Benefits of Effective Bilateral Communications

 

As you know, there are several ways to do business in Vietnam. US firms can set up operation in Vietnam through owning manufacturing plants, service facilities or retail stores. They can form joint venture with local partners, or have representative offices, franchises or licensing operations in the country. They can also be benefit from investing in Vietnamese enterprises. Whatever methods of business they operate; effective communication plays a crucial role in boosting revenues. By saying effective communications, I mean more than learning “Do” and “Don’t” behaviours. It must go to a deeper level where local knowledge is well integrated in corporate communication strategy and policy.

One distinct feature of corporate communications in Vietnam is that there tends to be overlap between Business-to-Business (B2B) and Business-To-Consumers (B2C) Communications. In an economy dominated by the Small and Medium Enterprise Sector, where corporate governance has yet to develop and the Board has not yet been vested with sufficient power, communicating with a company is, in effect, an interaction with an individual, the CEO and his/her close “circle of trust.”

 

Another issue is the ability to think locally. Consistent handling of “moments of truth” in direct interactions, such as customer services and public appearance, is a prerequisite for a successful public relations campaign. This is one area where US firms can create significant value if they master this skill. Ironically, multinational firms tend to recruit “bilinguals”. In the end, it is always easier for foreign firms to evaluate language skills as opposed to comprehensive cultural understanding. Not every American has a deep understanding of American culture, and not all Vietnamese can provide comprehensive executive training in cross-cultural business practices for newcomers to Vietnam.

 

As far as trade relations between the US and Vietnam are concerned, the insights into Vietnamese culture are not simply for the purpose of creating personal rapport. It is rather aimed at effectively introducing more advanced and sophisticated business concepts from a developed economy like the US to the emerging economy of Vietnam. As economic status is reflected in the level of product or service awareness, communication strategies and tactics that US firms use in their home field can be counter-productive in Vietnam.

 

Back in 2001, when capital markets in Vietnam were still underdeveloped and the stock exchange was small and lacked liquidity, I was responsible for promoting the private equity concept to the local business community. At that time, the majority of private companies were family owned. They looked at IPOs as a significant threat of outside control and acquisition, rather than potential growth. The complicated and lengthy due diligence process by foreign investment funds based in Vietnam was not well understood by local entrepreneurs, who still enjoyed conducting business on the basis of trust or oversimplified legal agreements. To make matter worse, some private equity terms in English simply didn’t exist in the Vietnamese vocabulary. The task at hand back then was not merely to translate marketing materials widely used in the US from English to Vietnamese, it was to develop a separate set of communication strategies indigenous to the Vietnamese business context. 

 

Vietnam may not be an “early adopter” but I think it is a “fast follower,” especially following admission to the WTO. For example, 5 years ago, many people equated investments from investment funds with bank loans. But today the Vietnam stock exchange is booming and the prediction of the next wave of M&A in Vietnam will soon be realized.

 

One thing is for sure, local PR firms must have the ability to speak English fluently and understand the dynamics in American culture and business customs in order for both sides to share the same strategies toward a common goal.

 

Unless local PR firms limit their focus on technical roles, those aiming to provide strategic public relations planning for US firms, whether in the market entry or execution and development stage, must have both Western understanding and insights into the local business and legal environment and inevitably, Vietnamese culture and traditions. The knowledge of how products have been developed and accepted in different markets in combination with local knowledge will result in stronger communication of the message and enhanced ability to predict audience reactions to the message.