Recently, some Beeline colleagues were at an industry conference and sat in on a session discussing Latin America and this particular presenter focused on two main points:
- Latin America is the next big place to go in terms of expanding an organization’s flexible workforce.
- Because of cultural similarities to North America, it is easier to expand into Latin America.
I agree with statement number one. Central and South America continues to grow economically and many companies are “near-shoring” their services in countries like Mexico, Brazil, Colombia, and Chile. However, it is short sided to think you can just take a US-based program, simply lift and shift it to fit the needs of a program in Latin America.
After extensive research and a series of successful Latin American expansions, I believe that there are two strong advantages in growing a program based out of North America into this region:
- One of the greatest advantages of expanding a program from North America is the time zone similarity. While this will be a challenge for Europe, Asia and the Pacific headquartered programs, if you are in North America it does make for easier travel and scheduling.
- Another advantage is the trade agreements between the United States of America and countries like Mexico, Colombia, Panama, and Costa Rica. In these countries you may find some economic similarities. Many of these countries also have trade agreements with the European Union, China, India and Japan. For example, Mexico has trade agreements with over 50 different countries.
What makes Latin America culturally similar to North America?
To say because of cultural similarities it is easier to expand into Latin America is an oversimplification. Over the past ten years, most of South America has been turning away from Western-style globalization and focusing more on resource nationalism.
Each country is unique and with that has its own cultural, economic, political, legal, and employment practices. Taking time to understand each country’s cultural characteristics and legal practices is very important prior to implementing an expansion. Do not assume that what works in Mexico will work in Colombia. What will work in Colombia may not work in Brazil.
For example, in Mexico a 48 hour work week Monday through Saturday is the norm. Over 48 hours and up to 9 hours is consider paid over-time and after that a company is required to pay triple time. Also, internships and apprenticeships are very popular and at times required in certain countries. By law a minimum of 5% of the total employee workforce should be apprentices in Brazil.
What about my MSP/VMS programs?
MSP/VMS programs are new to many of these countries so plan for plenty of time for education in order to get the appropriate local executive buy-in.
If you are dealing with a smaller number of contingent workers in some of these countries, beginning with a resource tracking solution to help with initial visibility can be a great start. This will allow you to deploy quickly and easily and gain initial traction in this Latin American market.
In conclusion, take time to listen, be culturally aware, and start simple. Be prepared for an exciting journey when expanding into Latin America.