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Many European companies didn’t have contingency plans if Britain decided to exit the EU, and now are playing catch-up. They shouldn’t have been caught off guard.
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All too often, companies from emerging and established economies talk past each other when discussing intellectual property. The result is that often fail to consider all their options for a productive collaboration. The authors detail five ways that companies can structure such IP partnerships, and say that it’s important for a company to choose the one that’s the best fit for the project: “The choice of IP business models is a strategic decision, not merely a legal matter.”
New research shows that the vast majority of the world’s largest corporations are run by CEOs native to the country in which the company is headquartered. Does that matter? Some studies indicate that national diversity in the top management team can be associated with better performance. What’s more, the presence — or absence — of nonnative executives in a company’s top management team can send a signal to employees outside the home country: It indicates the long-term career prospects for foreign middle managers already in the company as well as for potential hires.
Something strange is happening as globalization marches forward: Increasingly, powerful local companies are winning out against multinational competitors. Some 73% of executives at large multinational companies say that “local companies are more effective competitors than other multinationals” in emerging markets. To compete effectively, multinationals need to let go of their global strategies and embrace a new mission: Integrate locally and adapt globally. That means becoming embedded in local distribution, supply, talent and regulatory networks as well as in the broader society.
The process of bringing assembly work back to U.S. factories from abroad is more challenging than the economics would predict. In the United States, many key resources, including the manufacturing workforce, have atrophied. Author Willy C. Shih (Harvard Business School) recommends that to reduce turnover, companies that embrace reshoring — bringing assembly work back from abroad — encourage workers to complete training and certification.
As Facebook becomes more mobile-centric, it’s also becoming adept at laying its customer data over brand data and third-party data to create uniquely customized experiences for its users. In a Q&A, Blake Chandlee, vice president of global partnerships at Facebook, details the power that comes from being able to overlay all that customer information. “Historically, we’ve never had the ability to have the scale of a mass media along with the personalization that digital provides,” says Chandlee.
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.
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.
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.
As China’s growth and integration into the world economy continue, many companies are looking for ways to build effective business relationships with Chinese companies. China’s ways of doing business are becoming more Westernized, but non-Chinese executives must still work hard to build trust in relationships with their Chinese business partners. But developing trust between Chinese and Western executives takes time. This article explores methods for developing cross-cultural trust.
Faced with the need to educate themselves quickly about a foreign market, companies employ a variety of approaches to learning. New research offers insights into choosing the best approach for your circumstances.
There are four elements to an effective “network orchestration” strategy, which brings together local and global innovation partners in emerging markets. The elements: Multinationals should 1) extend innovation partnerships beyond the usual channel partners by engaging key community stakeholders such as government bodies, universities and NGOs; 2) engage innovation partners strategically with a larger purpose; 3) trust but verify in a transparent manner; and 4) designate local partner network managers.
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.
Since the mid-1990s, many companies have outsourced or offshored their manufacturing operations. For most, one crucial enabling factor was cheap oil: Long supply lines were economically feasible because transportation costs were relatively low. Hence, companies emphasized reducing manufacturing costs through (1) offshoring or outsourcing; (2) plant rationalization; and (3) consolidating distribution centers and warehouses to reduce inventory levels and minimize fixed facility costs.
International relocations of entire corporate headquarters are rare. But the relocation of top management team members is happening more and more. For instance, a desire to be close to its major global customers led Halliburton Co., an international oil services group, to relocate the company’s CEO from Houston to Dubai. But there are strategic costs and benefits of such decisions. Deciding which option to pursue depends on the strength and interplay of the relocation drivers and barriers.
Senior executives weighing strategies appropriate for today’s global economy will hear contradictory advice. Some say you need to move quickly, before competitors, to establish a worldwide presence; others cite data showing that this approach is often less profitable. The reality is that neither approach is appropriate for every circumstance. Therefore, executives need to understand when to pursue one route and when to pursue the other.
Successful multinationals get that way by finding better ways to leverage operational improvements across the entire company. But developing such superior processes is not easy. New operational ideas fail for many reasons. One of the most common is not that the idea was bad, but that the developers set up a pilot that failed to persuade managers in the units that the process was an improvement. Successful pilots share three qualities: credibility, replicability and feasibility.
While technological innovations have revolutionized the workplace, it is ironic that relational boundaries — obstacles to productive human interactions — remain largely unchanged. This article identifies five types of such boundaries, and suggests that all five of them may be overcome when collaborative and creative leaders engage in six boundary spanning practices: buffering, reflecting, connecting, mobilizing, weaving and transforming.
Too little — or too much — attention from head office executives can cause problems in a company’s global operations. Research with senior executives in 135 multinational companies found that management of executive attention can have a significant impact on the performance of global companies and that relatively few companies seemed to optimize global attention. Most seemed to either spend too little or too much time and mental effort on global issues.
Companies often approach the process of developing a global culture as a one-way process dominated by corporate headquarters, exemplified by common terms such as “cultural transfer” “and “culture dissemination.” Also, core values often originate at corporate headquarters and fail to reflect and incorporate diverse cultural influences. This approach breeds skepticism about global culture among overseas employees, who may perceive headquarters’ core values as ethnocentric and parochial.
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