The world looks very different today than it did just over a year ago. It’s no secret that the pandemic has had long-lasting effects on the way we live and work.
From a business perspective, the pandemic has caused turmoil in the global economy and financial markets. Companies have been affected by disruption in supply chains, a shift in demand for products and services and the loss of customers.
The economic climate in the wake of Covid-19 is also creating new challenges for international business growth. Let’s have a look at some of the ways that international businesses have been affected, and ways in which they can overcome these barriers to make room for growth.
Entrepreneurial outlook
First off, businesses across the globe have been forced to innovate and re-evaluate the way they operate. For us at Latitude GB, this meant a shift in our entire company structure, aligning ourselves more with international business expansion rather than business consulting.
With restrictions meaning an impact on travel and mobility of labour, businesses have been forced to adopt an entrepreneurial outlook in order to keep their head above water in the current market environment.
This means that multinational businesses are moving towards a strategic approach to their day-to-day operations, as they find themselves having to adapt how they operate, manage their work force, react to customer and employee needs and adhere to rules and regulations from the government.
Health and safety
International businesses which are focused on global expansion have voted health and safety as a top concern, according to a study by Globalization Partners and CFO Research. They cited this as nearly twice as important as new business strategies and increasing revenue.
A global pandemic brings with it a responsibility for international businesses to look after their employees worldwide. Companies should initiate measures to support employees’ physical and emotional well-being, whether at work or at home. This can be done by communicating effectively in global uncertainty, to make sure all employees are informed and supported. Due to remote working, resources and support should also be put into place to drive productivity.
Strategies in place for obstacles
Looking at other obstacles to growth, 83% of company executives revealed concern about managing third parties and stakeholders in a foreign environment during business expansion. Seventy-four percent of respondents were worried about working with foreign banks and managing international payroll.
As companies move from reacting to alleviating the impact of the outbreak, strategies should be put in place to deal with these unprecedented obstacles, in order to emerge stronger. Such strategies could be protecting growth and profitability through scenario planning, and more regular financial modelling exercises to improve resiliency. Companies should continue to keep the customer at the heart of their growth strategy, and should think through long-term considerations around shifts in core markets and business models as a result of Covid-19.
An optimistic future
Despite the gloomy outlook, many businesses remain hopeful that the disruption caused by Covid-19 will not stand in the way of the opportunities offered by international expansion. Even though standing strong in the face of adversity is a must, innovation is the key to driving recovery and growth in post-Covid-19 economies. This comes from identifying where change can have the greatest impact.
While the short-term outlook might be disheartening, history tells us that markets and society can not only recover after a crisis, but that they can come back stronger. For sure, the world will look different post-virus and so will international business models.