As the world becomes more interconnected, global organisations are expanding into new regions at a significant rate. In fact, a recent study revealed that in the UK alone, 87% of organisations already trading internationally intend to expand further over the next year, and 450,000 domestic organisations are poised to reach overseas markets.
Despite the potential for international growth, unknown territories come with different cultures—and these must be respected. Even if an organisation’s services and products appeal to buyers in those markets, ignoring local working culture will set it up for failure. By trying to understand local customs before branching out internationally, organisations can overcome cultural nuances and nonverbal communication barriers to build stronger relationships and start on the right foot.
Avoiding Culture Clashes
By truly understanding the local culture, businesses can accelerate their expansion through strong employee engagement, whether by respecting local traditions around breaking for Fika in Sweden or meeting employees’ hunger to partake in worthy CSR initiatives.
If planned effectively, international expansion can be hugely beneficial beyond just the immediate bottom-line boost. Organisations will also build an increasingly diverse knowledge base that helps them develop innovative approaches to solving problems, improve decision making, and boost employee and customer engagement. With a broader understanding of different customs, organisations can make more informed decisions to mitigate risks and compete effectively in a global market.
Three Steps for International Success
With so much to consider, business leaders need to plan effectively to ensure they understand, respect and align with the local culture during international expansion. A crucial first step is understanding the layers of cultural differences between existing and new markets. What is typical for a professional from one country could be very different from a colleague from overseas. For example, Israel has a Sunday to Thursday work week to accommodate cultural practices. The UAE, on the other hand, has a Monday to Friday working schedule, with employees fitting prayer time into their regular workday.
Recognising how customs and working practices affect communication, organisational structures, and etiquette can help avoid cultural problems and ensure a smooth transition into a new region.
Breaking down the process into manageable steps can help the transition feel less overwhelming and give a better chance of succeeding. Here are three key steps organisations need to complete:
- Set Up Solid Processes
Firstly, organisations must complete a thorough assessment of the region before developing an integration strategy. This can be done through talent mapping, researching competitor markets, or getting ‘be there’ experience by carrying out walking interviews. To use this type of intelligence, organisations should look to proactively drive diversity and inclusion in the local workforce through Employee Resource Groups (ERGs). These initiatives can help organisations, and their employees become more confident in their understanding of the cultural nuances that may exist between and across markets and see how those may differ from their current experiences.
- Hire From a Diverse Candidate Pool
Organisations need to adopt a layered approach to recruitment. When hiring in a new region, leaders must make a real effort to ensure they are not only considering skills but also looking for a mix of people who understand the culture—from senior figures down to local leadership teams. Alongside these new hires, businesses taking a longer-term view can develop technical and soft skills in local hires. Businesses can even engage with schools and universities on STEM (Science, Technology, Engineering and Maths) programmes to drive innovation in the next generation of talent on its way to the workplace. The ratio of these hires is not important; it’s more about ensuring that all employees are aligned on local culture, understand business goals, and are the best fit to drive success in the new region.
- Provide Educational Resources
Training and network groups can only do so much anyway. It can be difficult to make an impact across a global organisation with hundreds or even thousands of employees all interacting with colleagues and customers from different countries. Instead, employees must be empowered to educate themselves on cultural matters, with organisations providing access to a mix of experiential learning and signposting third-party resources that provide further information. The key is to ensure employees are fully equipped with the resources and connections to educate themselves and others on cultural differences proactively. So, they understand the best way to approach any situation.
Embracing a Global Culture
As we move closer to a global culture, organisations must make a conscious effort to embrace diversity at every level, especially when moving into a new country or region. Labelling an organisation as ‘global’ isn’t enough. It’s crucial for business leaders to commit to diversity initiatives and follow them through so they genuinely impact how the organisation operates.
Naturally, they will come up against complex barriers, such as individualism, masculinity, and uncertainty avoidance. Across different countries, attitudes and societal norms will be hugely different —but by using these three steps as a starting point, businesses can begin moving in the right direction. Culture is constantly shifting, so businesses must ensure their internal culture is adaptable and can embrace broader societal changes in existing markets and new international territories. Businesses that cannot develop, and maintain, cultural understanding, will lose to those who can. Those that get it right, however, will be set up for international success.
