1997

As the end of the year is drawing closer, it is time for some reflection. Let me take you back not just one year, but twenty. At the end of 1997, I found myself at the epicentre of the Asian financial crisis, also known as the Tom Yum Goong crisis, which originated in Thailand and followed the devaluation of the Thai Baht earlier that year. I was in charge of a startup company in Bangkok providing software services to local companies in Thailand. Within just a few months, almost all of our clients either became insolvent or withdrew from their contracts. As might be imagined, this presented quite a challenge for a fledgling startup business. At times, I was worried that I would not be able to pay out salaries to our employees at the end of the month. Fortunately, it never came to that. Due to providential circumstances that allowed me to bridge the worst periods with loans and advance payments, my company avoided joining the increasing numbers of Asian crisis casualties.

However, by the end of that year it became clear that the economic slump was of a more permanent nature and that I needed to restructure the company’s business if I wanted it to have a future. Fortunately, there were two things on our side. The Internet was taking over the world rapidly, creating a sudden demand for web services and web-savvy software and at the same time making remote collaboration more practical. Secondly, the company was small and agile, which meant it could adapt to these changes quickly. Thus I put all eggs in one basket and began to restructure the business as web development company. We moved away from the more traditional enterprise software market and embraced then emerging web technologies. I hired two graphic designers and our programmers learned HTML, Perl and JavaScript.

Perhaps more importantly, we started to look abroad for new business, particularly in Germany and the USA. The idea was not just to offer a new type of service, but also to offer it to a new type of clientèle, namely one that is located offshore in different places around the world. Within six months, between 80% and 90% of the company’s revenue was derived from web services, particularly from creating web sites for small and medium enterprises. As our portfolio was growing, we established a reputation and were able to attract bigger clients. By mid 1998 we merged with a small local web development company and thus cemented the path taken. The transition from working locally to working globally took a bit longer, however, as it turned out to be more challenging. Cooperating remotely with international clients presented not only technical and organisational difficulties. There are also a cultural barriers between Thailand, Europe and America that need to be taken into account.

Among the many cultural differences one finds besides language, communication style, business practices, social habits, the degree of risk acceptance, awareness of hierarchies just to name a few. Efficient communication turned out to be the most challenging issue. It became necessary to put project leads in charge who are not only fluent in English, but who also have some understanding of the way things are done outside of Thailand. In most cases, this adds a layer of management and administration. For example, requirement and specification documents have to be translated. Customer expectations must be communicated clearly to those who execute the work. By 1999, all of our major clients were international. It took almost two years to complete the transition from a local consulting business to an offshore services company. In the end, my company had escaped the snag of the Asian crisis. But more importantly, it had reinvented itself and the new direction laid the foundation for years to come.