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Expanding a business globally can be a daunting task, but the benefits can be significant. It can increase revenue, reduce risk, and provide access to new markets, talent, and resources.
Convincing your Board or executive team to take the leap and expand globally is often the most challenging. And we know that Senior Management is often more inclined to explore global expansion than those in the C-Suite or at the Board level. And we have quantifiable evidence!
Data from our Spring 2023 Factum Global Business Sentiment Survey report showed that sentiment towards conducting business internationally varies widely across all executive functions. In fact, survey results showed that executives at the Director and Middle Management level were much more favorable towards working internationally (35% above average) than the C-Suite and Board level (only 6% above average) and Senior Management (21% below average).
How Executives Feel About Working Internationally
Director/Middle Management
35
Above average
C-Suite/Board
6
Above average
Senior Management
21
Below average
We hear you Directors and Middle Managers and we want to help!
In this blog post, we’ll discuss the benefits of expanding globally, practical tips for success, and tactics and techniques for convincing your executive team that now is the time to go global.
4 Benefits of Global Expansion:
Expanding globally can provide several benefits to your organization. Here are some of the most significant advantages:
1. Increased Revenue and Growth Potential:
Expanding globally provides access to new markets and customers, which can lead to increased revenue, the development of new products or services, and greater brand recognition (see #4). It can also help diversify revenue streams, making the company less reliant on any single market. If you are a U.S. company, for example, you may think that you are already operating in the largest, most attractive market in the world. While this may be the case, the United States accounts for only slightly above 15% of the world’s GDP, after adjusting for purchasing power parity. This means that nearly 85% of the world’s wealth is generated internationally. Can your company afford not to be part of the global market?
3. Reduced Risk:
Diversifying operations globally can reduce risk. For example, if a company is heavily dependent on one market, and that market experiences a downturn, it can negatively impact the company’s revenue and operations. By expanding globally, a company can spread its risk across multiple markets, making it less vulnerable to market fluctuations.
3. Access to New Talent and Resources:
Expanding globally provides access to new talent, resources, and suppliers. It can also provide access to new technologies, innovations, and best practices, which can help the company stay competitive. Culturally, you can enrich your workplace by providing greater access to cross-border collaboration and opportunities for your team members to work with others in foreign markets.
4. Enhanced Brand Recognition:
Expanding globally can enhance a company’s reputation and brand recognition. It can also provide opportunities for the company to showcase its expertise and thought leadership in new markets.
Tactics and Techniques for Convincing Your Executive Team:
Now that we’ve briefly covered a few benefits of expanding globally, let’s discuss tactics and techniques for convincing your executive team that now is the time to go global:
1. Showcase the Opportunity:
The first and most crucial step to convincing your leadership to expand globally is to showcase the opportunity. It’s essential to provide data and evidence to support your claims. This includes showcasing potential revenue growth, access to new markets, and reduced risk.
Start by analyzing your current revenue and growth projections. If your company has been experiencing stagnant growth in your current market, it might be time to look for new opportunities abroad. Conduct some market research on your target markets to determine their market size, growth potential, and competition. This data can help paint a picture of the opportunity available for your business. Having objective research and data in hand will strengthen your “case.”
2. Share Success Stories:
Sharing success stories from other companies that have successfully expanded globally can be a powerful way to convince your executive team. It can help demonstrate the potential benefits and reassure the team that global expansion is feasible. So, speak with your network and ask them how their work around the world has benefited their organization.
Compile case studies of companies in your industry that have expanded globally and achieved success. Highlight how they managed to overcome challenges such as language barriers, cultural differences, and regulatory compliance. These stories can help your executive team see that global expansion is possible and that other companies have achieved great success.
3. Develop a Comprehensive Global Strategy:
Creating a comprehensive strategy is crucial for successful global expansion. A well-planned approach can help mitigate risks and increase the chances of success. A comprehensive plan should include a clear understanding of the company’s goals, target markets, and entry strategy.
Work with a consulting partner to help you conduct thorough research on the target market, including the local laws, regulations, and cultural norms. Then, develop a market-entry strategy that outlines the steps needed to enter the market successfully. In doing so, you may consider partnering with local companies or hiring local talent to help bridge cultural differences and ease your entry into the new market.
4. Address Concerns:
It’s essential to address any concerns your executive team may have about global expansion. What have you heard them say in meetings or in casual conversations?
Expanding globally can enhance a company’s reputation and brand recognition. It can also provide opportunities for the company to showcase its expertise and thought leadership in new markets.
Create a risk management plan that outlines potential risks and how they can be addressed. For example, currency fluctuations can be mitigated by using hedging strategies, such as currency options or forward contracts. Regulatory compliance can be addressed by working with local legal and compliance experts.
5. Leverage Technology:
Technology can play a critical role in global expansion. It can help streamline operations, facilitate communication, and enable the company to scale quickly. Consider researching tools and software that can help your team manage cross-border operations, such as project management software, communication tools, and international payment systems.
CONCLUSION
Everyone has their own unique challenges in convincing senior management that now is the right time to expand globally. These tips and tactics are just a few that we hope will be helpful in your pursuit to convince leadership that you’re ready to explore opportunities for your organization abroad. It’s not a matter of “if,” but “when.”
Can you afford NOT to go global at this point? Have you asked yourself about the risks of inaction?
