The past decades have seen many Asian countries embrace market capitalism and open their economies to foreign participation and influence. There has been a considerable increase in the number of global companies setting up shops in Asia. With exotic locales, unique cultures and sun-kissed beaches, tourism has become one of the booming industries in Asia. Recently, the active promotion of high quality and affordable health care and a renewed focus on developing a world class education system, has developed health and edu-tourism.

As many Asian countries are able to boast of one or more of the above attractions, the need to differentiate and brand themselves to attract capital and people is rapidly gaining importance.

Countries create distinct identities in the minds of potential tourists, businesses travellers, traders, importers and consumers. As the number of tourist arrivals and business travellers continues to increase in the world, countries must increase their share of the pie by building strong top-of-mind awareness. Recall of the destination should be instant when they try to plan a holiday or the venue for the next company-wide conference.

Overall, country branding can be divided into three main categories by the purpose they serve:

• Export branding
• Generic country branding
• Internal country branding

Although one of the obvious reasons countries brand is to sway tourists (and their dollars) away from other, often neighbouring, countries, the more important reason is to create a positive image which local products, when exported, can be associated with and can gain instant cache from. Selling Italian shoes and German engineering is much easier than selling Australian shoes and Czech engineering. Branding can also serve a purpose in the global marketplace through attracting investments and skilled workers.

Internally, governments can use their new brand identity to channel development and boost public morale. For many decades, due to Asia's relatively lower level of social and economic development the products and services emerging from the Asian region did not enjoy a very positive country-of-origin effect. Studies done in the 1970s portrayed a dire picture for Asian companies.

But now, with new branded identities to rely on, they can fight entrenched beliefs not only in their home countries but outside as well.

Even today, the majority of Asian companies still function with a trading mindset where short-term sales and investments in tangible capital assets are predominant.

A study carried out by McKinsey & Company shows that tangible assets are becoming less relevant in Asia's battle for global success. It shows that the biggest value creators of Asia have a 1:1 sales to asset ratio as against a 1:4 sales to asset ratio for an average Asian company.

Going ahead, Asian boardrooms need to realize the importance of intangible assets and invest in them. Asian boardrooms will have to accept and support consistent investments in brand building, the results of which will take a couple of years to accrue.

For long, Asia has primarily thrived by adapting western technologies to local markets. But going ahead, this need to change if Asia wants to accelerate away from the low cost OEM trap and thus innovation and strong brand leadership becomes the key factor to drive better margins.

Huawei Technologies, the telecom equipment company from China, spends more than 10% of its revenues on R&D, while Samsung spends more than 8% of its revenue on R&D. They serve as examples of Asian companies which focus strongly on innovation.

Asian companies need to invest substantially more in research and development and come up with new and proprietary technologies to survive amongst the impending competition.

The business landscape in Asia will change rapidly in the coming years, where the opportunities for Asian companies to benefit from international branding will be larger than ever before. The growing emphasis on international branding will move up the boardroom agenda and branding will become one of the most prominent drivers of value in Asia Pacific in the next two decades. Branding is being discussed almost daily in Asian media and in multiple conferences and seminars.

Branding is a boardroom agenda - a strategic issue. The branding process cannot reach its logical conclusion unless the chairman and the CEO buy into it and back it up with the required resources. But merely having the branding knowledge will not suffice. Leaders need to have a holistic vision and an in-depth understanding of the discipline. One also has to be an excellent business leader and brand marketer with a truly international edge.

Asian boardrooms have traditionally been the playing fields for technology and finance professionals, and most directors either have technology, operations or finance backgrounds. Going ahead, these capabilities alone will not be sufficient for sustained growth and enhanced shareholder value. With branding taking the center stage, it is extremely crucial that the boardroom represents brand capabilities and experiences to ensure that brand guardianship is practiced at the highest level.

This can be accomplished in two ways. Firstly, education and training of the boardroom directors can bring them up to a common understanding of the discipline, its opportunities and challenges. Secondly, the company can elevate people with strong marketing and branding backgrounds to the board.

Companies can ideally combine the above two ways to achieve optimum results. Asian brands can indeed challenge the global players, but it requires a new mindset, resources and capabilities. The Asian boardrooms and their brands have all opportunities at hand.