Expanding a business internationally can represent a key step in a corporate growth strategy. Global expansion provides a significant opportunity to tap into new markets and customer bases, providing a solid strategy for increasing revenue potential. This has been proven by the world’s largest companies – who have all cemented their pathways to success by going global.
Any business hoping to see success when scaling globally knows the value of a well-distributed team. Getting the correct balance – the right people, in the right place, at the right time – isn’t always an easy task.
Previously, international human resource management may have represented a significant barrier to global growth. Recruiting and organizing teams abroad comes with a huge amount of complexity, associated admin and compliance requirements.
However, today there are experts on hand to assist in navigating these formidable challenges. Global outsourced human resource management streamlines the end-to-end process of a global workforce – making it a valuable and efficient option for any business focused on expansion.
With the growing trend of remote work, an increased need for specialized skills and the desire for international expansion, global human resource management literally puts the world at one’s fingertips. Broad new avenues of opportunity can open up, and most importantly, without the significant overheads, risk, or administrative burden.
Outsourced global human resource management assumes responsibility for daunting local administrative and compliance issues, while simultaneously allowing companies to enjoy a normal “day-to-day” working relationship with the employee.
The advantages of global human management are numerous – and in this article, we’ll take a look at how to utilize the fullest potential by unlocking the key offerings.
The Best of Both Worlds 🌎
Using the services of an outsourced human resource agency is a win-win situation. The company is able to make the key decisions, such as who the best candidate to hire for the role is, and can then hand over all the complex administrative burdens. An outsourced agency can assist with all formal employment tasks, such as employee onboarding, payroll, work contracts, tax and insurance registrations and much more.
The expertise of outsourced HR teams is also invaluable, and can bring a great deal of illumination and helpful advice in terms of local knowledge of labor and compliance laws. Attempting to master this in-house would be extremely time-consuming and costly. Part of the service provided by a global human resources agency is the ability to partner with an EOR (Employer of Record) – a third-party organization that hires and pays an employee on behalf of another company. An EOR also takes responsibility for all official employment tasks, greatly minimizing compliance risk and overheads for the company.
Another solution provided by a global human resource management agency comes in the form of a PEO (Professional Employment Organization) – which allows companies to hire talent from anywhere in the world without establishing their own legal entity.
Due to the fact that the process of setting up a legal entity can take up to six months and that the mere cost of startup is around $20, 000 (and this is not taking into account the ongoing charges), the expense and effort involved in attempting to do it alone can be stifling. And this is not to mention the strain it puts on the internal legal and HR team, who will have to attempt the complex navigation of foreign legalities.
Partnering with an EOR or PEO is by far the more efficient route for businesses, where internal resources can rather be free to focus on other elements of expansion and business growth.
Global Movement and Expansion Made Easy 🚀
With an increased number of companies focusing on global expansion, the notion of international relocation is also fast becoming an attractive option for employees. Many see it as a chance to further develop their skills, advance in their careers, and enjoy a better quality of life for themselves and their families. One study even found that 3 in 5 workers are willing to relocate for work – and the interest in relocation keeps growing.
For a company, there are also many advantages of relocating staff abroad when expanding globally. It means a company can be confident that skilled and trained people are doing the work, also avoiding the hiring and training costs of starting afresh in unfamiliar territory. In addition, a relocated employee will be familiar with the company vision, business model, and practices, meaning a continuity in service across borders.
However, global mobility can present several challenges for companies. There are a number of complex procedures to follow and applications to make. Visas, work permits, and all immigration-related paperwork must be sorted prior to any move abroad. Locally, bank accounts need to be opened, tax and insurance contributions applied for, and living arrangements, such as accommodation, must be secured.
Poorly handled relocation can not only have a detrimental effect on company reputation, but can also lead to decreased work morale and productivity, and resignations of valuable staff.
This is where a Global Mobility Specialist can provide support and minimize risk – making the process for companies harmonious and simplified. A Global Mobility Specialist is essentially someone who manages all processes relating to a smooth transfer of an employee overseas. The tasks included in this role are:
- Co-ordinating the everyday administration as laid out in the Global Mobility program
- Organizing all permits required for relocation, such as visas and work permits
- Managing tax registrations and all necessary certifications
- Building communities across teams that are relocated globally, and
- Collecting and processing global compensation data
Good management of the relocation will also go a long way in ensuring the transition for employees is far easier and less stressful. And Global Mobility Specialists are not just adept at handling permanent relocations, but can also assist in temporary moves – for example, if there is a short-term contract that needs fulfilling. Or even, an extended business trip.
The support offered by a Global Mobility Service also extends beyond administrative tasks, assisting the relocated employee and any joining family with local support such as the organizing of housing, transportation, insurance, and even schooling.
Tapping Into New Markets 😎
International markets undeniably provide a wealth of opportunity, with global expansion also being a reliable catalyst for faster business growth. This makes going global a strategic move for many businesses. Expansion is an effective means to get a product and service in front of a completely new audience. It also provides an opportunity to tap into an unsaturated market before the competition arrives.
Putting down roots in a new location will also increase brand exposure – and with this comes enhanced company visibility for potential foreign investors. Furthermore, global expansion will widen recruitment options, giving access to a previously undiscovered local talent pool.
However, while global expansion can be the best thing for a business, it is not without its potential pitfalls, and might not represent the best path for every business, meaning a good amount of research prior to taking the plunge is essential. Aspects to consider, and seek advice on, include:
- Market conditions – are they currently favorable for revenue growth?
- Familiarity with the product or service – how will it be received and understood in the new market?
- Legal issues – what is required to compliantly run a business in that location?
- Operational setup, liabilities, and costs (including entry and exit costs) – how viable is it to expand and what are the risks involved?
A Global Expansion Advisory can offer this advice by providing access to a network of experts and trusted advisors. These advisors can provide invaluable financial and legal information, assisting companies to make informed decisions prior to and during the expansion. Also, and most conveniently, a Global Expansion Advisory can help with the incorporation of the new company abroad. It is just part of any good strategy to ensure a move abroad is supported by knowledge and information – and a Global Expansion Advisory will do just that.
Streamlining With a Global Payroll Solution 💰
Once a business has taken the steps to hire remote talent, relocate teams, or expand globally, running a payroll becomes significantly more tricky to manage. The challenges in running a global payroll include working with different currencies, time zones, tax and compliance requirements, leave calculations, plus managing remote/virtual work hours.
The list of considerations of different countries is also long, with varying public holidays, and regulations on what constitutes paid time off, in terms of maternity/paternity benefits, illness cover, and family responsibility leave.
Keeping track of all of these variations can quickly become complicated, but is also essential in avoiding mismanagement. A poorly managed payroll can not only result in penalties and legal fees, but also unhappy employees and a higher staff turnover rate. Also, one cannot ignore the risk of reputational damage to the company.
A Global Payroll system is another benefit offered by a global human resource management team. It provides a centralized, integrated space, where all payments, insurance, tax, statutory contributions and leave can be managed. The advantage of this system is that it provides a detailed overview, reducing the risk of error – and also improving the accuracy of the analytics reporting for better overall cost management and planning.
The cost and time-saving in using a Global Payroll Solution is also significant. The need for hiring additional accountants to manage the payroll is redundant, and the risk of overloading the current HR team is no longer an issue. The company can rather focus its resources more efficiently, while the global payroll is skillfully taken care of.
Solutions That Enable Businesses to Focus on Growth 📈
Ultimately, the main focus of a business should be on financial gain and growth. There are most certainly multiple moving parts to negotiate in the running of each organization, but good management is also the ability to know when outsourcing is the smarter option. Handing over complicated systems to those skilled specifically in those fields is the best option for maintaining focus on the core priorities of the business.
Partnering with an outsourced global human resource agency means global expansion, remote and relocated employees and a seamless payroll system are not only a possibility, but entirely achievable – and without any of the stress and error a business can encounter by going it alone.
Do you want to stay up-to-date with important global human resource management insights and trends?
