Why HR is key to successful global expansion

Find out how HR can power global growth and navigate global expansion challenges

Why HR is key to successful global expansion

This article was produced in partnership with Safeguard Global

Safeguard Global is an industry leader in workforce management solutions, helping businesses to manage their international workforce more efficiently. Its offerings include global payroll, employment outsourcing and consulting services in relation to international labour laws, tax compliance and HR strategies.

In today’s fast-paced business environment, expanding globally can offer an exciting opportunity for growth. However, this venture isn’t without its risks – and HR plays a vital role in navigating these waters.

According to talent management company Safeguard Global, global expansion can open up a world of possibilities. It allows organisations to tap into new markets, access diverse talent pools and foster innovation by bringing different perspectives into the business. However, in order to make your global expansion plans work, there are a number of factors to keep in mind – from cultural differences to compliance requirements, to differences in market demand.

It its recent blog post, Safeguard Global highlights German company HelloFresh as an example of global expansion success. It became the top meal prep delivery service in the US. by responding to Americans’ wish for more time in the day, and ended up cornering a whopping 70% of the market.

On the flipside, US-based Home Depot failed to grasp significant cultural differences when it expanded to China. Its DIY approach wasn’t a good fit in a country where handymen and contractors are so affordable that consumers prefer hiring experts over tackling renovations on their own. As a result, it missed the opportunity to effectively target Chinese customers.

According to Safeguard Global, getting local expertise is critical to any global expansion plan. If you want to avoid getting your German employees to do motivational morning chants (an infamous gaffe by US company Walmart), you’ll need to hire on-the-ground professionals who speak the language and understand local culture, market needs and compliance requirements.

This is where the concept of ‘agile HR’ comes in. To seize a new overseas opportunity, your team will need to move quickly to ramp up global recruiting and onboarding. To create a truly agile team, your people should be confident moving boldly and independently.

This means flattening your reporting structure, and letting your teams self-organize and adapt to changing market conditions independently. They should be empowered to make decisions in real time and reach out to other teams as needed, without waiting for management approval.

Agile teams should also be comfortable sharing data across teams, and using the right technology to collaborate, encourage creativity and eliminate silos. Being open to innovation is key – Plus X Innovation estimates that innovative businesses grow twice as fast as businesses that fail to adapt.

This leads us to the final step in creating an agile team ready to tackle global expansion – promoting innovation.

Safeguard Global notes Kodak as an excellent example of the consequences of a lack of innovation. Once a titan in the world of photography, Kodak hesitated to abandon film and fully embrace digital technology. By the time Kodak acknowledged the significance of digital photography, it was too late.

To promote a culture of innovation, HR teams and recruiters should look for “original thinkers and disruptors” to bring on board, no matter where they are in the world. The rise of skills-based hiring is also an important trend to follow, as ‘softs skills’ such as communication, attitude and values will often bring more to the team than a hard number of years in your specific industry.

Finally, embracing diversity is non-negotiable. 2022 saw a 145% increase in global hiring, and companies with a diverse workforce were 45% more likely to gain market share.

By recruiting diverse talent, companies not only embrace a wealth of backgrounds and perspectives but also unlock a substantial financial advantage. This financial boost can mean the difference between turning a profit or not, and also aligns with the goal of maximizing return on investment (ROI).

For more insights on global expansion, maximising ROI and creating agile HR teams, check out Safeguard Global’s resource centre.


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