How to design and deliver your overseas expansion

Once you have considered all the key factors in expanding overseas, you'll need to look at designing and delivering an expansion in line with your growth plans.

How to design and deliver your overseas expansion

Once you have considered all the key factors in expanding overseas, you’ll need to look at designing and delivering an expansion in line with your growth plans. 

Remember that overseas expansion is not a normal project. It is a transformation, and if you spend any time online reading about transformations, you will quickly come to realize they are daunting and the majority fail. 

So how do you set your expansion up to succeed?

Step 1 – Understand what a transformation is

Large scale change, or a transformation is perhaps one of the most overused and misunderstood terms in business today. It seems like almost every project or programme is labeled a transformation, but this creates the wrong behaviours and the wrong outcomes.

The irony is that delivering successful transformations has never been so important. In a rapidly changing world of consumer trends, technology acceleration and disruption, geo-political shifts and now the huge impact of Covid-19, transformation success may be the difference between a business surviving or collapsing into the scrapheap of history add on the complexity of an overseas expansion and the odds are against you.

From this, rather long, definition you can derive four tests you need to check to confirm you are doing a transformation:

  • Test 1: Large-scale change programme

A transformation is a big change. It is a large-scale change programme that makes a significant impact on your organization. 

If you are expanding your company down the road, that is far less likely to be a transformation then an overseas expansion. 

  • Test 2: Dissatisfaction with current business results

Transformations are hard and require tough decisions and senior board focus. You really need that real imperative to expand overseas, or the hard difficult decisions that are required to deliver the expansion, just won’t be made.

Are you super clear on what that imperative is? For example, your profits might be too low, your costs too high or your industry may be being disrupted and you are being left behind.

  • Test 3: Cannot be achieved through business as usual

A transformation is a risky endeavour and should only be undertaken when absolutely necessary. If your target can be achieved through BAU, do that.

For example, if your objective is to increase sales by 1%, then this should be achievable through business-as-usual operations in your current region. Your existing sales teams should be able to meet this target without going through the risk and tax of a transformation.

However, if your objective is to increase sales by 100%, then it’s unlikely that your current market or operational teams would be able to achieve that without a transformational change programme.

  • Test 4: Positive material impact on Enterprise Value

At the end of the transformation, the value of your business should be disproportionately higher than the cons of the transformation. There is a lot of risk in implementing a transformation, therefore, it needs to be offset by a large reward.

By this definition nearly every overseas expansion should be considered a transformation.

Step 2 – Design and Deliver your transformation 

Why do so many transformations fail when they have large budgets, excellent people and strong business cases?

We’ve all read in the press about the high-profile transformation disasters:

  • McKinsey’s global survey reports that 74% of companies fail at digital transformation.
  • The Wall Street Journal ran a survey of directors, CEOs and senior executives which found that transformation risk was their #1 concern in 2019.
  • The Harvard Business Review states 70% of large scale transformations fail to meet their goals.
  • Forbes/Towers Watson reports that only 25% of change management Initiatives are successful over the long term.

After years of leading transformations, advising transformation teams and viewing transformations from a distance, there are some common issues which frequently emerge.

  1. Not focusing on value ‘ You must prioritise activities that have the largest impact towards your Transformation Outcome 
  2. Not removing transformation blockers ‘ This is the hidden killer of transformations. It must be the leadership’s number one priority to help resolve these blockers and get the flow of value running again.
  3. Lack of metrics ‘ It’s essential to make the outcomes clearly quantifiable so that you know where you are today and when you will arrive at your end point.
  4. Poor transformation vision ‘ If your transformation vision is not strong enough, not well understood and, most importantly, not measurable, then you are unlikely to galvanize your organisation for real change. 
  5. Lack of board sponsorship ‘ If your board doesn’t fully buy into your transformation and commit to being accountable, you are unlikely to make the hard changes when the going gets tough. 

By ensuring you are aware of the common pitfalls and taking steps to avoid them, you can radically increase your chances of business transformation success.

Cuan Mulligan
Cuan Mulligan

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