New Game, New Rules: Developing Managers for a Competitive World
Gaining competitive advantage in the 21st century will be a very different game than it has been in the past, as companies confront issues from the rapid-fire expansion of the service-based economy to the impact of deregulation and globalization. In this interview about HBS Executive Education's Program for Global Leadership, Professor Christopher Bartlett discusses the challenges facing managers in today's global environment.
Editor's Note— The Program for Global Leadership assembles senior executives from organizations worldwide who participate and interact in a unique, multi-phased educational process. The program's unusual structure helps them to gain fresh insight about the forces of economic transformation affecting industries and organizations, strategic planning, and operations management as we have come to know them.
Q: How are fundamental changes occurring in the global business environment driving change at the organizational level?
A: These are turbulent times for business as many companies struggle to adjust to a diverse set of changes simultaneously. The globalization of markets and competition, the rapid maturation of the information age, the expansion of the service-based economy, the impact of deregulation and privatization, the explosion of the knowledge revolution—these forces are driving companies to fundamentally rethink their business models and radically transform their organizational capabilities.
The implications for organizations and management are profound. Let's take one example. At the heart of most modern corporations are information, planning and control systems, and processes that are designed to help management make sound strategic choices and ensure efficient implementation of those decisions. They do this by allocating scarce capital resources to the best opportunities, then measuring and controlling performance against projections.
But, what if the assumptions behind that management philosophy are flawed? What if intellectual capital rather than financial capital was the scarce resource, as it is in many companies today? Unlike financial resources, an organization's vital information, knowledge, and expertise cannot be hauled to top management levels for reallocation across competing needs. These reside deep within the organization, and therefore must be developed and leveraged through processes completely foreign to the vertical, control-based management approaches that proved all powerful in earlier times.
This, in turn, has changed the motivation for global expansion. No longer will access to incremental markets be the primary expansion driver; increasingly the drive must be to capture scarce sources of intellectual and human capital—strategic resources that can provide sustainable competitive advantage in the 21st century. It's a very different game, strategically and organizationally.
Q: What impact do these changes in the marketplace and organization have on the roles of today's managers?
A: The seemingly endless waves of restructuring, downsizing, reengineering, de-layering, empowerment, and organizational learning we read about are simply the symptoms of a fundamental revolution occurring in companies worldwide. In the organizational transformation we are witnessing, the roles and responsibilities of managers—from senior levels to the frontlines—are undergoing radical change, as well.
Frontline managers play a vital role in knowledge-driven strategy—they are the first to learn of changing customer needs, first to see competitors' marketing strategies in action, and first to encounter new regulatory initiatives. Top management increasingly relies on the ability of its geographically and organizationally dispersed managers to sense, adapt, and respond rapidly whenever necessary. As information technology escalates the pace and complexity of business everywhere, managers can ill afford to operate according to the bureaucratic dictates of the past. As organizations become increasingly flexible, dynamic, adaptive, and organic, managers at all levels must be more willing to undertake lifelong learning and behavior modification to remain abreast of leading-edge thinking and practice.
Q: How does the unique structure of PGL advance the learning process?
A: The structure of PGL is unusual in that it comprises three distinct modules that stretch across the globe while also linking the classroom and workplace. Held offshore, the program's introductory module directly immerses participants in the challenges that foreign markets and cultural environments present. The subsequent module utilizes the concept of "distance learning" wherein managers work in cross-border teams to resolve a variety of complex, international, management problems. The challenges they encounter are much like those of the "virtual" teams at the heart of effective global organizations today. A final module at HBS emphasizes the development of dynamic leadership skills and instilling a true global perspective.
PGL has been framed using multiple units and levels of analysis. At the most macro level, we address the broad and constantly changing context within which companies must operate. Another level explores how companies compete in diverse industries amid varying social, political, and economic forces. And finally, we look inside the company itself, examining what organizations must do to remain competitive in world markets—what capabilities and management competencies they must develop. We recognize that external competitive strategy and internal organizational capability are both critical sources of sustainable competitive advantage.
Q: To what extent does the diversity of PGL's participants add to the experience?
A: The diversity factor is a major contributor to the learning experience. But, it reaches further yet. Today, many companies are turning inward. Consequently, there's little that's more powerful than stepping beyond your own industry and questioning conventional wisdom by gaining exposure to people from other industries, geographies, and disciplines. The Program expedites such cross-fertilization through its carefully structured living groups, work teams, and discussion forums that facilitate communications at many levels. Past PGL participants say they've built networks of lifelong friends and professional relationships while adding to their individual skills and competencies.
Q: Why is the Program conducted in such geographically diverse settings?
A: The best answer to that is that the medium is the message. Tremendous learning occurs just from being immersed suddenly in an entirely different world. Remote settings also enable us to draw directly from extremely diverse environments so participants sense firsthand the types of difficulties they're likely to confront when operating and marketing among divergent economies. The upcoming PGL launches a series of HBS initiatives in the Asia-Pacific region and other parts of the globe that reflect our commitment to draw from the real-life experience of industry leaders worldwide, and to integrate that learning in a way that advances the educational experience we offer through this and many of our other programs.
Q: What managerial groups are likely to benefit most from PGL?
A: The program is specifically designed to advance the management knowledge and leadership skills of senior level executives, particularly those on a general management track. Others who may presently be technical or functional specialists, but are preparing to assume broader general management roles also stand to gain considerably from it. Whether they come from large established multinationals or smaller companies expanding rapidly into overseas markets, it is imperative that participants and their sponsoring organizations view themselves as active participants in a competitive, global business environment.
In closing, Bartlett explains, "PGL breaks from traditional, compartmentalized learning not only by assisting managers in developing new skills and competencies, but also by helping them integrate their newfound experience and learning in addressing specific needs within their respective organizations."
For more information about the Program for Global Leadership: Developing Managers for a Competitive World, please click here.