Twelve Practices for Effective Globalization
By Maureen Minehan
In February, Dr. Stephen R. Rhinesmith, a founding partner of CDR International Inc., a global business leadership consulting firm, spoke to the Society for Human Resource Management’s Board of Directors about globalization and its implications for HR. Rhinesmith is the former president of Holland America Cruise Lines and a former Special Ambassador to the Soviet Union. Today, he serves as a consultant to Fortune 100 corporations on globalization and the development of global mindsets, competencies, and corporate cultures.
Rhinesmith told the SHRM Board that almost every study of the global corporation has concluded that an integrated and forceful HR function is necessary to recruit and develop the leadership mindsets and skills for global competitiveness and success.
“HR is becoming the most critical factor in pursuing, defending and taking advantage of operating in a global world,” he said. “Companies throughout the world -- in the United States, Asia, Europe, Latin America, the Middle East and Africa -- are turning to their HR departments to deliver business performance through managers and systems that can deliver the success factors needed for global and local competitive advantage.”
Rhinesmith’s presentation described 12 practices that HR should consider to develop the skills and mindsets needed to compete in a global environment. “These are practices that you should consider if you want to help your organization think more globally and be more global,” he tells the SHRM Global Forum in a post-presentation interview.
The dozen practices Rhinesmith advocates are:
1. Global sourcing. “If you’re going to be a company that is really competing today, you have to go anywhere in the world to get what you need. You can’t be confined to your home country to recruit,” Rhinesmith says.
Global sourcing also means thinking about how best to meet a particular objective, whether through outsourcing (including offshore activities), insourcing or a mixture of both. "It’s a political hot potato now, but if you’re going to compete on a global basis, you need to deal with the realities of wage differentials. U.S. companies have been shifting jobs overseas for years – look at the textile mills in New England in the 1950s and 1960s," Rhinesmith says. "This is not a new concept."
2. Assessment and selection. The key to effective assessment and selection is to use criteria that look to future needs and skills, rather than those from the past, Rhinesmith says. "You need to recruit against future challenges. You don’t recruit CEOs to do the job that their predecessors did. You recruit them to move the company forward. Why shouldn’t you do that for all positions?"
3. Global orientation centers. Global orientation centers provide entry training that helps people learn the corporate culture. “Formal global orientation programs get everybody in the world on the same page. A good example is the Accenture training center in Illinois. Consultants from all over the world come for up to eight weeks of training. When they leave, regardless of where they are located, they understand how Accenture does business,” Rhinesmith says.
4. Global action learning programs. Companies that adopt global action learning programs help high potential employees develop personal and cultural acumen through business projects. “This has been used with great success in Europe and is starting to spread to the U.S.” Rhinesmith says.
In a typical global action learning program, a group of 30-40 high potentials are put through a three-module program spanning several months. The group comes together for an initial three-day training period and is then broken into five- or six-person teams, each of which is given a strategic organization problem to solve. A few months later, a second three-day training is held followed by additional work on the problem and a final three-day training session a few months after that.
“This is the best leadership training in the world. The participants apply their learning to a particular business issue that gets evaluated by the company’s executive committee,” Rhinesmith says. “However, because it’s time-intensive...it’s not the type of training you do for the masses.”
5. Global business training. Global business training involves educating people about their functional activities on a global basis. “This can be done through programs such as those offered by INSEAD or Harvard where an expert shares knowledge about the globalization of a particular function such a marketing or procurement,” Rhinesmith says.
6. Comparative management training. Comparative management training helps people understand how business is conducted in different countries. “There are country variations in how communication, leadership, decision-making and so on is handled. Comparative management training helps people understand the differences so they can be effective no matter which country they are in,” explains Rhinesmith.
7. Cultural and language training. “It’s important to acquire both language skills and knowledge about cultural differences. The goal is to be able to diagnose and understand a foreign culture so that living in it is easier,” Rhinesmith says.
8. Multicultural teambuilding. “Most global companies are filled with multicultural teams working on projects together. Bringing people in on a country, regional or global level and giving them a chance to do team-building helps them better understand their roles and responsibilities and identify any problems that may have arisen because of cross-cultural or other issues,” Rhinesmith says.
9. Staff exchanges and network development. Brief international assignments of up to six months give people experience in other parts of the world as well as contacts and knowledge they need to increase their leadership capabilities. Staff exchanges can be for as little as two weeks. “Some say that’s too short, but I think even brief stays can be beneficial,” Rhinesmith says.
10. Relocation mentoring and re-entry. According to Rhinesmith, relocation mentoring means “assigning a mentor in the home country who will help an expatriate stay up-to-date on what’s going on at home as well as ensure he or she has a meaningful job to return to.”
11. Global career pathing. This strategy makes all career paths accessible to everyone in the organization.
12. Consistent performance management: Finally, Rhinesmith says that to reinforce practices that support global competitiveness, “individuals that engage in effective global management must be recognized and rewarded for their contributions.”
"Globalization is not where you do business, but how you do business," Rhinesmith concludes. "These practices give HR an framework for thinking about the best way to develop the mindsets and skills their organizations need."