The 4 Cs of International Growth

How to build a strong business foundation on a global scale. 

Remote work models have opened the horizons for your company. No doubt your company leadership has considered or even started hiring in other countries, either for global market growth or broader hiring opportunities.

As you grow your team, you need to focus on what’s essential for success on an international scale. The foundational basics can be summarized as the 4 Cs: Culture, Costs, Compliance, and Capability.

As a leader embarking on international growth, you must:

• Construct an engaging work environment that embodies your culture.
• Build with ample consideration for your bottom line.
• Set solid foundations in compliance.
• Strengthen the arising structure by assuring in-house or outsourced capabilities.

To share the secret sauce of our company’s growth across markets, and the customers we’ve helped to achieve their growth, we have compiled some thoughts on the 4 Cs of international growth.

1. Culture

Today, we are in an employee-centric hiring market. IBM and many other companies have identified that employee expectations extend well beyond compensation and that a high-purpose culture is a top desirable.

Standing out as an employer and retaining the best and brightest is no longer all about offering a good salary. Your employees expect you to go above and beyond. They want genuine work-life balance and a healthy company culture.

In order to improve your internal culture and support your global HR team, consider these tips:

• Ensure your team leads are conscious of cultural differences when integrating new people to their teams, and have the tools and education needed to bridge any gaps when they impact employee satisfaction.
• Set up clear compensation, benefits, and retention schemes unique to every country where you have operations.
• Invest in creating learning opportunities and clear career paths that are accessible to everyone, no matter their location.

For your company’s sake, you need to stay ahead of the curve and be informed on the latest evolutions in employee experience and expectations.

2. Compliance

You might have hired internationally in the last few months, tempted by the borderless environment that worldwide remote work unveiled. Remote work made hiring distributed employees as contractors, or the local equivalent, seem logical. This isn’t necessarily new — think of how workers have held companies like GrubHub accoutable — but workers are aware of their rights as local regulations continue to evolve, and you need to be up to speed on how to avoid worker misclassification fines.

You can easily protect your company from penalties and be seen as an employer of choice in your new country by doing the following:

• Ensure all your employees are hired compliantly, not as contractors while working full time, for example. This will save you from misclassification fines, and potentially protect your intellectual property – essential for high growth companies that want to take on new markets.
• If you’re concerned but need more information, there are detailed guides to help you differentiate worker classifications.

On a separate compliance point, if you have team members working outside an office, you need a remote work policy. This is especially important to ensuring international work happens compliantly:

• Explain to your team that a remote work policy gives them a clear understanding of their company’s expectations for remote workers and encourages compliance.
• Work together to outline rules on communication channels, security and data protection, insurance and liability, and local work regulations.
• Utilize a local expert to stay informed of changing regulations around remote work policy – these are continuing to evolve as the world moves toward a remote-first environment.

A comprehensive remote work policy protects your company from compliance concerns by providing clarity around:

• Security
  Your employees should understand how seriously the company takes cybersecurity, especially if they were onboarded remotely. Ensure your technology platforms and policies secure confidential information and data all shared online, then communicate this to the wider team.
• Insurance and liability   
  If your employees suffer an accident while working remotely, your HR team needs to be prepared with clarity on how insurance claims work in their country, and who is liable.

There is another caveat to employment compliance risk, international or not: relocating employees. If your employees have relocated internationally, you must ensure you have the ability to pay and offer compliant benefits packages to all employees.

Find out if your relocating employees have the legal right to work in their new locations.

Knowing where they have the right to attain residency will save you a lot of trouble.

• Each country may be different, but 180 days is the average time workers can live in one location before their stay counts as residency establishment.
• If the employee lacks residency rights in their chosen country, you will need to investigate work visas for them to remain living there while working for you.

Determine how to continue to employ relocating team members.

You want your employees to have location freedom because their happiness leads to your growth, but what if you lack a corporate presence in the country where an employee wants to relocate? This can be an opportunity for market entry, but you should know your options for compliant hiring:

• Option 1: Set up an international entity. This process can take 4-6 months, and it will require tax filings and a certain financial investment over time.
• Option 2: You can work with Globalization Partners, since we already have entities in place to compliantly hire international employees immediately and a platform to make it simple and easy.

These steps will keep your company compliant through global mobility and employee relocation.

3. Costs

It can be cost-effective to build teams in new jurisdictions, but companies should be aware of other, less obvious costs. For example, the employee relocation process presents cost concerns for which your company should prepare.

If your company is prompting an employees’ international relocation, these are the main costs:

• Employees may need relocation benefits, including assistance with finding a home, living expenses, and a travel budget to fly back home every so often.
• You can work with relocation companies that can ensure a smooth move and, while they will charge a fee, this will ensure you avoid facing surprise costs.

If employees are voluntarily requesting international relocation, there are different costs involved:

• Each country has different employer requirements and social charges, so your HR team might want or need to adjust the employee’s salary relative to the total cost of employment in the new location.
• Be aware that you can change salaries for voluntarily relocating employees based on local benchmarks. However, there are loyalty benefits to keeping employees’ salaries the same when they move to a lower-cost jurisdiction and readjusting their salaries when they move to a higher-cost location.

4. Capability

You want to grow your business. You may do this by exploring new markets where demand might be greater, or by accessing less costly talent hubs. When hiring in a country where you lack a presence or the bandwidth to learn the local employment intricacies, you’ll need to decide whether to prepare in-house or seek out local partners.

Globally growing companies need to consider the following:

• Learning local regulations and cultural expectations will drain current resources. Regulations and norms that already vary from country to country are subject to regular change.
• Authorities expect companies to stay informed of local laws if their teams move to another country while working remotely, or if they hire internationally. Whatever the reason – compliance with local laws is on the employer.

Do an assessment to understand if you have this capability in your organization. If you don’t, internal HR teams must frontload learning of how to regulate employees in home offices, perhaps in multiple jurisdictions. On the other hand, if you want to grow around the world, or even in just a few new cities to start (but your HR team has plenty to do already) use Globalization Partners: a SaaS Employer of Record designed to help you scale quickly and compliantly.