Global Operations

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The Perils of Attention From Headquarters

  • Research Highlight
  • Read Time: 11 min 

Visits from corporate headquarters to operations in markets such as China are often seen as overly time-consuming and unproductive. According to one China country manager of a European luxury-goods group, “Not only do they come often, but they want to spend more time, and they all come on weekends! For my team, it means that nearly every weekend, there is somebody to entertain.” The authors offer a set of recommendations for healthier dynamics between corporate headquarters and affiliates.

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Creating More Resilient Supply Chains

Global supply chains bring increased risks of disruption from events such as natural disasters. But by understanding and planning for such risks, Cisco Systems improved its own supply chain resilience. Its five-step process: identify strategic priorities; map the vulnerabilities of supply chain design; integrate risk awareness into the product and value chain; monitor resiliency; and watch for events. John Chambers, Cisco chairman and CEO, calls this type of risk management “a key differentiator.”

Image courtesy of Flickr user Ming Xia.

Protecting Intellectual Property in China

“By operating in China, overseas businesses expose their intellectual property to risk,” write Andreas Schotter (Ivey Business School at Western University) and Mary Teagarden (Thunderbird School of Global Management). “But deciding to stay away entails the even greater risk of missing opportunities to acquire knowledge that is critical for competitiveness across a wide range of global markets.” To protect their IP, companies need to control and manage their IP vulnerabilities proactively.

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Reducing the Risk of Supply Chain Disruptions

Most managers know that they should protect their supply chains from serious and costly disruptions — but comparatively few take action. The dilemma is that solutions to reduce risk mean little unless they are evaluated against their impact on cost efficiency. To protect their supply chains from major disruptions, companies can build resilience by segmenting or regionalizing supply chains, and limit losses in performance by avoiding too much centralization of resources.

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Reading Global Clients’ Signals

How can geographically distributed companies monitor large clients’ attitudes about their services? Traditional customer satisfaction surveys can lack sufficient timeliness and detail. But taking a big data approach to analyzing collaborations lets companies gain valuable and timely insights into client satisfaction. Examining the structural properties of email communication patterns and correlating them with external performance metrics can offer managers helpful insights.

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Free Article

Are Companies Ready for the New Global Executive?

  • Blog
  • Read Time: 2 min 

HR executives believe that tomorrow’s leaders will be a more diverse group than today’s and will face special challenges as a result. A survey of 197 human resource executives from global companies finds that “leaders from highly diverse backgrounds will need to work together more effectively.” The challenge is that diverse groups often have more disagreements than homogeneous groups, demanding proactive skill development in group dynamics.

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Free Article

MIT Sloan Management Review Launches Chinese Edition

  • Blog
  • Read Time: 1 min 

MIT SMR has launched a Chinese edition of its magazine and website, in partnership with local publishing firm Shanghai Li Han Technology Information Management Co. Ltd. Building on MIT SMR’s English language content, translated into Simplified Chinese, the publication will be enhanced by localized content relevant to business leaders and academics in China. The Chinese edition will bring MIT SMR’s premier content to the Chinese management and business community.

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Does Your Company Seem Socially Irresponsible?

Public perceptions of corporate irresponsibility are shaped in subjective, yet predictable, ways. “People like tidy stories with a clear villain,” write Nathan T. Washburn of Thunderbird School of Global Management and Donald Lange of the W.P. Carey School of Business at Arizona State University. “We lose interest when there are too many factors, extra complexity or too much ambiguity.” That means that powerful negative images can be hard to respond to.

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Developing Tomorrow’s Global Leaders

Human resources executives say that the next generation of global executives will be more diverse. But by diverse, they don’t just mean having variations in age, nationality and gender. They believe that top leadership groups in the future will be characterized by people with greater diversity of experience and “thought styles.” HR executives also believe that next-generation leaders will be working more collectively.

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Organizing R&D for the Future

Executives from around the world agree that research and development is a global effort requiring collaboration. Yet many say their organizations must improve in this area — evolving from the centralized approach that’s prevalent today — to meet strategic goals. In other words, for today’s R&D organizations, there is a significant gap between knowing what to do and actually doing it. Vital as it is to their futures, the art of collaboration is one that many R&D organizations have yet to master.

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A New Mix: More Sustainable Beer from Better Water Practices

It’s only natural that a beer company would be concerned about water. It takes five liters of water, on average, to manufacture one liter of beer. When SABMiller mapped its water footprint and found that it took 45 liters of water to produce one liter of its beer in the Czech Republic, and 155 liters in South Africa, the company changed its water practices to make its beer more sustainable. An interview with SABMiller’s senior vice president of sustainable development explains how they did it.

Image courtesy of Flickr user Robert Scoble.

Managing the Human Cloud

Online crowdsourcing platforms are growing at double-digit rates and are starting to attract the attention of large companies. Just as cloud computing offers unconstrained access to processing capacity and storage, the “human cloud” promises to connect businesses to millions of workers on tap, ready to perform tasks and solve problems that range from the simple to the complex. The article explores four new human cloud models: The Facilitator model, The Arbitrator, The Aggregator, The Governor.

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Building Your Company’s Capabilities Through Global Expansion

Today, the task of the global strategist involves not only identifying where to leverage a company’s strength but also how to enhance and renew its capabilities. The experience of many global companies suggests that expensive mistakes are often made when companies don’t ask key questions before making internationalization decisions. By better understanding their own competitive advantages and how they might fit into or complement a new market, companies can improve their chances of success.

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Driving Growth and Employment Through Logistics

Logistics clusters are local networks of businesses that provide a wide array of services, including transportation carriers, warehousing companies, and freight forwarders. Logistics clusters address several challenges that economies face, including the need for good jobs. In addition to helping companies navigate global supply networks, logistics clusters are contributing to the efficiency of global supply chains and, in the process, increasing international trade and global trade flows.

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How to Compete in China’s E-Commerce Market

A surprising number of high-profile Western companies have stumbled in e-commerce in China, including Amazon and Google. This article offers a list of workable strategies to succeed in Chinese e-commerce, gleaned from U.S. companies’ experiences.

There is no one-size-fits-all solution. However, in a market like China’s, where local knowledge and culture are crucial to success, more thought should be given to how to better serve local customers and adapt in a rapidly changing market.

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Image courtesy of Flickr user mmoosa.

Why Kraft Foods Cares About Fair Trade Chocolate

As vice president for sustainability at Kraft Foods, Chris McGrath has been pivotal at guiding the company’s sustainability efforts. With its global reach and massive market shares, the company is setting new standards on how to source through sustainable agriculture and keep packaging out of landfills.

Image courtesy of Nokia.

Mobilizing for Growth in Emerging Markets

The article offers four recommendations for an effective “network orchestration” strategy, bringing together local and global innovation partners in emerging markets. Multinationals should extend innovation partnerships beyond the usual channel partners by engaging key community stakeholders such as government bodies, universities and NGOs; engage innovation partners strategically with a larger purpose; trust but verify in a transparent manner; and designate local partner network managers.

Image courtesy of Shell.

Six Principles of Effective Global Talent Management

Although organizations must pay attention to things like recruiting and performance management, competitive advantage in talent management doesn’t just come from identifying key activities and then implementing “best practices.” Rather, successful companies subscribe to six key principles: 1) alignment with strategy, 2) internal consistency, 3) cultural embeddedness, 4) management involvement, 5) balance of global and local needs and 6) employer branding through differentiation.

Image courtesy of Flickr user jurvetson.

Improving Environmental Performance in Your Chinese Supply Chain

Multinational corporations are under growing pressure to make sure their contractors and subcontractors in China meet environmental standards. Yet traditional approaches to ensuring environmental, health and safety compliance, such as checklist audits, have proved problematic. This article recommends that organizations work closely with suppliers, providing incentives for identifying, disclosing and addressing problems and establishing collaborative relationships with NGOs and industry groups.

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