The Death of the Global Manager
Executive
Summary:
The "global manager" was a
coveted job description sought by many leaders for many years, but times have
changed—now we are all global managers, says Harvard Business School professor
emeritus Christopher A. Bartlett, coauthor of the classic business book Transnational
Management. He reexamines the ever-changing nature of running multinational
corporations while confirming that, six editions and 20 years later, some
challenges remain the same.
Key concepts include:
- Multinational corporations must pursue three core strategies to build layers of competitive advantage: exploit worldwide operations to build global scale efficiency; develop sensitivity and responsiveness to national differences; and leverage the world for information, knowledge, and expertise.
- The organizational capability of a company to rapidly develop and diffuse innovation is incredibly important but difficult to cultivate.
- The term "global manager" is a misnomer—we all operate in a global environment.
"The global economy was
radically restructuring in the wake of an era of accelerating globalization in
the 1980s," says Harvard Business School professor emeritus Christopher A.
Bartlett, who coauthored the textbook and its updates with the late Sumantra
Ghoshal (HBS DBA '86) and Paul W. Beamish of the University of Western Ontario.
"The Japanese juggernaut had just come driving through the United States,
challenging the international strategy of so many companies."
"Having eyes and ears around the world is
critical"
Nearly 20 years later and in its
sixth edition, Bartlett's case-filled textbook (which he describes as a
"continuing passion") offers the opportunity to reexamine the
ever-changing nature of multinational corporations (MNCs) and cross-border
management while confirming and further exploring some basic challenges that
have, more or less, remained the same.
"There are three core
strategies that any MNC has to pursue to build layers of competitive
advantage," Bartlett says. "The first is to use worldwide operations
to build global scale efficiency. If you're Ford or Toyota, for example, you
have to compete in the world market to capture the minimum efficient
scale."
The second requirement, often in
conflict with the first, is a sensitivity and responsiveness to national
differences. "It's a closeness to the market that enables you to adapt and
modify, not just produce one single, standardized product. The simplest example
might be the need for a right-hand drive Toyota Corolla in the UK,"
Bartlett says.
The third imperative is to leverage the
world for information, knowledge, and expertise. "The latest consumer
trend or technological development may be emerging in Germany or Japan, not
your home market," Bartlett says. "Having eyes and ears around the
world is critical, as is having the response capabilities to tap into the best
and brightest, wherever they may be. Companies can no longer assume that all
the smart people in the world are born within a 20-mile radius of their
headquarters."
This last factor—of being able to
develop and diffuse innovation rapidly around the world—has emerged to become
much more important as companies constantly renew their product line or service
business, Bartlett says. "That's a big change that's taken place."
The
world's communication pipeline
Another seismic shift is the broader
context in which companies now operate, forgotten all too easily in today's
hyper-connected world. "Back in 1992, the Internet was a very narrowly
used technology," Bartlett says. "It is now the communication pipeline
of the world."
The organizational capability of a
company to rapidly develop and diffuse innovation is incredibly important but
difficult to cultivate, he continues.
"Back when the book was first
published, it required a huge amount of travel, with communications mailed and
faxed around the world. Things are obviously different now, with the Internet,
satellite phone connections, and video conference calls on Skype."
Those communications channels are of
critical importance, Bartlett adds, when it comes to resolving the inherent
tensions between headquarters—where the focus might be on standardizing
products to drive down cost—and subsidiaries lobbying to adapt products to meet
the specific needs of a local market.
Making
the global manager
What are the requisite characteristics
of a "global manager," if there is such a thing anymore?
"Today, I would argue that you
don't put that qualifying adjective in front of manager—we all simply operate
in a global environment," Bartlett says. "It used to be that you
would make a career choice to be in the 'international division.' "
And in the 1960s and '70s, a foreign
assignment could be far from a promotion: "It was sometimes the failed
domestic managers who were sent abroad."
"Companies can no longer assume that all the smart
people in the world are born within a 20-mile radius of their
headquarters"
In today's world, however, a
shortage of human capital, not financial capital, is the bigger constraint.
"Companies look for bright, capable managers all over the world; there's
much more fluidity across the organization in that sense." (A case in
point is Carlos Ghosn, a Brazilian-Lebanese who serves as chairman and CEO of
the Japanese and French automakers Nissan and Renault.)
Managers operating in a global
environment obviously need a broad perspective and the ability to relate to
other people and cultures in an open, engaged way. Beyond that, Bartlett points
to the need for the mental flexibility that enables a manager to negotiate,
adapt, and modify the layers of competitive advantage and various strategic
imperatives that are part of any multinational company.
"We talk about building a
matrix into the organization's structure that enables people to be responsible
for the global product line, the geographic area, the functional expertise of
R&D or marketing," says Bartlett. "That's still necessary, but
much more important is to build a matrix in the manager's mind so that he or
she sees the world in terms of the tensions, conflicts, and trade-offs that are
part of operating in today's world."
Envisioning
the future
Bartlett describes Transnational
Management as being in a constant state of evolution. The most recently
added chapter, "The Future of the Transnational," includes a case
study on the pharmaceutical company Genzyme and its efforts to establish
Humanitarian Assistance for Neglected Diseases (HAND), a corporate social
responsibility program focused on treatments for diseases that typically affect
too small a population to warrant the attention of drug development companies.
"As the organizational model of
the transnational has evolved, it's become a critical player in the development
of the global political and social economy," Bartlett says. "With
that enormous power comes an increased responsibility; this most recent chapter
highlights the role that the transnational company has in bringing about change
to the world."
As the Genzyme case shows, that
responsibility is accompanied by considerable complexities and trade-offs. The
company's initial focus on developing a treatment for Gaucher disease
extends to malaria, TB, and Chagas disease, with various global partnerships
and constituencies cropping up along the way. The crux of the case becomes
apparent soon enough: Can Genzyme's HAND program manage all of these
initiatives successfully without stretching itself too thin? Given its
priorities, what should its partnering strategy look like?
"This is really the next
frontier for the transnational company," Bartlett says. "How does it
move beyond its role as an economic entity and recognize itself as a key player
in the sociopolitical environment in which it has responsibility as well as
power?"
Given the scope and influence of
today's global corporations, the answer to that question promises to shape the
world as we know it for years to come. 
http://hbswk.hbs.edu/item/6761.html
No comments:
Post a Comment