There has never been an exact science to international expansion. Success in global markets depends on a company, its product, geographies of operations and myriad other factors.
Businesses across borders must now navigate the structural changes that the Covid-19 pandemic has consolidated. In a tech-enabled world with globally distributed teams, executives need a new strategic approach to scaling internationally, argue Aaron McDaniel and Klaus Wehage.
Their new book, Global Class, aims to be a guide for how best to build distributed teams and manage international footprints. They believe adopting an ‘agile’ methodology — the flexible model tech companies favour over longer-term plans — is essential in a new ‘culturally conscious’ era of global business.
The authors say that applying agile principles enables global-class companies to more easily pivot their business and successfully localise in overseas markets with different cultural contexts.
As co-founders of 10X Innovation Lab, which helps build innovation ecosystems worldwide, the authors begin by outlining their own experiences as corporate leaders, entrepreneurs and start-up advisors. At times, the book strays into self-promotion — not at all surprising for a business publication written by two residents of Silicon Valley.
Their main argument, however, is backed up by extensive research and interviews on the successes and failures of some of the world’s most well-known tech companies. New and informative case studies with behind-the-scenes stories of executives at the likes of Google, Apple, Zoom and Spotify are weaved throughout its 296 pages.
The book uses some age-old international business case studies, too. It begins with Walmart’s much-discussed failure to enter Germany through its 1997 acquisition of local retailer Wertkauf. The US supermarket giant tried to replicate its same low-price model in Germany, overlooking the nuances of local German culture in the process.
This summarises one of the book’s main pitches: legacy “command-and-control” management strategies are ineffective when growing internationally. Instead, corporate headquarters should grant more freedom to local teams and adapt businesses to fit local cultural contexts.
Global Class is filled with instructive examples in this vein. This includes Frédéric Mazzella’s decision to rename the car-sharing platform he founded from Covoiturage to BlaBlaCar, to give it more resonance outside of France.
The authors insist on not using the word ‘foreign’ in the book when referring to global markets due to its potential to create barriers. Jennifer Yuen, former head of Airbnb’s Americas and Asia-Pacific Marketing, and one of the many experts quoted in the book, summarises this well: “It’s more effective to look for connection and commonality.”
The book constantly underlines the importance of talent to international expansion. A central concept is that of “intrepreneurs”, who the authors believe have the traits needed to succeed when scaling into new markets. A portmanteau of ‘international’ and ‘entrepreneur’ — which the authors admit is trite — intrepreneurs are “the secret sauce of global-class companies”, according to Mr McDaniel and Mr Wehage.
Global Class is not just a summary of company anecdotes. It is a call to action for businesses and their leaders to embrace a new approach when growing internationally. For entrepreneurs, it provides a comprehensive playbook for how to navigate the challenges of going global. For economic developers, it gives an insight into the minds of the decision makers at some of the world’s fastest-growing companies.
The book Global Class: How the world’s fastest-growing companies scale globally by focusing locally will be published in hardback on August 23 2022
This article first appeared in the August/September 2022 print edition of fDi Intelligence. View a digital edition of the magazine here.