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When Global Comes to Town: Four Realities of Strategy Implementation

Global organizations that try to implement corporate-wide change without considering the needs of local and regional managers need a reality check

Global organizations that try to implement corporate-wide change without considering the needs of local and regional managers need a reality check, an SAP executive said Sept. 23, 2010, at Thunderbird School of Global Management.

“Local and regional managers sometimes cringe when ‘global’ comes to town,” said Bruce Mihok, Vice President for SAP’s Global Marketing and Demand Management Strategy group. “The global cadre of experts has come in at times with a rather erudite attitude — being from global and having solutions that they feel, if implemented on a global basis, would drive success throughout the company.” Mihok told an audience of about 200 Thunderbird faculty, staff and students that communication from “up on high” should be more like water coming from a pipe rather than like rain falling from the sky.

Local and regional managers should participate in key decisions that affect their operations.

Mihok said global companies benefit from company-wide initiatives, but corporate leaders must understand at least four realities before they show up at the regional or local level to influence change.

Reality 1: Money
Most funding and resources are controlled at the local and regional levels. Because of this reality, global managers who try to tell people below them on the hierarchy how to spend their money run into resistance.

“Imagine telling a friend how to budget his money or raise his children,” Mihok said. “That’s what it’s like.”

Mihok said a better approach for global managers is to withhold judgment when they arrive and anticipate local and regional concerns. “Come with resources,” Mihok said. “Offer solutions.”

Reality 2: Tunnel Vision
Resourceful managers — especially at the local level — sometimes forget they belong to a global organization. Mihok said they sometimes fall into a trap of “tunnel vision.”

Solutions developed in one country are not shared with other countries, which slows progress and creates inefficiencies. “They don’t talk to each other,” Mihok said. “If you are from global, it is your job to get people talking.”

Reality 3: Data Disparity

Another important reality is the challenge of data disparity. A database of marketing leads in one country, for example, might not match other databases in the same company due to overlapping systems and inconsistent definitions of terms.

“If you are from global,” Mihok said, “don’t assume that the data you have is good.”

Mihok said the key is to develop standardized reporting methods and uniform definitions of terms. He said global companies should run pilot programs to test their data before launching large-scale initiatives.

Companies also need to stay vigilant and view data management as an ongoing task. “The day that you have your data in the condition that you want it, it starts to degrade,” Mihok said.

Reality 4: Lax Governance
Mihok calls corporate governance the “secret sauce” that drives the long-term success of any project. But he said few managers embrace or enjoy the responsibility, which can be a thankless job.

“People have a lot on their plates, and those who may be requested to be a governing resource for a particular project are overcome by the daily events,” Mihok said. “Sometimes the daily business needs overcome the responsibility to govern.”

Mihok said global managers must address these realities without getting caught up in the daily operations at the local or regional level. “Build on generalities rather than exceptions,” he said.