In today's dynamic business landscape, the ability to adapt to evolving circumstances and embark on global expansion has emerged as the fundamental driver of sustainable growth across industries.
As companies set out to explore uncharted territories, recruit talent from different corners of the world, and strive to achieve true global reach, they are confronted with a host of formidable challenges. These challenges encompass the management of a geographically dispersed workforce, navigating complex and ever-evolving regulations, as well as addressing issues related to payroll and employment compliance. Successfully executing a global expansion strategy calls for strategic foresight and a profound comprehension of the diverse regulatory landscapes across countries.
In our ongoing commitment to offer practical and actionable insights to the HR community, People Matters, in collaboration with Atlas, organised an exclusive virtual session. Titled Future-Proofing Global Mobility: Overcoming challenges of overseas expansion, during this engaging session, Stan Choi - Managing Director, Head of HR, Hex Trust and Raju Chauhan - Regional Payroll Manager, Atlas, delved into the intricate challenges that organisations encounter when venturing into international markets. They also unveiled the most effective strategies for proficiently managing a borderless workforce.
Challenges when expanding into new markets
As the world becomes more and more accessible thanks to new, evolving technologies, it is only natural for organisations to want to expand and explore newer markets. But setting up an office in a new country or city comes with its challenges.
“When venturing and expanding into new markets, there are two big focus areas. First, we have the logistical challenges – business registrations, government regulations, and getting everything set up so you can effectively run your business right from day 1. The second is the how – how the organisation plans on incorporating the new, distributed workforce into existing working styles and work culture,” Choi said, adding that even though organisations have been able to leverage technology to collaborate across geographies, the problem of a distributed workforce working across different timezones needs to be addressed.
Evolution of the payroll landscape
Logistic and cultural challenges aside, how can organisations deal with the very practical challenges of running payroll for a distributed workforce?
“For very long, payroll was seen as a back office function. But this perception has finally changed over the last few years. Organisations today understand that an efficient, strategic and compliant payroll process is needed for global business,” Chauhan explained.
Key drivers behind this change:
AI - Infusion of artificial intelligence, machine learning and advanced analytics is revolutionisng the payroll industry, with research showing that 26% global payroll functions integrate AI into their operations.
Compliance - Regulatory landscapes are constantly shifting with countries becoming more stringent about their data security and compliance regulations, businesses need to be very adaptable.
EOR - Employee of Record services have fast emerged as a powerful solution in today’s market, helping organisations navigate complex regulations and provide a consolidated framework for their diverse, global workforce.
Whenever we talk about global expansion, the discussion turns towards myriad challenges a business faces – from compliance and cultural nuances to operational inefficiencies and scaling up. This is the stage at which EORs come into the picture, rescuing organisations from these challenging intricacies and helping them expand into new markets.
With more and more organisations looking at scaling up and onboarding global talent, the panel also spoke about the best practices organisations can follow to ensure an employee experience that respects different cultures and work environments.
“Research and planning are both very important when it comes to expanding into new markets. Practice makes perfect and the more planning you do, the easier it will be to run your business from a new location right from the start,” Choi said, adding that the more you understand the market you are expanding into, the easier it will be to cater to the unique cultural nuances and/or working styles.
He further said that focus on the employee onboarding experience is also very important. “Even when organisations are, say, opening a new office at a new geographical location and are hiring a small group of employees, that doesn't mean they shouldn’t focus on creating the right environment for these employees,” Choi said.
“Technology is playing a pivotal role in simplifying hiring and also onboarding. Technology has revolutionised the payroll industry and the entire world of work. Apart from that, being cognizant of the local and cultural nuances is also important when breaking new ground in a new city or country,” Chauhan added.
Given the evolution of payroll as well as the focus on global expansion, there are several key trends and innovations that business leaders must focus on to stay ahead of the curve.
Technology, specifically artificial intelligence, is revolutionising global payroll processes. “Nowadays, with the integration of AI into payroll, all the data points are just one query away. On top of that, the introduction of chatbots has also made access to information much easier,” Chauhan said, adding that another emerging trend is organisations focusing on applying overlapping when dealing with a distributed workforce.