Released by: Manager@Work, The Edge
Date: 27 October 2008
Increasingly, business executives today are called upon to be ever-competent, ever adaptable management leaders driven by the enterprises' global vision and strategic focus on growth through continuous value innovation. This is enabled by essential local business, operational know-how and management capability. Such capability requirement is even more important when the organisation begins
venturing to foreign shores. Though crucial, achieving personal management mastery is not the end point, but a pivotal point towards becoming a global executive. The ability and willingness to work across borders - whether culturally, geographically or in one's thinking paradigm - is essential for the development towards becoming a global executive.
Results of a study conducted by Carnegie Mellon University on 433 senior and mid-level executives reveal that most respondents have the opinion that corporate management today is still ill-equipped to compete effectively on a global scale. Today's global companies must possess the management competency to run the business well, remain ahead of the competition, aggressively aim to expand and grow
internationally and form strategic alliances with other organisations, as well as manage and tap the cultural diversity of the workforce. Competitive firms like GE, HP, P&G, Microsoft, Rio-Tinto and Johnson & Johnson are cognizant of this fact. These firms adopt a set of global and functional strategies and are long-term players in the competitive market, driven by innovative initiatives and
strategic thinking of the global executives who helm them.
What are the characteristics of a global executive?
The ability to transcend both physical and mental borders is crucial. In this aspect, being an able communicator in terms of dealing with and managing people from various backgrounds and cultures are important. Proficiency of the host country language would be a real advantage. The global executive should be adaptable, be conversant in change management, and have a global outlook with local
cultural sensitivity and acuity. He or she must be able to think strategically, without losing sight of the know-how of building the business and competent teams. As global executives will often find themselves posted to differing parts of the globe (or even the country), they must not only have the ability to be self reliant, manage their time effectively at work but also reach a harmonious
compromise for their uprooted family members in a foreign environment.
Why develop and grow global executives?
With globalisation and expansion of business overseas to pursue growth, talented executives are now much needed and sought after. According to www.perfectlaborstorm.com, the non-performance rate for new executives in the US is 40 to 60 percent within the first 18 months and, within five years, two-thirds of executive hires fail. Such a failure can cost the organisation up to 20 times the salary of
the executive. Therefore, to develop the new breed of global executives, a well-defined corporate strategy that includes leadership and talent development as a key component is fundamental.
Developing global executives is no walk in the park - one has to be sure of what is expected out of the executives, then have a programme to identify high performers and high potential employees and be willing to devote time and energy, not to mention resources consistently on a long term basis in training and mentoring to prepare them for global assignments.
Here are some management insights that you can consider to develop and grow global executives in your organisation:
Management Insight #1: Design Your Organisation to Promote Development of Global Executives
The best way to pave the path to global executive development is via job structuring and job-rotation, as the manner in which the organisation is designed, determines the extent of its growth or career advancement opportunities. A case in point is Harley Davidson which is a single business entity, organised around three main divisions - product development, demand creation, and support services.
The top 24 executives are actively engaged within each team, lending their skills and expertise in guiding these entirely self-managed teams. This helps the members of the team gain more knowledge about the organisation, broaden their scope, be involved in making major decisions besides directly benefiting from the coaching by their teammates.
Management Insight #2: Identify & highlight the best talent.
Review each of the organisation's top executives and note the best 20 percent. For more superior feedback, coaching and mentoring, the review should focus on each executive's strengths, weaknesses and development needs. Establish a talent bank, with detailed information about talented and potential employee's knowledge, competency and skills. When the need arise for international postings, the
appropriate candidate can be quickly identified and selected from the talent bank. Some companies erroneously send their `rookie' managers to learn and get overseas experience, when instead they should be sending their best personnel to establish overseas outpost and businesses.
Management Insight #3: Pick outside the box.
If there is a vast pool of people and jobs across an organisation's executive ranks, don't confine the search for the next global executive to within the division. How much development potential is lost if each executive job in a division is only allocated for the people within the department! For companies which have established a talent bank, they should look across the group of companies to
select the most eligible candidate for posting. Sharing talent across an organisation is not a normal practice and has its inherent risks, but if it can be done it will provide the pool of people talents to tap on. The most commonly adopted approach is the centrally managed one practised by GE and Rio Tinto. At GE and Rio Tinto, staffing decisions for the top jobs begin at the corporate center. HR
executives work with the CEO to compile a list of candidates from across the organisation. Managers with jobs to fill can then select any candidate they please.
Management Insight #4: Take a path less ordinary.
At present, the people who make staffing decisions in most organisations focus on getting the best-qualified person for the job. How about taking a different approach to this situation? Instead of focusing entirely on proven competence when appointing executives, companies should be prepared to take risks by considering the needs of executive development and the potential of the employee. By
putting a high-potential person in a job before he or she is ready challenges them to utilise whatever talent or skill they have to complete their tasks and prove themselves. It can also be a learning curve for them to further enhance their careers, especially with an overseas assignment.
Management Insight #5: Pursuit of excellence.
There must be a culture of pursuit of excellence. Non-performance or mediocre performance can harm the culture and image of the organisation. Remove those who produce mediocre results, are lacking in potential, do not inspire in their roles of coaches or leaders from key jobs after a given period. Once they have been removed, it opens up a whole range of development opportunities for the cream of
the crop. Half of the development powerhouses companies studied in-depth in a McKinsey survey are known to adopt this development system.
Management Capability Index (MCI)
Developing a truly global executive is not an easy task. If an organisation is focused on driving global expansion and business development, it must increase the pace of growing their global executives. The senior management has to commit time and energy towards managing their talent pool especially building up global management leaders of the future.
As with many lessons in life, our endeavours must begin at home. Our ability to manage globally begins with us being able to successfully manage locally. One of the best indicators or measure is the Malaysian Management Capability Index (MCI) which is computed from an annual nation-wide survey. The MCI survey can gauge our strengths and weaknesses in management capability whilst benchmarking
against other countries. The results of MCI 2008, the second survey in its series, will be released on 30 October at the MIM-MPC CEO Forum at the Putra World Trade Centre. For more information, please contact 03-2164 5255. Watch out for a special report on the survey results in a coming edition of The Edge.
Dr Wilson Tay, MMIM, MIM-CPT is CEO of the Malaysian Institute of Management, the national management organisation of Malaysia. MIM invites companies and professional managers to be members. Contact MIM Membership Support and Outreach at (603) 2164 5255; fax (603) 2165 4681; e-mail: enquiries@mim.org.my or visit www.mim.org.my.
