Fostering Openness, Knowledge, and Integration Across Countries
Beyond the mere rote learning of discrete facts about foreign cultures, successful adaptation requires a company to employ as many open-ended opportunities to develop literacy about diverse cultures as it can. 1. Hiring for adaptability: People vary in their ability to act appropriately and effectively in new contexts or among people with unfamiliar backgrounds. While training and experience can help in this regard, it is best to start by hiring people attitudinally disposed to mastering such situations. 2. Formal education: Formal education occurs not only in classrooms, but also through interactions with colleagues from other locations around the world. Of course, the appropriate content of such formal education is highly contingent: it would be dysfunctional to emphasize the importance of more localization to Philips’s managers, for instance, and of standardization to Wal-Mart’s, instead of the other way around. When I work out a training program on global strategy for a corporation, I tend to spend more time on design than on delivery. 3. Participation in cross-border business teams and projects: Team and project work can be key in developing interpersonal ties that cross borders—a very important complement to formal authority in getting things done. The coordination of globally distributed teams has been eased in recent years by information technology, which might itself be cited as a key enabler of the creation of high-bandwidth international links. 4. Utilization of diverse locations for team and project meetings: I recently attended a meeting for IBM stock analysts held in Bangalore. As CEO Sam Palmisano explained it to me, this was primarily about signaling commitment to and helping integrate an operation that had grown from less than ten thousand people to close to fifty thousand in three years, and not because IBM’s strategy could be explained only in Bangalore. 5. Immersion experiences in foreign cultures: The Overseas Area Specialist course that Samsung initiated in 1991 is still a role model in this regard. Every year, more than two hundred carefully screened trainees select a country of interest, go through three months of language and cross-cultural training, and then spend a year there— without a specific job assignment or contact with the local Samsung office—followed by a two-month debrief in Seoul. 6. Expatriate assignments: An even more intense form of immersion, expatriate assignments are also very expensive economically and in terms of personal wear and tear. As a result, they need to be targeted at high-potential managers rather than as a way of exiling people whom one would rather not see. 7. Cultivating geographic and cultural diversity at the top: It is still easy to find large companies with significant operations outside their home markets whose top management—and board of directors—is still (almost) entirely domestic. China provides a particularly dramatic example: the number of large Western companies with any Chinese representation at the top is still tiny. 8. Dispersion of business unit headquarters or centers of excellence: P&G’s CEO, A. G. Lafley, regards the company’s geographically dispersed business unit headquarters as a key point of difference from many of its competitors. Of course, the locations must be selected carefully: P&G’s attempt to locate the headquarters of one of its global business units in Caracas quickly ran into problems and had to be revised. 9. Defining and cultivating a set of core values throughout the corporation: A strong one-firm culture can help override parochialism despite the diversity of locations and market conditions. A number of professional service firms provide good examples. 10. Opening up across organizational boundaries: To frame the problem as one of creating openness within the organization is to frame it too narrowly: interest in open innovation, for instance, is a reminder of the gains that can be tapped by opening up the organization to the outside world. Of course, such opening up to the outside also entails risks.

Chapter 5 Value Components | | Comments | Adding volume | + | Latin American business | | ++ | Large global deals requiring Latin American component | Decreasing costs | – | Higher absolute costs in Latin America | | + | Indian costs rising | Differentiating, or increasing willingness-to-pay | + | Language advantages | | + | Time zone advantages | | ++ | Targeting provision of “one global service standard” | Improving industry attractiveness | + | Ability to counter multinational companies’ claims that TCS is not global | | + | Prospect of seizing sustainable lead over Indian competitors | Normalizing risk | + | Reduction in “India risk” | Generating and upgrading resources, including knowledge | + | Buzz | | ++ | Multiculturalism | | ++ | Attempt to propagate delivery capabilities internationally |