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The coronavirus pandemic has drastically impacted European companies, prompting a seismic shift in the way businesses operate. This uncertainty has caused leaders to take proactive measures in mitigating risks to position their companies to speed up productivity and grab opportunities when the pandemic ends.
McKinsey & Company conducted a survey on small and medium-sized enterprises (SMEs) in France, Germany, Italy, Spain, and the United Kingdom. Seventy percent of these European companies surveyed said the pandemic had a severe impact on their companies and that their revenues have declined.
The virus has continued to impact companies at an increasing rate as the nature of disruption evolves. Here are a few critical ways you can lay the groundwork for a successful 2021:
Choose the Right Tools to Help Build Strong Teams
Of the many industries affected by the pandemic, European companies in the recruitment and hiring industry experienced an almost complete overhaul. Since companies’ focus is to keep prospective candidates moving through the hiring pipeline, video conferencing software has come to the rescue. The overnight change to virtual face-to-face interviews helped recruiters experience seamless and interactive interviews.
According to a survey by Aon, 76 percent of companies in the UK have already implemented virtual hiring and recruitment processes. Finding the ideal candidate for the job is less time-consuming using AI-based technology.IBM uses AI as an accelerator to augment business operations, develop and attract new skills, and improve their overall employee experience. In response to such a drastically changing world, companies need to embrace the virtual world of hiring and recruitment.
Read our blog 5 Tips for Hiring, Onboarding, and Building Trusted Teams – Virtually to get more best practices for onboarding employees virtually.
In response to such a drastically changing world, companies need to embrace the virtual world of hiring and recruitment. Click To Tweet
Tap into the Global Talent Pool
It’s a worker’s market. Top talent can pick and choose their place of employment, and that’s putting some European companies in a bind. A McKinsey & Company report showed that employers in Europe and North America would experience a shortage of 16 million to 18 million college-educated workers by the end of 2020.
Widening the scope of your search is an effective way to increase the quality of your applicant pool. Here are some of the top countries companies can look to hire in:
- Poland: As the ninth largest country in Europe with a population of 37.8 million, Poland has become a hotbed of tech talent and one of the biggest hubs in Europe for global tech companies.
- Ukraine: Ukraine’s talented workforce is attractive to many Fortune 500 companies – over 100 organizations like Samsung, Google, and Microsoft hire R&D teams in cities all over the Ukraine.
- Russia: Russia generates more software engineers than any other country, and the tech talent pool currently has an average age of 38.
Read more about emerging tech talent hubs here.
Retain Employees Relocating to Their Home Countries
According to the Future of Work in Europe report by McKinsey & Company, roughly one-third of the European workforce began working from home due to the pandemic. If this does become a permanent adjustment, workers can work remotely from anywhere, and won’t necessarily have to move cities to join far-off companies.
European companies need to be more flexible around remote working and focus on employees’ well-being during these turbulent times. A survey conducted by PwC on worker mobility showed that around half of the companies surveyed allowed their employees to start their international move by continuing work from their home country, and around one-third of the companies extended and enhanced employee support in compliance matters.
In a world where skilled talent can be challenging to locate, retaining high-performance employees becomes more critical than ever.
A solution like an Employer of Record (EOR) allows European companies to pay, offer benefits, and provide consistent HR support to their relocating or remote employees without setting up costly entities and subsidiaries. A reputable global EOR will have a physical presence in many countries and acts as your local business expert. They understand and follow country-specific regulations, help you mitigate risk, and onboard employees on locally compliant payrolls.In a world where skilled talent can be challenging to locate, retaining high-performance employees becomes more critical than ever. Click To Tweet
Embrace the Advantages of Global Remote Teams
In 2010, analyst firm Garner predicted that by 2020, half of the world would be working outside of the traditional office setting. This became aggravated in 2020 due to Covid-19, and the world was pushed into one of the largest remote-work experiments of all-time. As a result, companies are going remote, and in some cases, that means going global.
A remote, global team gives you two specific advantages: proven efficiency and increased success. The remote aspect brings the efficiency, and the global perspectives increase overall business performance. But it’s the combination that gives your business an added measure of resilience, and that’s what will put you ahead of the competition. Here are a few ways companies can benefit from remote global teams:
- Diversity: Workers on diverse teams are happier and more engaged, and the company benefits as a result. According to our 2020 Global Employee Survey, employees at diverse companies were three times more likely to report feeling happy at work.
- Global Perspectives: Having global team members in-country is critical for any company that hopes to successfully scale at an international level. Local perspectives provide invaluable insights into your target market. Local hires speak the language, understand the norms and customs, and make partners and customers more comfortable.
Consider Global Growth When Competitors May Be Holding Back
European companies that separate from the pack and actively work to adapt to new environments have the resilient mindset needed to overcome current challenges. Whether this means pivoting product direction, pursuing merger or acquisition opportunities, or entering new markets, these companies will likely see their investment pay off beyond 2020. Here are three advantages of expanding internationally, especially in the midst of uncertainty:
- Recovery Following Economic Downturn: In a study on which companies have bounced back the fastest after recessions, Harvard Business Review stated that organizations must strike a balance between offensive and defensive measures. Those that found this balance had the greatest chances of regaining ground in the future. Companies that defensively cut costs through improving operational efficiency (versus just reducing headcount), and also pursued two offensive strategies – developing new markets and investing in new assets, did markedly better. In contrast, companies that acted too defensively or didn’t fully maximize their opportunities showed slower growth recovery.
- International Brand Recognition: When companies expand globally, audiences all over the world become familiar with the company and its products, which can help boost sales, drive word-of-mouth marketing, and expand potential markets even more.
- Diversification of Revenue: You can strengthen your business today through a diversification strategy. Beyond beating the competition, this gives you an advantage over any challenges the future may bring. Multiple products and services in more than one market mean a diverse stream of revenue. Access to numerous markets and consumer bases also mean you’ll have greater visibility into trends and more insight that can be gathered for future product development.
To diversify a business, the organization must be willing to explore new markets, test new products, and go outside the norm of what’s already working. However, companies that have built a strong foundation can create new opportunities by diversifying their operations around the world. Benefits include opening up a distributed supply chain and a much more diverse consumer market. As a result, they’re well-positioned for success in a quickly changing world.
Develop Business Resilience
Covid-19 has exposed the fragility of overall business operations. As the environment becomes more dynamic and unpredictable, it’s more crucial now than before for leaders to focus on building resilient companies. Business leaders should focus on building trusted crises-management teams to navigate hurdles and empower them to make quick decisions.
A recent survey by CFO Research and Globalization Partners found that despite the economic upheaval caused by Covid-19, most CFOs aren’t abandoning their global expansion plans. They are moving forward faster than ever, pushing their revenue and operations teams to go after market share and localize talent to the jurisdiction where it’s most cost-efficient.
The survey showed 78 percent of executives plan to implement or have already implemented a global EOR to help execute their international expansion plans.78 percent of executives plan to implement or have already implemented a global EOR to help execute their international expansion plans. Click To Tweet
Plan Now For 2021: Simplify and Expedite Your International Expansion
For European companies looking to expand internationally, Globalization Partners’ Employer of Record can help. We have a physical, on-the-ground presence around the world and can act as your EOR in more than 187 countries.
Get in touch with Globalization Partners to start discussing your international expansion today. For more information on onboarding and managing talent in the top 20 expansion countries, download our Global Hiring Handbook.
Book a consultation with us today.