Global Leadership Skills: Positioning Your Company for Export Success

By G. Alfred Kennedy and Michael B. Kennedy


You have read the previous articles and your interest in taking your company global has been stimulated. You have done the due diligence and have determined that globalization "fits" within your operational capability and your long-range vision of yours as a world-class company. How then do you introduce this change in direction, this global concept to your employees? How will they become oriented to think in global terms? How will your corporate "culture" affect your ability to thrive in an international arena... at least in your target country?

To answer these and many other questions related to how your business plan can be successful, both at home and abroad, you will find that a comprehensive international human resources plan becomes an indispensable management tool. Your plan contemplates the successful inclusion of human resources, both domestically and internationally, in the development and implementation of your international business strategies.

In establishing your international management team, your Human Resources (HR) executive is invaluable. He/she can address such important issues as the type of corporate structure that should be established, the administration associated with registering your overseas operations, the immigration regulations that will obtain, staffing expenses (to include benefits and compensation rules of the host country), required staffing ratio of local nationals (in target market) to foreigners (Americans) and many other critical issues.

Your HR must be a good business partner — whether it is opening a sales office or an R&D facility, or obtaining an acquisition or establishing a joint venture — this is central. HR must understand the company's international business goals and communicate frequently with business leaders both domestically and in your target market to ensure it is meeting your company's objectives. Understanding the underlying business needs will help drive the way HR should design the compensation and benefits structure, identify the employee-relations' issues and determine which individuals might be best suited for the international operation. They, too, must blend in culturally.

HR global managers also need to do their homework so they can develop processes that will lead to compensation and relocation packages that are equitable and fair to all expatriates — not only American expatriates. Think about your program globally and what you will need as you achieve success and grow. You will want to establish procedures that have a global perspective, that do not address expatriates as an anomaly, but that set a precedent for future assignees. Some global HR managers have said that staffing and HR issues internationally are tenfold more complicated than domestically, and it takes that much extra effort to accomplish the job.

Preparation Begins at Home: Developing a Global Mindset
Your HR should already be reporting directly to you and should be fluent in the language of your corporate vision, goals, structure, operations, budget, and profit orientation. If your HR executive does not have international experience, he/she should identify and enlist the assistance of an international HR team of consultants who are well experienced in conducting business in your target country.

The first and, by far, the most important charter of your international HR plan is to prepare your management staff to communicate the vision of yours as a world-class company to your employees. The level of preparedness of your management team will determine the success or failure of your international venture.

The goal of your management team will become to facilitate change management. They must be prepared to communicate your vision of world-class competition in a clear, simple manner that is easy to express orally. Help them to prepare people to adapt to change through communication and a well-developed education plan. Plan to provide employees with as much information as possible and seek their input regarding change implementation. Ensure that they understand that export-related processes and functions are to be integrated into your domestic production function, not an isolated activity. The changes associated with your global expansion should be represented to employees as needed to establish a new standard of world-class quality.

Anticipate the time and effort required to complete the integration of change
It is best to communicate with small work or task groups so individuals can respond and provide feedback to managers about the proposed changes. Be prepared to allocate the time necessary for employees to refocus on their new tasks or on changes in how they will perform their existing tasks. The investment of this time and effort in communicating the integration of change to your managers and work force will pay significant dividends as your company transitions into global status. Again, it is important that your employees understand new business directions and the role they will be asked to play to achieve new goals.

Corporate culture
Your corporate culture, to be advantageous to your company, must be an outgrowth of a well-conceived global plan. "From a human resources point of view, it's critical that the company have a clearly articulated business strategy that spells out why it wants to become more international, what it's trying to achieve, and how it plans to harness senior-level commitment," says Dale E. Smith, an independent HR consultant located in Wilmington, North Carolina, who specializes in helping organizations develop global strategic plans.

First, you must have a clear mission and vision statement. Then, you need to understand the global environment or the specific region in which you are attempting to do business — it's history, economies, political situations, and cultures.

"Define what globalization means and how you're going to approach it," Smith says.

Next, HR professionals must identify the key human resources concerns that will support those strategies. Interview managers and customers, analyze data on the work force, and relate external changes in the areas of the world into which you are planning to move specifically to the business plan.

For example, if the business strategy is growth, your company needs sufficient management talent to support international growth. If there are enough managers for this, the next questions are, do they have a global perspective? Second, are they motivated to work in an international environment?

External Awareness
Logically, the next major project in your global expansion strategy is the acquisition of cultural awareness. Once carefully selected, your international management representatives must learn the culture of your target country, especially those cultural aspects that differ from the rest of the world. Remind them not to assume that the international corporate culture is the same as the one at headquarters. For example, your company may have the style of getting right down to business. Often, especially in Asian cultures, it is customary to establish a personal relationship before conducting business. People of Asian cultures prefer to take time to get to know each other before diving into business discussions. It is also important to avoid making negative comments (even in jest) about any custom or practice that is different from our own, even if one disagrees with or finds the customs offensive. Comparing customs or bragging about elements of American culture is also considered rude. Business styles are, in large measure, dictated by cultural norms. Thus, time and effort invested in learning the culture of your target country will provide the greatest payoff when attempting to establish that all-important rapport with your new business partners.

Learning the language of your target country, while important, is far less critical in the development of a productive relationship with your new business partners than is knowledge of their culture. In fact, many of the business associates with whom you may interact may speak English at some level. However, those who can are not likely to understand many of the colloquialisms, jargon and metaphors so often found in "American English." For example: "This is the meat and potatoes of our business". "It's a dog-eat-dog world." Or, "this is where the rubber meets the road."

These are phrases that simply do not translate and should be avoided when attempting to communicate with foreign counterparts — unless you have specific knowledge that they are familiar with American colloquialisms. Many foreigners are educated in the United States. Similarly, phrases that tend to obfuscate your point should also be avoided. For example, suppose you were concerned about including a clause in your contract negotiations that protected you in the event your new business partners reneged on some element of the contract. If you describe such situations as "ramifications of contract termination indemnification obligation" you may well not make your point. Consider the challenges faced by your international counterparts when, in their dealings with us, they encounter this business language construction in a language foreign to them.

Whether you are speaking to your counterparts directly or through an interpreter, the most important adjustment that needs to be made in cross-cultural interaction involves a conscientious effort o ensure that your communications — verbal, written, or visual — are as clear and easy to understand as possible. All it takes is a flexible attitude on your part and a little effort to ensure we relay information at a level appropriate for the other party. This sounds simple, but there is a fine line between making yourself understood and appearing to be condescending. Here are a few more hints that may help to enhance your effectiveness when communicating across the language barrier with international associates: Do not judge intelligence on English fluency. Just because your foreign counterparts may not speak English perfectly does not mean they are not highly qualified, capable, and intelligent. On the contrary, remember who is making the effort to be multilingual.

Be understood This involves more than simple yes-or-no questions. You usually will not get an accurate answer just by asking people if they understand. It can be embarrassing or culturally unacceptable to admit a lack of understanding. Do not repeat yourself unnecessarily, but rephrase important concepts and, when appropriate, do some checking to see if the information is being received correctly.

Understand the nuances of nonverbal communication.
In the United States, we are taught to look someone directly in the eye when speaking. In some Asian cultures, for example, you look away to show respect. Also, when talking to someone, be aware that your proximity to the person is dictated by custom.

The challenge of global relationships certainly is not limited to linguistic sensitivity, but this is a good place to start. And the first step in making this happen requires a little modification to the way we interact in our own language. Effort in this direction "help make the rice bowl a little fuller."

Once you have successfully installed your "persons on the ground" in the target country and completed all the dialogue and contract negotiations necessary to begin business, you may well find that establishing at least a small office in your target country is essential to maintaining positive, ongoing business relationships with your new business partners. As has been previously discussed, your products and/or services do not speak for themselves. People must represent them and they must be adapted to blend in with the culture of your export market. One of the important roles these "expatriates" are going to play is acting as liaison and helping interpret information back and forth to help your company channel its energies in the right direction....in a timely manner. As your representatives, these staff will respond to questions, receive complaints, provide consultation, exercise warranties, negotiate contract modifications and, hopefully, foster business expansion.

As you, the small and medium sized enterprise look outside your home base to increase sales, your challenges multiply along with your revenues. Human resources professionals within your companies who staff and support the business team are the ones who help ensure an international win. Creating solid structures, processes and programs that are built on the groundwork of responsiveness and communication will help to sustain growth and allow you to reach your goal of becoming a world-class company.



G. Alfred Kennedy is an international consultant and retired senior Foreign Service officer with the US Department of State. He was the US Consul General in Toronto, Canada (1993-1996), a Senior Advisor to former Commerce Secretary Ronald H. Brown, and a Deputy Assistant Secretary of State with the US Department of State in Washington, DC Mr. Kennedy has lived and worked in Europe, north and Southeast Asia, and Canada specializing in trade promotion, communications and public affairs. Currently, he is a partner and owner of Source International, Inc., an international consulting firm in the Washington, DC area. Web site: www.sourceinternationalinc.com. He is a contributing editor of The Black Business Journal.

Michael B. Kennedy is Director of Human Resources for a large nonprofit organization in Southern California. He has lived and worked in Japan and the Pacific Rim for extended periods and has an extensive background in human resource management, financial analysis, and business development.