June 23, 2011 at 7:58 PM
Millions of Americans, especially of a certain age, grew up drinking Tang, the powdered "orange" beverage with the glamorous connection to the USA race to the moon. Astronauts drank Tang in outer space! For millions of kids who wanted to be astronauts, or rocket scientists, Tang offered a liquid vicarious thrill. Plus, there was the sugar.
Tang went global, and eventually kids in many countries were drinking it — and helping turn Tang into one of Kraft Foods' "billion-dollar brands."
The other day Kraft posted a news release saying that sales of Tang in "developing markets" have been growing at 20% per year for the past two years and reached $13.6 billion in 2010. "Markets like Brazil, Argentina, Mexico, the Philippines and the GCC countries were the rocket fuel behind the brand," wrote a clever p.r. agent.
Is it mere coincidence that most of those countries just mentioned are also home to successful outsourcing industries? That's another story. But the Tang success story involves some themes that IT outsourcing and BPO companies, especially ones expanding into other countries, can pull from.
Most important: Act local, even if you are global. Kraft developed versions of Tang based on local fruit flavors. In Brazil, this meant soursop (graviola). In Mexico, horchata. The company also localizes the nutrients it adds to the beverage powder — the additional services it provides, you might say.
"We fortify Tang with Vitamin C in all geographies, but in Brazil and the Philippines where kids are iron deficient, we fortify with iron," says Kraft Foods executive Sanjay Khosla. If Khosla were from an IT services company, he might instead be saying, "... where businesses are deficient in web developers, we fortify with web developers."
Khosla also mentioned the importance of giving local employees a chance to try something new, applying a business model that gives local leaders "freedom within a framework to act like entrepreneurs." One thing innovative and agile IT providers all share is the willingness to give their teams the leeway to be entrepreneurial.
This idea of local control and flexibility is even more important to IT services than to the fortified beverage industry. I've talked recently to a number of executives for Indian and for multinational companies operating in Latin America who say they have learned that local managers running local branches is the way to go, and that things don't work well otherwise. Relationships and cultural bridges are smoother and more collaborative.
Execs who take a rigid, overly procedural approach — the one-flavor-fits-all approach — should think about the Tang approach. Sure, you offer the classic orange flavor, but you also invest in soursop, horchata, pineapple, or tamarind if that's what the local market likes, and add iron if that's what clients need.