How Entrepreneurship Exists Outside of the West, and How to Adapt

“The past is a foreign country; they do things differently there.”

Of course, the famous opening line of L.P. Hartley’s 1953 novel The Go-Between has a different context in that it focuses on the contrast between the past and the present, but the emphasis of the words on how things can be so dramatically different in contrasting environments is also hugely relevant to the question of entrepreneurship around the world.

We have previously discussed how a one-size-fits-all approach to entrepreneurship often fails as companies, mostly Western, seek to expand internationally.

In a previous post, for example, we looked at Uber’s relative failure in Southeast Asia. The company’s “plug and play” model to replicate its success in Western markets ultimately resulted in it selling its services to local operator Grab.

Grab, by contrast, adapted its offerings to local drivers, for example, helping them obtain personal loans that were otherwise out of reach.

If success is to follow, any Western company’s approach to a very different, decidedly non-Western culture has to be highly sensitive to local behaviors and norms. The same can be said for Western companies marketing to pockets of different cultures who have immigrated to Western countries.

Take Airbnb’s experience in Japan, for example.

The short-term rental company initially underestimated the importance of local sensitivities when it attempted to enter the Japanese market, a potentially highly lucrative one given the country’s status as the world’s third largest inbound travel market with 31.9 million visitors before the COVID pandemic.

Missteps included a lack of deep market integration and a misjudgment of the cultural context—a lack of awareness about the country’s deep-rooted need for offering personal service. They also included the importance of chōnaikai, or neighborhood harmony, where local community groups monitor residential activities.

The company turned things around partially by incorporating local cultural norms such as omotenashi, the Japanese philosophy of deep, anticipatory hospitality, as well as adapting to more stringent regulatory requirements. It wasn’t a complete turnaround as the company found itself largely limited to Western travelers but Japan remains one of Airbnb’s most successful Asian markets.

LCC vs GCC

While there has historically been a general move towards global brands and, therefore, a global consumer culture (GCC), there are increasing signs of a stalling of such GCC in favor of local consumer culture (LCC).

Increased travel opportunities, improved technology, and the historical reality of major political events such as the widespread collapse of communism have all played a role in developing a global consumer culture. Still, this apparent retreat towards local consumer culture may also show that parts of the world are not yet ready to open up to such large-scale changes. Perhaps there may even be a backlash to such a GCC potentially one-size-fits-all approach as communities fight to keep the unique identities of their cultures.

This is where it is important to recognize certain approaches to adapt to such changes and differences.

For example, businesses would do well to adopt a glocalization approach where companies adapt their global products to fit local sensitivities. Or they could adopt a more localization approach where the focus is far more on making and marketing the product to fit local sensitivities at the relative expense of a global product focus.

Whatever the approach, and despite the constant fluidity of such trends, it remains imperative for any business leader to be increasingly conscious of local cultures they may not be familiar with. They have to do the work even, or especially, when it is the most uncomfortable for them.

“As business leaders embrace these insights and consciously adapt to the ever-changing market dynamics, they invite greater innovation and growth in their organizations,” I write at the end of the second chapter of my book Between Borders, Beyond Boundaries. “That, coupled with optimism and a commitment to understanding and meeting the needs of diverse consumers, is the key to creating a brighter business future.”

Go Live It

There can be no substitute for truly attempting to understand a culture you may be doing business with than to go and live in that culture.

When I look at my own experiences, I’ve previously spoken about how I was thrown in at the deep end when I moved to Bangladesh at the age of 21 to help out with my father because of a family emergency.

I may have been a native, but I couldn’t speak a word of Bengal having grown up outside Bangladesh. What made that reality even more alienating was that local people assumed I did speak the language simply because the color of my skin was similar to theirs.

However, the glaring mismatch between my background and the new environment I found myself in was much more than just a language difference. It was how people led their lives, which was relevant to environments both away from and within the world of work.

It was only through a gradual acceptance of having to adapt to fit in what was previously a very foreign environment that I eventually started to thrive, both in life and in the world of work.

I’m not suggesting that everyone seeking to market products overseas, for example, has to live in every relevant market, but I would encourage business leaders to at least spend some time in such cultures, even for a short period, to try to understand local sensitivities and traditions.

Only that way can they begin to interpret the otherwise foreign environments around them and act upon such information and experience, the EIA approach:

• Embed. Live and work in the culture you seek to reach
• Interpret. Understand and integrate local cultures
• Act. Offer your goods or services in a manner most appropriate to the new culture

Airbnb’s experience in Japan highlights the importance of the EIA method, showcasing how adapting to local culture and regulations is key to sustainable market penetration.