At lunch, a client recently asked me “Do you believe this is the
final stage of globalization? Is it all going to be about China and India taking away more jobs and growing their economies, while Western
companies continue to offshore labor to developing countries, from here on forward?”
My answer didn’t require much reflection: “No, I don’t
believe we’re close to reaching any kind of final stage. As I see it, most companies haven’t even begun to realize what
globalization means for them. For example, many are busy shifting jobs from corporate offices in the United States or in Europe to other
corporate offices in India, China, Brazil, or Russia. What most fail to realize is that the majority of future jobs may not even require
an office in the first place and that the specific geographical location of their employees may be all but irrelevant.”
Think of all the stories you heard about how job location becomes
increasingly irrelevant. For several years now, low-cost airline JetBlue has employed housewives as customer service agents, working from
their homes in the state of Utah. Rolls-Royce engineers in the UK can diagnose aircraft engines while working from home, while the planes
are actually in the air. Fast food chain Wendy’s is field-testing a concept where people in Sri Lanka remotely take American
drive-through orders, enter them into a computer, and send them back to the staff at the service window, who then hand out the orders
and take the customers’ money.
Thomas Friedman coined the term ‘Globalization 3.0’ for the
convergence of technologies, individuals, and economies around the world that we are only beginning to understand. One of its
consequences is that for many future jobs, the physical location of the person doing it is a don’t-care.
Geography and Globalization 3.0
Let’s not get carried away here: in many industries, especially in
manufacturing-intensive ones, centralized operations continue to be essential. Some retailers and certain service industries are also
tied to specific locations because “the job is where the customer is.” At the same time, more and more businesses realize
that a large percentage of jobs and services can now be performed in almost any country and location.
This option, created by technology advancements as well as political,
socioeconomic, and cultural trends, presents powerful opportunities to multinational companies embracing it. At the same time,
such companies face numerous challenges. Most find that adopting such a global model requires a substantial makeover of corporate
policies and practices:
• Companies must “unlearn” traditional methods of
operating from central office locations. This could require numerous transformations in processes and procedures, such as modifying
customer interfaces, implementing revised security and IP protection policies, adjusting work hour logging practices, and many others.
Without extensive preparation and proper change management, magnitude and complexity of such a makeover can be overwhelming for any
• Communicating with employees in meaningful ways and making them
feel welcome and included is much harder in a global environment. Companies need to stimulate a sense of belonging and nurture a strong
corporate culture across their globally fragmented workforce.
• With members spread out across many countries and regions,
managing virtual teams becomes far more complex than when they are co-located. Different approaches to management and leadership are required.
Corporations need to revisit “the way we do things around here”, looking into numerous aspects of managing their people remotely,
such as how to conduct effective meetings and make good decisions, or how to prevent and resolve conflicts between people who rarely, if
ever, meet in person.
• National and local cultures continue to play a strong role
in spite of the converging factors of globalization. Consequently, managers and employees need to learn effective strategies for working
across cultural boundaries. In addition, they must cope with the specific challenges of multi-cultural virtual teaming in an environment
where every team member’s cultural background may be different.
The Journey Has Barely Started
Whether we like it or not, globalization takes us on a journey into the
unknown that has barely started. Emerging economies in Asia or Latin America now face pressures similar to those developed countries in
North America and Europe have come to worry about for many years. Economies find their traditional competitive barriers weakening or
disappearing. Some countries fight uphill battles to protect these barriers, while others are trying to adjust by expanding their
strengths in areas of competitive advantage, such as technology infrastructure and quality of education. All of them are facing global
competition. If anything seems clear at this point, it is that globalization creates opportunities and threats for all countries,
including traditional economic powerhouses, up-and-comers such as China and India, and emerging players who are just beginning to
reach the threshold of competitiveness on a global scale.
Success in the age of Globalization 3.0 is a matter of individual
adjustment as much as it depends on large-scale corporate and macroeconomic decisions. Is your company ready for it? As an individual
contributor, manager, and/or leader, are you?