Med-Academy After-care methods & tools

Transcription

1 Med-Academy After-care methods & tools Emmanuel Noutary - Marseille, 22 March 2009 emmanuel.noutary@anima.coop ANIMA - Invest in Med

2 What is after-care? After-care comprises all potential services offered at the company level by Governementsand their agencies, designed to facilitate both the successful start-up and the continuing development of a foreign affiliate in a host country or region with the view of maximizing its contribution to the local economic development Young & Hood (1994) After care is the provision of services offered to investors aimed at: Encouraging and anchoring incremental investment Providing the factor conditions to encourage existing investors to upgrade their activities Facilitating new investment ANIMA - Invest in Med

3 Why is after-care so important? It is 7 times more expensive to land a new customer than to sell to an existing one Former Chairman of Ford UK Local development benefits from FDI will not come about at once Incremental investment can account for 60% of investment flows in Western European countries According to PWC Consulting, 2/3 of companies say that after-care influences their expansion plans Perception of host country = key trigger for investment Positive impact for potential investors of witnessing existing investor expansion ANIMA - Invest in Med

4 The image of the aircraft (given by a foreign investor in a MEDA country) As a plane, the investor has landed in the country The plane has stopped on the runway and seems abandonned No information about parking No luggage handling No passenger handling Poor condition of the airport Importance of follow-up Re-investment account for less than 10% of FDI flows for MEDA Most IPAs/EDAs are either waiting passively or searching abroad (when the resource is here) ANIMA - Invest in Med

5 After-care: some targets Key projects or issues Re-investment, production unit expansion Co-investment opportunities Sector/cluster development initiatives Risks of closure or vulnerable industry Licences, privatisations Target players in key sectors Multinationals with foreign/local clients/suppliers Potential for new types of activity, for growth, for suppliers MNCs and foreign-owned firms whose know-how could be used/ developed locally to integrate suppliers Reinforcement of the supply chain value Embedding companies more strongly in the territory Retention of existing companies ANIMA - Invest in Med

6 Preconditions for effective after-care IPAs should concentrate on building up the stock of investors in the first instance; Investment climate should be reasonably competitive; Clear strategic direction (i.e. objectives); Strategic goals should differentiate if: emphasis is on basic aftercare mainly to facilitate retention and expansions; or aim to really maximize the long-term spin-off from foreign investment (embedding and upgrading programs) requiring greater commitment ANIMA - Invest in Med

7 After care in the FDI management process B. Image building and promotion Country attractiveness Communication tools & events A. Strategy & organisation Industrial strategy Investment map Marketing strategy Policy advocacy E. Investor servicing Project Offers to handling investors Investment facilitation & one-stop shops Follow-up, after-sale, after-care, clubs etc. C. Resource management Investment intelligence Training, coaching D. Lead generation Investor /sector Prospection targeting network Project Project generation qualification Data, studies, observatories Monitoring & evaluation ANIMA - Invest in Med

8 After-care phasing Growth of company Introduce higher value added activities and R&D Help ensure that Company growth is not being constrained Assist during the start-up phase Time Source: Profile of graph / Buck Consultants International ANIMA - Invest in Med

9 After-care services 1/2 Administrative services Work permits, visas, company registration Homes and schools for expatriates Liaising with banks, legal and accounting services, real estate agents Operational services Staff training, export promotion, premises expansion Local suppliers, clusters integration Support internal lobby to develop in the country (business case) Strategic services Support new product/ services development Support and upgrade local suppliers Network (industry, with politics) and policy advocacy ANIMA - Invest in Med

10 After-care services 2/2 Source: UNDP survey, 2007 ANIMA - Invest in Med

11 After-care world survey 1/2 IPA resources by activity Investment generation: 26% Investment facilitation: 20% Image building and branding: 19% Aftercare services: 10% Policy advocacy: 8% Other: 17% Level of priority for generating reinvestments/ expansions compared to new investments Higher priority: 25% Same priority: 59% Lower priority: 16% Source: UNDP survey, 2007 ANIMA - Invest in Med

12 After-care world survey 2/2 Aftercare services provision National level: 66% Regional level: 33% 95% collaborate with other institution for aftercare 60% of aftercare services are offered to all investors, then a segmentation helps prioritise the campaigns Industry or sector: 80% Investment size: 60% Source country: 3% Location of the investment: 7% Source: UNDP survey, 2007 ANIMA - Invest in Med

13 The after-care process Implement the services & monitor 5 Understand the investor community 1 Develop objectives & targets 2 Segment and design the after-care programme 4 3 Assess resources & identify partners ANIMA - Invest in Med

14 1 Understanding the investor Develop and maintain investors databases Analyse companies profiles Location, country of origin, sector, size, markets Potential of growth and importance for the region and interest for your territory Understand the investor activity Supply chain, markets (national & international) Employees profile In house competence vs local externalisation Survey the investors needs... AND REPORT! Send letter with invitation to meet Set meeting open semi-structured dialogue including the plant tour Invite them in social/ networking/ policy events ANIMA - Invest in Med

15 Knowing the investor: example Knowledge of the existing foreign basis per nationality Example of UK companies in France Total UK and Irish investments in France: 1,800 companies 200,000 jobs UK and Irish investment flows in France: 40/50 projects per year 2,000/3,000 new jobs per year 12/13 bn per year ANIMA - Invest in Med

16 2 Develop after-care objectives and targets Typical objectives Increase value added activities or export driven activities Increase employment of certain level of staff Attract suppliers of MNCs Develop specific areas, territories Increase industry/ university/ R&D collaboration Corresponding targets Number of visits (per year, per segment) world average = 3.7 visits/ year/ company; 10.7 calls or s/ year/ comp. Number of new investments/ extensions from existing investors Number of new jobs to create Number of jobs to safeguard Number of MoU/ association agreement with Univ.& R&D ANIMA - Invest in Med

17 3 Assess resources & identify partners Little resources (2 people) On demand reactive action (from admin to strategic) Project support in specific areas (admin, supply chain, link with Univ/ R&D) Co-ordination of partners delivering the services first steps to test the interest of after-care After-care centralised team Deliver a wider spectrum of services Usually, national approach sometimes frustrating, because never finished After-care integrated approach Articulates national and regional economic development Aims at integrating companies into the local economy Source: UNDP survey, 2007 ANIMA - Invest in Med

18 Key components of after care programmes BODIES INVOLVED Vocational training centers, Universities Central/local governement FDI and development agencies Foreign trade institutions Property, financial institutions Employers' associations/ Chamber of Commerce Private sector utilities WORKING TEAM * Single agency or partners' " team" based * Proactive, long term team at Senior level * Coordination among involved bodies TARGET GROUPS * MNEs and foreign owned companies * European HQs of MNEs * OEMs and first tier suppliers * Key players in target sectors OBJECT IVES Reinvestment and Retention Product development for innovation Attract foreign suppliers/ clients OEMs development Local economic development Links with R&D and Universities Cluster developm ent Source: Paola Elia Morris for ANIMA, 2002 ANIMA - Invest in Med

19 After-care partners Government Parliament and MP s Chambers of commerce Local labour offices and Labour unions Customs office Private sector specialist companies Network of regional development agencies Other professional associations Schools & universities R&D and Technology parks. ANIMA - Invest in Med

20 4 Segmentation of investors to care after Whatever the resources, after-care like any sales activity is a never ending job Hence the segmentation of investors to target Segment investors to be targeted Depends on the territory economic objectives (jobs, technology, knowledge, export, local industry, etc.) Segmentation by sector/ origin country/ region/ size/ market/ level of jobs and wages/ risk of closure Dispatch the contacts between Senior account managers (major MNCs) Specialised experts (technologies) Regional organisations (clusters, territory/ zone manager) Marketing department (event, mailing, etc.) ANIMA - Invest in Med

21 Design the programmes: examples Understand, get in touch with the investor AND FOLLOW UP EVERY 6 MONTHS! Direct mail or phone to companies (need analysis, survey, information) Marketing activities: newsletters, conferences, seminars, exhibitions, conventions Outward and/or inward missions Support the company s project Investor s hotline Generating links to private firms, networks, industry clusters Links with administration, schools, embassies, etc. Nurture future investments Links to local Chambers, Employers Associations Links to Universities, vocational training centres Involvement in local projects and strategies ANIMA - Invest in Med

22 IPA aftercare tools (world survey) Source: UNDP survey, 2007 ANIMA - Invest in Med

23 5 Implement after-care services After-care is about selling, selling is about needs Designate account managers (by seniority, by competence) Manage after-care staff as sales staff (offer marketing tools, incentive, ask for reporting) Good relationships sell more than superior selling technics Send people on the field! be customer focus: what are you bringing to the table? 95% of after-care people work with partners Administration, institutions Chambers of commerce, clusters, existing clubs Private consultants (facilitators, business services, real estate) Investor do not expect you to do everything, but they expect you to know everything Knowledge is the key (pre-investment datas, local industry, administrative issues) Develop strong relationships with your partners (admin ) ANIMA - Invest in Med

24 Direct delivery vs partner delegation? Administrative services Work permits, visas, company registration Homes and schools for expatriates Liaising with banks, legal and accounting services, real estate agents Operational services Staff training, export promotion, premises expansion Local suppliers, clusters integration Support internal lobby to develop in the country (business case) Strategic services Support new product/ services development Support and upgrade local suppliers Network (industry, with politics) and policy advocacy... In any case, co-ordinate! ANIMA - Invest in Med

25 Evaluate and monitor your targets ANIMA - Invest in Med

26 Thanks / Contact Coordination / Programme management Bénédict de Saint-Laurent, Programme Director, ANIMA Clémentine Brisson-Lesage, Assistante Tel /Fax clementine.brisson-lesage@anima.coop bsl@anima.coop Executive Committee Freya Lemcke, EUROCHAMBRES Tel /Fax: lemcke@eurochambres.eu MedAlliance Board Monia Skhiri, Secrétaire Générale, BusinessMed Tel /Fax m.skhiri@umce-med.org ANIMA - Invest in Med 2009 Invest and develop business in the Mediterranean 26