Articles

Although myriad organizational mechanisms exist for integrating geographically dispersed operations, the most effective tool is assembling and nurturing cross-border teams comprised of many nationalities. The resulting diversity can yield significant synergies and produce collective wisdom superior to that of any individual -- each member bringing a unique cognitive lens to the group. However, mastering the management of a global business team calls for confronting several unique challenges that tend to exacerbate the more common problems faced by all teams, point out authors Govindarajan, director of the Center for Global Leadership at Dartmouth College's Tuck School, and Gupta, a professor of strategy and global e-business at the University of Maryland's Robert H. Smith School of Business. Of the 70 global business teams studied by the authors, about one-third of the teams rated their performances as largely unsuccessful. How can companies reverse the generally weak performance of faltering global teams? The authors' survey of 58 senior executives from five U.S. and four European multinational organizations reveals some hard-earned insights that may benefit your cross-border endeavors. When global business teams fail, it is often due to a lack of trust among team members. As a result, executives guiding global teams must institute processes that emphasize the cultivation of trust. Also high on the list of culpable factors are the hindrances to communication caused by geographical, cultural and language differences. Even in the case of teams whose members speak the same language, differences in semantics, accents, tone, pitch and dialects can be impediments. To mitigate the corrosive effects of these cross-cultural impediments, executives are advised to carefully craft a cross-border team's charter, composition and process -- with each aspect equally emphasized. The authors elaborate on how these work holistically to increase the odds that your global business teams will become high-performing sources of invaluable multinational experience leading to competitive advantage.

New research shows that among today’s numerous strategic alliances, the most successful are in companies with a department specifically assigned to overseeing alliances. Management professors Jeffrey H. Dyer, Prashant Kale and Harbir Singh came to that conclusion after conducting an in-depth study of 200 corporations and their 1,572 alliances. The number of strategic alliances has increased dramatically over the past decade, with more than 20,000 reported during the last two years alone. On average, the top 500 global companies each participate in 60 major strategic alliances. Fraught with risk, almost half fail. The authors set out to discover why some companies manage alliances effectively when others fail. They found that organizations such as Hewlett-Packard, Oracle, Eli Lilly & ; Co. and Parke Davis, which excel at generating value from alliances, have a dedicated strategic-alliance function. Companies with a dedicated function were better at solving problems related to the four key alliance-management elements & #8212; knowledge management, external visibility, internal coordination and accountability. A dedicated function, the authors show, acts as a focal point for learning and for leveraging feedback from prior and ongoing alliances. It systematically establishes processes to articulate, document, codify and share alliance know-how. The authors found that one benefit of creating an alliance function was that it compelled companies to create metrics for evaluating the performance of all their alliances. And regular evaluations alerted senior managers to intervene when a particular alliance was struggling. Many companies with dedicated alliance functions report codifying alliance-management knowledge. They create guidelines to help with specific aspects of the alliance life cycle, such as partner selection or alliance negotiation. Some companies establish training programs, both formal ones and informal ones & #8212; such as roundtables that let managers of various alliances share their experience. When done properly, dedicated alliance functions offer internal legitimacy to alliances, assist in setting strategic priorities and draw on resources across the company. That is why, the authors advise, the function cannot be buried within a particular division or be relegated to low-level support within business development.

User innovation communities present a great advantage over manufacturer-centered development systems.

The external environment for innovation is an important driver, and industrial clusters offer special advantages.