Although corporate sustainability usually refers to green business or environmental concerns, from a perspective of growth and stability of business in the market, sustainability is basically the ability to withstand market competition. In view of today’s competitive environment and the increasing number of businesses that fail, it is important to focus on sustainability of business to withstand competition in the market.

In my book, Sustainable Growth in Global Markets: Strategic Choices and Managerial Implications, I explore the factors that sustain businesses in the market despite intense competition and changes in organizational behavior. I discuss the concepts of marketing management in doing business in international destinations, and analyze the abilities of companies to do business in international markets.

In the “market chaos” of today, a company’s ability to be sustainable in the market depends in part on high brand equity and consumer loyalty. This is the phase in which companies strengthen their corporate reputation, build global brands, and gain competitive advantage over the other companies. Sustainable business is largely customer-centric and appeals to mass-market segments.

Furthermore, businesses must have a long-term international expansion strategy to survive. However, it is not easy for any company to break into international markets: businesses need to consider macro- and micro-economic, market competition, technological, and governmental factors, but above all, they must make complex strategic choices when forging and implementing a short-term strategy. The speed of strategy implementation matters in the marketplace today to gain the first mover advantage. But at the same time, only the companies able to make right strategic choice are found fit to do business in the international destinations.

These businesses gain competitive advantage mainly by investing in innovation and technology, driving product differentiation. Such efforts stimulate the consumer preferences and companies that are successful in building technology-led product differentiation and generate consumer preferences take the first mover advantage and emerge as market leaders.

In my book, I also analyzes the success factors of companies in international markets, the role of leadership in international business, and the emerging trends toward building an innovative company.

A consumer-oriented approach is crucial to company survival in today’s competitive environment. With family spending power at a standstill and an increasingly fragmented market (with a variety of products and services, ways to purchase, sales channels, and means of communication, etc.), businesses need to understand the consumer experience and align their marketing strategies accordingly. Virtual shopping and enhanced reality are just two phenomena that make up the intricate mosaic in which the consumer moves today; he is more informed, analytical, experimental and, above all, emotional in his purchasing.

With the goal of helping managers to understand how emotional and non-conscious processes influence consumer behavior and to build successful marketing strategies, we wrote the book Understanding Consumer Behavior and Consumption Experience. 

From the consumer’s initial perception to his behavior in the online market, the purchasing experience, the relationship with products and brands, ethnic identity and cross-cultural variations, and consumer happiness and well-being, the book offers a practical guide for decision making, based on the most relevant findings of contemporary academic research.

Understanding consumer emotions

The foreword by Dr. María de Lourdes Dieck Assad, Dean of EGADE Business School, states that in the age of virtual shopping and enhanced reality, consumer satisfaction continues to be driven by factors such as “trust, emotions, psychodynamics, and self-reference criteria that are often complex and characterized by high volatility.”

This is why, even if businesses accept the significant role that positive and negative emotions have on consumer decisions, a better understanding of the complexity of these emotions is required to design a marketing strategy that gets the desired response from consumers and increases satisfaction and loyalty. We delve into the different aspects of consumer behavior that affect emotions, such as persuasion, word-of-mouth, the non-conscious, well-being and happiness, vulnerability, multiculturalism, social networking sites, etc.

Business leaders meticulously analyze these factors to develop reactive marketing strategy and gain tactical advantage. In hard-hitting economic times, many businesses adopt a customer-centric approach to retain existing customers rather than investing in acquiring new ones, for example, by offering more value-for-money strategies. In this case, we emphasize the experience of multinationals in emerging countries, focused on cost-innovation capabilities and mass-market prices.

For consumer-oriented strategies to be successful, we recommend companies to empower consumers, educate them about the attributes of the competition to enable the right decision making, offer an integrated experience on buying and consumption, and definitely improve their ability to purchase intelligently.

We suggest an in-depth analysis on consumer behavior and consumption experiences. The eleven chapters in this book are a pivotal reference source for business managers and marketing executives, as well as for scholars and graduate students interested in the relationship between consumer cultures and businesses.

Globalization has driven extensive market competition at all levels, from global to local. By the end of the 20th century, market saturation by products and services, often identical (for example, purified bottled water), led businesses to make competitive differentiation in their product and marketing strategies. Accordingly, companies make small differentiations in product attributes, pricing, distribution approaches, product promotions, packaging, sales strategies, consumer psychodynamics, corporate posture, and more, to establish their unique competitiveness in the market and acquire customers. This small differentiation has proved better results in consumer products such as breakfast cereals with organic fruits, bottled water from natural springs, solar wristwatches, and ventilated sports shoes.

These small changes can lead to big differences in the market, driving tactics in competitors that alter consumer preferences and buying habits, as I illustrate in my new book The Butterfly Effect in Competitive Markets: Driving Small Changes for Large Differences.

Based on the “butterfly effect” concept of chaos theory, coined by mathematician and meteorologist Edward Lorenz in 1972 to explain how sensibility to small variations in initial conditions have effects on long-term atmospheric climate prediction. I describe how businesses with small differences have gained greater market participation and are able to maintain a competitive advantage with this type of products.

Some examples of this phenomenon related to technological innovation are the Samsung Galaxy Gear wrist band, which serves as a wristwatch, a bidirectional communication tolls, and a camera and has thrown a big challenge to the Swiss watch industry, or the transformation of iPod to iPod Shuffle, taking advantage of the inheritance of brand sales in the global market.

Competitive differentiation can be driven by a set of marketing-mix elements, which include the so-called “11 Ps”: product, price, place, promotion, packaging, pace, people, performance, psychodynamics, posture, and proliferation.

Chaos and Market “Darwinism”

Market chaos emerges with the uncontrolled entry of companies engaged in selling identical and/or marginally differentiated products, allowing consumers wide options for buying with similar prices. Under such circumstances, consumers develop switching behavior over the brands, and all brands settle at the bottom-line sales/market share just at or barely below the break-even point.

This market chaos threatens the business outlook of the companies and prompts a tactical entry into and exit of the business from the marketplace. In this process, multinational companies focus on the segments at the base of the pyramid, whereas the local small and medium-sized enterprises tend to go regional, national, and global.     

This situation drives the Darwinian forces of “struggle for existence” and “survival of the fittest” among local and multinational companies. While multinational companies face “struggle for existence” challenges in the market chaos, the emerging companies from the local arena put their efforts into meeting the “survival of the fittest” requirements.

Globalization has also had global–local effects; multinational companies that intend to operate in the local markets adapt to the needs of the local consumers, blending global brands with local tastes. For instance, Unilever adapts to the local food needs and makes consumers sense the pride of an international brand within their reach. Knorr soups by Unilever in Mexico have common local flavors, and this same brand offers numerous vegetarian options for markets in India. In this way, multinational companies tend to establish their market leadership in local markets. However, in this process, foreign brands often cannibalize local brands and the existence of local brands becomes vulnerable.

In turbulent, uncertain world market situations, companies should follow customer-centric strategies more than market-oriented strategies based on competitive moves.

All markets have operational cycles that are evidenced by booms and busts in consumer demand. The customer preferences shift according to the attributes of market booms and busts. It would be wise for companies to develop strategies of awareness, availability, affordability, and adaptability for products in reference to technology and concerns for value-for-money. During the recent global recession (2007–12), multi-domestic companies that moved with consumer preferences and maintained affordable prices survived the market turbulence.

In this book, I explore other ideas such as “sustainable marketing,” characterized by long-standing brands, non-fluctuating market share, consistent customer value, and increasing profitability of companies over the years.

To get a job, a promotion, or a new position in an organization, social networks can be decisive. Whereas in developed countries such as the United States or Canada, “weak” social ties—acquaintances with whom one has sporadic contact—are key to getting a job, in emerging countries in Asia or Latin America, “strong” ties are more useful— kinship or close friendship—when getting promoted and prospering on the job market. Knowing how social networks function as related to Latin American job market dynamics can help human resources in the region perform better, and can serve as a guide to manage them efficiently.

The chapter “Human Resource Management in a Kinship Society: The Case of Latin America,” included in the Handbook of Human Resource Management in Emerging Markets. and co-written with IESE professor Marta Elvira, examines how social networks affect human resource practices in Latin American organizations. By analyzing the region´s cultural values, and focusing particularly on hiring, promotions, training, and labor relations, we explore how, in Latin America, social networks influence the job market.

Prevalence of Kinship Networks

Kinship societies, such as in Latin American countries, tend to favor the development of networks with “strong” ties, for economic and business reasons. Social networks within and outside of organizations then facilitate an administrative function (of governments and businesses) that does not manage to meet the needs of employees.

Thus, social networks produce a “social capital” that has its own value (and that generates more trust than the institutions), because it is based on reciprocity and the constant exchange of favors. An example would be compadrazgo, which also exists in the Chilean middle class and the Brazilian jeitinho. Culturally, the region has developed mainly from a kinship structure and not through market principles.

“Vertical” and “Horizontal” Ties

Latin America’s economic development is strongly related to a pattern of cultural values whose cornerstones are the family, authority, and power. Historically, family businesses have been the main driving force behind development in the region, and relationships among family members have been of vital importance, but so have relationships among elite families and the members of the same socioeconomic group. As a consequence, the “weakest” ties with friends, acquaintances, or colleagues are secondary to these networks, the opposite of what happens in countries such as the United States or Canada.

On the one hand, in the paternalist system that has prevailed in the region’s labor relations, bosses take care of their employees’ personal needs and those of their families. On the other hand, there is a lot of respect for authority and hierarchal structures, which may favor close ties between the members of the same socioeconomic group.

One of the findings of this research shows that, in Latin American organizations, superiors and subordinates develop strong “vertical” ties because they share the value of power distance based on solidarity and reciprocity; whereas it is more likely for “horizontal” ties to develop among people from the same hierarchal level because they share the value of legitimate authority and social differentiation.

Networks and HR in Latin America

“Strong” ties—which privilege kinships and close friendships from the same socioeconomic group—may be the most effective way of finding a job. It is also believed that hiring relatives or family members of employees increases trust, loyalty, and responsibility in the workplace, and recommendations from family members, close friends, or classmates are the main source of hiring in many companies.

Recruitment and personnel selection practices based on the family or the socioeconomic nucleus through “strong” ties guarantee employee control and performance; however, they can also be a glass ceiling for executive promotion, as they are more important than talent.

With respect to training, we found a predominance of the master-apprentice model, by which the relationship between superior and subordinate is strengthened based on the principle of vertical reciprocity. Informal training is also useful, as vacant positions are usually filled from the inside, although it could create opposing viewpoints at the management level when managers get training and apply professional administrative practices.

The chapter describes how labor relations have historically been carried out in Latin America: Strong ties between unions and political groups have guaranteed control over the workers in exchange for privileges, which shows another strong vertical tie between these social agents.

The institutional context in which businesses develop have a decisive influence on their growth. For example, a lack or underdevelopment of institutional mechanisms increases transactional costs for companies—because of the absence of specialized intermediaries, regulatory systems, or mechanisms to guarantee that contracts are complied with—, and thus limits their reach and growth. Even though there has been ample research on how multinationals face these “institutional vacuums” in Less Developed Countries (LDC), there is not much literature the effect on local entrepreneurs in these countries.

The paper “Entrepreneurship Amid Concurrent Institutional Constraints in Less Developed Countries,” co-written with Dr. Theodore A. Khoury, from Portland State University, addresses how to overcome institutional limitations faced by entrepreneurs in LDCs.

Understanding entrepreneurship under extreme conditions

The article delves into how institutional limitations are a challenge for local entrepreneurs and illustrates how these entrepreneurs survive thanks to cultural entrepreneurship strategies and “DIY” (a concept that is used in the filed of entrepreneurship to refer to “doing the right thing with the available resources to create a new product or market opportunity”).

Sometimes entrepreneurs in LDCs work in extreme conditions, because they not only lack functional formal institutions but also their informal institutions have serious limitations. To illustrate this point, the authors analyzed the case of olive-oil company Canaan Fair Trade, which has operated in Palestine’s West Bank since 2004. The limitations that his company faces, mostly derived from occupied territories, include access to resources and jobs, limits on mobility, a lack of authority to implement policies or enforce the law, and judicial uncertainty regarding property rights, among others.

In this adverse context, the company has managed to minimize risks such as land expropriation or late-arriving transportation services that result from military controls, taking advantage of exploitation created in cooperatives, which are smaller and spread about the territory; still, this strategy may entail not taking advantage of economies of scale.  

Despite the limitations, which undoubtedly affect Canaan Fair Trade’s efficiency and volume of production, the company was able to export more than 350 tons of oil to North America and Europe during its first four years.  

With the increase in world instability over the last decade—warfare, a global financial crisis, political agitation, and influence from social movements—, we think a better understanding of the dynamics of entrepreneurship under severe limitations is vital. Survival and competitiveness are possible thanks to entrepreneurial creativity and persistence.

The book Humanistic Perspectives on International Business and Management, published by Palgrave Macmillan in October 2014, included a contribution by Dr. Anabella Davila and Dr. Consuelo García de la Torre, research professors at EGADE Business School, Tecnológico de Monterrey, and EGADE Business School graduates from the Doctorate in Administration Sciences (DCA)—Dr. Mario Vázquez Maguirre and Dr. Osmar E. Arandia Pérez—, along with Dr. Luis Portales Derbez, a graduate in Tecnológico de Monterrey’s Doctorate in Social Sciences program (DCS); all of the former students made up part of the Humanism and Management Research Group—led by Dr. Consuelo García de la Torre—which today is one of the research topics for EGADE Business School, Tecnológico de Monterrey’s Research and Social Innovation Group.

The book Humanistic Perspectives on International Business and Management, edited by Nathaniel C. Lupton—Associate Professor of Management Systems at Fordham University—and Michael Pirson, director of the “Humanistic Management” Network and associate professor at the same university, gives global perspectives on how to rethink international business and business practices to cover climate change, international terrorism, social inequality, or the food crisis, taking advantage of globalization forces.

Dr. Anabella Davila, a research professor at EGADE Business School, co-authored the chapter "Humanistic Leadership as a Value-Infused Dialogue of Global Leaders and Local Stakeholders" together with IESE professors Carlos Rodríguez-Lluesma and Marta Elvira. This chapter explores how global leaders and local stakeholders can contribute to mutual flourishing through a better understanding of the other's values.

Dr. Consuelo García de la Torre, who wrote the chapter Humanism and Management of the Humanistic Management Network, headquartered in Switzerland, and Dr. Mario Vázquez Maguirre, a DCA alum, wrote the chapter “Indigenous Social Enterprises: A Humanistic Approach to Sustainable Development and Poverty Alleviation.” By analyzing the Ixtlán social business group, the authors identify the social entrepreneurship mechanisms that allowed for a sustainable solution to poverty and unemployment, as well as mechanisms to commercialize products in international markets. This group of social businesses in southern Mexico has transformed a highly marginalized community into a prosperous ecosystem.

Also, Dr. Osmar E. Arandia Pérez, a DCA, EGADE Business School graduate, and Dr. Luis Portales Derbez, an alumnus of the Doctorate in Social Sciences (DCS) at Tecnológico de Monterrey, co-wrote along with Dr. Consuelo García de la Torre the chapter “Shaping Humanism at the Tecnológico de Monterrey: The Citizen of the Future.” This chapter describes how Tecnológico de Monterrey is integrating the humanistic paradigm into its mission statement, designing an educational, formative model based on humanistic principles. This model is characterized by the guarantee that its graduates not only have knowledge and abilities to compete in global markets but are also aware of national and international socioeconomic realities and are able to act from an ethical perspective focused on citizens.