Strategic Learning and Leading Change

Stephen John

• Publisher: Routledge
• Year: 2008
• ISBN:
  9781136363009
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Strategic Learning and Leading Change is a practical, inspiring read that challenges business commentators who have doubted the power of HR and presents examples of how HR leaders are leading change to truly earn their seats as business partners at the strategy table. Using real-life examples that take in the intricacies of performance management, talent management and leadership development, the book shows business leaders how to improve strategy execution and interact with the board.

Structured in three parts, the book covers:

* The globalization of business and its impact on strategy, structure, operating processes and culture

* Global team-based organization and change leadership, using the in-depth case study of APC, a company that reinvented the Pharma business model

* The reinvention and changing role of HR in today's global organizations

Written for senior business leaders, HR leaders and managers who are working in or planning to enter a global business environment, Strategic Learning and Leading Change is also ideal for management consultants who advise business and HR leaders on leveraging learning and change with an emphasis on improving strategy execution. It is also a perfect real-world text for students on human resources courses and business MBAs who aspire to drive success in a global business and HR setting.

I The Globalization Of Business

Part I discusses the globalization of businesses and its impact on their strategy, structure, operating processes, and culture. Chapter 1 explores the history of globalization. Some companies have had to rethink their strategies and operations as well as their identity and core beliefs. IBM and GE Medical Systems are discussed as examples of how leadership proactively solves globalization challenges as they execute their strategy. Chapter 2 discusses, primarily through a Pharma Outsourcing case study, how leaders and managers respond to the challenges presented to them in their performance management, leadership development, and talent management philosophies and processes in a global business environment. Chapter 3 explores the role of teams and the cross-cultural capabilities needed in executing a global strategy. The eight principles of strategic learning are discussed in the context of performance and development coaching skills needed by leaders/managers of global organizations. Also covered is the use of Social Network Analysis and community building as major change implementation tools. LVMH and Lonza are presented as examples of diverse organizations successfully using strategic learning and leading change techniques to transform their organizations.

Enter Globalization

DOI: 10.4324/9780080941844-1

Globalization has arrived in the world, but not in most of the world's organizations.

Rhinesmith (1996)

A little over a decade later, there are more questions and challenges for leaders of today's business organizations. The media displays a wide array of contradictory images in portraying the globalization of business. We see business leaders, politicians, and Hollywood celebrities toasting globalization at the World Economic Summit held each year in Davos, Switzerland. We saw riots in the streets of Seattle with ensuing property damage when the WTO held its conference there several years ago.

Companies of all sizes — large and small, domestic and international — across all industries have had to rethink their strategic intent, operations, and in some cases their core beliefs and values. Leaders and employees in many organizations are challenging their identity, their purpose, and some argue their soul. As the French so eloquently say raison d';tre.

Organizational Identity

An organization's identity is an important factor in how they define their value proposition to their customers in the marketplace and as importantly their value proposition to their employees who create and deliver on the organization's strategic intent. The degree of clarity the leadership communicates by words and actions impacts, positively or negatively, the depth of passion and zeal with which the organization's employees deliver on its value proposition to customers. Identity as it shapes leadership and management philosophy within an organization becomes a prime force in shaping and reshaping the culture. This can be especially true for organizations facing rapid changes and shifts within their industry as well as the forces due to merger and integration activities. Identity can be lost and regained and lost again and emerge as very different from the original identity. These changes can be extremely disorienting to the leadership and employees alike. Globalization can exacerbate an already turbulent environment. As we will see later, strategic learning and leading change is a 21st-century mandate for everyone in the organization. They must become woven into the very identity and behaviors of every individual in the organization to ensure its long-term sustainability.

The power of identity for positive or negative impact on an organization is best seen when the leaders chose to shape the identity of their organization in a narrow and self-serving way or through the prism of merging two companies and the ensuing integration of strategy, operations, and cultures. An example of leaders choosing the narrow self-serving route can be found when public relations tag lines are utilized to portray an image that is out of sync with the experience of the customer and/or employee. A company may chose to use the words globalization, or high tech or industry innovator, etc., when in fact they never deliver such a value proposition. Sound bite leadership produces at best skepticism in its customers and employees and in the worst-case scenario cynicism. The impact on the culture can be extremely harmful if the leadership fails to intervene immediately to correct. Corporations today are under increasing scrutiny and pressure to act in economically, environmentally, socially, and ethically responsible ways. Each of these areas must be visibly represented in the identity of today's global organization. Mergers and the ensuing integration activities provide an organization with an opportunity to shape the new emerging company's identity to meet today's rigorous expectations of both customers and employees.

Ackerman (2000) cites a Conference Board survey (1999) which, after interviewing a number of business leaders, reported three factors that were critical to ensuring success of the post-merger organization:

1. clear articulation (by leadership) and understanding (by employees) of the new company's basic identity, core values, and business strategy;
2. a strong underlying economic model of the organization; and
3. the philosophy and style of the CEO inspires confidence in the new entity's potential.

The power of identity was described in the Conference Board report as “the firm's identity supported by its core values and business strategy, helps to create a common understanding and commitment among all employees”. Ackerman states:

The mechanics of integration are most dramatically evident today in globalization, which, in its own unique way, is prodding companies to wrestle with the notion of identity more seriously than ever before. Globalization is forcing a slow but steady integration of national markets and economies. Within far-flung organizations, it is driving the integration of experience, talent, beliefs, and passions among people who don't know each other, who come from different countries, and who don't speak the same language or share the same customs. Yet these people have been brought together to compete in territories where there is no end to the challenges they are being asked to meet. “Who are we?” has never been a more pressing question.

And yet, if we “Google” globalization we have millions and millions of links made available to us. The volume of information on globalization is so large that defining globalization and more importantly how it is being defined and acted upon in our business organizations is critical for all constituencies — business leaders, employees, customers, stakeholders, politicians, and citizens of the world. It is a 21st-century imperative that we gain a deeper understanding of: What is the globalization of business? Where did it come from? And which organizations have achieved a degree of success in globalizing their businesses?

Leadership, learning, and change are converging in the global business world to form business cultures that when they click are capable of producing enormous economic value to their customers, employees, stakeholders, and communities. When they lose their sense of identity their culture becomes fragmented and, in turn, destroys the value proposition of the organization. The challenge for all organizations — large or small — is for their leaders to understand what strategic learning and leading change means to them and to use the power of a sharply defined identity to create and recreate themselves through their employees as the meaning of globalization changes in an ever-changing world. Peter Drucker (1998) notes leadership/management is a social discipline that deals with “the behaviors of people and institutions … the social universe has no natural laws as the physical sciences do. It is subject to continuous change. This means that assumptions that were valid yesterday can become invalid and, indeed, totally misleading in no time at all”. Each of us must be vigilant to ensure that our organizations serve us in meeting the needs of people throughout the world.

Globalization and all it implies in the modern era for leadership, learning, and change is not a new phenomenon. The section that follows discusses the historical evolution of globalization of business enterprises and provides some examples of globalization in action.

What is Globalization

In the shadow of Wyoming's Grand Teton Mountains, a distinguished group of bankers and economists were leaving for the Federal Reserve's annual retreat. They spent the better part of three days in deep discussion grappling with the challenges surfacing from the defining force of our age — globalization. They listened and interacted with some of the world's leading academic economists who one after another, when pressed, sheepishly admitted the process and outcomes of globalization are not clearly understood — even after decades of study by some of the best minds in economics. Imagine attending a similar retreat dedicated to discussing and understanding globalization in relationship to industrialization, political policy, technology, information sharing, and social/cultural impact. Imagine coming away from the retreat with lots of new ideas and perspectives shared, but with very little progress in making meaning of what you heard and saw. Welcome to globalization in the 21st century. Such retreats and their outcomes and resultant feelings of excitement to be living at a time of enormous economic, social, and political change and fear that we will not be able to master the complexity of the current world give a human face to the millions of links that the “Google” search yielded.

Wikipedia, a click away from the “Google” search results, defines globalization as

The increasing interdependence, integration, and interaction among people and Corporations in disparate locations around the world. It is an umbrella term which refers to a complex of economic, trade, social, technological, cultural, and political interrelationships.

The term globalization, within a business context, is generally credited with the publishing of Theodore Levitt's (1983) Harvard Business Review article. Over 20 years later, there is still controversy over the Levitt article. Abdelal (2006) states “Everyone says the article is wrong and everyone reads it 20 years later”. Most agree that many of Levitt's futurist predictions were wrong. However, most agree that Levitt gave business managers a new way of looking at their markets and by provoking them with challenging questions changed the nature of the debate in the business community — then and now. Researchers and other interested observers and commentators such as Hohnen (2005), Robertson (2003), and Sheshabalaya (2006) have identified three waves or rounds of globalization. Large multinational corporations have dominated the shaping of the third wave/round starting after World War II. Prior to the focus on globalization of business enterprises there were two other distinct waves/rounds of globalization.

The First Wave/Round

The first wave takes us back to ancient times, well before the interchange of goods and services between different societies or civilizations. Ideas were the first medium of exchange across such civilizations as China, India, Greece, and Rome. Arabs are generally credited with transferring Indian science, medicine, and literature to the western world. As these civilizations developed the capability to produce goods and services, so did the trading between these vastly different cultures and societies. Hohnen (2005) notes “On the trade front, anthropological evidence suggests that humans have communicated and traded over vast distances for thousands of years. Marco Polo may have been the first Westerner to open a supply chain with China, but he didn't invent the concept”. There was also a darker side to globalization during this wave. Tribal lords, religious leaders, and conquerors often plundered the local resources when needed to stimulate trading. Also cheap or free labor in the form of slaves was often employed to construct buildings, roadways, bridges, aqueducts, and so on. All this took place well before the creation of corporations to carry on the development and trading of goods and services.

The Second Wave/Round

The second wave/round of globalization started during the great colonial period that followed the maritime explorers such as Columbus, Diaz, and da Gama. It was during this period that European nation states created the Chartered Corporation. The Dutch and British East Indies Companies were set up to facilitate the active exchange/trading of goods and services as well as ideas across the known world. Perhaps the most powerful force for change in the second wave was industrialization in the production of goods and services. Also major changes in the transportation system, e.g. steamships followed by major improvements in communications systems such as wireless telegraphy. The formal financial flow of capital was also a major innovation during this wave through the banking systems and treasury concept.

Up until the 19th century there was an equality or equity between China, India, Europe, and America in reaping the benefits of global trade. As the 20th century approached, China's and India's position started to diminish and Europe and America's stared to sharply improve. The latter two have seen large-scale improvements to the health and well being of their citizenry including abundant food supplies, housing and medicines/hospitals, etc. The concepts of freedom, equality, and liberty also started to rise in Europe and America during this period which stimulated efforts of the citizenry to continue innovating ways to increase the trading of goods and services across ever-widening geographic circles. The 21st century is seeing the rapid rise of China's and India's position in the global economy as well as the im...

Table of contents

• Cover Page
• Half Title Page
• Series
• Title Page
• Copyright Page
• Dedication
• Frontmatter
• Contents
• Foreword
• Preface
• Senior Editor’s Preface
• Acknowledgements
• PART 1 The Globalization Of Business
• 1 Enter Globalization
• 2 Challenges in Building Global Organizations
• 3 Strategic Learning and Leading Change
• PART 2 Reinventing Pharma
• 4 Globalizing Pharma — The APC Way
• 5 Globalizing R&D — The APC Way
• 6 Building Global Leadership Capability
• 7 R&D Leads the APC Culture Change
• PART 3 How Global Companies are Reinventing Human Resources
• 8 Reinventing Human Resources
• Epilogue
• Index