Brexit - A work in progress, a change waiting

Organisations are considering many key areas. Freedom of movement and the effects of a lower foreign exchange rate for sterling will lead to tax concerns for both employers and employees. The removal of passporting rights could have a profound effect on the ability to continue business across the EU borders, what are the legal considerations for entity structures for those who need to continue to operate in this market?

These and other challenges will be faced by most international businesses.  Some have made the decision to look at opening new offices or moving personnel already whereas as the majority are waiting on the outcome from negotiations. Either way, there is still a lot of preparation that can be undertaken for what is likely to be a significant change management exercise, whatever the outcome of negotiations..

Businesses will need to understand the options available to them so that they can lay the foundations in readiness for when the starting pistol is fired. Whatever the reason for adapting to the implications of Brexit there will be a need to understand how to lay out an approach to the impending change.
  • Will the change affect your customer profile or might increased costs colour their views of the services you offer? Will your suppliers changing ability to support your supply chain cause you to rethink your strategy for bringing your product or service to market?
  • What about your underlying business processes? If you change your structure of operations will you also need to review your ability to maintain the same processes as you currently have or do they need refining?
  • Where might you need to review applications for their appropriateness to meet your operational objectives? Ok, this should not be ‘Y2K’ all over again because technology is inherently more stable than 17 years ago but configurations and application flexibility may need reviewing. And your management information – will your performance measurement focus need to change?
  • IT solutions and the underlying infrastructure are always being reviewed as part of IT Strategy and the need to be flexible will become even more apparent. Many have already made the move to cloud-based solutions or are currently considering it as a cost-effective way to manage potential future location changes.
Whilst many organisations are adopting a ‘wait and see’ approach before making potentially costly decisions it pays to consider options whatever type of Brexit is adopted. This does not require major investment at this stage but sufficient due diligence will stand companies in good stead, allowing boards to consider the likely budgetary needs against possible strategic options.

By looking at potential options and considering how ready your business is to continue to meet its business objectives you are taking the first planning steps for a change programme. Identifying the principles and constraints, considering possible scenarios, and defining the priorities are the key steps towards defining draft change management / business transformation plans. Essentially, you should be looking at a Readiness Assessment to ensure that you have a clear understanding of the challenges and a coherent policy for managing change.

Whilst there is currently uncertainty surrounding how the legal entity landscape may look post Brexit negotiations, many businesses have started the process of considering “future proofing” their businesses through changing their legal entity structures. Each jurisdiction will have its own local rules to which businesses will need to comply whereas perhaps they did not previously have such exposure nor have the relevant expertise. Refer to ‘Regulatory’ for further information around jurisdiction and associated rights.

Such operations need not be a burden to their businesses. Through business outsourcing partners you have access to local experts who can assist with set up, transition and support. This means that your business can continue to operate as it once did and focus on its core strengths.

If you are uncertain about Brexit or would like further information from our team, please contact us here.