The global talent gap: what it means for overseas business

“Overseas business is having a hard time getting off the ground” or “head office is not managing acquired overseas subsidiaries well” - When we receive such inquiries from management and corporate planning, one of the reasons we get to the bottom of this is the simple fact that we don't have global talent.

In many companies, this problem tends to be treated as a problem faced by the human resources department, such as “recruiting problems”. However, in reality, the lack of global talent is a management issue that affects the success or failure of overseas business and the very governance of existing subsidiaries. In this article, we will explain what kind of management risks a lack of global talent can lead to, the causes of this, and the measures that companies should take.

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1. What will happen if there are no global talent?

If you proceed with overseas expansion without global talent, two major things will happen.

One is that the overseas business itself is not developing. If you don't have people who understand local business customs and regulations and who can stand between the head office and the local area and make decisions, your business plan will be nothing more than a cakewalk. The other problem is that we will no longer be able to manage our existing overseas subsidiaries. As time passes after an acquisition or establishment, it becomes harder for the head office to monitor the company, and as a result of continued local management, there are many cases where the actual status of business performance and internal controls is not properly communicated to the head office.

Fresh in my memory, it was reported that in 2026, a major advertising agency group recorded the largest impairment loss ever in its overseas business, which had been repeatedly acquired as a pillar of its overseas growth strategy, and was forced to consider selling the overseas business itself. I'm intentionally not naming the company, but if you follow business news, I'm sure many of you will recognize it. Even if the acquisition itself is not a bad business decision, if the headquarters does not have enough global talent to manage and control the business after the acquisition, even a good growth strategy will fall by the wayside.

Even if it's not such a big deal, the same structural problems tend to develop quietly, especially at the following two timings. One is the second or third year after the establishment of an overseas base. Initially, a key person sent from the head office might look at the site, but after that person transfers or retires, a successor is not trained, and the work is gradually left to the local site. The other one is right after M&A. While management and advisors are deeply involved in acquisition negotiations and due diligence, the management of the personnel who will actually manage the subsidiary after the acquisition is often left on the back burner, and by the time you realize it, things are out of control.

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2. Why are we unable to develop and recruit global talent?

The lack of global talent is not simply due to a lack of people in the market. When we look at the companies that we actually consult with, we find that the causes are divided into two parts within the company.

2-1. Cause A: Failure to develop global talent within the company

A common situation - People who are fluent in English are selected, but there are no training opportunities to entrust them with negotiation and decision-making with overseas bases - Overseas transfers and assignments to overseas projects are biased towards a few employees, and the population of employees does not expand - There is no system for young employees to gain overseas experience, and by the time global talent are developed, they have taken on other positions - The head office intentionally has less involvement in the management of overseas subsidiaries under the premise that “if you leave it to the local people, it will work”

Points to review Developing language skills and developing experience in managing overseas locations are completely different things. The latter can only be acquired through the experience of actually assigning authority and responsibility, so it is necessary to systematically design “who to send, when to send to which base, and with what authority.”

2-2. Cause B: Unable to acquire even mid-career hires

A common situation - Job postings are limited to language requirements such as “business-level English proficiency” and do not convey “who will be judged for the position, in what language, and in what language?” - All interviews are conducted in Japanese, and there is no opportunity to check the English proficiency used in actual work or the style of negotiation with overseas bases - Selection speed is slow, and global personnel who receive offers from multiple companies at the same time are selected by other companies - Offer interviews end with only notification of terms and conditions, leading to employees declining without discussing their role or career path after joining. - Since the community of bilingual and foreign-affiliated human resources is not wide, each bad recruitment experience has an impact on the depth of the population in the medium to long term.

Key Points for Review Rather than using abstract phrases such as "global recruitment," the starting point is to verbalize what kind of decisions, adjustments, and proposals are expected from the talent at the job posting stage, and to redesign the speed of decision-making itself as a competitive advantage.

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3. Response: Eliminate the cause using both recruitment and training

Training (Cause A) and mid-career recruitment (Cause B) may seem like separate issues, but they are actually two sides of the same coin. With in-house training alone, the supply of human resources will not be able to keep up with the speed of overseas expansion. On the other hand, if you rely solely on mid-career recruitment, you will be handing over authority without understanding your company's business and decision-making processes, making it difficult to retain them.

A practical approach would be to hire people from outside the company for core positions, while also having those people play a role in nurturing the next generation of global talent within the company. By positioning the hired human resources not only as “fillers who can immediately work,” but also as the ones who start up the training system itself, the investment for one hired person will lead to raising the global responsiveness of the entire organization.

When redefining requirements, we recommend that you take inventory from three perspectives: “With whom, in what language, and how often will the position communicate?” “What kind of decisions, proposals, and adjustments do you expect to make through that communication?” and “What kind of expansion of the role do you expect in the first year after joining?”

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4. Recruiting alone is not enough to create a global talent base

So far, we have looked at strategies for recruiting and training, but fundamentally, the lack of global talent is not a problem that can be solved by the recruiting department alone.

Which business should we expand, in which country, and at what speed? How much authority and supervision should be given to existing overseas subsidiaries? If you proceed with hiring without such vague management decisions, you will not be able to get out of the situation where you just hired someone who can speak English, and this could lead to a lack of control over overseas subsidiaries, as mentioned at the beginning.

The lack of global talent needs to be reconsidered as an issue for overseas business growth strategies and governance design itself, rather than as a personnel issue.

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5. It is also essential to have a design that does not isolate hired personnel.

Even if you go through a lot of effort to recruit global talent, there are many cases where you have trouble retaining them. The “global role” that was talked about at the time of recruitment turns out to be essentially a translation/interpretation job once the employee joins the company, leading to a decline in motivation and early career moves - this is a common failure pattern when recruiting global talent.

The underlying problem is a structural problem in which there is no one else within the company who can understand overseas operations other than the person who hired them, and employees are forced to make decisions in isolation. Matching the roles and discretion that were clarified at the time of hiring with the authority and support system that will actually be handed to them after joining, combined with the in-house training mentioned in Cause A, and placing the next generation of personnel around the hired personnel will lead to both retention and strengthening of organizational strength.

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Summary/Conclusion

If we leave the situation without global talent, not only will our overseas business not grow, but the governance itself of our existing overseas subsidiaries may be shaken. There are many reasons behind this that companies can review, including the lack of an in-house training system, mid-career recruitment requirements and selection processes that do not match reality, and poor retention plans after recruitment.

When expanding your company overseas, start by taking stock of who is in charge of making which decisions and how you will develop and replenish those human resources in the future. In particular, the second or third year after setting up an overseas base, or immediately after an M&A, is a good time to reconsider.

At Global Career Incubator (GCI), we not only support the recruitment of global talent, but also provide a wide range of support for management, organizational, and human resources issues, including strengthening the governance of overseas subsidiaries. If you are concerned about building a global talent base, please feel free to contact us.

Author

Global Career Incubator Co., Ltd. CEO Shinichi Ikawa

Biography: Entered the business world after working for the Ministry of Defense (National Class I) and the Australian Ministry of Defence. After working at a major real estate company, he started a real estate venture and experienced management and recruitment at a domestic fund, domestic business company, and overseas tech company before founding our company.

Based on my experience as a corporate management and recruitment manager, I support corporate management, organization, recruitment, and training, as well as individual career selection and ability development. At the point of contact between Japan and the world, we face the challenges faced by companies and individuals alike.