As Diversity Goes Global
While we might like to think the axis of the world falls somewhere between New York's Times Square and Los Angeles' Rodeo Drive, the center of the world has shifted. A recent New York Times article (Claudia Deutsch, 2/14/08) confirms that top American companies are generating larger and larger percentages of their sales offshore. According to Deutsch: "Last year, for the first time, General Electric's overseas revenue surpassed domestic sales. But more important, overseas sales are growing even though the slowing American economy is damping sales back home."
IBM has reached 65 percent of offshore sales, United Technologies' offshore sales—including UT goods produced overseas—are at 60 percent; even General Motors has surpassed 50 percent.
Moreover, many companies are not simply tapping overseas markets; their operations are moving overseas. For instance, General Electric has moved 6 business units to other countries since 2004.
Cultivating international markets, with diverse cultures, habits and languages, has become a new pipeline for corporate growth. There are obvious side benefits—learning to market globally can produce marketing advantages within the diverse United States population as well.
With the line between international and domestic business blurring, global diversity, with its accompanying challenges, is an emerging reality.
Global Diversity Challenges:
When large numbers of employees live and work outside the United States, traditional American management models become less effective. Leaders need to develop new management models to fit a globally diverse workforce.
Deeply imbedded cultural attitudes in non-U.S. countries may not align with the Human Resource goals and programs of U.S. companies. For example, South Korean managers and employees may not willingly accept the training programs offered to South Korean female workers. Reconciling these cultural differences will be important.
The one-way direction of U.S. executives being assigned to operations outside the country will need to change. Tapping the cultural knowledge, education and management skills of non-U.S. executives for U.S. units may be well advised, especially when entering new, diverse markets both within the United States and abroad.
Language, culture and diversity skills training will need to reach many more employees and go beyond superficial exposure. Cross-cultural acumen and just-in-time assistance with cross-cultural situations will demand high-tech access to global diversity resources.
If American companies grow into international markets while expanding their U.S. market positions, global diversity will be an essential business strategy. Perhaps in seeing beyond our own American ethnocentricity, we also will learn to respect and value differences—and do good business everywhere. In the meantime, there is some important "homework" to be done.