The Relationship between Remote Work and Global Expansion
Remote work plays a huge role in globalization. From helping businesses grow at a faster pace to improving work lifestyles for employees and the global economy at large, remote work has drawn a lot of businesses to the global market. This is especially true of small business enterprises (SMEs) seeking growth and international recognition for their brands. This emphasizes the reasons why brands scout for international talent, as it is one way to thread through multiple geographical locations simultaneously, bringing ease to the expansion process. Here’s where third-party organizations come to play, as they have a lot to offer in terms of their wealth of experience and exposure to such locations.
Roles of International PEOs in Remote Work
Remote work is the future of work. International Professional Employer Organizations (PEOs) help businesses transition seamlessly to the global stage. They often act on behalf of employers, staying on the hiring front and helping them bring in the best of the best in the talent pool. Not only do they help in hiring, but they also provide other forms of assistance to businesses. Here’s how they help:
Hiring and Onboarding
The best businesses not only succeed with good strategies but also with talented employees. International PEO provides employer of record (EOR) solutions to legally assess and hire the cream of the crop for businesses. They not only go through the rigorous process of conducting interviews and necessary checks on potential employee backgrounds, but they also manage employees and see to their welfare. This minimizes the risk of hiring the wrong individuals but provides skilled people who are prepared to work from anywhere. Recruitment needs are paramount, and these organizations see to fulfilling these needs in a compliant way.
Onboarding existing employees is also one of their roles. This applies to businesses that send their expatriates to foreign countries. This process helps them settle in faster and seamlessly integrate themselves into the workspace. It is a cost-effective option for just one or two employees who have to be in a foreign country for a short time.
The financial responsibilities of an employer are better shouldered by professional employer organizations that seek to minimize risks and ensure full tax and other financial compliance. This includes payroll preparation, execution of tax payments to the appropriate quarters, insurance payments, and other incentives. This ensures that employees are paid in the local currency without hitches and on time.
Compliance and risk mitigation
For a business to survive in a foreign country, it is necessary to play by the rules. Rather than navigate the regulations alone, these organizations help businesses find their footing by legal means, ensuring that no stone is unturned where the rules are concerned. If laws change and new policies are erected, they help train and educate employees to help them remain fully compliant. This role shields companies from the risk of non-compliance.
Other HR Duties
International PEOs also carry out other HR functions such as termination of employment contracts, preparation of severance packages, payment of benefits, and packages such as pensions and travel allowances.
These roles help businesses minimize costs. They circumvent the subsidiary establishment process. In the event that a company decides to withdraw its business from the country, the process is seamless and does not incur as much cost as it would have if it had a legal establishment. It also helps employers make the best provisions for their employees, especially for premium health packages and so on. This ensures employee retention, making sure the international team optimizes its skills for brand growth. They not only advise on the tax and employment regulations but also help businesses take advantage of government remunerations and benefits. Businesses are shielded from the risks that accompany non-compliance, such as fines, permanent sanctions, and loss of brand reputation.
How to Set Up Your Remote Team during Global Expansion
There are different ways to go about establishing a team when expanding globally. Here are some of the ways to go about this.
Curate a global brand
One major way to establish a remote team is to curate a global brand. Some brands opt for the establishment of a branch overseas. This way, the branch is built as a sole legal entity with the need for employees. This option will, however, require the tedious process of paying taxes and following the legal procedures that accompany setting up a branch. This can be done by establishing a foreign subsidiary that can be owned wholly by the company or majority-owned. This way, employees can be hired as members of the international team.
Also, mergers and acquisitions, as mentioned earlier, are another way to draw international talent. The company can leverage existing resources to do so. However, this option will succeed only if there’s a business readily available in your preferred location poised for a merger at an appropriate price. Moreso, brands with big names are often attractive. This is especially true if your brand is solely online but has a traceable virtual footprint with positive employee reviews.
Hire Overseas Contractors
Independent contractors are a great idea for short-term projects. They can be hired to fill in on a remote team. They can be hired both virtually and onsite. In a 2018 study by Upwork, freelancers’ work increased by 168 percent, which is expected to grow exponentially over the next few years. Independent contractors often work on their terms with a legal document binding the agreement between employer and employee. Contracts of this nature are often required to avoid employee misclassification. This is because different countries have varying employment and labor laws regarding independent contractors and freelancers.
These laws often protect their rights, and it becomes necessary to differentiate between a regular employee and an independent contractor. Key areas that are often of contention include work hours, the level of autonomy that a contractor should possess, their level of accountability, rules of work engagement, perks, and benefits. Employees should not be hired as contractors without being paid their full benefits and vice-versa. Doing this could result in legal action with grave consequences such as back-paying accumulated income with interest, taxes, benefits, and a damaged brand image.
Utilize virtual channels
Virtual channels provide a much more flexible avenue to hiring remotely. This is because the options are not limited. With the current and evolving technology, finding skilled individuals with whom location is not a barrier is a less tedious task. Employees from different industries can be easily reached over virtual platforms.
Transitioning into managing a fully remote workforce may be challenging, but the process can be seamless with the right team of experts. Employees can easily be monitored over video conferencing software while teams can be managed with collaboration software. Various virtual platforms make room for employers to find talented individuals who match their demands. You may want to, however, consider these steps when hiring virtually:
Prepare a good screening process
This will go a long way in determining the best candidate for your company. You may decide to select which works best for you. A good screening process will want to cover interviews; they could be one-on-one or via a group panel, whether on the phone or via videoconferencing apps such as Zoom and Google Meet. It may also cover job skills tests, presentations, personality tests, and background checks.
Formulate a structure
Formulating a structure helps the pre-planning process and helps conserve time. This could include the number of topics you intend to discuss with the candidates, the number of questions to be asked on each topic, and the time allocated for each topic. It is also important to remember to leave room for questions and feedback.
Share vital information before commencing
Once candidates have been shortlisted, they can be informed of whatever necessary information a few days before the interview. Details conveyed will help them prepare, especially if they have to download software to access the interview. They could also be informed of a time frame in which the interview will take place, as well as a backup contact or mail just in case a glitch occurs during the interview.
Referrals could be from employees or other people. Employee referrals are a gold mine. They could be done via word of mouth and social media platforms such as LinkedIn, chat apps, and other mediums. Here’s why they are so important:
Recruiting and hiring can consume time and effort. Hiring via employee referrals helps save this time. It also helps to cut the cost that would have gone into searching for a perfect fit for the company.
Employees who get hired by referrals have proven to have a higher retention rate than others hired by other means. This is because they often have an understanding of the system, company culture, and policies. This makes the onboarding process a seamless one.
Employee referrals are often beneficial to the marketing strategy of companies. The use of social media has made this easier, and it has been shown to increase brand visibility and drive web traffic. This can, in turn, drive sales and increase company revenue.
Employ Global PEO Services
A quick way to hire international employees is to utilize international PEO services. They are particularly important because their presence is global. That is, your choices will not be limited to a location. This way, global talent can be accessed without setting up a legal entity or going through the rigorous process of paying taxes and so on.
Using local resources will aid the onboarding process. This is important as they are resourceful in hiring the best talents in a location. They will also help in conducting background checks and verifying claims and references. Their experience is also key in preparing attractive employment packages that comply with the stipulated regulations of the country. It will also minimize the risk of misclassification of workers as well as compliance.
Importance of Remote Teams during Global Expansion
Remote work often demands remote teamwork. This is crucial during global expansion to ensure company growth. Curating a remote team while expanding globally has a lot of benefits accrued to it. Remote teams, just like an on-site team, require a lot of synergies to work and are quite important. Here are some reasons why remote teams are crucial and beneficial:
Productivity is key to company growth and success. Remote teams are often productive for various reasons. This could be from individual personality to optimized flexibility. Remote employees have been shown to go the extra mile just to be able to work from their convenient location. Not working in the traditional workspace can reduce distraction and encourage focus and time management. This is because the growth of remote employees is often measured, thus keeping them actively on their toes and helping them discover smarter and more convenient ways to complete tasks.
This newfound flexibility also permits commute time to be allocated to other productive activities. These include meditation, exercise, making breakfast, reading, extra hours of sleep, and other activities that permit their creative juices to flow. It also puts them in a relaxed state before work hours commence and permits them to create their convenient workspace, which could be inside or outdoors, ultimately giving room for productivity. Doing this also allows remote employees to work during their most productive hours without undue pressure.
Decline in turnover
Employee productivity will lead to a lower turnover rate. Companies utilize the remote work option as a means to retain talented individuals. According to a survey carried out in the US, 82% of employees agree to be loyal to employers who provide flexible work options. Employees also have access to better incentives, which motivates hard work.
Permitting employees even to work remotely speaks volumes. This is because the employee is trusted to do their work effectively without the physical presence of the employer. It allows them effectively manage their schedule and priorities without interference. This trust fosters employee loyalty as it proves the employee’s abilities to the company and helps them strive to be better.
Increased Employee Wellbeing
In times like this, remote work is the go-to option for preserving employee well-being when the planet is experiencing a series of weather conditions and epidemics such as heat waves, monkeypox, and even different strains of Covid-19. There is zero contact between employees and zero chances of spreading illnesses because meetings are telecommuted.
This way, employees can be better preserved from exposure to diseases and work well without having to resort to absence from work. Employees who work from home are also known to have a good work/life balance. This is because they can easily manage their time and stay more productive.
Remote work fosters diversity. It helps different individuals connect and rub their minds to produce innovative ideas and solutions. It also fosters deep cultural understanding among employees, increasing their tolerance levels. This is because teamwork ensures valuing and understanding other people’s points of view and contributing to team success with these interactions.
It also eliminates certain kinds of conflict that are associated with working in the same space with co-workers. This creates fewer problems in the workplace. Remote work fosters team spirit, which in turn fosters growth. It also helps them create time to access professional networking events, which, ordinarily, they may not have access to attend because of a 9-5, but can prove beneficial to their individual growth, positively impacting their commitment to work.
Remote hiring is a cost-effective venture. This goes sideways for both employees and employers. This is because it helps to minimize certain costs. For the employee, transportation costs can be diverted into other purposes. This also goes for work outfits, food, and other expenses. The employer can save funds that would have gone into office space, furniture, electricity, equipment, janitorial services, and other running costs.
In addition, maintenance costs are minimized as companies can cut down on purchasing equipment for employees. Employees can always make use of their devices with technical support from their employers. Projects can be managed through cloud-based software, collaboration can be done via high-quality teleconferencing software. Ultimately, both employer and employee get to profit from the remote work culture.
All hands are on deck to make things work, this is why constant communication will require constant support from members of the remote team. Different geographical time zones make it possible to achieve flexibility and keep work going around the clock. This helps teams provide support for one another, especially during the day. This is especially true of businesses that require customer support service. It helps create a sturdy but flexible structure that enables efficient workflow.
Projections for the Future of Remote Work
Remote work is here to stay as long as global expansion remains a phenomenon. It has evolved in the last few years, and it keeps evolving. There’s no way to predict its path in totality, however, based on current trends, projections can be made for the future of remote work. These projections will be useful in international expansion, as one cannot be separated from the other.
The hybrid work model
It is clear that the hybrid work model will be fully adopted in the coming years. Remote work is not going away anytime soon, and companies are adjusting to make room for it. Also, as more people are leaning towards remote work, companies may have to shelve or remodel their culture in order to accommodate top talents.
The beauty of the hybrid model is allowing these two types of work to coexist and give room for productivity. This approach allows employees to opt for whatever option suits them best.
A survey by Cisco discovered that one of the factors that influence employee productivity and job satisfaction is access to work resources. The workspace will fold to become more accessible to employees who desire to bask in the community spirit. Workspaces are springing up in different locations to cater to these needs, and there will be more of such in order to cater to some organizations and start-ups who just need a short-term lease.
Workspace flexibility will become more pronounced as remote work will see more creative workspaces in the years to come, with design detailed to cater to the aesthetic and collaborative needs of the employee. This will be important to encourage productivity, creativity, and satisfaction.
Flexibility will be a result of the balance in the work/life lifestyle. Apart from the level of autonomy that remote employees currently enjoy, the remote work lifestyle frees up time to carry out other activities under less pressure. This will prove to be beneficial in the coming years as this flexibility will foster the employee’s overall well-being and, in turn, positively affect their outlook on work and productivity.
Improved cyber security
Working in the remote space will not only spur evolution in technology, as is already taking place but also improve cyber security. Cyber security is a huge concern for remote workers, and it will improve in the coming years. This is because companies will be required to update and upgrade office equipment to secure data. The right tools will have to be procured to do this. According to the CEO of nVisium, Jack Mannino, “The shift to remote work has prompted many organizations to make significant new investments in their IT systems and infrastructure.”
In addition to procuring the right equipment, cyber security education will be on the rise as employees and team leads will have to be educated. Intelligent cybersecurity strategies will need to be held in place to cater to data security, both in the virtual and physical workspace, including the homes of remote workers. Modern cloud technology will have to evolve to cater to the situation.
Higher performance management
Remote work will improve performance management as performance measurement strategies will evolve. This is because employers will be focused on the amount of work that has been done, as opposed to the number of hours spent doing the work. Virtual employee management tools will be needed to improve employee efficiency so as not to give the impression that laxity can be tolerated. Some of these tools include Timely, TransparentBusiness, and Time Doctor.
New roles may be assigned to HR personnel who will be in charge of overseeing remote employees and ensuring their performance is optimal. It may also be necessary to evaluate team growth more often than consistently would be. Stemming from set goals and performance metrics, this would have to be a result of team reports and feedback, which may be weekly, bi-weekly, or monthly, as opposed to annually.
Resilience and productivity
The remote employee’s overall productivity results in the company’s growth. Thus, as remote employees find ways to navigate remote work and get better at their jobs, the employer can ride on these waves and arrive at optimal growth.
In addition, remote work will create more stable organizations. The absence of physical buildings will enable employers to cut costs and divert them to other productive areas. This may include hiring more employees in the case of expansion, enabling them to tap into the wealthy resources of global talent and upscaling at the same time. It will also help organizations remain resilient in natural disasters, wars, disease outbreaks, and extreme temperature changes as the workspace has decentralized.
Rise in the digital nomadic culture
A digital nomad works in various locations virtually, other than their physical location, and makes a living out of it. This definition is true of many Gen-Zs and Millenials as it is a way to cross borders digitally and experience cultures without being there in person.
It is an explorative way of utilizing creativity, and countries are encouraging this. Digital nomad visas are being introduced in countries such as Georgia, Barbados, and Croatia to attract and encourage remote workers. Digital nomad villages and communities are becoming increasingly popular, and there are estimations for the number of digital nomads to reach 1 billion by 2035.
The concept of remote work or ‘work from home’ has evolved largely from globalization. International expansion has met less resistance with the aid of remote work. This is because both go hand in hand. Organizations continue to seek growth, brand recognition, and an increase in revenue, and the drive and productivity of skilled and talented individuals fuels this move. Not without its downsides, many choose to pay more attention to the larger access they get to the global market, the innovation and creativity that oozes from a diverse workforce, not to mention the new sources of revenue this brings along with government incentives.
Hiring a global team bears benefits but requires a lot of attention. Communication, cultural acceptance, and compliance have proven to be hurdles for many. However, adequate preparation and team involvement are a panacea to these challenges. Over the years, global expansion has been approached with different strategies: hiring remotely. This is because this strategy has proven profitable for several organizations. The future of remote work has begun, and it strings visionary companies and business owners. From optimized productivity to a decline in turnover and increased profitability, many have turned to seek talent abroad.
Of course, global expansion can be done in different ways, from the most traditional means of erecting a subsidiary to exportation, licensing, and franchising. In all of these, the third-party factor consistently takes a spot. Remote hiring can seamlessly be done with an the employer of record solution of an international professional employer organisation, otherwise known as international PEO. This organization is licensed to keep companies and business owners from walking in the dark after deciding to expand. This is solely why WeHireGlobally exists, to help businesses make the most out of their expansion experience. Our specially curated team of experts helps businesses focus on the sheer goal of expansion while catering to other affairs. These include:
- Finding and hiring the best talents in your preferred location
- Catering to onboarding-related issues
- Handling payroll, tax, and other perks for employees
- Managing employees anywhere in the world
Anywhere in the world? You may ask. This is no facade, as our services span more than 150 countries worldwide. Compliance is a huge deal to us at WeHireGlobally, and we take extra care to ensure that our services are delivered compliantly. Expanding globally is a huge leap with many risks, but WeHireGlobally tailors your needs to eliminate these risks and bring them to a minimum. Picture any country you want to expand to, and be sure to meet WeHireGlobally at your service. Talk to us here to begin your journey.