Who is More Globalized?
Despite the hype over globalization and suggestions that the top managers of large corporations should come from/be based in emerging economies like India and China, we have only a handful of instances where corporations have done something tangible in this direction.
The notable examples are that of Cisco, IBM, and now Halliburton, though many analysts see Halliburton’s move as more in sync with location selection strategies in the 19th century and less as its need to globalize.
IBM, whose decision to move corporate chief procurement officer John Paterson to Shenzhen in China last August was hailed as a major strategic shift, was anything but a larger strategy of globalization. Paterson himself, in a letter to the suppliers, stated as much.
…this move does not signify a change in our prevailing strategy of building long-term supplier relationships. We are not moving or changing any other aspects of Global Procurement–our business commitments and existing relations remain intact.
Cisco’s announcement of creating a Chief Globalization Officer and entrusting that job to Wim Elfink, head of Cisco Services and one of the top five executives in the company, was the first holistic globalization effort in that sense. Its decision to base him in Bangalore in India meant Cisco was serious.
I, along with two of my colleagues, met Wim earlier this week. After talking to him, I am more convinced that Cisco is likely to succeed in what it has set out to achieve, but I am not sure whether I would unequivocally call that full-fledged “globalization”.
However, for a company of Cisco’s size, that is a giant step in globalizing. Wim will work on clear measurables to drive growth, innovation, and talent from the region. In that sense, he is empowered to do a lot of things in this (I am based in India) part of the world. Within the company, Bangalore is informally called the headquarters of Cisco East, whereas the original San Jose office is now the headquarters of what they call Cisco West. But then, no corporate function has moved here, except Wim’s own — that is services. The functional heads in HR, operations do work with the corporate headquarters.
Wim has measurables on how much talent, revenue, and growth should come from the East. For more details on that, you will have to wait for a story that my colleague Balaka is working on. But it is very clear that he is more of a Chief Easternization Officer than a Chief Globalization Officer. Never mind Wim, the former abbreviation sounds better!
But then I guess, for a listed company of Cisco’s size, there is hardly any other way.
In contrast, look at what a smaller but much older (more than 150 years) company from UK has done. Wisden Group is the publisher of cricket periodicals such as Wisden Cricketer, and Wisden Cricketer’s Almanac, and websites such as cricinfo.com; and some other titles such as the Oldie — yes, it is targeted as the “discerning, old” readers. Started in 1850, it is a company that is fairly proud of its heritage, like many smaller, niche companies.
Around the same time as Cisco and IBM announced their decisions, Wisden took an even more drastic decision. It decided to move its CEO to Bangalore. India, as anyone who has even once been to the country knows, is obsessed with cricket. In the last few years, it has also emerged as the biggest source of advertising revenue in the world cricket. So, despite the fact that Wisden’s maximum revenue still comes from Britain as of today, it clearly recognizes that that equation would change in the future.
In an article, The Economist, quoted Wisden’s CEO, Tom Gleeson.
“If we are seriously saying that the future of the business is in India, then as CEO that’s where I have to be.”
He also told The Economist that a local successor would eventually replace him. If and when that happens, globalization woule really be complete. (See this)I, for one, believe that it is a more sincere approach to globalization than anything that I have seen in the tech industry. Wisden is clearly an unsung hero of proactive globalization.
Reconsider India
The difference between Cisco and Wisden. Cisco can continue its globalization in India. Wisden should reconsider after what happened at the World Cup.