International Trade

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Business Without Borders: The Challenges Of International Expansion

15/07/2010

By Jamie Stewart, UK Managing Director, Exact

As companies defy the recession to develop their international business, they are likely to run up against a barrage of challenges from multiple quarters. They may need to do business under local legislations, in different languages and in different currencies, serving local markets while complying with global company standards. In addition, they may need to deal with a whole range of location-specific risks, from unstable economies and governments, to security concerns and labour availability. And then there are the human risks, where working with a new and untested overseas supplier, or new colleagues in a foreign subsidiary, could pose a significant stumbling block to the success of global expansion.

Yet not all challenges faced by companies seeking to expand internationally are so tangible in nature. When negotiating a path through new and unfamiliar markets, cultural considerations can all too often be underestimated or swept under the carpet as an afterthought. In actual fact, managing the cultural implications of international expansion is a non-negotiable ingredient for its success.

Companies that get to grips with cross-cultural communication are the best placed to use shared information and experience to enhance their competitive position at home and abroad. They are also far better equipped to deliver their long-term business objectives.

It’s important to appreciate and assimilate the subtle differences in verbal and non-verbal communication across cultures. And language is perhaps the least of the cultural obstacles that international managers can face. If misconstrued, even barely perceptible nuances of gesture, eye contact, tone and humour have the potential to offend, and can even derail projects if not dealt with swiftly. Business cultures themselves can also vary widely, with significant deviations among countries on attitudes to challenging... continued on page two >

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