Globalisation : International Expansion Starts With The Right Mindset
Trevor O'Hara is the founder and Principal of Renarc.
Prior to founding Renarc, Trevor spent over 20 yeas living and working internationally. Most of this time was spent as a senior executive in global-facing roles such as MCI, Nortel Networks, and Schlumberger Sema. Fluent in 4 languages, he was educated in Dublin, Oxford, Paris and Berlin.
The prospect of taking your company into new international markets is exciting, and there are many clear benefits as to why you should consider expanding now more than ever before, such as access to greater revenue opportunities, recognition as a global player and greater market share. Ultimate success of course comes as a result of lots of careful planning, research, patience, dedication and more often than not, just plain good timing. But at the beginning of the 21st century, this is simply not enough. The difference between survival and ultimate success comes as a result of one critical ingredient – the creation of a global mindset !
You start to create a global or international mindset the very moment you take your decision to enter new international markets. Even before you have decided on a route to market, timescales, budgets and sales targets, your global blueprint starts at the very centre with your decision to do away with one major assumption – what works back home will apply in international markets. Don’t start with this, and you risk opening Pandora’s box even before you have achieved any success overseas.
So how then should you start to build this mindset inside your company ? A global mindset can be seen as a “state of mind” - your firm’s ability to perceive both the differences and commonalities between different international markets when embarking on expansion. Start by identifying an “international champion” within your firm who can help you manage your expansion. Secondly, develop a program for attracting, hiring and retaining top international talent with seasoned international skills to ensure your success. Thirdly, put in place a training budget to help your staff prepare for overseas assignments. And finally, make sure that you have at the forefront of your agenda an effective international human resources policy that help you retain your international talent.
Global expansion is all about effecting change. Therefore your international champion should be a senior manager, director or VP of your firm, capable of driving and implementing that change both across and down your organization as it is implemented. But this is simply not enough in itself. You are also ideally looking for somebody with long and sustained first hand experience of the complexities of doing business globally, somebody who has lived and worked at the coalface in a variety of different cultures, is uniquely familiar with the differences in business cultures, and ideally, can speak a few languages. If this sounds like looking for a needle in a haystack within your organization, you may find you’ll need to source this individual externally.
Either way, a recruitment program to attract international talent into your firm should be at the top of your list. If you are looking for English-speaking candidates, make sure you candidates’ levels of international experience shines through on their resumes. In an age when supply of candidates exceeds demand, it is often tempting for candidates to “inflate” their resumes a little more to get the job. Make sure that you drill down into resumes, question the level of international experience and qualifications, and always obtain references. And watch out for people who say they speak “fluent”. Since language skills should go with the territory, and since you’re paying top dollars for your international talent, always ensure that fluent really means fluent, be as harsh as that, so make sure that you have a resource to check language skills. All too often, candidates claim they speak a fluent language, but put them in front of a client, and they can just about order a pizza. Your are hiring people to do business beyond your borders, so “fluent” means being able to hold a steady conversation with your clients and partners without having to fall back on the native language.
There is a common misconception in the Anglo-Saxon world that senior multi-lingual staff can be expensive to hire, but that isn’t necessarily the case. Today, global talent moves across borders much more easily, so you may find that the candidate you were looking for just happens to live in the same city as you. Some Europeans are known to speak 3 or 4 languages for example, and if you can find them on your own doorstep, with your own industry experience. So by putting an ad first in a well known local or national newspaper yourself, you can often avoid an expensive international recruitment campaign that may take the candidate search to other countries.
Linguistic capabilities are important, but this is not enough. Your international champion must be uniquely familiar with the challenges of developing global business, and they will need to know what issues and challenges they will face at the very outset. For example, what are the day-to-day business implications of managing international teams remotely ? How do I do business with the Germans ? How do I export to India ? What is my time to market if I compare acquisition vs. organic growth in Canada ?
The panacea for building a global mindset is not found by sourcing all your people outside the company. Very often, just bubbling beneath the surface in your own company can be found a wealth of potential, just waiting to be let loose. And these are the people who have been working to make your company a success in your home market, so why not give them a chance overseas ? Tap into that potential, because if you don’t, you risk de-motivating your own people at the outset, and you don’t want to do that. Identify that potential, then let it loose, but not before you have a training budget in place. Tailor your training to your specific needs. Perhaps you need to invest in knowing the different facets of export ( documentation, letters of credit etc ), or perhaps training involved a negotiation skills course, or you may have a direct sales team that requires some cultural training in how to do business in a certain country.
When all is said and done – your training budget forms an inherent part of your future overseas success. You’re selling to human beings, whether at home or overseas, and if you can show that you are at least making an effort to understand your client’s culture and language, you will have made a great leap towards closing that sale. Again, you don’t need to understand the laws and customs of every country – but you need to show that you are making an effort, and simply assuming that English is the language of international business just does not cut it any more.
Alongside your training budget comes your retention plan, and you will need to have a HR policy in place to reflect your international activities. Identify very early individual motivations. For example, you may have recruited somebody with a Latin background to head up your international expansion. For this person, perhaps the amount of time they wish to spend with their family ( i.e. number of holidays per year ) may be more important than the amount of salary you pay them. And then you need to ensure that this particular person fits in with your staff. In some Latin cultures, lunch breaks can sometimes extend to two hours or more, simply because it’s the principle meal of the day. That may be perfectly acceptable back home, but here you need to ensure that this doesn’t demotivate your team. So once again, if you’re recruiting a foreign national, drill into their CV to see how familiar they are with your own business culture. If they are not – are they really right for the job ?
And finally, your Human Resources policy embraces an international framework. That means that worked for you at home can no longer apply as you enter new international markets. Recruitment and incentive programmes must reflect the needs of everybody within your firm now, not just the select few who will be driving your international expansion.
If business, whether local or international, can be defined as the exchange of goods and services between people, then the people aspect must play an important part. After all - people buy people. And if your staff and teams can show when they are doing business internationally that they are making an effort to know the local laws, business etiquette, customs and language of the country you are doing business in – your overseas clients and partners will respect you all the more, over and above your competitors.
© Copyright Trevor O'Hara, 2002