By Dhaval Gore, Partner Communities Director, at G-P (Globalization Partners)
As businesses around the world face disruption with inflation pressures, the prospect of a recession, supply chain disruptions, and talent shortages, it is clear that challenges lie in the road ahead. In uncertain times, organisations often turn to cutbacks to reduce overhead costs and keep their head above water. However, if business leaders are willing to think outside the box, there are options available that can allow companies to not only survive, but thrive.
Global expansion continues to be a part of many businesses’ future plans. In fact, a recent 2022 Globalization Trends Survey found that 83% of CFOs confirm that their company’s long-term growth strategies include potential expansion into countries where they are not currently present.
However, with economic headwinds only adding to the challenges of navigating new regions – like compliance and regulation – what is the best way forward for organisations to drive growth and mitigate risk?
Retaining top talent at home and abroad
One key benefit of the remote working revolution is, of course, that businesses are no longer limited to the local workforce and can look much farther afield for the right candidate. It is then unsurprising that 92% of CFOs agree that a remote first work policy is key to attracting and retaining the best talent. The same percentage also say that such a policy increases inclusivity and diversity by providing equality of access to career opportunities regardless of location so people who might otherwise be excluded can apply. However, when hiring in a new location the challenge of local compliance and employment law arises, which is why partnering with a recruitment specialist who works across borders is a smart move.
Beyond flexible working, other popular retention strategies include learning and development, more detailed employee feedback and enhanced recognition. However, and surprisingly, when it comes to benefits and compensation, these play a more limited role in retaining employees. Instead, company culture is a greater factor in staying with an employer. A positive corporate culture is one that helps people focus, deliver and enjoy what they can contribute to the company as a whole.
Companies must beware that when they expand globally they may not necessarily be familiar with the tax structures, labour laws and HR practices in new countries. There is also a risk of doing something wrong or even breaking the law, which can have a significant impact on not only their expansion plans, but also on brand and reputation. As a result, any organisation hiring globally must quickly familiarise itself with the local laws and practices of each new territory they enter.
Building this type of knowledge and expertise takes time. In the UK alone, for example, employment legislation includes a huge range of topics and obligations. The Chartered Institute of Personnel and Development breaks the requirements down into over 20 categories, covering everything from recruitment, working time and equal pay to discrimination, data protection and health and safety. When this translates onto the global stage, the complexities increase tenfold, which is why 93% of CFOs confirm that working with a global employment platform to support international talent management is very worthwhile. Such a platform can help companies understand and comply with local legislation across different geographies, minimising risk and reducing time spent in the process.
The future global workforce
Nearly half of CFOs report that their company’s future talent strategy is based on a hybrid workplace. In addition, more than nine out of 10 CFOs agree that allowing employees to move location, rather than backfilling a position with local talent, is the preferred talent strategy.
These strategies help combat the disruption we have seen in recent years and offer an opportunity to reinvent an industry, company, business model, or simply an internal workstyle. This is a great way to transform instability into enhanced flexibility. This can be seen in the widespread introduction of remote working, where operational changes are now meeting the long sought-after needs of employees while fundamentally changing the way the world works during times of major disruption.
Increasingly, having a local presence is becoming a critical must-have for capitalising on opportunities around the globe, and having the ability to attract and retain the best talent required to drive operations forward will become a key competitive advantage. Even in uncertain times, companies can still drive growth and achieve global market expansion, while minimising costs and risks, by deploying a global employment platform. This will allow them to hire people anywhere in the world without the need for local legal entities or boots on the ground.