Thursday, September 27, 2007

The Global Mindset as a New Managerial Paradigm

Here is a good summary of why a global mindset is important for today's manager. It is from the Babson College website and refers to the book "Managing with a Global Mindset" by Jean-Pierre Jeannet.

Managers can be categorized into different type of mandates, ranging from domestic to international, regional, and multi-domestic. Each of these mindsets represents a particular point of view and is the result of different type of experiences. For the new emerging competition in the globalizing economy, the old mindsets will not suffice and a global mind will become necessary. But first, let us look at how managerial mindsets progressed over time.

The domestic mindset is characterized by a reliance on one market as the key reference and is the mindset most managers are born with. Domestic mindsets rely on a single reference point, their domestic markets, for judgments. For successful managers, who need to act in a globalizing economy, working with a domestic mindset tends to limit the point of view.

Representing the next level up is the international mindset characterized by one or few experiences in another country. The international mindset might come with different levels of international experience, ranging from casual international exposure through travel all the way to extensive foreign stay resulting in a capacity to integrate in a foreign country or environment. The international mindset, with a limited, but in-depth exposure, is, however, not identical to the more extensive global mindset.

A manager with extensive regional experience, such as throughout Latin America, or across Europe, may possess a regional mindset. The regional mindset is of interest because it includes experiences across a score of countries. Still further up the scale is the multinational mindset typical of executives who have been on successive international assignments in different countries. Although representing the backbone of the executive pool of many of our largest multinational firms today, executives with multinational mindsets are still not necessarily possessing true global mindsets.

The global mindset is defined, for the purpose of the book, as a state of mind able to understand a business, an industry sector, or a particular market on a global basis. The executive with a global mindset has the ability to see across multiple territories and focuses on commonalities across many markets rather than emphasizing the differences among countries. Companies which find themselves engulfed by extensive global pressures will need to acquire a large pool of executives who possess a global mindset and who are able to view business opportunities from a global perspective. Part of this global mindset is an entire set of new and different analytical tools that would not be needed by the previous domestic or multinational mindset. New strategies, resulting from responding to new market opportunities, are another part of this toolkit.

This global perspective differs substantially from the more traditional single-country, or domestic, and multinational perspective so much more typical today.

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