Everywhere you look today, there are reports that the country is now in an economic slow down or as some speculate - a recession. No matter how it is viewed, organizations are taking a hard look at their global operations as economies around the world begin to slow down. What does this mean for human resources leadership and your organization?

-  Reduce capital expenditures?
-  Forego a proposed joint venture or organizational restructuring?

The list of options could be endless. Nevertheless, without strong global leadership aligned to stated business objectives; your organization could experience a reduction in profitability, which could result in stifled growth.

Given the challenges of rapidly changing economies, human resources leadership is needed to ensure that global leadership competencies are in place to manage current and future business challenges. The focus of this article is to examine one of the five factors (Thinking Globally) described in Goldberg, Marshall et al (2003), "Global Dimensions, in addition:

-  Outline how organizations can help leaders think globally in a logical and pragmatic manner
-  Tips to drive change in thinking globally.


What Does it Mean to Think Globally?

Thinking globally requires an integrated approach to changing the paradigm to thinking globally in your organization. It is not as simple as reading the newspaper or watching the news. It begins with senior leadership partnered with human resource leadership to drive this paradigm change, so that leaders can:

- Understand economies of scale and the impact that economies, e.g., the U.S. can have on the cost of capital, resources, and business arrangements.

- Understand how the cost of capital impacts your capital expenditures on a global scale, especially if the organization or a specific business unit is involved in creating a green field site or looking to retool an existing brown field site.

- Understand that the war for talent and retention are impacting one of your largest expenses, labor. If labor conditions impact your global operations what steps are you going to take to ensure that the availability of skilled and talented labor is available to continue business operations?

- Understand your organizations products may not be as competitive as first thought as global pressures grow. How are you going to create and sustain competitive pricing of your products?

-  View your business strategy in the context of dimensions of value, product or service differentiation and specialization while still maintaining a competitive advantage.

- Understand that your competition is actively seeking ways through various methods of business intelligence to beat you to market. Are you leveraging the available public and private intelligence to keep your edge?

- Understand that your organization is embedded with individuals who can provide you with ways that help you think globally. Tap into that this vast internal knowledge to help you as a leader in becoming better prepared for those global challenges. Understand that your global workforce consists of a variety of the diverse thoughts, ideas, and experiences that can provide insight as you operate in the various countries around the globe.

- Understand the politics and business practices where you conduct business. Consider whether there are obstacles to overcome to achieve your stated business outcomes in a specific country. Look at best practices from others who have come before you to determine if this is aligned with the organization's business strategy for growth.

Being a global leader requires a good grasp of the world events, reacting to political unrest in countries of operation, understanding the impact on the environment, compliance with country specific laws and regulations, and how to lead a global workforce to drive organizational capability and efficiency.

It is not imperative that you become an economist or a financial expert instead; global leaders need to become grounded in those areas that impact the organizations' global business interest in order to maximize profits. In contrast, not being prepared to manage these challenges as a global leader could create a climate of questionable leadership and a waste of company investment in development as discussed in Roper, G. (2008).

In that article, research showed that organizations with annual revenues of $10bn dollars, making a 2% learning and development investment could squander $100MM dollars which can never be recovered, because the investment in development is not leveraged by the organization.


How to Measure Thinking Globally

The old adage goes, "what gets measured, gets done. In developing your global competency of thinking globally, there are a couple of metrics that human resource professionals can use to align this competency with the stated business objectives for the organization.

- Revenue per Full-time Employees-This measures the contributions of an engaged workforce in any business. This metrics provides the organization with a baseline of how well global leadership competency of thinking globally is working to drive business results. It will let the organization know if their global leaders are optimizing the global workforce efficiently. (Revenue/FTE)

- Profit per Full-time employee-This measure also determines the contributions of your global workforce, because organizations that produce a product or service are measured by their profitability. Organizations want good global leaders to consistently improve the profit outcomes for its shareholders. (Profit/FTE)

- Modified Internal Rate of Return-This measure allows you to find out how well your capital is being used for global projects, which require a global perspective of where to spend the capital for growth. In other words, it is a financial measure used to determine the attractiveness of an investment, either people or equipment.

These three metrics are just are a few that will help human resources professionals begin the dialogue with their leaders on how well they are thinking globally. Human resources professionals need to understand strategically how to challenge the thought process to help leaders grow. Thinking globally is something that requires a great deal of work, however the returns of having a better understanding of the different challenges will help make decision-making easier when considering new business opportunities.


Tips for Driving Change in How to Get Your Leaders to Think Globally

- Provide your leaders with mentors in the organization who have thinking globally as part of their DNA.

- Make thinking globally a critical component of a leader's individual development plan.

- Provide an opportunity for your leaders to work on or lead international projects, if possible. Being exposed to new cultures, diverse thoughts, and new environments helps drive this change in thinking.

- Make thinking globally a part of your weekly staff meeting, by asking leaders of your team to speak about the global perspective of their business and challenges they see.

- Provide an expatriate assignment.

- Provide courses or other resources that consistently provide opportunities to practice strategic global thinking. Send leaders to conferences and or seminars where thought and global leaders are presenting material that will help them get fully anchored in the paradigm of thinking globally.

- Work on global communications by understanding how to craft messages that convey your thoughts, while keeping cultural differences in mind.


Conclusion

As organizations grapple with the challenges presented by globalization, those organizations that are destined to be players for years to come understand the importance of having their leaders think globally and develop this competency. Thinking globally is not only for the U.S. executive, but for any leader who is a part of a global organization to think, act, and do what is right for the organization based on their strength in this competency.

This is not a program, but one of the ways human resources professionals can help develop leadership to think globally. Human resources professionals who have not taken this leadership development component and aligned it with senior leadership need to champion this aspect of leadership development. It is the responsibility of human resources professionals as a strategic business partner to drive this agenda of change, so that it is fully aligned with the organizations strategic direction. Proactive human resources leadership can be the game changer, through developing this competency for your organization.