It is no secret that the pandemic has changed the way people work and interact with each other. It has also, inadvertently, ushered in an era of increased globalization opportunities. Businesses looking to expand into new countries have access to global markets and new talent pools, which provide growth opportunities for firms operating in multiple industries.
Before the pandemic, many early- and medium-stage businesses were focused on local and national market share. However, today, with the right technology partner and proper legal guidance, even the smallest firm can easily reach global customers.
Making expansion possible on a global scale requires strategic planning from business leaders. Companies investing in advanced HR technology platforms have access to a single entity with the capabilities to manage international workers while staying in compliance with local regulations, ultimately allowing the leadership team to focus on business objectives and international operations.
Global Growth Is Within Reach
Fortune found that many of the world’s most “admired” companies are also those that focus on globalization. A survey of respondents in the magazine’s annual “World’s Most Admired Companies” list found 72% reported that globalization will have a “very important” or an “important” impact on their operations. By contrast, only 52% of peer company respondents placed less emphasis on globalization.
An HR Technology Pulse’s 2020 Survey showed that 69% of businesses will change or increase their HR technology spend in the next 2 years. The importance of making strategic investments in advanced technology platforms is becoming more prominent in leadership discussions while looking at the future of their company’s success.
By investing in HR tech, business leaders sidestep the laborious manual undertaking that comes with navigating HR regulations and personnel management and, instead, can focus on quickly entering the new market. By expediting the speed to market, HR tech is giving firms access to new talent pools, which results in newer and more job opportunities.
Technology automation within the office covers the “Four Ds” of work: dull, dangerous, dirty, and dear. Automated tasks save money or time, freeing up employees to tackle more creative work. The digital workplace transformation has shifted the types of jobs needed in the world, creating an increased desire for creative workers who can spur innovation and change.
Finding a pool of talented people is easier with remote workforces, which are becoming increasingly transient.
The Employer of Record Opportunity
An employer of record (EOR) is a technology solutions provider that helps with various in-country administration and compliance capabilities. The partner performs multiple administrative functions and takes responsibility for the compliance and legal requirements involved with international workers, and it manages wages, benefits, and other employee-related functions.
HR platforms that offer EOR services typically have lawyers and immigration experts who understand the nuances of laws in different countries and how those differences apply to particular industries.
For example, an experienced HR technology provider will have teams of lawyers and immigration experts who can advise and onboard employees in targeted markets worldwide. They can do this while maintaining all the immigration paperwork and remaining in full compliance with mobility regulations and visa requirements.
A direct EOR is an organization that is just a step from the expanding parent company and the employees. By contrast, an indirect EOR model outsources to third parties that manage payroll, as well as other staff hiring functions. With a direct EOR, a firm with global expansion plans can move staff into any number of hundreds of countries, leverage massive talent pools, and largely eliminate data exposure and potential legal complications.
People and culture teams’ responsibilities for global expansion can then focus on reskilling workers, building an environment for remote work, and embracing the latest technology tools. For example, an HR department can further global expansions by supporting cultural awareness and training or offering guidelines on the skills and expectations needed for remote work instead of focusing on, say, details on a worker’s visa issue.
Complete HR Technology Services
Industry leaders in HR technology offer holistic business process outsourcing, which includes human capital management strategies, delivering handbooks and employment agreements, and managing employee questions about payroll or HR protocols. These HR tech providers often offer free company resources to help clients find top global talent and expand quickly without taking on the costs of the additional country- or region-specific HR staff.
Another component of these all-inclusive platforms is entity formation services. This type of service manages the selection to ensure the best choice is made for a particular country and business arrangement. Additionally, it can help streamline an organization’s transition from an EOR to the newly created entity to ensure the HR components are operational without delay.
With an EOR model, data exposure is reduced because employees’ personal information flows directly between the secure HR technology platform and the employees. The provider will also ensure compliance with the various country- and region-specific data security and governance rules such as the General Data Protection Regulation (GDPR) or the Brazilian General Data Protection Law.
Some HR tech providers also offer features that assist with employee benefits packages. They will partner with select organizations that can provide global workforces with quality medical and dental insurance options that fit within country-specific requirements. These packages typically include pension and 401(k) plans. A quality benefits program improves worker satisfaction, enabling the expanding firm to generate positive word-of-mouth as it strives to attract top talent.
Beyond the Pandemic
Adding HR technology functionality is a counterpoint to the global pandemic slowdown. Some industries were impacted more than others, while others also saw an opportunity. HR technology platforms simplify expansion and business processes so companies can hire the best talent while focusing on larger company goals and objectives.
Global talent pools offer firms quality workers and an insider’s viewpoint into local markets that can further inform expansion strategies. Through continued investment in HR technology solutions, such as an EOR, businesses will be able to quickly and confidently move into new markets and retain a global workforce.
Rick Hammell is the Founder and CEO of Elements Global Services. He has extensive experience in HR, having served as a Director of HR and Chief Operating Officer before launching his own business. Under his leadership, Elements Global Services has pioneered a new business model for the global employment industry and has become one of the fastest-growing, risk-diverse, and high-profit EOR in the sector.