What Does It Mean to Be Global?

Being – or becoming – a global company is a complicated, long-term undertaking. It’s a challenge, but increasingly necessary for organizations that want to compete and prosper in a business environment marked by continuing globalization.

In an article recently published in Ethisphere Magazine, I looked at our recent history at JLL, plus my own career experience, to discuss what it means to be a truly global company and what is needed to become one. 

What does being global mean?

It’s easy to tell a purely locally-focused company from a global company, but what is the difference between international and global companies? Planting flags around the world creates international companies. Global means linking the pieces together with common standards, systems, policies, and processes. It means having a common culture that recognizes and willingly accommodates the different aspects of local business.

Why be global?

Consider five broad motivations, not in order of importance:

Strategy: Pursuing the objective conviction that your brand, service or product has relevance and competitive advantage that is desired – and therefore will be valued – by an international audience.

Growth: Gaining disciplined and consistent access to new growth, particularly in developing markets.

People: Integrating value from the diverse skills and experiences of people from around the world.

Customer/Client Service:  Serving customers and clients who will buy, and pay premiums for, your products or services, and who are confident that they will have the same experience with your firm in Istanbul as in New York or Singapore.

Costs: Achieving powerful economies of scale on a world scale, or accessing lower cost bases for your products or services.

The path to a global business

Through the years, we’ve grown JLL significantly by gradual organic development. It’s relatively safe, and it offers the best chance of maintaining a common culture across the organization.

We’ve also grown confidently in mature markets through strategic mergers and acquisitions. That requires the capital, and more particularly, the international management depth to manage a successful integration. And you need to make sure that you don’t just buy something and move on. After all, most acquisitions fail, and the good ones reflect detailed planning and a high-touch approach to managing through inevitable issues.

Developing a Global Operating Platform: finding the balance between top-down and bottom-up management

To operate a truly global business, management needs to find a balance between top-down centralized control and bottom-up decentralized execution, balancing the tension between a global standard and local delivery authority. A basic rule is that you get discipline, scale economies and best-practice transfer from central influence. But you get commercial agility, flexibility, innovation and entrepreneurial behavior by granting local autonomy, so you don’t miss opportunities flying beneath your global radar.

Mastering the hard and soft skills

Another aspect you need to rethink to globalize your business platform is how to master the different skills that your organization needs to sustain itself and thrive. These include “hard” skills – which relate primarily to systems and processes – and “soft” skills, which comprise a range of cultural issues.

Hard areas include local fiscal systems and accounting rules. Websites and social media outlets have to be kept current in multiple languages. Data, information and analytics increasingly need global alignment. Branding and product nomenclature must be uniform. And the regulatory and compliance work you must do to run your business safely is different in different jurisdictions.

More difficult still is adopting and adapting a range of softer skills. If you want to be effective outside your native culture, you need to be sensitive to other cultures. Your company culture also needs to be inclusive. Being successful globally is about being a broad church, accommodating all nations as equals so all can be successful.

At the same time, you need to operate your standards of ethics to the highest level, not the lowest common denominator.  If discrimination against gender or race is tolerated and not illegal in a country, that does not make it acceptable in your local office.

Managing enterprise risk globally

Any organization needs to manage the risks inherent in its business, starting at home. When you go overseas, operational risk can often be handled by re-tooling your home country processes: from food- and factory-safety standards, to pollution limits and contract risk. It isn’t easy, but you can often adapt and apply your existing risk management processes.

We have measures that say JLL has become better at this even as we have gone global. We’ve made the World’s Most Ethical List for eight years in a row. We’ve seen our professional indemnity insurance premiums drop 75% as a percentage of revenue. We realize, however, that global risk management is about constant and ongoing reinforcement, and anticipating where the next landmine is buried.

Becoming a global company is clearly a challenge. But the potential benefits of increasing growth and competitive advantage, tapping the diverse skills and experience of talented people around the world, and meeting client needs wherever they arise can more than repay the effort.

Click here for the full version of ‘Doing Business Globally’.