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Pilots for the new world: global leaders need special qualities.

Striving to be a truly global company is a relatively new quest. A few early explorers steered uncharted courses during the first half of the 20th century. But most companies recognized the opportunities presented by an increasingly global marketplace only in the past two decades. So it's not surprising that the number of global companies remains extremely small. Besides the newness--and, of course, the difficulty--of this quest, there is one other important reason so few global companies exist today: Not many executives possess the qualities needed to lead their companies around the world.

But exactly what are the qualities of successful, effective global leadership in today's world?

We put this question to a number of Kearney clients with broad global experience. In recent years, these companies have established local operations in diverse markets, built market share, and integrated their competitive advantages to leverage their strengths. Equally important, they have closely examined the leadership qualities needed by their CEOs and other executives to ensure success in the global environment.

We offer some of our clients' general insights and specific comments about four qualities most often cited as key elements of global leadership: a spirit of adventure, global aptitude, long-term perspective, and vision. Some of these are the result of training and experience, while others are basic personality characteristics. We also will look at how some companies are moving to keep the management pipeline filled with qualified global leaders.

SPIRIT OF ADVENTURE

This may be the most important personal trait of a potential global leader. A global leader must thrive on change, abhor the status quo, and be willing to take risks. Such characteristics enable a manager to evaluate a new culture without trying to transplant a more familiar, native culture.

Melvin Goodes, chairman and CEO of Warner-Lambert, is one of nine members of the company's 20-person management committee to run operations outside the U.S. Goodes, a native Canadian, reminisces about his first years of foreign experience. He ran parts of the company's European business in 1969 in Belgium. Then in 1970, at the age of 35, he was assigned to run the Mexican company. "It is a great experience to run your own operation," he says. "I loved it!"

One has to have a feeling of adventure and be willing to listen and learn, Goodes says. "What makes you successful are the things you learn rather than the things you bring from another culture. One of the principles I used was to never refer to what went on in the country that I came from. That just says you are trying to transfer cultural values from one place to another. And that simply doesn't work."

In seeking to learn the ropes in a new market, global leaders must be adaptable. They must develop interpersonal skills that transcend national borders and adapt their behavior and discourse to that of their international colleagues. Developing such flexibility, says Tokyo-based Richard Findlay, president of SmithKline Beecham Consumer Brands, means separating yourself from your personal nature and understanding yourself and others so well that you can adapt to other cultures thoroughly and instantly.

Global leaders should welcome entrepreneurial risk, especially in a new culture, according to Fred G. Steingraber, chairman and CEO of A.T. Kearney, who early in his career spent 13 years in Europe launching and managing the firm's European operations. "Managers who have never had the opportunity to fail will not be the innovative, energetic global leaders needed to run the company in the future.

"I'd like to see global leaders who can recreate the pioneering spirit of adventure and entrepreneurial flair that industry had at the beginning of this century," Steingraber says. "This spirit is what companies need to succeed in the global environment."

VISION

Global leaders have vision. They know what their companies are today, what they must become to succeed in the future, and how to make the transition. Executives of domestic companies must have a similar vision, of course. But there's a world of difference. The global company's geographic dispersal and differences of language and culture compound the tasks of creating, sharing, and achieving a global vision. They make it almost impossible to fit all of the company's worldwide pieces into a single vision and to personally champion this vision worldwide, sharing it with everyone and inspiring them to work together to make it a reality. The global leader must have a vision of how each element--such as marketing, R & D, sourcing, customer focus, etc.--contributes to the company's competitive advantage.

Nevertheless, several executives say making this vision a reality is a primary role of the global leader. A.T. Kearney's Steingraber echoes this popular belief, adding: "Without the strength of vision, all the finely honed strategic plans and all the exhortations for quality and service are for naught. In effect, a company would be like a finely crafted sailing vessel--with its rudder missing."

GLOBAL APTITUDE

Global aptitude encompasses several different qualities. First, of course, is foreign experience. But probably equally important is sensitivity to other cultures.

Foreign experience. Global leaders have had many years of foreign experience. One of the best ways to develop global aptitude is to live and work for a number of years in another country. In fact, there is no substitute for extended foreign experience, says Skip Malone of Walt Disney Company. Malone is the director of human resources for the film and entertainment group, which in 1991 earned half its total $2.5 billion in revenues from non-U.S. operations. "To be a successful global leader, a person has to have international experience," Malone says. "This experience does not have to come when the person is in his 20s or 30s but somewhere before he gets into that top position and has to make global decisions. Not having this experience shows. If you put a domestic executive at the top next to an international executive, you will see a significant difference. They can both be well-educated, bright, good decision makers. But the one with the international experience has done it before. It may be a new problem or even a new country, but he has all of that other experience to call on, so it's much easier to get to the right decision."

Most of today's global leaders got this experience by luck, happenstance, or individual determination--rather than through a planned corporate strategy. For instance, at SmithKline Beecham, which has headquarters in both London and Philadelphia and operates in 130 countries throughout the world, many executives with global responsibilities sought out their own international assignments earlier in their careers, either at SmithKline Beecham or elsewhere. "Through this experience, they qualified themselves as global managers," says Findlay.

Global leaders are also global citizens--this is an added advantage enjoyed by seasoned professionals. "To be a successful global manager, a person has to have distanced himself from his own national heritage and culture," says Findlay, who has had extended assignments in five countries and worked in about 45 others. "He has to have developed a broadened outlook and a balanced view of life in general."

Cultural sensitivity. Global leaders have dispensed with parochial attitudes that put domestic culture, ideas, and business values uppermost and replaced them with a global reference. They are knowledgeable about, interested in and can relate to the histories, cultures, politics, and economics of other nations.

When David Bronczek, vice president of Canadian operations for Federal Express, launched the company's Canadian service, he took with him the basic philosophy of adapting the Federal Express culture and global strategies to the geographical, social, and commercial realities of the new country. "We believe in balancing people, service, and profit objectives," Bronczek says, "but we had to adapt the personnel policies from our U.S. operations to take into account the differences in the Canadian culture." Apparently, the company believes he has succeeded, because the Canadian operation is now a model for global expansion. This sensitivity to other cultures ultimately strengthens the global executive's ability both to personally influence the company's local competitive advantage and to broaden local managers' perspective of the ethics, priorities, and practices that underpin the company's global success.

LONG-TERM PERSPECTIVE

Global leaders take the long view. While their domestic counterparts may still concern themselves with quarterly and annual results, global leaders understand that success in a foreign market cannot be achieved in the near term. As the story in this brief, entitled, "Opportunities And Barriers," makes clear, a company should not even bother to enter a foreign market if it is not committed to a long and deep investment there. Global leaders know profit will not come quickly, and they look beyond this fact to the long-term potential of the market. Multiply this single-market difficulty by the number of foreign markets demanding a company's long-term commitment, and it's easy to see why the shortsighted are not suited to lead their companies' quest to go global.

It's also important for managers to feel a long-term commitment to their foreign assignments. When Warner-Lambert assigns a manager to Japan, it is for a minimum of five years. "They can't go for anything shorter than that," Goodes says. "We want our people to start out with that |long-term~ mind-set."

This long-term view is not taught in business school. Nor is it a priority in many companies. But developing it is essential to success.

ENSURING GLOBAL LEADERSHIP

How do companies ensure they have global leadership for the future? Three strategies stand out in our discussions with clients: implementing formal and informal development programs, rotating assignments, and spreading the corporate culture worldwide.

More and more, companies are addressing the need to create global leaders. Molex, an $800 million global manufacturer of electrical connectors and switches, started its international exploration 25 years ago when its annual revenues were only about $8 million. It now earns 73 percent of its revenue outside the U.S. The company creates global fluency in two ways: It trains young managers on international business issues and offers cultural and language training to transferred managers and their families--before and after they move. (The company publishes its annual report in English, Japanese, French, German, and Chinese.)

This international business training consists of eight two-week sessions held over a two-year period, says Frederick A. Krehbiel, vice chairman and CEO. "Forty or 50 people from around the world attend this mini MBA program. They study with some of the best professors from Harvard, Northwestern, Chicago, and other leading business schools. And they work together on case studies and projects targeted toward international business in general and our business in particular."

Many of these people eventually transfer throughout Molex's worldwide operations, which include 40 manufacturing plants in 20 countries and R & D centers in nine countries. "We move a tremedous number of people around--especially middle managers and people with specific capabilities," says Krehbiel, who on a number of occasions has lived for several months in Japan and Europe. "We do it to help us in one country or another, and we do it to give managers opportunities to work in other countries."

This year, SmithKline Beecham is embarking on a management program designed to create global managers. Through this program, the company is recruiting newly graduated MBAs who respond to, and want, challenging assignments. During the initial six years of their careers, they will rotate across business sectors (pharmaceuticals, consumer products, etc.), disciplines (marketing, finance), and geography. "After six years, they basically will have broken their ties to their motherlands. And they will have had a chance to get a broad view of the corporation and of themselves," Findlay says.

Truly becoming a global citizen, however, requires an even longer period of service abroad. "If a person has not lived or worked in his home country for the past 10 or 15 years," Findlay says, "the chances are good that he has really opened his mind to a global perspective."

Other global companies have management programs or company policies aimed at infusing a sense of global citizenship into the managers they target for senior spots. And each of these companies has a strong corporate culture.

This corporate culture is embodied in their senior executives, no matter where these people are based around the world. "That's one reason we send them overseas: to put our way of doing business and our thought processes in place there. A company's standard of service and product quality must be the same everywhere," Disney's Malone says, adding, "It's also vitally important that the business fit the local culture."

Molex has managed to spread its culture by thinking globally and acting locally. Krehbiel says, "When we deal with our customers on a corporate-to-corporate level to work out their global strategies, we look global to them. But after the strategies are worked out, we look very local. Many of our customers in Japan and Germany, for instance, think we are a local company." Such an approach to customer relations stems from the understanding Molex's senior executives have of their company's culture and local markets and from their flexibility to work within the two.

Almost everyone with whom we discussed this topic agreed that these qualities--spirit of adventure, vision, global aptitude, and long-term perspective--distinguish global leaders from their domestic colleagues. But these qualities are certainly not the only ones needed by someone hoping to successfully lead a company around the world. Perhaps being a skilled communicator or being technology literate are equally important.

A.T. Kearney is interested in learning what qualities the readers of Chief Executive think are key to being a successful global leader. If you'd like to share your ideas or experiences, call or fax us at the numbers listed at the end of this brief. We would like to use them in future publications on this topic.

AN AFTERWORD

In this brief, we have explored the whys and hows of globalization. We have recognized that the global route may not be the right one for every company. What is most important is that the CEO evokes a vision of how globalization fits into his quest to steer the corporate ship toward building and maintaining competitive advantage. An ambitious and provocative set of mission, goals, and values, strongly articulated and communicated throughout the organization, can chart the course for the voyage.

A.T. Kearney is a global management consulting firm with more than 65 years of experience helping top management solve critical problems and capitalize on opportunities in most of the major areas of business operations. For more information about the subjects discussed in this brief, please contact: Corporate Communications Department, A. T. Kearney, 222 West Adams St., Chicago, IL, 60606. Telephone: (312) 648-0111. Facsimile: (312) 223-6200.
COPYRIGHT 1993 Chief Executive Publishing
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Chief Executive (U.S.)
Date:Jan 1, 1993
Words:2444
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