Executive Interviews

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“We have aspirations to become a multinational retail player” --Interview with the general manager of a sporting goods retailing company in Macedonia-- (1/2)

2017/9/22（Fri）10:00

(Macedonia/マケドニア)

 

*This interview article is divided into two parts and posted separately.
This is the first part of the article.
< Part 2>
 

Sport Vision Dooel Skopje
Mr. Igor Trpkovski (General Manager)
Macedonia

 

Many business people from abroad including the emerging countries have participated in AOTS training programs. Positions of the targeted audience vary with the programs, and there are some programs aimed for top executives.

 

We conducted an interview with a general manager of a company which retails, produces, and distributes sporting goods in the Balkan region.

 

 

--Please explain your company profile first.

 
Sport Vision is a successful retailer with a strong concept and product portfolio from the Balkan region, engaged in retail, production and distribution of branded sporting goods and athletic inspired fashion – footwear, apparel and equipment. The company was founded in Bosnia and Herzegovina 20 years ago, but in the past five years has evolved into the most serious retail chain for sporting goods in the Balkans with more than 250 stores. It operates directly in six countries (Bosnia and Herzegovina, Serbia, Macedonia, Croatia, Bulgaria and Romania) and through a retail franchise in three countries (Montenegro, Albania and Kosovo) thus serving the population of approximately 50 million of people.
 
The business operations began to boost over the last five years because, firstly, the founders and employees have worked very hard to expand our business. Secondly, the company possesses a business model and know-how – mostly connected with speed of income stream generation – that represents competitive advantage in the market. At this stage, the company is rather mini-national (regional), but has aspirations to become a multinational retail player. It is headquartered in Bijelina (Bosnia and Herzegovina) and Belgrade (Serbia) and employs around 2,000 people. Each country subsidiary acts as an independent profit center using the synergy – economy of scale when placing orders, know-how and experience shared across the group.
--What aspects of corporate management do you put much value on? Please share with us your management philosophy or policy, or something considered important.
 
The retailers have understood that there is no chance to survive as an independent company in a single national context. Therefore, it has become natural that international expansion is considered as a means for strategic growth and success. In line with this, Sport Vision has strategic plans to extend its retail operations in two neighboring markets, Greece and Turkey, with a total population of 90 million people. For this purpose we have done the market research and appropriate funding. When we expand internationally it is normal to choose neighboring countries, since there is a big similarity in terms of mentality, living standard, purchasing power and dispensable cash. We are also considering entering the larger European market in the near future.
 
To do so, the company have to engage in an iterative sequence of tasks to identify issues, gather information, devise strategic actions, respond to competitor reactions, and overall generate the capabilities in demonstration of its global corporate presence.
 
We, at Sport Vision, believe that knowledge-based capabilities are the most demanding intangible asset for competitive advancement. Therefore, constant investment in knowledge and people will make all the difference between being outstanding and average, between business success and failure.
 
As the company still expands, the possibilities for advancement are great and we are in constant demand for highly motivated and dedicated people. Our employees can witness that improved knowledge can “lead the way” first for middle and then for higher managerial positions. We have few layers of managers (HR, regional operations, retail operations, internal control) who are instructed to recognize the individuals which have shown capabilities to understand the bigger picture and their specific role within the system.
 
Of course, for further advancement we have specific training, adaptation time and monitoring process followed up by reports for advancement within a certain time frame.
 
--Do you think of any challenges that hinder your company business to grow and develop further? What kind of actions do you think need to be taken to address the above-mentioned “challenges”?
 

As we are attempting to reorganize from a mini-national to multinational corporation, the leading managers are central figures from two fundamental aspects. First, managers are expected to implement global programs, to distribute best practices and to align the organizational cultures of the headquarters and globally dispersed subsidiaries. Second, they have to adapt the management processes and practices in response to the cultural specifics of the host country. To achieve this, managers should acquire the depth of knowledge necessary to assist the company in managing myriad intercultural factors reflecting both global and local forces. In this case, intercultural competent, strategically localized executive managers address global-local tensions in everyday interactions, while at the same time confronting the difficulties of integrating geographically dispersed processes of sourcing, production and sales.

 

When subsidiary of MNC is directed top-down from the distant HQ, sometimes, because of the dynamics of retail business operations and constant time deficit, it is difficult to foresee all the aspects (or consequences) from a specific decision or action. In this case, the insights from the local staff are of utmost importance and should be considered by all means. Here, the country manager and his integrity are in the focus. He or she should take the responsibility to cease or proceed with a certain course of action, having in mind the interest of all stakeholders, delicately balancing between the global company strategy and local short-term performances. The popular “principal-agent problem” describes exactly these situations, where huge costs may arise from problems of moral hazard and conflict of interest. The higher interest of the company is above all, no matter if it causes conflicts with short-term key performance indicators. Again, the manager should find the way to relax the friction between the parties with different short and long-term interests and to secure smooth operations further.
 
I’m pretty sure that Japanese companies are experiencing the same dilemmas in their operations abroad. If not managed in a proper manner, the language, business ethics and cultural specifics and differences can put a significant pressure to international business operations.

 

The basic precondition is to recognize and promote a new breed of intercultural managers which are the essential economic agents for navigating cross-border activities in order to meet the challenges of competitive foreign markets. These world-class executives should successfully master the international challenge of balancing global integration with local responsiveness. By professional profile they are goal-oriented pace setters with high managerial, technological and innovation experience. So, again, people are the key. With the same importance as proper strategy, the success of the company in a new market depends largely on operational implementation and realization.

 

Considering the expansion in a broader context, early preparation and adoption of a proper entry strategy will minimize the risk in operations. Therefore, it is necessary to perform global scanning and obtain all the information necessary for exploiting the international opportunities. Still, the information scarcity may be attributable to the shortage of managerial resources and manifested with the absence of specialist executives to manage international operations. According to our experience, managerial expertise and competence, and the lack of information are the top two difficulties faced by the company in internationalization.

 

*This interview article is divided into two parts and posted separately.

It is the first part of the article.
< Part 2>

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