The Global-Local Paradox: Unlocking Success Through Consistent Ways of Working

In today's interconnected business world, global organizations face the constant challenge of balancing centralized efficiency with local market relevance. As discussed at the recent WFA CMO Forum in Toronto, all large organizations are grappling with this challenge, seeking the "best" way to organize their ways of working between global and local teams. However, from my perspective: there isn't only one most effective way for a global organization to work - the most powerful thing is for an organization to work one way consistently.

Best Practice 1: Choose a Clear Model and Commit to It

The first and most crucial best practice is to choose a clear model for global-local collaboration and commit to it fully. Whether you opt for a more centralized approach or a decentralized one, consistency is key.

Consider two highly successful yet contrasting examples: Netflix and LEGO.

Netflix, as described in "No Rules Rules: Netflix and the Culture of Reinvention" by Reed Hastings and Erin Meyer, employs a unique "Freedom and Responsibility" culture. Their approach to global expansion involves hiring local experts and giving them substantial autonomy to adapt Netflix's offerings to local markets. This aligns with their philosophy of "lead with context, not control," emphasizing empowerment and trust in local decision-making.

On the other hand, LEGO uses a "Shared Vision" approach, emphasizing a unified global brand while allowing for regional adaptations. Their "One LEGO" philosophy involves a Global Brand Team developing core product lines and marketing concepts, which are then adapted by local teams for different markets.

Both of these models, despite their differences, work because they are consistently applied across their respective organizations.

Best Practice 2: Ensure Clear Communication and Understanding, Driven from the Top

Once a model is chosen, it's crucial to ensure that everyone in the organization understands it clearly and adopts it fully. This adoption must be driven from the top down, especially when implementing a change. Leadership's commitment and consistent modeling of the new ways of working are essential for successful implementation.

In my experience at Sanofi during our integration with Boehringer Ingelheim, we faced significant challenges in getting people to fully adapt to the new ways of working. We had two different previous organizational models to contend with. To address this, we launched our intended ways of working with leadership first, starting with N-1 and N-2 reports to our business unit head before implementing broadly. However, moving from concept to implementation proved challenging, as almost everyone was operating differently. An additional hurdle was integrating new leaders during the change process and ensuring they were fully onboarded to the Sanofi Way.

Clear, consistent communication about the chosen model, its rationale, and its implementation is crucial, but it's not enough on its own. It's important to remember that this isn't a debate - the critical thing is getting everyone on the same page. Leaders must be aware that "I don't understand" is often code for "I don't agree." To truly drive change, leaders at all levels must go beyond communication and actively demonstrate their commitment to the new model through their actions and decisions. This consistent behavior from leadership is what ultimately overcomes resistance and ensures alignment throughout the organization.

Best Practice 3: Balance Scale with Innovation

Even within a consistent model, there's still a delicate balance to strike between creating scale and maintaining innovation. Different organizations achieve this balance in ways that align with their chosen model.

LEGO's approach provides an excellent example of this balance within a more centralized model. While they have a strong global brand and centralized innovation through their "Creative Play Lab," they actively seek input from different regions to ensure global relevance and allow for market-specific innovations. This approach allows LEGO to maintain a consistent global brand while still adapting to local markets and fostering innovation at various levels of the organization.

Netflix, on the other hand, scales within its decentralized model by empowering local teams to make decisions and produce content that can potentially resonate globally. As described in "No Rules Rules," Netflix achieves scale not through centralized control, but through a culture of "freedom and responsibility." They hire the best talent in each market and give them significant autonomy to create content and adapt marketing strategies to local preferences. This approach has led to remarkable successes. For instance, "Squid Game," a South Korean survival drama, became Netflix's most-watched series ever upon its release in 2021, despite being produced entirely in Korean. Similarly, the French mystery thriller "Lupin" became one of Netflix's most-watched non-English series globally, and "Sacred Games," an Indian crime thriller, found popularity far beyond its home country. These examples demonstrate how Netflix's strategy of investing in diverse local content and then leveraging its global platform has turned regional hits into international successes. This model allows Netflix to scale rapidly in diverse markets while maintaining a high level of local relevance and innovation. The company's global scale is built on a foundation of shared values and principles rather than standardized processes, allowing for both consistency in culture and flexibility in execution.

Best Practice 4: Maintain Core Principles While Allowing Controlled Adaptation

While consistency is crucial, successful global organizations recognize the need for controlled adaptation. The key is to identify a small set of core principles that remain rigid, while allowing for flexibility in other areas.

These core principles should be as few as reasonably possible, forming the non-negotiable foundation of the organization's ways of working. By keeping these core principles stable, organizations can maintain consistency in their most important areas while still adapting to changing market conditions.

For example, Netflix maintains its core principle of "freedom and responsibility" across all markets, but allows for significant local adaptation in content creation and marketing strategies.

Organizations can implement this approach by:

1. Clearly defining and communicating the core, non-negotiable principles

2. Regular review cycles to assess adherence to these principles and identify areas for potential adaptation

3. Using data-driven decision making to guide adaptations

4. Creating feedback loops between global and local teams

The goal is to create an organizational culture that values both consistency in core principles and controlled adaptability in other areas. This balance allows global organizations to maintain a coherent way of working while remaining flexible enough to respond to emerging opportunities.

Best Practice 5: Foster a Global Mindset

Fostering a global mindset across the organization is crucial, regardless of the specific model chosen. This involves developing cultural intelligence, encouraging cross-cultural collaboration, and maintaining open communication between global and local teams.

From my personal experience, cross-pollination of global and local roles is invaluable. After working in a local market, joining the global marketing organization enhanced my global leadership skills. Later, as General Manager in Canada, my global experience helped me leverage global support effectively and provide valuable feedback to the global team.

A particular challenge I faced was implementing a new local media partnership created by a global pitch. My global experience was instrumental in ensuring the implementation met local needs while respecting global intentions.

Organizations can foster this global mindset through:

1. Employee rotation programs between global and local offices

2. Cross-cultural training initiatives

3. Creating opportunities for global-local collaboration

4. Encouraging open communication between global and local teams

By cultivating a global mindset, organizations can better implement consistent ways of working while remaining responsive to local market needs.

Conclusion

In the complex world of global organizations, the quest for the perfect balance between global efficiency and local relevance is ongoing. However, as we've explored through these best practices, the key to success lies not in finding a one-size-fits-all solution, but in choosing a clear model and implementing it consistently.

Whether an organization leans towards a more centralized approach like LEGO or a decentralized model like Netflix, the critical factor is alignment and consistency in execution. This doesn't mean rigidity – controlled adaptation within a framework of core principles is essential for long-term success.

Clear communication, driven from the top down, is crucial in ensuring that the chosen model is understood and embraced throughout the organization. Balancing scale with innovation, maintaining core principles while allowing for controlled adaptation, and fostering a global mindset are all vital elements in navigating the global-local paradox.

Ultimately, the most successful global organizations are those that can maintain a consistent approach to their ways of working, while remaining flexible enough to adapt to local market needs and evolving global conditions. By focusing on these best practices, organizations can unlock success in the complex, ever-changing landscape of global business.

References

1. Hastings, R., & Meyer, E. (2020). No Rules Rules: Netflix and the Culture of Reinvention. Penguin Press.

2. World Federation of Advertisers (WFA). (2024). CMO Forum, Toronto.

3. Robertson, D. (2013). Brick by Brick: How LEGO Rewrote the Rules of Innovation and Conquered the Global Toy Industry. Crown Business.

4. Ghemawat, P. (2007). Managing Differences: The Central Challenge of Global Strategy. Harvard Business Review, 85(3), 58-68.

5. Bartlett, C. A., & Ghoshal, S. (2002). Managing Across Borders: The Transnational Solution. Harvard Business School Press.

6. Mallick, M. (2023). Inclusion Reimagined: How Leaders Can Build a Culture of Belonging in a Diverse World. Harvard Business Review Press.