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C:\Documents and Settings\MStern1\Desktop\MIT Fall 2006 Ses 4 10-5-06.doc 1 Session 4: The International Markets, Networking/Marketing and Selecting the Appropriate Project Delivery System 1. Introduction 2. New Opportunities and Marketing Targets a. The Markets b. Peacekeeping and Nation Building c. Natural Disaster Response d. The AEC Providers 3. Appropriate Policies and Strategies to Adopt In Order to Enter Overseas Markets a. Evaluate your Strengths and Weaknesses b. Develop a clear Strategy c. Know your Marketing Target d. Carefully Define your Marketing Effort e. Carefully Define the Target Project, Program or Investment f. Know who are the Competition g. Know who are the Prospective Clients or Customers h. Know what are: - the Supporting Financial Institutions - Potential Networks - Contacts 4. Traditional and Future Approaches to Partnering a. Introduction b. Forms of Partnering c. Partnering and Privatization 5. Project Delivery a. Local Office b. Other Concerns c. Staff Loyalty d. Initial Entry 6. Class Discussion a. “Underestimating Costs in Public Works Projects – Error or Lie” b. Readings from “The Lexus and the Olive Tree” and c. The Foes of Globalization 7. Session 5 – The Impact of Globalization of the Financial Market on the Construction IndustryC:\Documents and Settings\MStern1\Desktop\MIT Fall 2006 Ses 4 10-5-06.doc 2 Session 4: The International Markets, Networking/Marketing and Selecting the Appropriate Project Delivery System 1. Introduction In the first three sessions we discussed the broad forces and issues impacting and likely to impact the global AEC field and their implications. Today we will begin getting into the nitty-gritty details of identifying markets and potential partners, developing appropriate strategies and launching and successfully managing one or more foreign operations or initiatives. Many AEC managers continue to labor under the mistaken impression that marketing technical, professional and construction services and concessions globally is not really that different from how one does it at home. In the case of the AEC field, you simply mail out some prequalifying material, advertise if you have the resources, make a short visit to introduce the company to prospective clients and then sit by your fax machine or look at your e-mail or website screens. But, opportunities do not come in over the transom any more - even at home - like it used to in the “good ole’ days.” 2. New Opportunities and Marketing Targets The Markets As we discussed in Session 1 and 3, the global AEC marketplace is now far more complex. As late as 1980, it essentially included: • domestic public and private markets; • the developed/industrialized (OECD) countries’ public and private markets; • newly industrializing/emerging country markets, essentially multi- or bilateral-funded though host market clients, were increasing in importance; • the poorer undeveloped nations where the market was limited to multi- or bi-lateral donor-funded assignments or natural resource development;C:\Documents and Settings\MStern1\Desktop\MIT Fall 2006 Ses 4 10-5-06.doc 3 • the command economies, usually host government or export promotion-funded (export credits, etc.) which, except perhaps for Cuba and North Korea, no longer exist. While this is the classic definition of the post-World War II markets, what other definitions might now apply and what are the implications? There currently, unfortunately, is no single all-embracing, all-purpose, one size fits all, market strategy when you operate on the global stage. A bewildering number of new market segments or niches have arisen to confuse and cloud strategies. These include, in addition to the traditional planning, architectural, engineering and construction services: • program and investment managers for large initiatives formerly the purview of governments; • advisory services for the sale, purchase, management and operation of public assets; • construction management, once essentially limited to private clients and a few public agencies, now widely adopted by both governments and concessionaires; • independent consulting architects and engineers; • independent design checkers; • technical advisors to lenders, governments, concessionaires, etc.; • loan certification; • concessionaires; • concession audit specialists; • estate and property managers; and • advisors to real estate and other investors; … to name but a few. Furthermore, with the rise of privatization, the private client market once limited to OECD-based clients and third world natural resources exploitation, with few notable exceptions (Taiwan, Brazil and, perhaps Turkey and India), now applies,C:\Documents and Settings\MStern1\Desktop\MIT Fall 2006 Ses 4 10-5-06.doc 4 as The Berger Group readily knows, to even Mauritania, Mali, Ghana, Jamaica, Ecuador, Laos, Bolivia, Peru, Nepal and Cambodia where numerous privatize initiatives are currently underway. The command economies are no longer significant and, with these market shifts, have come, as noted, a bewildering number of opportunities in addition to traditional planning, design and construction supervision. Furthermore, each of these discrete opportunities and marketing targets has not simply a need to solve a problem, but often distinctive ideas on how to choose the most appropriate problem solver. To market your or your company's services or investments internationally – to become the approved “problem solver” - requires the same care and insights that you apply in your domestic markets. But, at home you are so thoroughly familiar with a client’s likely preferences, prejudices, taboos, business practices, legal, moral and cultural constraints, etc., that you sub-consciously incorporate those constraints and considerations into your marketing strategies. But in a foreign environment, comparable elements are also present and they are additionally impacted as we discussed in earlier sessions by historic, religious, gender and ethnic concerns which will, and should, influence and guide your approach in each particular marketplace. b. Peacekeeping and Nation Building From 1944 to 1988, as we know, much of the world was divided into two separate


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MIT 1 463J - Study Notes

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