As of 2022, there are about 33.2 million small businesses in the US. Growth is one of the main goals of almost every business, and even one that starts out incredibly small might be able to one day become a global business. While this kind of growth is good, a larger business is often more difficult to manage. In this guide, we’ll cover five of the biggest challenges of running a global company. Keep reading for more.
Also, Read Finding the Right Talent for Your International Expansion
1. Human Resources
Managing a global workforce can be tricky, as you need to be able to recruit and develop talent in a broad range of environments. This can involve language and cultural differences which your HR personnel need to be able to manage.
What works in one country might not be effective in another. To handle things well, you may need to establish multiple HR administration systems that meet the needs of your different employees.
2. Taxes
Taxes can always be difficult when running a business, even in a single county. With an international business, things can get significantly more complicated.
You need to make sure you abide by the tax laws in every country that your business operates in. Ensure you understand the local rules and develop a plan to minimize the risks of any problems coming up.
3. Cash Management
Global expansion often means embracing change. You need to be able to adapt to new advancements, and one that’s currently very important is digital cash. Many countries use it for faster transfers, better security, and lower costs.
You might think working with banks in each country is best, but this can complicate things. Instead, you should work with a small number of global banking partners as they’ll be able to help you with everything you need.
4. Market Entry
Entering a new market can be difficult, but it’s a key part of company expansion. It’s important to make sure you do appropriate research for each country you want to expand into. This will help ensure you meet local compliance and avoid making common mistakes.
5. Tracking Performance
When not working face-to-face with employees, it can be tricky to see how they’re performing. If they’re in another country, this is much more challenging. The relevant managers in different locations will be able to provide information on this, but you shouldn’t pressure them too much to keep giving you updates.
Make sure you set up a system for your teams in different countries. This will tell them when they need to update you, and what information they should provide so you can get everything you need.
Managing a Global Company Effectively
While managing a global business can bring many challenges, growth is beneficial and will help you achieve your business goals. Make sure you understand the various elements of expansion beforehand so that you can do things right and avoid any major issues..
Also, Read What Are the Causes of Business Insolvency?
