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Module 1 Episode 4: A Shift In The Business Landscape Requires Companies Scale/Build In New Ways

business landscape shift new scaling strategies

Read the full script of Module 1, Episode 4 of the Global Growth Master Class below. Want to get certified on global expansion? Simply click here to access the complete course today.


A shift in business has occurred. The pandemic has accelerated a number of trends that affect how businesses operate, chief among them, the expansion of distributed work.

Companies are increasingly virtual (at least in part) especially as employees spread across multiple geographies during the pandemic, but this is just the beginning of the changes that have occurred. 

The notion of what “headquarters” is, has also changed. “Headquarters” used to be a single building where the entire power structure of a company sat. Now, company leadership is spread in many different locales. 

It has also become increasingly clear that markets across the world shouldn’t just be thought of as sources of inexpensive labor, but are developed economies with untapped customer-bases. The population of Africa, for example, is 1.2B people (a majority of whom are under age 19). With the explosive growth in the region, the population in the continent will surpass 2B by 2040. Although, at the same time talent has become more widely available. Smart companies are able to leverage this to establish a global presence. They see remote teams not as cost centers but as an engine of innovation.

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Many emerging markets are leapfrogging traditional stages of growth that more developed markets had to navigate, jumping right to new technologies. While for many in the US and Europe, people went from owning desktop personal computers to laptops to mobile phones, for billions of people across the world their first “computer” was their smartphone. 

Moreover, infrastructure is different as well. Instead of having to build a wireline network, wireless networks are being implemented, bringing network connectivity to many who never had it. And new fintech solutions are allowing people to access and move their money without the need for traditional banks.

The best markets aren’t always the most developed markets now. Zipline, a medical drone delivery surface based in California, chose Rwanda and other countries in East Africa as some of its initial markets because they were better than the US market. Transportation for medical supplies was fairly undeveloped in these areas, creating opportunity, while in the US the transportation system is pretty mature. Moreover, in the US you cannot fly commercial drones without approval from air traffic control, something that was not a restriction in East Africa.

Opportunities in global markets have grown due to four key factors, in particular:

1. Improved infrastructure in emerging markets (from internet speed to mobility of people). 

2. Greater access to talent due to workforce development in many countries, allowing companies to find the right talent when expanding to new markets.

3. Governments investing heavily in promoting innovation and entrepreneurship

4. Growing middle classes and better-developed consumer markets as economies both grow and stabilize

The cost to expand businesses into new markets is also decreasing with lower barriers to entry. But these benefits don’t come without risk. Rising nationalism has put up regulatory and political roadblocks for international companies entering new markets. Moreover, local consumers and businesses are starting to demand products and services customized just for them. In past years in places like Turkey, for example, an American company could get by on offering an American product to people, there was a novelty and appeal to that. But now, people expect products and services to be localized to their tastes and cultural nuances. International companies who could come in be thought of as appealing by keeping their solution the same as back home are now losing to local companies who are also taking advantage of lower barriers to enter and build a business, and these local companies have a better grasp on the local context, creating a competitive advantage that has caused many companies coming from aboard to fail. 

There is also a risk of not acting when disruption occurs - the taxi companies in San Francisco lost around 65% of their revenue (not profit, revenue) in a single year when Uber really started to hit its stride. New nimble companies challenge even fast growing companies by using modules (like distributed teams) to better serve a global customer base.

The local context is crucial, as we will discuss in other articles. No longer is it effective to send the “expat” in from headquarters (who touts the “company way” of doing things) to open up an office in an international market, local teams need to have a native local understanding of the market.

At the same time, companies have the opportunity to recalibrate to better consider not only the environmental, but also the human impacts of their business. Global citizenship and connectedness are increasingly important, and as Salesforce co-founder and co-CEO Marc Benioff evangelizes, businesses have the opportunity to become more of a catalyst for positive change.

Each of these shifts point to the fact that “global is the new agile.” In other words, business leaders understand the lean/agile methodology and have applied it to many aspects of their businesses; now they are looking for the next big thing. The parallels between global and agile go deeper. Just like an entire organization must be aligned on using the agile methodology, iterating and pivoting until the right model is discovered; versus sticking to an established plan, working in silos to reach a formal launch date. With global, the entire team must be aligned on adopting the “Global Class Mindset” outlined in this course, versus sticking to the “Company Way” of doing things to truly succeed at reaching global scale.

Moreover, instead of hiring a team of 25 people and opening a formal office and having a ribbon cutting when launching in a new market, a big commitment, companies are understanding a more iterative approach, committing fewer resources until a market is validated, is a great way to build a successful international presence.

As we are alluding to, starting on the right path to reach global scale starts with the right mindset, which we call the Global Class Mindset and is what we will explore in the next article.

Welcome to the new era in global business. The videos that follow will show you how to navigate this new world and be successful at reaching global scale.

NOTE: Don't miss out on the next episode! If you want to continue learning about global expansion strategies and dive deeper into the course material, simply click here to access Module 1, Episode 5 of the Global Growth Master Class.

If you'd like to learn more about Global Class and implement strategies and tools that we have developed, reach out to us!
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