Kevan Hall takes another look at this McKinsey Quarterly article, “The past and future of global organizations” by Wouter Aghina, Aaron De Smet, and Suzanne Heywood. The article reminded him of the days when many (particularly US) organizations had a separate executive managing “international”; these companies were moving from being exporters to having more significant international operations but these were still a small part of the overall business.
The domestic market was dominant and “international” was complex and difficult. The solution was to give another executive responsibility for it so the domestic business could get on as they always did. As the international business grew it became more interesting, sexy and powerful, so now functional leaders wanted to get involved. Gradually each function and business recognized it had an international dimension and so international became integrated into the core structure, the “international” role disappeared or morphed into a regional structure.
An ex-colleague of mine tells the story of when he worked for an organization who used to label its businesses “domestic” or “international”. When international operations overtook the scale of the domestic business he suggested that this language was not appropriate to a global business. His boss suggested calling it “American” and “Non-American”!
Today most large global organizations operate some form of matrix structure integrating global operations and in our clients we see greater and greater levels of connectedness and integration. International is everywhere and “business as usual” is not confined to a specific function or role.
Interestingly, perhaps Digital is the new international. People are not sure where to put it. It kind of had an impact on everything potentially, but it is new and complex and requires different skills. As a result we see a “Head of Digital” role appearing in some organizations. Expect digital to become integrated in all functions in the same way as international.
To find out more about developing truly global management skills and ways of working, why not contact one of our specialists.
Source: “The past and future of global organizations”: by Wouter Aghina, Aaron De Smet, and Suzanne Heywood, published by McKinsey Quarterly, September 2014.
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