assist!
Meanwhile, pay attention to the issues that I discussed in my July blog. For example, be ruthless about cutting out waste. Move staff or financial resources away from non-productive activities. Look again at how your IPA is organised. Would it pay you to outsource some or all of your lead generation? If your sales team is organised geographically, is there a case for setting up a new sector-based organisation? Would it be desirable to focus more resource on high value clients, which have the potential to have the most positive impacts on your economy?
Winning FDI in today’s global market place is getting harder, but the measures outlined above should help.
Good luck!
