Virtual, international teams are becoming more common in today’s workplaces. This trend is possible because of the prevalence of remote work. Currently, over 70% of employees already work virtually, at least part of the time.
There are many advantages to expanding your hiring efforts beyond geographical boundaries. Most importantly, it will expose you to a global talent pool. At the same time, managing an international workforce also comes with challenges.
If you’re new to hiring and leading remote workers, it might seem like an extremely overwhelming task. You might be wondering how you will manage different time zones, cultures, and work styles.
Below, we’ll walk you through what having a global workforce means, some of the biggest things you must consider when building one, the advantages and challenges you may face, and what kind of software solutions can help you along the way.
Ready to expand your global footprint? Let’s jump in.
What is a global workforce?
A global workforce is a team of employees who work for the same company but are based in different parts of the world. They may be spread out across several continents or even just across different time zones within the same country.
With advances in technology, more and more companies are starting to hire workers from all over the globe. There are a few reasons for this shift:
- The talent pool is no longer limited to those who live near the company’s headquarters.
- It’s easier than ever to stay connected with people who are far away.
- Offering remote work options can help a company attract top talent.
Take for example a web development company. In the past, they may have only hired workers who lived near their office. But now, with the rise of remote work, they can hire the best software engineers from anywhere in the world.
The global workforce is growing rapidly. In fact, by 2022, it’s estimated that 25% of all professional jobs in North America will be remote. So if you’re not already managing a team of international employees, chances are you will be soon.
Things to consider about global workforce management
It can be a huge challenge to jump from a small local business to an international one. With more employees comes more responsibility – and that’s especially true when those employees are based in different parts of the world.
But with the interconnectivity of the internet, software solutions that can bridge language gaps, and a little bit of planning, even companies with just a handful of employees are starting to spread across the world.
It’s not easy – but it’s getting easier. Make sure you consider a few key things before jumping into the global talent pool.
One of the most significant challenges related to managing a global workforce is dealing with international regulations. For example, the U.S. has the Wages and Fair Labor Standards Act while India has a Wage Code that was updated recently. It lays out employment rules that are very different from those in the U.S.
A company with international employees needs to consider factors like wage laws, employee benefit rules, employee allowance requirements, and tax regulations.
A human resources department needs to ensure that they meet all the requirements in the given country for employees. Some places have a separate set of laws related to working with contractors.
Another option is to work with an Employer of Record (EOR), which is a third-party entity that acts as the legal employer for your workers in a given country. An EOR handles all local requirements and your contract with them rather than with individual workers.
Organizing workflows and scheduling
Organizing smooth and productive workflows for employees who do not share a location can be a challenge. These difficulties get amplified when the team is working from different time zones or even on different continents.
The first steps involve coordinating activities, communicating goals, and setting a system for tracking progress and deadlines. A centralized scheduling tool is also essential. It will ensure fairness for all employees and will make planning, arranging meetings, and collaboration easier.
Also, it will help you get the best performance out of international workers because they can work according to their natural rhythms instead of having to conform to your schedule.
Time-clock tools can help you track hours worked for employees in different locations. You can add a system to ensure transparency by confirming employee identity through facial recognition.
These tools can help automate and simplify scheduling and record-keeping without forcing international employees to conform to the time zone of your main offices.
Engage with employees
Remote workers can sometimes feel disconnected because they lack “face time” with their co-workers and managers. One way to combat this is to touch base with team members via available communication channels each day.
The goal of an informal email or chat message is to replicate a casual “water cooler” conversation. It will make employees feel more connected, help you gain insight into their mindset, and give them a chance to bring up any concerns, needs, or ideas in a low-pressure setting.
You can also offer a wide range of communication tools, allowing each employee to access the option that best suits their needs and preferences. These can include chats, voice or video calls, emails, and collaboration platforms.
Encouraging communication options also allows employees to find their comfort zone and have opportunities for engagement and communication that fit their personality and cultural norms.
Providing training and career development opportunities
Onboarding, training, and development are as necessary for a global workforce as a local one. You can give skilled employees a chance to improve their abilities by offering a chance for career progression.
Extending training opportunities, either virtually or through a third party in the employee’s location, can help with internal promotions and offer employees incentives to stay with your company instead of seeking opportunities elsewhere.
Be aware of cultural differences
It is crucial to understand that a global workforce will have different motivations, communications styles, and benefits needs. People from some countries may embrace goals-oriented tasks and pursue clearly defined achievements, while others strive to be valued members of a team or seek approval from management-level employees.
These cultural differences can foster creativity because of the different experiences and perspectives offered. You can take advantage of this by creating forums where employees can bring ideas without worrying about judgment or critiques.
At the same time, management-level employees need to be aware of culturally appropriate communication practices for employees from other locations. A company with a global workforce needs to provide information or training so that managers are aware of the expected etiquette.
Determining fair payment and salaries
A company needs to negotiate compensation packages and salaries when hiring. This step is the same whether you are hiring locally or globally. You also need to be aware of salary expectations for existing employees, who may seek raises or ask for performance reviews from time to time.
With a global workforce, determining fair compensation packages can be complex. Employees in other countries will likely have different expectations of what a starting salary should be, and some may not negotiate at all and merely accept or decline your initial offer.
Human resources workers can address these differences by understanding the quality of life expectations for employees in each location. As a starting point, you can build around universally valued benefits, such as vacation, healthcare, and housing.
Focus on offering competitive packages in these areas, and then you can negotiate other things, such as additional benefits, on a case-by-case basis.
Then, when trying to determine what a salary is worth in different locations, you should also consider the following:
The first challenge is finding out what a salary is worth in different locations. The purchasing power of $1 will be different in Tokyo than it is in Omaha. A company needs to research local economies and compare them to the ones where its headquarters are located.
Then, they need to find a way to compare those economies. The easiest way to do that is with the “Big Mac Index” published by The Economist. This index uses the price of a McDonald’s Big Mac as a way to compare GDP per capita across different countries.
Because the famous fast food restaurant is so ubiquitous, it’s a helpful way to get an accurate picture of how much purchasing power different currencies have.
Cost of living
Once you’ve determined the purchasing power of a salary in a given location, you need to consider the cost of living. In some cases, employees may be able to live quite comfortably on a lower salary than they could in another country because the cost of living is lower.
For example, an employee in India may be able to live quite well on $1,000 per month. That same salary would not go as far in New York City.
Availability and quality of healthcare
The next thing to consider is the quality of healthcare in different locations. In some countries, high-quality healthcare is available to everyone, while in others it’s only available to those who can afford it.
This will have an impact on how much money employees will need to spend on health insurance and other medical costs. companies should research the availability and quality of healthcare in different countries before setting salaries and benefits packages.
Local taxation rates
Another important factor to consider is local taxation rates. The difference in tax rates between countries can be massive. In some cases, it can be the difference between an employee taking home 50% of their salary or 90%.
You need to consider how local taxation rates will impact your employees’ take-home pay, and include some of those calculations into your offer, or risk failing to meet the demands of some high-skill applicants.
It is important to remember that the goal of this research is not to squeeze every dollar possible out of potential employees or seek out the cheapest labor on the planet.
By doing either of those, you will be limiting your talent pool considerably and may end up with a disgruntled workforce. The goal is to find a fair way to compensate employees in different locations for their skills, experience, and the cost of living in their area.
Advantages and Challenges of a Global Workforce
Managing a global workforce requires you to address practical considerations, such as scheduling and communication platforms, and other issues related to local laws, salary requirements, and cultural norms.
Is it worth taking these steps to manage a global workforce? Here are some of the potential advantages that companies with international employees get to enjoy.
- You can choose from a larger pool of talent. If you are not limited by geography, you can find employees with the exact skills you need.
- You can draw on the experiences and insights of people with diverse backgrounds and perspectives.
- It can positively affect your bottom line. Though you need to invest in virtual tools, you do not have to operate a physical office and pay the expenses that come along with it. International employees work remotely, and the equipment and systems they need will likely cost less than operating a physical office.
In some industries, a global workforce can increase productivity. If you have teams in different time zones, you can have a 24-hour work cycle rather than having your systems sit idle for 16 hours per day.
There are also some challenges to employing a global workforce. These are things that you need to address if you plan to have international employees.
- Scheduling meetings and collaborative projects can be challenging because of time zone differences.
- Management staff members need additional training to understand the norms and communication styles of people from different cultures.
- You need to take employment laws and salary requirements in different countries into consideration.
With the proper tools and practices, you can overcome issues and enjoy the benefits of a global workforce
Global workforce solutions
That same technology that has connected a global workforce can also provide some solutions for companies looking to expand.
Many software platforms allow you to manage a global workforce by providing a space for communication and collaboration, tracking employee productivity, and managing projects. Generally, these solutions are broken into several categories:
Communication and collaboration
The most important aspect of managing a remote team is maintaining clear and consistent communication. Your team should have a space where they can easily share ideas, ask questions, and give updates on their work. Many software platforms can help with this, such as:
- Google Hangouts
- Microsoft Teams
Each platform has its unique features, so you’ll want to choose one that makes the most sense for your team’s needs.
For example, Zoom’s video conferencing ability took off as more companies moved to remote work in 2020, as a result of the pandemic closing in-person offices. Your company may need something else like direct messaging or file sharing that another platform offers.
Tracking employee productivity
It can be difficult to track employee productivity when everyone is working from different locations. However, there are software solutions that can help you get a better idea of how your team is performing. These platforms typically allow you to:
- Set goals and objectives
- Assign tasks and deadlines
- Track progress on projects
- See which employees are completing their work on time
- Offer feedback and coaching
Make sure that when you are using these, you are looking at the data as a whole and not singling out any one person. You want to make sure that you’re using this information to help your team improve, not create an environment of competition or mistrust.
If your company works on projects, you’ll need a way to keep track of each project’s progress, deadlines, and assigned tasks. Many software platforms can help you manage projects, and they typically allow you to:
- Create and assign tasks
- Set deadlines
- View project progress
- Offer feedback and coaching
Your company may already have a project management tool that you use, but as you grow, it may not be able to accommodate your expanding international workforce.
Choosing a software solution
Choosing the right software solution(s) for your company will depend on several factors.
- Size: The size of your company and workforce will play a role in the type of software you need. A small business with a handful of remote employees will have different needs than a large enterprise with hundreds or even thousands of employees around the world.
- Budget: Your budget for employee management software will also be determined by the size and scope of your company. A smaller business may only need one or two solutions while a larger business may require multiple software platforms to manage their entire workforce.
- Workforce needs: Your specific workforce needs will also dictate the type of software you require. For example, if you have a large number of remote employees, you’ll need software that allows for communication and collaboration.
On the other hand, if you have a mostly on-site workforce, you might not need as many features and functionality.
- Industry: The industry you’re in will also play a role in the type of software you need. A company in the retail industry will have different needs than a company in the financial services industry.
The best way to determine which software solutions are right for your company is to assess your needs and budget, and then compare those against the features and pricing of different software platforms.
Some companies will only need one solution to manage their global workforce, while others might find that they need a combination of two or more. There is no right or wrong answer here. It depends on what works best for you and your specific needs.
It can feel like the weight of the entire world is on your shoulders as you try to expand your business and manage a global workforce.
But with the right tools and processes in place, you can set your business up for success. By taking the time to understand the challenges and advantages of managing a global workforce, you’ll be better equipped to lead your team through anything.