Business News

Trading up

By Business & Finance
10 July 2013
Niall Olden

The changed nature of international selling is a challenge for Ireland, writes Niall Olden, with start-up and early-stage companies trying to make headway in global export markets.

Ireland is a trading nation. “Trade is our life’s blood”, the Taoiseach said in March 2013. “Ireland’s economic recovery must be export-led”, says the Programme for Government. The Minister for Jobs, Enterprise and Innovation, Richard Bruton TD, in his opening comments on the Action Plan for Jobs said:  “All these actions are supporting the transition from an economy based on debt, construction and property to one based on innovation, enterprise and exports.”

Ireland’s leaders recognise our economic future is dependent on innovation, enterprise and exports and it is obvious that positive achievements are being accomplished in this regard. Through the strategy for Science Technology and Innovation (STI) 2006-2013, Ireland is in the top 10 of EU countries, with national commitment for STI spending of €8.2bn on R&D programmes through Enterprise Ireland and substantial private sector investment, all focused on enabling substantial growth in our nation’s research, development and innovation activities.

As a result, our science and engineering graduates and academics are gaining an international reputation for excellence, and we have world-class R&D in our colleges and universities. Ireland is also attracting significant foreign direct investment, and we have a vibrant national programmes for the development of indigenous innovation-led companies. What is not so clear is what we are doing at national level or in academia about exports.

Kernel Capital published an Open Letter to the Minister for Education and Skills, to the Minister for Jobs Enterprise and Innovation and the presidents of all Irish Institutes of Technology and Irish universities. Here follows an extract based on this letter, the full text is available here.

Open letter

Many of our start-up and early-stage companies are trying hard to make headway in global export markets, strongly supported by this private and public sector investment. Even with this well funded platform, the availability of substantial investment and the support of Enterprise Ireland, our indigenous companies appear to be hitting a ‘glass ceiling’. With a few notable exceptions, we are not building a substantial base of innovation-driven Irish companies of significant turnover.

We must recognise that technology innovation and funding alone will not drive our economy. We need sales, the engine of company and national growth. At the core of trading and export is international sales. Without commercialisation of research, and sales of the products and services, the R&D and innovation effort is wasted. To be a major export nation we need to be world-class at selling advanced products and services.

Yet, relative to the availability of scientists, engineers, finance experts, legal experts, and other professionals, companies have a critical shortage of world-class internationally-focused sales expertise.

International selling

International sales has undergone seismic change over the last two decades. Since the 1980s, advances in technology and software have transformed the nature of companies, from products and services to how they should sell them, allowing smaller innovation-led companies to enter markets that were previously the prerogative of large players.

Even for large corporates, widespread access to knowledge has changed the character of sales, with far greater customer knowhow through the emergence of the internet and search engines, personal computers, smart tablets and smartphones, and the global networks that connect them. International selling is now a complex, multi channel, multi cultural environment, where the path from ‘innovator’ to ‘end user’ is not always clear; today, buyers and competitors have unprecedented immediate access to industry and company information. This ubiquitous access to information is the most significant difference between now and previous eras and affects every aspect of international selling.

A complex sales-channel eco-structure has developed. New sales mechanisms with multiple layers of intermediaries between the start-up and the global multinational and explosive growth of e-commerce, have created channels to market that bypass previous eco-structures, so Ireland must develop new sales skills to penetrate export markets worldwide.

While formerly it was claimed that sales was personality and behaviour driven, and the best sales people knew instinctively how to sell, reinforced by a widespread belief that courses in improving personality and social skills would transform the standing of a salesperson, international selling now requires complex new skills where those who understand and exploit its complexity succeed.
The focus has moved from ‘behavioural driven sales’ to ‘knowledge-based process-driven sales’ implying that many companies no longer know ‘what they do not know’ as they strive to generate international sales and grow.

Teaching approach

We believe that academia has not recognised how far these trends have progressed and are moving. In any major area requiring high levels of understanding and knowledge acquisition, third level education normally plays a vital role.

Academia is neglecting this one area of business where we have a critical shortage of expertise. While Irish academia provides for teaching and research in science, engineering and other business aspects, with a few exceptions there is no coherent international sales focus in our colleges and universities. Sales is mentioned as ‘sales and marketing’ with little emphasis on sales. There are no Irish professors of international sales, or full-time research, degree or higher diploma courses, and no State-sponsored sales research drive. There are few full-time courses in the UK or the rest of Europe, nor any EU-supported sales R&D programme.

However, international sales learning, despite its importance to our nation’s growth and wealth, is not on our national academic radar; there is no coherent national focus of research and teaching in our academic institutions to build up the level of international selling knowledge and skill that the country needs.

How can academia help build our expertise and needs in international sales? Marketing is a popular topic; companies marketing campaigns are by their nature visible, quoted companies financial accounts are published and technological advances are often patented, as such, all of this information becomes publicly available.

International sales, however, is different. International sales strategies are concealed and not made public’ so the field is ready for research and education. International sales, the great underrated, under-researched, under-taught science, is a compelling and valuable area for extensive study. International selling, process driven, complex and innovative, as a research and teaching topic is exciting and valuable, with a huge spread of relevant research topics. While sales research could produce startling and unexpected insights, lack of research and teaching in sales causes prejudices to spread myths without basis to grow and propagate, and good practice is not widely shared.

A new Irish educational approach could illuminate and help the national drive for international sales-led export growth. There are chinks of light; while still few in number, there are enlightened individuals in Irish academia who recognise the importance of international sales learning.
For example, Dublin Institute of Technology (DIT), in association with Enterprise Ireland, offer a highly successful part-time Diploma in International Selling which can be followed with a part-time MSc in Sales Management; the Ryan Academy at Dublin City University (DCU) offers a part-time Diploma in Professional Selling. It is also worth noting that Cranfield University in the UK has appointed a full-time Professor of Sales.

Addressing the knowledge gap

To address this knowledge gap does not require additional state funding or a delayed period of time to achieve — it requires the focused commitment of academia’s existing resources. Some aspects are already being studied and taught in a disconnected way without sales focus in many university departments. Institutions could, at minimal cost, separate international sales from marketing, reposition courses and research projects into many aspects of sales.

Firstly, appoint a professor of international sales and establish a virtual international sales faculty, appoint cross-faculty staff to contribute to sales studies initially developing ‘virtual sales’ faculties. This can be achieved, quickly, effectively and with minimal cost by bringing together staff in existing departments such as law, finance, marketing, HR, applied languages and international studies, business information systems, engineering, computer science and others, focusing exclusively on aspects where these departments overlap with international sales.

Secondly, understand that marketing and sales are two separate disciplines. Marketing is focused on creating awareness and getting your message out. Sales is focused on executing legally binding contracts and getting the revenue in. So we must separate carefully the subject of international sales from the marketing function and design full-time higher diploma, degree courses and research programmes focused on international sales.

Thirdly, cultivate relations with the ‘sales side’ of industry, with Enterprise Ireland, and other relevant state bodies, as academia already does successfully with these parties in the areas of technology and innovation.

Past experience

This concept is not new. It is similar to how our universities first developed nano technology departments, by bringing together existing staff of existing departments of microelectronics, microbiology and materials science into virtual nano technology institutes. We can build international sales faculties and institutes in a similar way.

There is a core of Irish academic’s and business leaders who have for sometime recognised that, just as has been the case with all other aspects of business education, international sales will in the coming decades become a mainstream academic subject globally.

If, as already recognised with regard to science, technology, engineering and mathematics, Irish academia recognises this emerging trend and we build reputation and capability in international sales expertise, the benefits to our nation will be enormous.