Despite economic uncertainty, these companies are exploring growth potential around the world.
Growth—every business, whether a small startup or a large enterprise, plans and hopes for growth. To meet those goals, many turn to international markets for the promise of new customers, economies of scale, and untapped talent pools. But with those opportunities come the myriad challenges that global expansion presents.
The State of Global Expansion report examined the prospects for firms entering new countries, based on a Velocity Global survey of 1,000 US and UK companies in the IT, software, hardware, and technology industries. As of March 2020, participating companies were bullish on their strategy for international growth despite economic and foreign affairs uncertainty—90 percent of US firms and 75 percent of UK firms plan to enter a new country within the next year. The COVID-19 global health crisis had yet to factor into their decisions.
To assess growth potential of regions outside the US and UK, the report evaluated the regulatory landscape, quality of infrastructure, population growth, economic strength, and availability of talent with the necessary skills. The last criterion is noteworthy for talent development professionals. Almost half of US firms and more than one-third of UK companies noted access to new talent as a reason for expanding internationally. Globally, Asia and Europe ranked as the two most desired regions for access to tech talent (according to 33 percent and 30 percent of US and UK firms, respectively).
Also covered in the report is Velocity Global's Global Expansion Tech Index, which ranks countries on their favorability as a growth location. Germany, Switzerland, the US, Sweden, and Denmark ranked as the top five for their availability of tech skills.
Global expansion, however, does not always follow a linear progression—for the number of companies that enter a new market, a similar number leave it. The report indicates that around one-third of US and UK firms have left a country for various reasons.
Enterprising talent development professionals can position themselves as assets to companies exploring global expansion. With organization development and talent management capabilities, they can identify high-potential talent to acquire, oversee updates to strategic workforce plans, and manage culture change efforts.