Today’s business landscape is fraught with challenges and barriers, including economic uncertainty, geopolitical instability, a rapidly changing regulatory environment and difficulty hiring skilled employees. With all these challenges in play, it would be reasonable to assume most business leaders would put their expansion plans on hold, and instead focus on operations closer to home.
In fact, the opposite is happening: Businesses are prioritizing geographic growth as part of their future-proofing strategy. In the Equinix 2023 Global Tech Trends Survey (GTTS), 69% of global IT leaders said their organization is planning a geographic expansion within the next 12 months, be it into a new region, country or city.
If you’re among the leaders planning to expand, you need to ensure you’re ready to deploy in the new location quickly and overcome any challenges you face once you get there. This can be especially difficult when you’re an outsider that lacks an intimate understanding of how things work in the region.
As a densely interconnected continent populated by hundreds of millions of potential customers, it’s no surprise Europe is such an attractive expansion target for businesses around the world. However, there are some unique challenges involved with doing business here, beyond the typical issues that come up in any expansion. In this blog, we’ll examine what steps you should take to give your European expansion the best chance of success.
Start with the right digital infrastructure strategy
A good digital infrastructure strategy is essential for any business, but the stakes are especially high for those starting from scratch in a new region. Deploying digital infrastructure without a strategy is essentially an exercise in guesswork. If you guess wrong, your expansion may be doomed to failure before it even starts.
For instance, let’s consider cloud services. In the GTTS, 45% of global IT leaders said they would deploy virtually via the cloud to get the IT capabilities they need to support their expansion. It’s no surprise that businesses that need to deploy new infrastructure quickly are looking to the cloud to make that happen. If they can build upon a cloud provider’s infrastructure in Europe, they can avoid having to deploy their own.
However, when businesses acquire cloud services with no strategy, they tend to make short-sighted decisions that could ultimately put their expansion at risk. They may go all in with a single public cloud provider, thinking it’s the simplest and most cost-effective way to execute their expansion. This could lead to the following issues:
- They may get locked into that cloud provider, limiting flexibility and driving higher costs.
- They may not have access to the sovereign cloud services they need to keep up with Europe’s evolving regulatory landscape.
- They may not be able to ensure proximity to workloads and users, leading to latency and application performance problems.
With a good strategy, organizations can determine in advance that a distributed hybrid IT architecture can help them optimize their approach to cloud services. They can then go a step further to determine what their ideal hybrid multicloud environment looks like, including how they should split their infrastructure across multiple clouds and on-premises environments and which workloads should go where.
Once they’ve identified their ideal hybrid infrastructure, they can consider how to properly connect the different pieces. Connectivity for distributed IT architectures could include a combination of physical cross connects, virtual connections, dedicated internet access and blended internet access.
Set strong security policies
A distributed hybrid infrastructure model may be an essential part of any successful expansion plan, but it can also create additional complexity and challenges of its own. For instance, such architectures offer a wider attack surface than a traditional, centralized IT architecture would.
In the past, businesses relied on a cybersecurity perimeter around their IT infrastructure. This traditional approach no longer makes sense in a world where IT assets and data are spread across many different locations. Organizations must do away with the concept of trusted networks altogether, and instead adopt zero-trust security policies.
In a zero-trust security framework, all users are untrusted until proven otherwise. Users should only be granted access to applications and data after passing a verification process. This verification should be risk-based, contextual and continuous.
The need for zero trust is widely recognized, but many organizations will find it difficult to implement effectively. In fact, according to one Gartner® report:
“60% of organizations will embrace Zero Trust as a starting point for security by 2025. More than half will fail to realize the benefits.”
Adopting zero trust requires baking security policies and capabilities into every aspect of your digital infrastructure. One way to do this quickly during your expansion is by deploying virtual firewalls, which can help you filter and monitor traffic anywhere across your distributed network infrastructure. Unlike traditional firewalls, virtual firewalls can be deployed in minutes, so you won’t have to delay your expansion just to get the right cybersecurity infrastructure. Network Edge from Equinix gives customers on-demand access to virtual firewalls from top vendors such as Cisco, Fortinet and Juniper Networks.
Fill the skills gap
In the GTTS, a plurality of global IT leaders (49%) said they plan to hire dedicated IT staff in the new area to support their expansions. Finding the right IT talent has become a challenge for many digital businesses, but it could be especially daunting for those who need to hire a completely new team in an area they don’t know well.
When IT leaders were asked to name the biggest skills challenges facing the tech industry, the most common responses were the speed at which the industry is transforming (45%) and talent retention (36%). This shows that the IT skills gap is both a technical challenge and a cultural one. Fillling the gap will require solutions that account for both.
For instance, businesses may need to explore non-traditional talent pools, such as workers in adjacent industries or those looking to return to the workforce following an extended leave. Since the tech industry is transforming so rapidly, it may no longer make sense to only hire candidates with the exact skill sets you’re looking for. Instead, you might offer retraining programs and look for candidates with a willingness to learn.
After you hire candidates, it’s important to build a workplace and company culture that helps retain the talent you have. This could include offering flexibility around when and where employees perform their job duties and providing employee assistance programs that help support physical and mental wellbeing.
Automating your digital infrastructure can help scale the productivity of your existing employees and thus offset the impact of the skills gap. Equinix digital services include built-in support for Infrastructure as Code tools such as Terraform. This means that these services can be deployed and managed with little need for manual intervention. Taking advantage of Equinix infrastructure automation capabilities can free employees to focus on high-value tasks, making them both more effective and more engaged in their work.
In the Equinix 2023 Global Tech Trends Survey, 69% of global IT leaders said their organization is planning an expansion in the next 12 months. Of these, about half said they’d hire dedicated IT staff in the new area to support the expansion.”
Plan for regulatory complexity
The question of who can access what data, and for what purposes, is one of the defining issues of the digital age. Regulators increasingly say that businesses must handle citizens’ data responsibly, store it only within the jurisdiction and use it only for legitimate purposes.
Europe has emerged as the global leader in strict data privacy and sovereignty regulations, which could complicate things for businesses looking to expand there. When asked how their expansion plans might change if a country or region announced stricter data sovereignty laws, more than half of global IT leaders said they’d make major changes to their plans, delay them or even cancel them altogether.
Businesses expanding into Europe can partner with Equinix to help keep their data protected and compliant across its entire lifecycle:
- Land intercontinental data traffic: Multinational companies can move their data directly from other continents into Equinix IBX® data centers in Europe via subsea cable landing stations. Major transatlantic cables land at our data center in Bordeaux, while our data center in Genoa is a landing site for cables that connect Europe with Africa and the Middle East.
- Store data while maintaining sovereignty: In an Equinix colocation facility, we provide the power and space, while customers deploy the IT equipment of their choice. This equipment remains their property, which means data stored on the equipment never leaves their possession.
- Move data safely within Europe: Equinix Fabric®, our software-defined interconnection solution, is available in many metros throughout Europe. This makes it easy for our customers to establish private, dedicated connections between metros. They don’t have to move data via the public internet, with all its inherent vulnerabilities.
Learn more about how digital infrastructure supports geographic expansion
If you’re looking to simplify and streamline your expansion into Europe, it helps to have a digital infrastructure partner that knows the region and its unique challenges well. This is where Equinix can help.
With Platform Equinix®, customers get a unique blend of global reach and regional presence. In addition to colocation facilities in major metros across the continent, we also offer digital services that can help you get the infrastructure capabilities you need, when and where you need them. The Equinix digital services portfolio includes:
- Equinix Metal®, which allows you to deploy single-tenant compute and storage on demand.
- Equinix Fabric, which allows you to interconnect your own digital infrastructure and with ecosystem partners, globally and at software speed.
- Network Edge, which allows you to deploy the network services you need, without the cost and complexity of physical hardware.
To learn more about how leading businesses are using distributed, interconnected digital infrastructure to overcome the many challenges they face, including but not limited to geographic expansion, read the Leaders Guide to Digital Infrastructure today.
Gartner, “Predicts 2023: Zero Trust Moves Past Marketing Hype Into Reality,” John Watts, Jeremy D’Hoinne, Dale Koeppen, Charlie Winckless, 6 December 2022.
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