When Menashe Kaslassy, chief executive of Israel-based Compax, landed in Miami International Airport last July, a U.S. immigration official questioned him about the entry stamps from so many Central Asian countries in his passport. U.S. officials may not be used to dealing with senior executives whose passports have been stamped repeatedly in countries like Uzbekistan and Turkmenistan – not to mention, other rarely visited nations in Africa, Latin America or Southeast Asia. Kaslassy jokes that he’s worn out entire passports making his way around the world, marketing the products and services of Compax – a member of the Orad Group of companies – in countries where security conditions, transportation infrastructure and even legal institutions are far from ideal.
What keeps Kaslassy on the go? Compax, based in Israel’s Yokneam Industrial Zone (southeast of Haifa), provides high-value added equipment ranging from water treatment to oil-and-gas monitoring and control services, and industrial controls. In southern Turkmenistan, for example, near the borders of both Iran and Afghanistan, Compax implemented on site a turnkey modernization project for the Dovletabad natural gas field plant, which renewed its entire control system from instrumentation to control room operations. In Uzbekistan, Compax supplied the 193-kilometer (120-mile) long Shurtan-Sherabad natural gas pipeline, which passes over difficult and hilly terrain, with a state-of-the-art communications system. Compax had full turnkey responsibility, including design, equipment supply, cabinet manufacturing, field installation, software development, integration, training and site start-up. In Colombia, Compax implemented another turnkey project, this time providing electronic industrial controls that monitor the flow of water in Bogota’s water and sewage networks so that potable water was delivered – and wastewater removed – in the most efficient way. The project was so well-received, notes Kaslassy, that Compax was honored with an award by the Colombian president.
In designing such products and services, companies like Compax leverage Israeli engineers’ practical experience developing communications and monitoring devices that have protected Israel’s population from attacks for decades, Kaslassy notes. Israel is surrounded largely by countries that shun doing business with it; as a result, many Israeli companies have developed remarkable skill selling their products in unlikely markets that are farther from their borders – including countries like Turkmenistan and Uzbekistan, whose populations are about 90% Muslim. In the case of formerly Soviet countries, Compax has also taken advantage of the cultural affinity of Israel’s corps of Russian-born engineers — Jewish immigrants from the former Soviet Union who are fluent in Russian, a language still widely spoken in former Soviet republics.
From your experience, how typical is Compax’s success in such unlikely foreign markets? Can you relate the experience of other Israeli firms that have been able to seize business opportunities in emerging markets that are off the beaten path of most U.S. and European companies? In what other sectors and countries – aside from those pursued by Compax – have those companies had success?
Despite their success in some predominantly Muslim countries such as the former Soviet republics of Central Asia, do Israeli firms face any special challenges there because of Israel’s isolation from nearly all of its neighbors?