For any company expanding internationally, you are going to need more than a successful product and a great logo to make an impact. Failing to anticipate cultural differences can mean disaster when taking a company global. The world is an incredible and diverse place, and an abundance of wonderful opportunities exist. The U.S. Department of Commerce estimates that 95% of the world’s consumers live outside of the U.S. and two thirds of the world’s purchasing power is located overseas. If done correctly, taking your business global could be they key to continued growth and success.
If your company is considering expanding globally, following this simple advice can help make a huge different in the potential growth and profitability of your business.
- rethink work-life balance
- remember that internal culture is as important as external
- work with a culturally aware market research firm
- research local HR rules and regulations
- overlook the importance of protecting your intellectual property
- rely solely on virtual communication
- think that one size fits all
- rush the hiring process
When you expand globally, you now work in different time zones and with different schedules. When you work in a start-up or in the tech industry, chances are you are a workaholic. It’s the norm to have long days and tasks that come through at all times of the day. It is important to be sensitive to how other cultures perceive work-life balance. In Europe, work-life balance is taken very seriously with 25 plus days of vacation being the norm. In India, employees often work extremely long hours in order to keep up with the demand from US based customers. It is important to be available to your staff and your customers when they need you while keeping in mind the cultural view of work-life balance.
It is important to consider the culture of the new market you have entered and to ensure that your internal communications reflect that culture. You must ensure that you are sensitive to the standard work environment of another country. For example, in the US, businesses often mix personal and professional. Start-ups in particular build their teams around passionate people who love what they do and see the company’s success as their own. This isn’t always the case in other countries. In some European countries, employees see work as a job and the concept of colleagues as a family is foreign.
Market research is incredibly important, with any product or service. You must have a unique product or customers will simply not buy. In addition, many cultural factors may affect how customers will respond to your product and/or your branding. Do your research and if you hire a market research firm, be sure to research your choice thoroughly. Ensure that they are experts in your chosen market and they work with locals. Work with the firm to understand the market needs and existing competition before you make any big decisions.
Do your research before you design your office space or set up rules and regulations regarding your employees, as HR regulations can vary quite a bit from country to country. For example, cubicles are extremely common in US offices and have even become part of our popular culture, but they are not an accepted office set up in many countries. In Germany, legally employees must be able to look out a window. This is mostly based cultural needs as German’s tend to work quietly at their desk and therefore do not require noise buffers. In addition, they do not tend to communicate as much with one another in the workplace and when they do will move to a separate location. Recognizing these difference is important and failing to do so can result in confusion and even foster aversion to cooperation and your company’s culture.
Your intellectual property is incredibly important, protect it! It is a whole new ball game when you take your brand global. Seek the advice of experts and ensure you have someone who has experience with branding in the market you are expanding into. Talk with your legal representation about your expansion plans and ensure you have all of your bases covered.
Across the board, we are relying more and more and virtual communication. Tech companies in particular are often comprised of a set of employees who work remotely and independently, working mostly out of their homes or remote offices. Email has become the default method of communication. This is perfectly acceptable for everyday tasks, but studies show in managing virtual teams that face-to-face communication is 10 times more effective than phone, and phone is 10 times more effective than email. Ensure that you are encouraging phone, video, and face-to-face conversations whenever possible. It will increase your efficiency and foster personal relationships, which increases employee retention rates and promotes a global mindset.
Expanding globally is often a lot more involved than many companies anticipate. Standards in the US that we take for granted may not be accepted abroad. Many companies have run into privacy issues. China is notoriously difficult for US companies to expand into. Many countries place special barriers onto any overseas companies that make it difficult to compete. Do your research and be aware of these issues before you invest time and money into global expansion. Put special attention into cultures, customs, and laws. Take the time to foster relationships with local economic development agencies, the chamber of commerce, and other similar local companies. Ensure you have someone on your team who understands the local landscape to lead your global expansion project.
Local partners, employees, and relationships in the countries you will be working in are extremely important when it comes to your ultimate success. Decide carefully who to align yourself with, changing later can be disastrous.
Going global can be an excellent way to grow your business. However, you must take the time to understand the cultural differences of the country you are expanding into. Do your research and work with knowledgeable local partner to ensure your ultimate success.