GLOBAL SUCCESS IS ALL IN THE MIND
Becoming a successful manager in a global firm in the new millennium is going to take a global mindset.
So says Vijay Govindarajan, professor of International Business at the Amos Tuck School of Business Administration at Dartmouth College and director of Tuck's Global Leadership 2020 program.
"For the past decade, companies talked about going 'global' but their idea of being global companies meant selling a product overseas. Companies that really want to operate globally must cultivate a global mindset. They must open themselves to cultural diversity and be prepared to adopt successful practices and good ideas wherever they come from. To this end, senior management teams should be international in composition, experience and outlook."
Here's a test Govindarajan says that managers can use to find out if they have global mindsets. If they can't answer "yes" to every question, then they do not have a global mindset:
*When you interact with others, do you assign them equal status regardless of national origin?
* Do you regard your values to be a hybrid of values acquired from multiple cultures, as opposed to just one culture?
* Do you consider yourself open to ideas from other countries and cultures as you are to ideas from your country and culture of origin?
* Does finding yourself in a new cultural setting cause excitement rather than fear and anxiety?
* When visiting or living in another culture, are you sensitive to the cultural differences without becoming a prisoner of those differences?
To exhibit a global mindset, Govindarajan says, an organization's management team must have two important features: a deep understanding of the world's diversity and a strong ability to integrate diverse world views. Ensuring that the management team collectively understands the world's diversity requires that the team consist of people with different national backgrounds and considerable experience in different regions.
Many firms do not have managers with that global mindset, says Govindarajan. A Fortune Global 500 company with sales revenue of $10 billion today should exceed $50 billion in size within 10 years, even with modest growth aspirations. One of the critical constraints to growth is the availability of talented global leaders.
"That's what keeps CEOs awake at night. While it may seem obvious that global firms will need managers with 'global brains,' there are almost no programs training managers to have a global mindset," says Govindarajan.
For most medium-sized to large companies, market opportunities, crucial resources and competitors lurk increasingly in distant and often poorly understood regions of the world. How successful a company is at exploiting emerging opportunities and meeting challenges depends on how intelligent it is at interpreting the world in which it operates. A global mindset is one of the main ingredients of such intelligence.
"A central task of senior management is to identify talented managers and prepare them for positions of future leadership. More than ever before, corporate survival and prosperity depend on developing a cadre of leaders who can operate effectively in a global marketplace," says Govindarajan. "A truly global company moves knowledge, not just products, from one country to the other. The key to capturing the global opportunities is getting leaders with a global mindset. Companies that enlist such leaders will have a competitive advantage."
Govindarajan says if CEOs can't answer "yes" to every question below, then their firm does not have a global mindset:
* Is your company a leader rather than a laggard in discovering and pursuing emerging market opportunities in the world?
* Do you consider every customer regardless of country, to be as important as a customer in your own domestic market?
* Do you draw your employees from the worldwide talent pool?
* Do employees of every nationality have the same opportunity to move up the career ladder to the top?
* In scanning the horizon for potential competitors, do you examine all economic regions of the world?
* In selecting a location for any activity, to you seek to optimize the choice on a global basis?
* Do you view the global arena as "school"--a source of ideas and technology--instead of as a market to exploit?
* Do you perceive your company as having a universal identity and many homes rather than a national identity?
"I would not be surprised if the results of this test made a few chief executives--even those within large and long-established multinational firms--wince with discomfort," says Govindarajan.
Ikea, a global furniture retailer, shows why a global mindset is important, notes Govindarajan. As recently as the late 1980s, Swedish nationals constituted virtually the entire senior management team of the company. Fluency in Swedish was considered essential at the senior levels. When the company entered foreign markets, such as the U.S., it replicated its Swedish concepts such as no home delivery and beds that required sheets conforming to Swedish rather than U.S. standards.
In short, Ikea saw the world though a Swedish filter. It was largely blind to alternative views of market reality and had a closed world view, says Govindarajan. To its credit, when confronted with disappointing performance in the U.S., Ikea was a quick learner and realized that an ethnocentric mindset imposed major constraints on the company's ability to build and exploit a global presence.
The Tuck School just started a new executive education program, Global Leadership 2020, to help companies train fast-track managers being groomed for global leadership positions. It's believed to be the first program of its kind.
Tuck is doing the program in collaboration with Templeton College at Oxford and the HEC School of Management in Paris. It is a consortium program for about 6-8 companies. The companies participating are Deere & Company, Eaton Corp., Colgate-Palmolive, Ford, McGraw- Hill, and Groupe Louis Vuitton Moe Hennessy from France. Between 40-64 participants--all fast track managers being groomed for global leadership positions--will take part in the program.
The program takes place on three continents. The first program session takes place at Tuck in Hanover, New Hampshire, on October 18. The second session takes place in Oxford in February 1999, and the third session takes place in Shanghai, China in May 1999.
One of the program's goals is to help the participating firms meet the strategic and organizational demands of globalization in order to manage their growth over the next decades.
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EDITORS & REPORTERS: If you're interested in the topic of "global mindsets" and how it is important for managers and corporations to have one, feel free to call Govindarajan at 603-646-2156 (office) . He goes by "VG" and his e-mail address is Internet: [email protected]
You can also contact Paul Danos, dean of the Tuck School, at 603-646-2460. Please contact Steve Infanti of Dick Jones Communications at 814-867-1963 if you need any assistance. Dick Jones Communications helps the Tuck School with its public affairs work.
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