According to the first Global Latam Barometer for the Internationalization of Latin American Companiesa study carried out by the SEGIB (Ibero-American General Secretariat), the main obstacle for companies in the region is the regulation in the country of destination, which is usually very different in each of the nations of the continent. The second obstacle presented by the study is the tax system within the country itself, which implies significant changes in the taxation of sales operations and activities carried out abroad.
When we look at these two main challenges, we conclude that the regional knowledge it is essential to cross borders and enter completely new territories. Not to mention more subjective aspects such as the customsthe dialects -that each country uses different terms for fiscal and legal processes- and the routines of each culture that influence the entire plan.
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My experience supporting companies in international and intercultural management taught me that there is a very particular power when the values of the corporation are respected and its essence is maintained. However, in addition to the purposes, the strategies must adapt. It is necessary to understand the local culture and needs so that management practices, HR, taxes and legal obligations are lined up and, consequently, effective results are obtained.
if you plan a local to global strategydo not make one of the most common mistakes: replicate the same business practices that were successful at the parent company, thinking that they will work in another country. In addition to developing an extensive market study, it is essential to intelligently analyze the initial data of the operation abroad to understand how the different markets are behaving. stakeholders and company processes. I can assure you that this facilitates identify improvements, possible gaps, opportunities to save resources and have a complete vision of how to operate in this new market.
Faced with this challenge, it is evident how fundamental it is invest in technology that offers the management structure that is up to these demands and that, at the same time, provides the necessary experience to comply with the requirements and particularities of each country. In addition to a strategic vision of the operation, technology is an important ally for in-depth knowledge of the local market.
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The first step may seem basic, but it is essential: start this process with a good management system (ERP), which integrates with the matrix and adjusts 100% to the needs of each country. This makes a difference both for administrative duties and for the company’s core business activities. Overcoming this stage quickly and efficiently is essential for success in the short, medium and long term.
Therefore, it is essential that all partners, especially technology partners, have the strength, investment capacity, capillarity, a prepared local team and the necessary experience to guarantee the support of the different challenges come along that path.
But despite the existing obstacles, another figure from the Global Barometer shows that entrepreneurs are optimists about future expansion in the region. Since the majority of respondents (63%) planned initiate or increase investment abroad and almost half (46.6%) would be oriented towards Latin America.
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The success of this expansion depends on the Balance between global and local aspects. To study the current scenario of the company and the market to explore; understand best practices; and perform alliances with companies that know the nuances of local to global strategy. It is possible to minimize the risks of this plan with the support of experienced playerswhich contribute to a smart, efficient and successful internationalizationno matter where you want to go.
Source: Ambito
