It is hard today to use the word “globalization” without a certain sense of irony, rueful or otherwise. Riven by ideology, religion, and mistrust, the world seems more fragmented, more at odds, than at any time since, arguably, World War II. But however deep the political divisions, business operations continue to span the globe, and executives still have to figure out how to run them efficiently and well. The question that Christopher Bartlett and Sumantra Ghoshal pose—“What is a global manager?”—seems therefore even more pressing than it did when their article originally appeared in these pages 11 years ago. Their answer, too, feels particularly timely. “There is no such thing,” they write, “as a universal global manager.” Multinational companies instead require three kinds of specialists—business managers, country managers, and functional managers—and a set of senior executives to nurture the specialists and coordinate their efforts. Bartlett and Ghoshal provide comprehensively researched examples of all four types of managers, exploring the different skills and perspectives they require to succeed. Their article lays out a model for a management structure that balances the local, regional, and global demands placed on companies operating across the world’s many borders. In the early stages of its drive overseas, Corning Glass hired an American ex-ambassador to head up its international division. He had excellent contacts in the governments of many nations and could converse in several languages, but he was less familiar with Corning and its businesses. In contrast, ITT decided to set up a massive educational program to “globalize” all managers responsible for its worldwide telecom business—in essence, to replace the company’s national specialists with global generalists. Corning and ITT eventually realized they had taken wrong turns. Like many other companies organizing for worldwide operations in recent years, they found that an elite of jet-setters was often difficult to integrate into the corporate mainstream; nor did they need an international team of big-picture overseers to the exclusion of focused experts.
Success in today’s international climate—a far cry from only a decade ago—demands highly specialized yet closely linked groups of global business managers, country or regional managers, and worldwide functional managers. This kind of organization characterizes a transnational rather than an old-line multinational, international, or global company. Transnationals integrate assets, resources, and diverse people in operating units around the world. Through a flexible management process, in which business, country, and functional managers form a triad of different perspectives that balance one another, transnational companies can build three strategic capabilities: global-scale efficiency and competitiveness; national-level responsiveness and flexibility; and cross-market capacity to leverage learning on a worldwide basis. While traditional organizations, structured along product or geographic lines, can hone one or another of these capabilities, they cannot cope with the challenge of all three at once. But an emerging group of transnational companies has begun to transform the classic hierarchy of headquarters-subsidiary relationships into an integrated network of specialized yet interdependent units. For many, the greatest constraint in creating such an organization is a severe shortage of executives with the skills, knowledge, and sophistication to operate in a more tightly linked and less classically hierarchical network. In fact, in the volatile world of transnational corporations, there is no such thing as a universal global manager. Rather, there are three groups of specialists: business managers, country managers, and functional managers. And there are the top executives at corporate headquarters, the leaders who manage the complex interactions between the three—and can identify and develop the talented executives a successful transnational requires. To build such talent, top management must understand the strategic importance of each specialist. The careers of Leif Johansson of Electrolux, Howard Gottlieb of NEC, and Wahib Zaki of Procter & Gamble vividly exemplify the specialized yet interdependent roles the three types of global managers play.
The Business Manager
Strategist + Architect + Coordinator
Global business or product-division managers have one overriding responsibility: to further the company’s global-scale efficiency and competitiveness. This task requires not only the perspective to recognize opportunities and risks across national and functional boundaries but also the skill to coordinate activities and link capabilities across those barriers. The global business manager’s overall goal is to capture the full benefit of integrated worldwide operations.