How Companies Can Overcome the Pitfalls of Globalization

Overcome the Pitfalls of Globalization

Does your company have global aspirations?

How do you determine which countries to pursue and which to avoid?

 

When growth stalls, many managers decide that the answer to the slowing metrics is in going global. In many instances, managers don’t appreciate the inherent risks, miss the cultural nuances, and miscalculate the legal costs of the lofty goals globalization requires.

Robert Salomon is a professor of International Management and Faculty Scholar at NYU’s Stern School of Business and has been teaching and studying the effects of globalization for nearly 20 years. His new book, Global Vision: How Companies Can Overcome the Pitfalls of Globalization, is a guide to successfully navigating the global marketplace.

As the CEO of a global business myself, I was intrigued by the lessons in the book and reached out to Robert to share some of his findings with you.

 

The Problem of Unbridled Optimism

Global Vision . CoverIn your book, you say that one of the biggest problems with globalization is managers and their unbridled optimistic attitude. How does this increase risk?

The problem is that managers systematically overestimate the benefits of globalization and underestimate its costs. They tend to believe that globalization is relatively easy, and they therefore overlook the economic, political, and cultural risks involved.

Many people cite Thomas Friedman’s book “The World is Flat” as an urgent call toward globalization. What’s usually wrong with this thinking?

More and more research suggests that the world is less global than Friedman suggests, and not just by a little, but by a lot. And so if managers base their views of globalization on Friedman’s work, they will end up making very dangerous assumptions about globalization’s risks and challenges.

Why is overestimating market potential so prevalent?

It is prevalent because managers tend to think that consumers will respond to their company’s products similarly in every market. They therefore believe that they can simply port their existing business model to global markets with little change. In this respect, they fail to recognize the challenges that culture—in the form of different consumer cultures—can place on their business model.

 

Strategic Mistake: Porting existing business models to global markets with little change.

 

Understanding the Importance of Culture

Your research led you to the conclusion that “culture is probably the least understood.” Tell us more about the importance of culture and its role.

Culture is the least well understood of all of globalization’s challenges because culture is difficult to define and measure. Is culture about language differences? Yes. Is culture about religious differences? Yes. Is culture about differences in behaviors, norms, customs, and social structure? Yes. But even if we recognize these differences across countries, they are difficult to quantify and measure. Because culture is difficult to quantify and measure, managers end up discounting its effect on globalization. In my book, Global Vision, I discuss how culture impacts globalization and also how managers can quantify the impact of culture on global companies.

 

Culture is the least understood of the challenges of global expansion.

How To Create An Optimistic Workplace

Make Work Happy

Do you want to create an optimistic workplace?

How does a strong purpose help in difficult times?

How do leaders set a positive leadership presence?

 

“The climate suffers when employees don’t believe their leader has their back.” –Shawn Murphy

 

My friend, author and speaker Shawn Murphy is the CEO & Founder of the leadership blog, Switch & Shift. His new book, The Optimistic Workplace, is a guide to creating and maintaining a powerful, positive, optimistic culture that creates results.

Previously, Shawn shared with us the powerful implications of positive, contagious emotions. I wanted to go deeper into the research for his new book, and so I asked Shawn to share more about the leadership insights he gained from decades of working with business leaders.

 

“Optimistic climates support employees’ exploration of purpose.” –Shawn Murphy

 

Find Your Purpose

I was fascinated by the research on eyeblinks. How does the eyeblink reflex relate to purpose?

Researchers used startle probes to measure the reflexive eyeblink caused by a stimulus, in the case of this research it was an image. The images ranged from positive, to neutral, to negative.

What researchers learned was the length of the eyeblink gave insight into the person’s emotional response to the pictures. The longer the eyeblink, the more unpleasant the response to the picture.

How this connects to purpose is that the researchers, Carol Ryff and team, found that those who had a clearer sense of purpose in life recovered faster from negative images. The research gets at a person’s resiliency. Purpose in life strengthens the core of our identity. The clearer our sense of purpose, the stronger our resiliency is; we can recover faster from negative stimulus in our life.

In a work context, we can summon our purpose to guide us through difficult times at work. It can also help us make better decisions, as purpose serves as a guide in decision making: Does this opportunity support my purpose?

 

“Resilience can be strengthened when a person has a sense of purpose.” –Shawn Murphy

 

Start Small to Cultivate Optimism

To cultivate optimism in the workplace, you say, “Start small,” and, “Forget about the ‘big bang.’” Most people who have a passion for culture want to jump right in with sweeping initiatives and major change. Why start small?

In my 20+ years as an organizational change management consultant and in leading change in my own company, I’ve learned that the big bang causes more confusion, comes across as rah-rah, and alienates people from what the change purpose and message is.

 

“Workplace optimism is the belief that good things will come from hard work.” –Shawn Murphy

 

So, rather go for broke, start small. Create a pocket of excellence. The change starts in a small group within the organization. The group is typically a supporter of the change. Let the small group experience success and gradually widen it to other pockets within the company.

Word of the success travels through networks of people. This approach organically builds support through achieved success and not through possible success. It’s the latter that is the focus of big bang change efforts. It’s what disillusions people about change efforts.

 

Research: You can transform the work experience by focusing on the best positive realities.