Why US Companies Must Embrace the Concept of Global Talent
During the pandemic, employers were forced to embrace flexible or remote work. The change has been abrupt, significant, and leaves many wondering what the future will bring.
We knew this shift would come eventually. There has been a growing trend towards remote work over the last few years. However, the pandemic accelerated this trend dramatically and it’s definitely here to stay. Even after COVID-19 restrictions are lifted and we are able to go back to our offices, remote work will still be a major part of how many businesses operate.
What does this mean for the future of employment? How can you embrace the concept of global talent and make the most of this shift?
In this article, we’ll look at a few of the ways that the pandemic has transformed how we work – and what this means for small and medium-sized businesses.
We’re All Swimming in the Same Talent Pool
Before remote work was the norm, the talent pool you had to choose from when hiring was mostly limited to your local area. For example, if you were located in Kansas, you’d get applicants who live in Kansas (or plan to relocate there).
In the remote work era, geographical location is no longer a factor when hiring. You can post a job and receive applications from New York to L.A. and everywhere in between.
This is an advantage in some ways, as it offers you more options when it comes to hiring. But this also means that every other company in the US will be looking at your local Kansas talent pool when they are hiring.
This will cause an increase in skilled labor costs throughout the country, especially in the smaller cities. After all, if someone from your local talent pool can earn a great wage working remotely for a major company in New York, while enjoying the cost of living in small town Kansas, why wouldn’t they?
Companies in smaller communities will start to see more competition for their talent and will need to adjust accordingly. This will lead to a new, globally-focused way of thinking about recruitment.
Inflation Will Affect SMB’s Disproportionately
COVID-19 significantly altered the spending patterns of US consumers. Supply disruptions combined with currency depreciations could potentially lead to an increase in inflation over the next few years. (Of course, since the economic recession caused by COVID-19 is unconventional, it’s not exactly clear how much inflation we will see.)
What will the impact of inflation be on the future of business? It’s important to note that inflation (within reason) is not necessarily good or bad. Businesses will see increases in their operating costs, including labor. But at the same time, they will be able to charge more for their products.
One thing is for sure: small to medium-sized businesses will feel the brunt of inflation much more than large corporations.
While larger companies will be able to absorb the short-term impacts of inflation, small to medium-sized companies will have a harder time. They will not be able to deal with the domestic changes as well as larger companies, which will be able to distribute the impact across global operations.
This means that small businesses will need to look for ways to gain an advantage over the big players in their industry. For example, smart business moves like offshoring will allow small businesses to scale more effectively and compete with larger businesses.
Consumer Behavior Has Changed
Over the past year, consumers did things differently. They were forced to adjust their shopping and spending habits to accommodate for the pandemic. But which of these behaviors have been altered for good and which ones will eventually return to pre-pandemic norms?
A report by the McKinsey Global Institute offered a view on which pandemic behaviors would stick around. They measured the “stickiness” index of some of the biggest shifts of 2020 and found that shopping for groceries online was the behavior most likely to stick around. Virtual healthcare also had a lot of staying power and it is predicted that it will remain at or near the elevated COVID-19 level.
Some of the behaviors that were found the least likely to stick around included remote education. It’s not ideal for parents or children and we will see schools returning to business as usual as soon as possible. Plus, activities such as leisure air travel and in-person dining are expected to resume as the world recovers from COVID-19.
The changes in consumer behavior will affect various types of businesses in different ways, but very few industries have been exempt from these major changes. This is another major shift business owners will need to account for when planning.
The most important lesson we can take away from this is that there are some aspects of business that will never go back to “normal” after the pandemic. We need to prepare for the future with this in mind, so we can adapt to a “new normal” as the world transforms.
Women Are Especially Susceptible to Burnout
After a year of COVID-19, many women are feeling burnt out. A report on women in the workplace by McKinsey found that women are more likely to be working a “double shift.” In other words, they are expected to keep up with work responsibilities from home while simultaneously responsible for caring for children and the household.
In the past, childcare and school made this more manageable. However, with the pandemic taking these support options away, many women are feeling the strain and are overwhelmed. They feel the burden of housework and caregiving and they feel like they need to be available to work at all hours.
This has lead to a crisis for women in the workforce, with more than one in four considering downshifting their careers. Even worse, as many as two million women are considering leaving the workforce completely.
The workforce risks losing women in leadership and backtracking on years of progress toward gender diversity. It will be essential for businesses to think about how they can support the women on their team in any way possible.
What Can Businesses Do?
Due to the increased cost of living caused by inflation and the redistribution of talent caused by a shift to remote work, small to medium-sized businesses might find themselves struggling in the wake of the COVID-19 pandemic.
What are the smart moves a business can make in order to be prepared for what the future will bring? How can you make smart moves that will help you survive this uniquely challenging time?
Here are some strategies that you can adopt in order to stay ahead of the competition as things change.
Leverage Cost Arbitrage
By offshoring via a company such as Doxa7, you can take advantage of the cost arbitrage of hiring a team in a more affordable location such as the Philippines.
The cost of living in the Philippines is low compared to the US, so you can pay local wages and enjoy better rates for skilled labor. Your employees will be well-educated, speak excellent English, and have a wide range of highly valuable skills.
By sourcing skilled labor in this way from locations such as Manilla, you’ll be able to add capacity, take on new projects, and scale more effectively. A company like Doxa7 makes it easy by handling recruitment, training, and all other aspects of the process.
The Philippines has an amazing track record on offshoring. Several major companies such as JPMorgan Chase Bank, Hewlett Packard, Wells Fargo, Bank of America, White and Case, Jetstar, Telstra, Virgin, and more have already made the move to offshoring in the Philippines. It’s a smart and powerful way to leverage cost arbitrage and give your business a competitive advantage in the post-COVID world.
Change Pricing
Raising your prices can be another way to stay ahead of the competition as things get more challenging after COVID-19. After all, businesses need to raise prices periodically anyway in order to keep up with rising costs of supplies. However, many companies hesitate because they don’t have a plan to carry out the change in pricing effectively.
Here are some helpful tips for raising your prices:
Start by researching your costs, so you know exactly what you’re spending on materials, shipping, production, packaging, etc.
Take a look at which of your products is performing well. A product that is selling effectively could be an excellent candidate for a price raise.
You can also look for products that have become more expensive to produce due to an increase in the price of materials. They will be a good candidate for a price raise because you will be able to give a clear and understandable reason why you have increased the price.
Look for ways that you can increase the perceived value of your products. Add extras or create a special “limited edition” so you can justify charging more.
Add in other services above and beyond the product you sell, so you can add in the costs and increase the price. For example, gift wrapping, a warranty or a personalized card.
Start charging different amounts for special added features or colors. (This pricing strategy also has the advantage of giving the consumer a lower price as an “anchor” they can use for comparison.)
Try bundling together products and services that offer value to your customers. This can allow you to have a better profit margin on those products.
If done properly, a rise in prices doesn’t have to equal a decrease in sales. The key is to raise prices slowly and strategically, and be transparent about why you are doing it.
Reduce Costs
The pressures of the pandemic aren’t going away any time soon, so it will be essential for businesses to find ways to cut costs whenever they can. This will allow for more flexibility in the budget and more resources to allocate to other areas of the business.
Here are some ways that your business might cut costs:
Use software and technology to simplify tasks and save money on administration.
Set up a paperless office to save money on paper, ink, mailing supplies, postage and other expenses.
Reduce your business credit card debt to save money on interest.
Consider offshoring your business process tasks to an overseas location like the Philippines where you’ll be able to hire skilled labor for a lower wage.
Buy refurbished furniture and business equipment rather than brand new. It will often work just as well, but will be available for a discounted price.
Save money on business insurance by comparing providers and finding the most competitive rate. Try asking your current lender or insurance provider if they will match that rate.
Using a time tracking software to track employee time usage and see where processes can be streamlined or improved.
These are just a few ways to reduce costs and most businesses will try a combination of strategies to lower their expenses.
Simplify Work
Having processes that are too complicated will not only bring down workplace morale, it will also make your team’s productivity drag.
Take a close look at your company’s processes and see if there are any ways you can simplify what you do. Can you change the way you get things done in order to save time or resources? Are there any tasks that you can automate using technology or software, so your team doesn’t have to do them manually anymore?
Commit to clearing out low-value activities and time-wasters that are slowing your team down. Clarify what you really need to get done. When you take a close look at how your business operates, you’ll often find that 20% of your actions generate 80% of your revenue and results. The key to simplifying is to figure out what’s really important and what’s not.
And of course, sometimes simplifying means sending the work somewhere else. Offshoring allows you to enjoy the advantage of a skilled team of employees in another country who can handle certain aspects of your business for you.
This could apply to bookkeeping, customer service, marketing, administration, call center operations and much more. You can outsource these tasks to an offshore team, so that your US team have a simpler workday and focus on what’s most important to them.
Communicate Clearly
Being able to communicate clearly with your employees was always important. However, the way the world is changing means that connecting with employees is more crucial now than ever before.
According to insights from McKinsey, organizations that communicate their vision and policies on inclusion, support, and productivity see clear benefits to employee well-being and productivity.
Any communication with employees is better than none. But if you really want to stand out from the competition and empower your team to perform better, you’ll give them clear and detailed information on policies and plans. Plus, be sure to always be there to answer their questions and provide them with the tools and resources they need to succeed.
If you are working with overseas employees, communication can be challenging. You can set yourself up for success by choosing a location where there is a high level of English education, such as the Philippines. The Philippines ranks 2nd in Asia in the English Proficiency index, so it won’t be difficult to work and communicate seamlessly with Filipino workers.
Always Be Learning
COVID-19 brought with it a unique set of challenges and a once-in-a-lifetime disruption to the way businesses operate. These are just a few of the ways the pandemic has affected employment, and how your business can adjust to overcome the challenges.
The key to succeeding as the world changes dramatically is to always be learning and adapting. The businesses that emerge triumphantly will be the ones who are innovative. Never rest on your laurels or do things because “that’s how they’ve always been done.”
Always be open to new ways of optimizing your business so you can perform to your full potential. There’s no way to control the future, but you can control how you adapt to whatever comes your way.
