Developing Global Executives The Lessons of International Experience

Introduction: A World of Possibilities

Out of clutter, find Simplicity.
From discord, find Harmony.
In the middle of difficulty lies Opportunity.

—Albert Einstein, Three Rules of Work

In 500 B.C. Heraclitus wrote On Nature, a book that exists today only in bits and pieces. In his efforts to understand nature's ways, he observed that nature likes to hide its truths and that its principles are elusive. After spending eighteen months flying around the world hearing the stories and the insights of global executives, we reached a similar conclusion about global executive development. We had set out to discover the "truth" about how global executives develop and then to translate that truth into simple and usable form for aspiring executives and global organizations. Like Heraclitus, we found that reality is a bit more complicated than we had anticipated and that many of the readily accessible truths were the obvious ones.

Yes, all business is now global to some degree and organizations can't hide from it; they have been forced to develop strategies and structures appropriate to the international context. Scholars have also paid considerable attention to global strategy and structure, which has resulted in an increasingly differentiated understanding of the issues involved. There are many different types of global corporations, many different strategies for doing global business, and many different structures for carrying out those strategies? Aligning these forces appropriately has become the golden ring ofinternational competitiveness.

These new realities are driven home virtually every day in the business press, where the unfolding corporate struggles are reported. The twists and turns of megamergers, joint ventures, and forays into new markets and the life-and-death struggles against international competitors make exciting reading, involving every industry, from automobiles to cell phones.

But while approaches to strategy and structure have become increasingly sophisticated, our understanding of the kinds of executives required in such a complex setting has remained simple and simplistic. Yes, leading in an international context is more difficult than doing it on your home turf, and yes, it requires more sophisticated skills, but what does that mean? A growing case-study literature exalting the CEOs of admired global firms uses legendary figures like Percy Barnevik and Richard Branson to draw conclusions about what all global leaders should look like. An even larger movement believes that a small list of competencies can adequately describe the successful global executive. Though such lists consistently fail to capture the great variety of challenges for global leadership, they continue to proliferate. Even Jay Galbraith's definitive book on organizational design only touches on leadership issues, leaving implicit most of the leadership implications of strategy and structure choices.

Although many would agree that successful global executives must be flexible, sensitive to cultural differences, able to handle complexity, willing to think globally, and the like, such generalities are not very helpful when it comes to specific developmental strategies. Stewart Black and colleagues, for example, suggest using foreign travel, joining international teams, training programs with a global flavor, and international transfers to develop global executives. It's hard to argue with that, but is that all there is to it? If so, it is hard to imagine why there is a perceived shortage of talent.

Where does this leave us? We can say with some certainty that there are many different kinds of global corporations, varying along all sorts of dimensions, from the degree of their international presence, to how they are designed, to how multinational their work forces are. Since different situations require different executive talents and skills, there must be many kinds of global executives. But if there are many kinds, can an organization come up with a single strategy to develop all of them?

Such is the world of possibilities that we faced as we approached this study. We needed a methodology capable of bringing simplicity to some of the complexity, and capable of providing useful, if perhaps not universal, answers. We arrived at the following: First, we used a methodology that, since the early 1980s, has proved exceptionally useful in understanding how executives develop. Then, we took that approach to the executives in situ, that is, to their offices. We believed that we could understand global executive development more readily by putting ourselves in the global arena than by sitting in our offices analyzing numbers. Finally, and perhaps what was most important, we sought that understanding from global veterans themselves, executives who had "been there, done that," who knew both the excitement and anxiety of being a stranger in a new land with responsibilities that might well exceed their abilities. We describe in the next section just how we did the research. Borrowing again from Heraclitus, who observed that "the beginning is the end," we then include in this introductory chapter eight preliminary conclusions about developing global executives.

The Research Sample

* * *

We knew that the success of our method—interviewing executives about their developmental experiences—would depend on the quality of our sample of executives. We interviewed 101 executives, handpicked by their companies because they were considered extremely successful, even exemplary, global executives. The 92 men and 9 women hailed from thirty-six different countries (not counting the many multiple citizenships) and worked for sixteen global companies (see tables 1-1 and 1-2). Their positions were quite diverse, including multiple variations of such titles as chairman, chief executive, president, executive vice president, managing director, country manager, business unit manager, controller. At an average age of forty-eight, they had substantial business experience and averaged nine years of expatriate service. They collectively spoke every major language and had worked in every major country in the world. Highly regarded by their companies, these people by any criterion were a remarkable group, well positioned to provide the kind of information that we would need to address the difficult questions.

The Approach to the Interviews

* * *

In developing the interview questions, we reviewed the existing literature on global leadership. Although many topics relevant to international corporations have received considerable attention, the available research on the development of global executives is relatively sparse. If the literature agrees on anything, it is that experience is the primary vehicle for developing global leadership skills.

Given the centrality of experience, we drew on a study that identified specific developmental experiences that had shaped a large sample of primarily U.S. managers. The interview protocol and qualitative analytic methods developed for that study were helpful guides to the current one. This earlier work and subsequent research formed the basis for Morgan McCall's High Flyers: Developing the Next Generation of Leaders, which provided a conceptual framework and a useful starting point for understanding the development of high-potential global executive talent. If domestic executives were high flyers, then it wasn't much of a leap to see global executives as frequent flyers.

The high-flyers framework identifies five fundamental components in the developmental process. It begins with the assumption that whatever attributes a company desires in its leaders, they are the outcome of the developmental process rather than an input to it. Whatever those qualities (or competencies) might be for a particular company or executive job, a talented person, given the appropriate experience, might develop them. In figure 1-1, we labeled the end state of development "the right stuff," borrowing from Tom Wolfe's book by the same name. Rather than focus on specific qualities of gifted people, however, the approach in High Flyers focuses instead on the experiences that prepare a person for the leadership challenges inherent in the business strategy. It is the business strategy, not a theoretical model of leadership, that determines what experiences are developmentally significant. Only if we know what the organization is trying to achieve can we talk intelligently about the kinds of experiences its talented people will need to lead it successfully.

As figure 1-1 also suggests, if experience is the teacher, then who gets the important experiences is a key issue. Logically, one would hope to give such valuable experiences to the people most likely to learn from them. Thus, talent, or more precisely, potential, can be viewed as the ability to learn from experience.

Talented people, however, don't always have access to the experiences that would best develop their executive abilities, so organizations need some mechanism or process that determines who gets what experience. Whoever gets the experience has the opportunity to grow; the person who determines who gets what job controls development. How this plays out in an organizational context ranges from the decision of a single hiring manager to a formal process of succession planning.

For a variety of reasons, even a talented person may not learn the lessons that an experience has to offer. Talented people frequently are given developmental assignments without knowing specifically what they are expected to learn, without adequate feedback or coaching, or without being held accountable for the learning. Figure 1-1 labels as "catalysts" the things an organization or a boss can do that facilitate learning (which at times may be doing nothing!).

As we designed the current research project, we hoped that this basic framework would be relevant in the global arena even though much of the research underlying it was done with U.S. executives. On the other hand, we did not rule out a priori that something entirely different was going on with non-U.S. executives in international companies. So we revisited the original underpinnings of the framework by including some of the preframework questions: We asked the executives to describe at least three events or episodes that shaped them as executives and the lessons they learned from those key events, and to tell us about a situation they had witnessed in which a talented global executive derailed. In addition, we covered the various components of the framework through open-ended questions about what to look for in choosing people for global jobs (the talent component), and what the organization had done to help them (the catalyst component). We incorporated questions based on other research and theory relevant to global executives, including queries about background experiences and the role of family. Finally, we added some questions aimed at identifying the distinctions they saw between domestic and international jobs, including specific questions about working with bosses and subordinates from cultures other than their own. (The interview protocol, sent to the participants in advance of the actual interview, is in appendix A.)

Our intention, then, was to include an array of questions broad enough for us to tell whether the existing framework or some modification of it was translatable to global executive development. At the same time, we remained open to the possibility that some other approach was more parsimonious.

Introductory Conclusions

* * *

This book will lay out in detail what we were told and our recommendations for developing global executives. As the story unfolds we will overuse words such as "complex" and "complexity" as we attempt to describe what we have learned. Because of this complexity it may help if we begin with a few assertions to foreshadow what lies ahead. Though these assertions are more fully developed in the pages to come, knowing generally where we are headed may provide some guidance when the trail gets a bit difficult.

Business Strategy Drives Development

What work must get done? This is what drives (and should drive) development in any organization. It is conceptually clear and hardly controversial. The business strategy and the structure of a global corporation directly affect how many and what kinds of international jobs will exist, how many global executives with what kinds of skills will be needed, and what experiences are available to teach them what they need to know.

The problem is that few organizations have so clear a picture of their global business strategy that it can be translated into specific development needs. Responding to the vicissitudes of the international environment seldom results in logical strategies implemented in an orderly fashion. For example, haphazard efforts to expand internationally (that in hindsight can best be described as naive) often begin with "Who can we send to China (or wherever)?" If the business subsequently fails, the failure is too often interpreted as a deficiency in the person sent to lead the effort rather than what the endeavor was—a high-risk, ill-advised attempt to grow the business. As they go from pillar to posting, it is no surprise that global organizations lose talented leaders with invaluable experiences.

Systematic development of global leaders requires an even stronger, more focused commitment than does a domestic effort. You have to know what you are doing, why you are doing it, and what you want to get out of it. Without that clarity of commitment, the complexity of the global environment will swamp the effort.

What Global Executives Need to Know Can Be Learned, but It's Not All Business

The executives we interviewed described almost a thousand lessons they had learned from their experiences, covering every imaginable skill, ability, and knowledge base. Though some individuals may have some of these abilities as "natural" gifts, global executives, in telling us what they learned, were also telling us that such things can be learned.

Focusing exclusively on the business side, some executives suggested that the lessons of domestic and international experience weren't all that different. Business is business wherever you are: No matter what country you are in, you still need to concoct strategy, make decisions, handle customers, work with business drivers. People need to be motivated, bosses placated, conflicts mitigated, wherever you find yourself. Indeed, comparing the lessons described by global executives to the lessons learned by U.S. executives, we clearly see a common core of learning about leading and doing business.

Once beyond that core, however, the cultural context in which the business takes place has a profound effect on the content of the lessons learned. First, culture does affect how business is done, if less so what must be done. Second, the impact of cultural differences can be so powerful that learning about business becomes secondary. As a result, what people may learn about doing business is less predictable in an international setting and can be culture specific.

Although learning to run a business on the global stage is certainly one objective of global executive development, learning to adapt to different cultures turns out to be both more important and more difficult than acquiring the business lessons. In fact, our data indicate that many business lessons can be learned without expatriation, whereas most cultural adaptability lessons cannot.

Learning to work across cultures is an essential competency of the global executive, and it is for most people an emotional education as well as an intellectual one. In other words, the lessons are both professional and personal—often profoundly personal. We believe that one reason companies consistently have difficulty with repatriation is precisely that so much of what is learned is personal, that the personal learning can be more powerful than the business learning, and that those personal lessons are not always or obviously relevant to the next business setting.

Considering the intellectual complexity of the business lessons and the transformational quality of the personal lessons, we conclude that global executives do indeed have a broader perspective than their domestic counterparts. This unique perspective underlies the elusive quality called a global mind-set.

(Continues...)

---

Excerpted from Developing Global Executives by Morgan W. McCall, Jr. - George P. Hollenbeck. Copyright © 2002 by Harvard Business School Publishing Corporation. Excerpted by permission. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.

---

Introduction: A World of Possibilities

Out of clutter, find Simplicity.
From discord, find Harmony.
In the middle of difficulty lies Opportunity.

—Albert Einstein, Three Rules of Work

In 500 B.C. Heraclitus wrote On Nature, a book that exists today only in bits and pieces. In his efforts to understand nature's ways, he observed that nature likes to hide its truths and that its principles are elusive. After spending eighteen months flying around the world hearing the stories and the insights of global executives, we reached a similar conclusion about global executive development. We had set out to discover the "truth" about how global executives develop and then to translate that truth into simple and usable form for aspiring executives and global organizations. Like Heraclitus, we found that reality is a bit more complicated than we had anticipated and that many of the readily accessible truths were the obvious ones.

Yes, all business is now global to some degree and organizations can't hide from it; they have been forced to develop strategies and structures appropriate to the international context. Scholars have also paid considerable attention to global strategy and structure, which has resulted in an increasingly differentiated understanding of the issues involved. There are many different types of global corporations, many different strategies for doing global business, and many different structures for carrying out those strategies? Aligning these forces appropriately has become the golden ring ofinternational competitiveness.

These new realities are driven home virtually every day in the business press, where the unfolding corporate struggles are reported. The twists and turns of megamergers, joint ventures, and forays into new markets and the life-and-death struggles against international competitors make exciting reading, involving every industry, from automobiles to cell phones.

But while approaches to strategy and structure have become increasingly sophisticated, our understanding of the kinds of executives required in such a complex setting has remained simple and simplistic. Yes, leading in an international context is more difficult than doing it on your home turf, and yes, it requires more sophisticated skills, but what does that mean? A growing case-study literature exalting the CEOs of admired global firms uses legendary figures like Percy Barnevik and Richard Branson to draw conclusions about what all global leaders should look like. An even larger movement believes that a small list of competencies can adequately describe the successful global executive. Though such lists consistently fail to capture the great variety of challenges for global leadership, they continue to proliferate. Even Jay Galbraith's definitive book on organizational design only touches on leadership issues, leaving implicit most of the leadership implications of strategy and structure choices.

Although many would agree that successful global executives must be flexible, sensitive to cultural differences, able to handle complexity, willing to think globally, and the like, such generalities are not very helpful when it comes to specific developmental strategies. Stewart Black and colleagues, for example, suggest using foreign travel, joining international teams, training programs with a global flavor, and international transfers to develop global executives. It's hard to argue with that, but is that all there is to it? If so, it is hard to imagine why there is a perceived shortage of talent.

Where does this leave us? We can say with some certainty that there are many different kinds of global corporations, varying along all sorts of dimensions, from the degree of their international presence, to how they are designed, to how multinational their work forces are. Since different situations require different executive talents and skills, there must be many kinds of global executives. But if there are many kinds, can an organization come up with a single strategy to develop all of them?

Such is the world of possibilities that we faced as we approached this study. We needed a methodology capable of bringing simplicity to some of the complexity, and capable of providing useful, if perhaps not universal, answers. We arrived at the following: First, we used a methodology that, since the early 1980s, has proved exceptionally useful in understanding how executives develop. Then, we took that approach to the executives in situ, that is, to their offices. We believed that we could understand global executive development more readily by putting ourselves in the global arena than by sitting in our offices analyzing numbers. Finally, and perhaps what was most important, we sought that understanding from global veterans themselves, executives who had "been there, done that," who knew both the excitement and anxiety of being a stranger in a new land with responsibilities that might well exceed their abilities. We describe in the next section just how we did the research. Borrowing again from Heraclitus, who observed that "the beginning is the end," we then include in this introductory chapter eight preliminary conclusions about developing global executives.

The Research Sample

* * *

We knew that the success of our method—interviewing executives about their developmental experiences—would depend on the quality of our sample of executives. We interviewed 101 executives, handpicked by their companies because they were considered extremely successful, even exemplary, global executives. The 92 men and 9 women hailed from thirty-six different countries (not counting the many multiple citizenships) and worked for sixteen global companies (see tables 1-1 and 1-2). Their positions were quite diverse, including multiple variations of such titles as chairman, chief executive, president, executive vice president, managing director, country manager, business unit manager, controller. At an average age of forty-eight, they had substantial business experience and averaged nine years of expatriate service. They collectively spoke every major language and had worked in every major country in the world. Highly regarded by their companies, these people by any criterion were a remarkable group, well positioned to provide the kind of information that we would need to address the difficult questions.

The Approach to the Interviews

* * *

In developing the interview questions, we reviewed the existing literature on global leadership. Although many topics relevant to international corporations have received considerable attention, the available research on the development of global executives is relatively sparse. If the literature agrees on anything, it is that experience is the primary vehicle for developing global leadership skills.

Given the centrality of experience, we drew on a study that identified specific developmental experiences that had shaped a large sample of primarily U.S. managers. The interview protocol and qualitative analytic methods developed for that study were helpful guides to the current one. This earlier work and subsequent research formed the basis for Morgan McCall's High Flyers: Developing the Next Generation of Leaders, which provided a conceptual framework and a useful starting point for understanding the development of high-potential global executive talent. If domestic executives were high flyers, then it wasn't much of a leap to see global executives as frequent flyers.

The high-flyers framework identifies five fundamental components in the developmental process. It begins with the assumption that whatever attributes a company desires in its leaders, they are the outcome of the developmental process rather than an input to it. Whatever those qualities (or competencies) might be for a particular company or executive job, a talented person, given the appropriate experience, might develop them. In figure 1-1, we labeled the end state of development "the right stuff," borrowing from Tom Wolfe's book by the same name. Rather than focus on specific qualities of gifted people, however, the approach in High Flyers focuses instead on the experiences that prepare a person for the leadership challenges inherent in the business strategy. It is the business strategy, not a theoretical model of leadership, that determines what experiences are developmentally significant. Only if we know what the organization is trying to achieve can we talk intelligently about the kinds of experiences its talented people will need to lead it successfully.

As figure 1-1 also suggests, if experience is the teacher, then who gets the important experiences is a key issue. Logically, one would hope to give such valuable experiences to the people most likely to learn from them. Thus, talent, or more precisely, potential, can be viewed as the ability to learn from experience.

Talented people, however, don't always have access to the experiences that would best develop their executive abilities, so organizations need some mechanism or process that determines who gets what experience. Whoever gets the experience has the opportunity to grow; the person who determines who gets what job controls development. How this plays out in an organizational context ranges from the decision of a single hiring manager to a formal process of succession planning.

For a variety of reasons, even a talented person may not learn the lessons that an experience has to offer. Talented people frequently are given developmental assignments without knowing specifically what they are expected to learn, without adequate feedback or coaching, or without being held accountable for the learning. Figure 1-1 labels as "catalysts" the things an organization or a boss can do that facilitate learning (which at times may be doing nothing!).

As we designed the current research project, we hoped that this basic framework would be relevant in the global arena even though much of the research underlying it was done with U.S. executives. On the other hand, we did not rule out a priori that something entirely different was going on with non-U.S. executives in international companies. So we revisited the original underpinnings of the framework by including some of the preframework questions: We asked the executives to describe at least three events or episodes that shaped them as executives and the lessons they learned from those key events, and to tell us about a situation they had witnessed in which a talented global executive derailed. In addition, we covered the various components of the framework through open-ended questions about what to look for in choosing people for global jobs (the talent component), and what the organization had done to help them (the catalyst component). We incorporated questions based on other research and theory relevant to global executives, including queries about background experiences and the role of family. Finally, we added some questions aimed at identifying the distinctions they saw between domestic and international jobs, including specific questions about working with bosses and subordinates from cultures other than their own. (The interview protocol, sent to the participants in advance of the actual interview, is in appendix A.)

Our intention, then, was to include an array of questions broad enough for us to tell whether the existing framework or some modification of it was translatable to global executive development. At the same time, we remained open to the possibility that some other approach was more parsimonious.

Introductory Conclusions

* * *

This book will lay out in detail what we were told and our recommendations for developing global executives. As the story unfolds we will overuse words such as "complex" and "complexity" as we attempt to describe what we have learned. Because of this complexity it may help if we begin with a few assertions to foreshadow what lies ahead. Though these assertions are more fully developed in the pages to come, knowing generally where we are headed may provide some guidance when the trail gets a bit difficult.

Business Strategy Drives Development

What work must get done? This is what drives (and should drive) development in any organization. It is conceptually clear and hardly controversial. The business strategy and the structure of a global corporation directly affect how many and what kinds of international jobs will exist, how many global executives with what kinds of skills will be needed, and what experiences are available to teach them what they need to know.

The problem is that few organizations have so clear a picture of their global business strategy that it can be translated into specific development needs. Responding to the vicissitudes of the international environment seldom results in logical strategies implemented in an orderly fashion. For example, haphazard efforts to expand internationally (that in hindsight can best be described as naive) often begin with "Who can we send to China (or wherever)?" If the business subsequently fails, the failure is too often interpreted as a deficiency in the person sent to lead the effort rather than what the endeavor was—a high-risk, ill-advised attempt to grow the business. As they go from pillar to posting, it is no surprise that global organizations lose talented leaders with invaluable experiences.

Systematic development of global leaders requires an even stronger, more focused commitment than does a domestic effort. You have to know what you are doing, why you are doing it, and what you want to get out of it. Without that clarity of commitment, the complexity of the global environment will swamp the effort.

What Global Executives Need to Know Can Be Learned, but It's Not All Business

The executives we interviewed described almost a thousand lessons they had learned from their experiences, covering every imaginable skill, ability, and knowledge base. Though some individuals may have some of these abilities as "natural" gifts, global executives, in telling us what they learned, were also telling us that such things can be learned.

Focusing exclusively on the business side, some executives suggested that the lessons of domestic and international experience weren't all that different. Business is business wherever you are: No matter what country you are in, you still need to concoct strategy, make decisions, handle customers, work with business drivers. People need to be motivated, bosses placated, conflicts mitigated, wherever you find yourself. Indeed, comparing the lessons described by global executives to the lessons learned by U.S. executives, we clearly see a common core of learning about leading and doing business.

Once beyond that core, however, the cultural context in which the business takes place has a profound effect on the content of the lessons learned. First, culture does affect how business is done, if less so what must be done. Second, the impact of cultural differences can be so powerful that learning about business becomes secondary. As a result, what people may learn about doing business is less predictable in an international setting and can be culture specific.

Although learning to run a business on the global stage is certainly one objective of global executive development, learning to adapt to different cultures turns out to be both more important and more difficult than acquiring the business lessons. In fact, our data indicate that many business lessons can be learned without expatriation, whereas most cultural adaptability lessons cannot.

Learning to work across cultures is an essential competency of the global executive, and it is for most people an emotional education as well as an intellectual one. In other words, the lessons are both professional and personal—often profoundly personal. We believe that one reason companies consistently have difficulty with repatriation is precisely that so much of what is learned is personal, that the personal learning can be more powerful than the business learning, and that those personal lessons are not always or obviously relevant to the next business setting.

Considering the intellectual complexity of the business lessons and the transformational quality of the personal lessons, we conclude that global executives do indeed have a broader perspective than their domestic counterparts. This unique perspective underlies the elusive quality called a global mind-set.

(Continues...)

---

Excerpted from Developing Global Executives by Morgan W. McCall, Jr. - George P. Hollenbeck. Copyright © 2002 by Harvard Business School Publishing Corporation. Excerpted by permission. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.

---