Australian legal and management consulting firms are well-positioned to tap into growing opportunities in Asian markets, according to latest research.
But a significant shift in mindsets and strategy is required to capitalise on those opportunities, the new report found.
The first-of-its kind study, Growing Knowledge Economies provides in-depth insights into the specific opportunities, challenges and factors critical for success faced by Australian management consulting and legal services firms in four key Asian markets – Singapore, Indonesia, Korea and Japan.
The research, conducted by Asialink Business with support from Austrade, calls on Australian professional services firms to act quickly to secure their competitive advantage in Asia.
Austrade CEO Bruce Gosper released the report’s findings at a forum hosted by the Law Council of Australia and the Australian Services Roundtable in Melbourne yesterday.
It reveals that while free trade agreements have opened new doors, and Australia’s expertise is well regarded throughout the region, businesses must compete to succeed in an increasingly crowded marketplace.
Quality services in high demand
“With rapid economic growth and burgeoning middle classes, quality services are in high demand throughout Asia,” the CEO of Asialink Business, Mukund Narayanamurti, said.
“Australia’s free trade agreements, world class expertise in sectors like legal and management consulting, and strong reputation position our professional services firms well to capture these opportunities. But more needs to be done to maintain our first-mover advantage.”
“Our research indicated that ‘fly-in fly-out’ (FIFO) models are often no longer effective. What’s needed is a long-term, strategic mindset and a significant increase in investment, both to establish a physical presence in Asia and to build business relationships,” Narayanamurti said.
Stuart Clark, President, Law Council of Australia, said: “The Australian legal profession is well regarded for its legal expertise and record of establishing collaborative and mutually beneficial business relationships with lawyers in Asia.
“Every law firm has a unique value proposition that underpins the way it provides services to its clients – this report provides essential guidance on how to best communicate that proposition to potential clients in the region.”
Alina Bain, Chief Executive Officer of the Australian Services Roundtable said: “While circumstances differ in each market, and on the whole, the opportunities are promising, Australian professional services firms often do face multiple challenges relating to understanding local culture and regulations, attracting and retaining talent and getting your brand recognised.”
The research, which was based on qualitative interviews with Australian professionals based in the four target markets, identified a critical need to continue to build the Asia capabilities of the Australian professional services sector.
While the research found that Australian expertise was well suited to growing Asia’s knowledge economies, building Asia capabilities in our professional services firms was a key to success.
Asialink Business researchers interviewed 30 senior executives of 16 Australian law firms and 18 management consulting firms with operations in the four markets.
And more than 50 practitioners contributed to an Asialink Business survey, providing insights about key success factors, barriers to entry and market perceptions.
- Australian firms should take advantage of newly signed free trade agreements, including KAFTA (Korea) and JAEPA (Japan), as well as longer standing ones such as SAFTA (Singapore).
- Australian firms should capitalise on their niche expertise and specialised experience in particular industries such as resources, minerals and agribusiness to gain a competitive advantage.
- The potential for certain markets to serve as a gateway to further business expansion across the region should be considered when selecting where to first establish in Asia.
- Australian firms can best capture Asia-bound business by working with their Australian clients that are themselves expanding overseas.
- Investment in strong regional relationships and networks is critical to business success in the region.
- Australian firms operating in countries with which Australia has strong bilateral government relationsenjoy better facilitation of their operations.
Asialink Business supports organisations in all sectors to develop the critical skills, knowledge and networks needed to better understand and engage with Asia.