72 per cent of board directors believe BRICS businesses are less advanced in terms of technology
A major new international study by BT has revealed
that Western business is not fully prepared for the imminent impact of
emerging markets. While more than six out of ten (64 per cent)
directors of large American, British, French and German corporations
accept that emerging economies will “reshape” the global business
landscape, many seem to have only a rudimentary knowledge of their
business environments.
Even though a clear majority (61 per cent) of
respondents admit it is “crucial” their business is able to work with
the economies of Brazil, Russia, India, China and South Africa – the
so-called ‘BRICS’ nations – to succeed in the long term, many of them
demonstrate worrying ignorance of the realities of those countries:
almost nine out of ten directors (88 per cent) could not name the
currency of Brazil and 14 per cent believe that vodka is the main
product of Russia, for example.µ
BT commissioned Datamonitor to undertake the study
of 800 senior executives in the US, UK, France and Germany for its
study, “Building Business With BRICS.” The study discovered that more
than seven out of ten (72 per cent) Western directors believe that
organisations in the ‘developed’ world are better equipped
technologically to work internationally than those in BRICS.
Francois Barrault, CEO, BT Global Services, said:
“This is a troubling finding. The message hasn’t filtered through yet
that these nations are already equipped to make an impact on the global
stage. They have shown remarkable agility and speed at adopting new
collaborative tools and technologies – quicker, in many cases, than in
the US or Europe. Western organisations need to increase collaboration
in and with BRICS businesses or risk being left behind. Western
executives have the systems in place to work with BRICS. In terms of
the technology that enables collaboration between organisations and
countries, there is an effective global network in place. But Western
businesses need to do more to fully engage with BRICS countries.
Successful collaboration between organisations in the West and those in
BRICS will be a sign that globalisation has come of age. ”
According to the study, four in five (80 per cent)
of directors realise that the necessary information and communication
technology is readily available to allow their businesses to work
effectively with those in BRICS. Despite this, the study found that
directors perceive data security to be the main barrier to effective
collaboration with international businesses, followed by different
legislation and/or regulations and political interference.
The full report, “Building Business With BRICS”, can be downloaded from www.bt.com/global/collaboration/BRICS/. Other findings include:
• 35 per cent of directors do not know the currency
of Russia, 55 per cent do not know the currency of India and 65 per
cent do not know the currency of South Africa
• India is
perceived as the most comfortable BRICS economy in which to do
business, significantly more than China, which was rated second (30 per
cent to 23 per cent)
• Russia is perceived as the least comfortable BRICS economy in which to do business (24 per cent)
• Businesses
in the manufacturing industry are the most active in the BRICS
economies; 82 per cent of respondents said that their company was
already working with other businesses within BRICS
• 51 per cent
of companies within the financial and professional services sectors are
active in the regions. The BRICS economies are an opportunity for these
companies to apply their specialised knowledge to a rapidly developing
economic model
• Few government & non-profit and education
& healthcare companies are active; such companies are generally
prohibited in their expansion overseas
• Companies with revenues
in excess of $1 billion are currently the most active within the BRICS
economies. The increasing trend towards globalisation has a wider
effect on such firms who must look to developing economies to enhance
sales, diversify their geographical portfolios and minimize costs
through low-cost labour and energy
Notes to editors
About the research
BT
commissioned Datamonitor to undertake the study of 800 senior
executives in companies from a range of sectors, with turnovers from
$10 million to over $1 billion, in the US, UK, France and Germany for
its study. The full report, “Building Business With BRICS,” can be
downloaded from www.bt.com/global/collaboration/BRICS/