The new reality of cross-border growth: Navigating complexity in a fragmented world 

In a polarised world, operating a business across borders is becoming increasingly complex. While critical for those who seek customers, suppliers, talent, capital, and partnerships beyond their home markets, how do leaders balance risk and reward in a global arena? 

Our HLB Survey of Business Leaders revealed that 53% of leaders expect the rate of economic growth to increase in 2026. Forty-two percent of those surveyed also said they were very confident in their ability to grow revenue over the next 12 months, even as they pointed to a heightened sense of exposure.  

However, tension exists at the very heart of the new cross-border environment. Even though international growth opportunities remain attractive, the old expansion model isn't efficient anymore. Several challenges exist, including regulatory divergence, persistent economic volatility, skills shortages, supply chain disruption, and uneven digital capabilities. For mid-market businesses, success is no longer defined by where they expand, but by whether they have the capability to manage complexity across markets, jurisdictions, and operating models.  

A fragmented global landscape 

The world economy is far more connected than it was a few decades ago, but today those connections are becoming nuanced. Leaders can no longer rely on specific markets converging around similar commercial, regulatory, or technological conditions. Our latest research reveals that adaptive thinking, shorter planning cycles, and a growing acceptance of volatility will be key tactics for any forward-thinking organisation. 

Trade fragmentation and geopolitical tension are big parts of the story. We find that most leaders believe trade volatility will continue. In response, they're reconfiguring their operations to embrace friend-shoring and near-shoring, a shift that suggests a broader change in mindset. Efficiency is key, but optionality, resilience, and regional exposure will come into play when making strategic decisions. 

Regionalisation is also reshaping how businesses pursue international trade. Organisations that desire an international footprint might be more cautious, adopting region-specific strategies, making more selective investment choices, or forming stronger local partnerships instead.  

In short, organisations should adopt a multi-local approach to their global strategy. First, they should choose between what should be standardised globally and what should be adapted regionally. Then, they can execute locally as appropriate and manage this complex balance well to avoid the risk of cross-border growth becoming riskier, slower, or more exposed. 

The hidden barriers to cross-border growth 

Some of the biggest barriers to international growth aren't as obvious at the planning stage and might only become evident later, when expansion is already underway. This makes international growth more complicated than expected. 

1. Regulatory and compliance complexity 

When a business enters a new territory, it has to deal with challenges like tax registration and compliance, incorporation, accounting, legal, and secretarial obligations, as well as a wide range of local reporting rules. 

Meanwhile, the whole operating environment is becoming more complex and divergent, with matters like data privacy, ESG, tax, and reporting developing differently across jurisdictions. Treating compliance as a downstream administrative matter is unfeasible. Decision-makers must build compliance into their operating and market-entry decisions from the start.  

2. Supply chain disruption and reconfiguration 

Organisations used to craft cross-border growth models with cost efficiencies and centralised optimisation in mind. Today, that approach is not so straightforward when it comes to supply chains, as the world must deal with tariffs, political risk, logistics disruption, and strategic dependence on specific suppliers or regions.  

Leaders are now reconfiguring operations in response to continuing trade volatility and tariffs. But this new strategy comes with its own issues, as companies might have to accept higher costs in exchange for less concentration, better visibility, or stronger resilience. Collectively, this has led to more emphasis on supply chain design, which is now almost as important for cross-border growth as the demand-side opportunity itself. 

3. Economic volatility and financial risk 

Cross-border growth has always carried an element of financial risk, but that risk is far more prominent today. Companies must navigate currency shifts, financing constraints, inflation pressure, or uneven regional economic conditions when growing across borders. But those challenges are greater than ever before. Inflation in particular hides inefficiencies by masking poor decisions and operational weaknesses. Businesses should be wary of blaming market conditions to cover up any flawed operating models. Instead, they should insist on sharper pricing disciplines and tighter controls to more clearly understand where value comes from. 

4. Talent and operating model challenges 

If companies fail to plan their expansion carefully, skills shortages or cultural alignment could derail their ambitions. Local planning might look good on paper, but execution could still break down if accountability, decision rights, and regional autonomy are't factored into the equation.  

Operating model discipline matters a lot, which is why we advocate for a structure that lets businesses scale internationally without creating confusion among local operations, regional teams, and headquarters. 

5. Technology and data fragmentation 

Even though technology is advancing at a rapid pace, it’s not necessarily making international growth any easier. At times, tech adds another layer of fragmentation due to regional differences in systems, the presence of siloed data, and the fact that digital maturity is sometimes uneven across markets. Many companies are simply not ready for the advance of AI, while cyber exposure can also increase as a company's operating footprint expands. This explains why 74% of business leaders are either concerned or very concerned about cyberattacks.  

From expansion to transformation 

Companies can't push forward with market entry plans unless they fully understand the wider and more complex picture. Leaders should be prepared to revisit their operating models, risk management, governance, and decision-making processes while learning to live with shorter cycles and planning that adapts on the fly. The bottom line is that international growth is no longer a simple expansion exercise. Capability is becoming the differentiator.  

Leading-edge organisations are entering more markets and building their internal capacity first so they can manage supply chain risk, financial pressure, regulatory divergence, and local execution gaps. These competent companies know that cross-border success depends on a transformational mindset. 

What leading organisations are doing differently 

Rather than relying on one global template, top organisations are focused on:  

• Building regionally adaptive strategies, because an insular one-size-fits-all growth model creates friction, delays, and misalignment. 

• Embedding tax and compliance into commercial planning from the outset, because those matters will never sit neatly in the background and could shape viability, speed, and the cost of expansion. 

• Strengthening supply chain resilience rather than optimising purely for cost, as bare-bones models can quickly become more expensive when tariffs, disruption, or concentration risk appear. 

• Investing in local ecosystems or partnerships to give them an advantage in a fragmented operating environment, so local knowledge and trusted in-market relationships can help avoid costly missteps. 

• Making better use of data and AI in their decision-making, to help with earlier risk detection or faster scenario testing if operating conditions change. 

HLB's Survey of Business Leaders 2026 found that AI was a key enabler of efficiency, resilience, and smarter adaptation as companies invested in new technology. By using data analytics and AI to help with risk monitoring, scenario planning, and forecasting, companies have improved their digital visibility, data quality, and cyber readiness and made more informed decisions. 

Cross-border growth still matters, but the winners will be built differently 

The blueprint for international success looks different from what it did during the height of globalisation. Conditions today are more fragmented, volatile, and demanding, and traditional expansion models aren't sufficient on their own. For the best chance of confidently growing internationally, companies must pay more attention to compliance, risk, operations, supply chains, technology, and governance.  

The businesses that succeed will treat complexity as something to master rather than avoid. They'll spend their time figuring out transformation first and think multi-locally while acting with global intent. Leading-edge companies will also work with advisers who understand how cross-border business operates in practice across markets and jurisdictions. 

How HLB supports cross-border success 

At HLB, we believe that cross-border growth does not present as a series of isolated technical issues, but rather as a connected business challenge. Our international network helps clients deal with the practical realities of cross-market operation, focusing on areas such as regulatory demands and hyper-local obligations. 

We also shine a spotlight on the need for wider coordination between finance, operations, leadership, and governance. This is increasingly important in a fragmented business environment. Today, success depends not so much on entering new markets as it does on building the control structures and decision-making processes to make everything run seamlessly.  Companies can no longer approach expansion piecemeal, but must connect areas like tax, compliance, assurance, risk, and operations, turning this type of complexity into a competitive advantage. 

If you're pursuing cross-border opportunities and looking for support with international advisory, tax, risk, compliance, or transformation, we welcome the opportunity to discuss this with you.