We seem to have reached a point in our flat-world economy where virtually every private-sector CIO is a “global CIO” – a leader whose sphere of influence (and headaches) spans multiple continents.
The global CIO’s most common associated challenge, according to CIO Executive Council members, is managing global virtual teams. The Council’s European members, representing Royal Dutch Shell, Galderma, Olympus and other companies, commissioned a globalization playbook that collects and codifies best practices in this and other globalization challenges. Some of the findings to emerge are presented here.
In an ideal world, HR policies across the global IT team should have consistency, fairness and responsiveness. Titles and reporting structure (if not compensation) should be equalized. But as Jay Crotts, CIO of Royal Dutch Shell Lubricants points out, “The world may be flat, but HR terms and conditions are not.” Global consistency must allow for and be aligned with local laws and cultural norms. This is very difficult given the variation of work culture and organization structures and standards in each country. In addition, the cost of living varies considerably by region. So from an HR standpoint, a “one-size fits all” model is unlikely. Besides the struggle for consistency, CIOs also must find ways for remote teams to have responsive direct management and to keep their far-flung staff connected to the heart of the business.
Obtain local HR expertise.
Companies must have a local HR person in each country staff to deal with the local laws. “It is essential to have local HR expertise and knowledge. Hiring, firing and training obligations are some actions that must be managed very differently in each location; you need someone with local expertise on the laws and processes,” says Michael Pilkington, former CIO of Euroclear SA/NV.
Create job grade consistency across regions by applying a model.
Euroclear is moving toward a job evaluation methodology from The Hay Group, an HR consulting organization. Pilkington explains that the model organizes job types into vertical categories, such as managing people/process, product development, business support and project management. This provides an objective basis for comparing and managing roles and people across locations. For instance, a manager of 100 people may appear much more important to an organization than a single contributor. But if that single contributor’s horizontal grade (in terms of impact on the company) is very high because of a specialized expertise, he or she is equally valuable. Grade level is not the same thing as a title; people’s titles are much more subject to local conventions.
Manage dispersed staff as portfolio teams.
ON Semiconductor has IT staff that support sales residing in Slovakia, where ON has a factory; in Hong Kong, where ON has a major sales office; in Shenzhen, where a customer service centre is located; and in Kuala Lumpur at its regional development centre. ON overcomes the potential disconnect between the various locations by having a single sales IT portfolio owner, based at headquarters in Phoenix, Arizona, who sets the objectives and distributes the work to the members of that portfolio team no matter where they reside, explains CIO David Wagner. The same portfolio technique can work with IT staff dedicated to manufacturing, HR, finance and other global corporate functions.
Make the work meaningful for local IT teams.
To keep morale up and turnover down, be sure that each remote location contributes to important projects. Don’t just send remote IT workers a steady diet of maintenance. Otherwise you run the risk of alienating them, causing them to feel a lack of purpose and putting them in a subservient relationship to Group HQ. Pilkington suggests building a centre of excellence in each remote location. “By making each location a service provider for the enterprise, you mitigate the risk of that location feeling disconnected and underappreciated, he says. “Equally, ensuring that you have senior management presence in each location is a critical success factor.”
Clearly defining the roles of remote groups can also help underscore the meaning of their work. Knowing what their roles are within the larger picture, and what they can expect from others, “creates a sense of identity and purpose,” says Nariman Karimi, who is now senior VP and CIO of DHL Asia Pacific, based in Singapore.
Bring remote staff to headquarters and rotate their locations.
ON Semiconductor brings its foreign-based employees to the US to work on key initiatives and interact with other business units at corporate headquarters. “This may not be a monetary reward, but in many cultures it represents an endorsement and source of pride,” says Wagner. Motorola’s IT employee development program also rotates IT staff, specifically into broader roles that reach outside of their local site. The rotations vary in length depending on project type. Motorola will also have leaders from functional areas and locations manage programs based in different locations and functions, thus providing broader access to company knowledge and expertise.
Foster communication across regional boundaries.
Video conferencing is an obvious tool to enhance global team communication. But it’s important for cohesiveness and relationship-building to have in-person meetings as well. DHL’s Karimi, together with the regional board members, visits one of the top 10 sites around the Asia Pacific region each month; each gets at least one personal visit a year. The visits start with a formal agenda on overall business performance, including time for the local unit to showcase an aspect of themselves and their business. But there is also unstructured time for informal and personal interaction, Karimi notes. Companywide, leaders also hold regional conferences twice a year, and a global conference takes place once a year.
Promote cultural understanding.
The cultural differences among different locations and teams can create many obstacles. CIOs combat this with cross-cultural awareness and sensitivity training. Euroclear conducts a three-day training program, facilitated by an external firm, designed to address cultural differences and create a common understanding of the group’s mission and high-level strategy.