11:02 AM Friday February 17, 2012
by Bill George | Comments^[2]

The realities of globalization, with increasing emphasis on emerging markets, present corporate leaders with enormous challenges in developing the leaders required to run global organizations. Too many multinational companies — particularly Japanese, Indian, German, and some American ones — still concentrate vital decisions in the hands of a small group of trusted leaders from their home country. They hire technical specialists, local experts, and country managers from emerging markets but rarely promote them to corporate positions. Instead, they groom future global leaders from the headquarters nation by sending them on overseas appointments.

This approach worked relatively well for companies selling standard products in developed markets, but as multinationals transition into truly global organizations relying on emerging markets for growth, it’s far from adequate. In order to adapt to local cultures and market needs, companies must shift to decentralized, collaborative decision-making. That requires developing many leaders capable of working anywhere.

To address these needs, new approaches for developing global leaders are required:

• The diversity of top leadership should reflect the diversity of the firm’s customers.
• Global leaders must be effective in aligning employees around the company’s mission and values, empowering people to lead, and collaborating horizontally rather than managing vertically.
• Rather than concentrating on the on the top 50 leaders, global companies need to develop hundreds, even thousands, of leaders comfortable operating in a variety of cultures.
• Developing global leaders with cultural sensitivities and collaborative skills requires greater focus on emotional intelligence, self-awareness, and empowerment than on traditional management skills.

To understand these approaches, let’s examine what leading global companies are doing:

Create diversity among senior leadership. To make sound decisions, companies need a diverse set of leaders who have deep understanding of their local customers, especially those in emerging markets. Opportunities at the highest levels, including C-suite and CEO, must be open to people of all national origins. Atlanta-based Coca-Cola is a pioneer in geographic diversity. As early as the 1960s, the company was run by South African Paul Austin. Since that time, Coca-Cola has had Cuban, Australian, and Irish CEOs, leading to today’s CEO, Turkish-American Muhtar Kent.

Over the past decade two Swiss companies, Nestle and Novartis, have made dramatic shifts from Swiss-dominated boards and executive leadership to a diverse set of nationalities. Both now have non-Swiss majorities on their boards and several business units based outside Switzerland. Nestle’s executive board represents ten different nationalities, while 80% of Novartis executives come from outside Switzerland.

Focus on values, not hierarchy. The characteristics of successful global leaders today are quite different than traditional hierarchical managers. They need high levels of emotional intelligence and self-awareness to unite people of different cultures, many who are new to the enterprise, around the organization’s mission and its values and empower them to make decisions without waiting for higher-level directions.

Samuel Palmisano, IBM’s chairman and former CEO, recognized that IBM’s traditional hierarchical structure would not be effective in the 21st century because it was dominated by product and market silos. In 2003 he reorganized the company into an “integrated global enterprise^[3]” based on leading by values and collaboration, and uses special bonuses to empower leaders to extend IBM’s culture globally.

Broaden the reach of leadership development. Collaborative organizations like IBM’s require far more leaders than the traditional focus on a select group of top leaders. With flatter organizations and decentralization of power, corporations must develop savvy global leaders capable of operating locally and globally simultaneously. IBM’s former chief learning officer recently estimated that IBM will need 50,000 leaders in the future.

Unilever has more than half of its business in Asia, and that percentage will continue to increase. The company has undertaken a major initiative to develop 500 global leaders in intensive leadership development programs to prepare them for expanded roles. According to CEO Paul Polman, “Unilever’s Leadership Development Programme prepares our future leaders for an increasingly volatile and uncertain world where the only true differentiation is the quality of leadership.”

To be effective in global roles, leaders require experience working and living in multiple countries. Extensive travel overseas is no substitute for living there, gaining fluency in local languages, and deeply immersing in the culture. German chemical maker Henkel, whose executives come from a diverse set of countries, insists they live in at least two different countries before being considered for promotion.

New methods for developing global leaders. Developing global leaders necessitates a shift from focusing on management skills to helping leaders be effective in different cultures by increasing their self-awareness, emotional intelligence, and resilience. Dean Nitin Nohria at Harvard Business School recently sent 900 MBA students overseas^[4] to work with companies in countries where they have neither lived nor worked.

It’s not enough just to work overseas. To process and learn from their experiences, individuals should utilize introspective practices like journaling, meditation or prayer, and develop support networks of peers like True North Groups^[5]. There they can consult confidentially with people they trust about important decisions and have honest conversations about their dilemmas, mistakes, and challenges. These experiences enable leaders to develop the self-mastery and appreciation and acceptance of people from diverse backgrounds required to become effective global leaders.

These methods of developing global leaders for the future are still in their nascent phase, but there is little doubt that they will have a profound impact on developing global leaders in the years ahead.

References

1. ^{^} Bill George (hbr.org)
2. ^{^} Comments (blogs.hbr.org)
3. ^{^} integrated global enterprise (blogs.hbr.org)
4. ^{^} Dean Nitin Nohria at Harvard Business School recently sent 900 MBA students overseas (hbr.org)
5. ^{^} True North Groups (blogs.hbr.org)

February 17, 2012, 1:31 PM EST

By Kate Andersen Brower

(Updates with Carney comments in 10th paragraph.)

Feb. 15 (Bloomberg) — President Barack Obama will be tapping into Hollywood money in his first California fundraising trip since anti-piracy legislation backed by the film industry was scuttled in Congress.

Over the next three days Obama is seeking to raise more than $ 8 million for his re-election, the bulk of it coming from six fundraisers in Los Angeles, San Francisco and Corona Del Mar, California, including one event co-hosted by comedian Will Ferrell. He also plans to raise money in Washington state.

Californians have given more to the president’s campaign than donors from any other state, according to the Center for Responsive Politics, a Washington-based group that tracks political money. The state also is home to two of Obama’s top donor groups, the entertainment industry and Silicon Valley, which were at odds over the legislation to curb pirated content on the Internet.

Andrew Schwartzman, senior vice president of the Washington-based advocacy group Media Access Project, said Obama probably should expect questions from entertainment industry executives about future attempts to revive the anti-piracy measure.

Movie executives will have to “lick their wounds and accept that, if legislation is going to be enacted, it is going to require a very substantial revision,” said Schwartzman, whose group promotes freedom of expression and universal access to communications.

Legislation Shelved

Leaders in the House and Senate on Jan. 20 shelved anti- piracy legislation backed by the movie and music industries days after a global online protest led by Mountain View, California- based Google Inc. and Wikipedia eroded congressional support. Internet companies objected, saying the measures would promote online censorship, disrupt the Web’s architecture and harm their ability to innovate.

The Obama administration, without taking a direct stand on the legislation before Congress, said it wouldn’t support measures that encourage censorship or disrupt the structure of the Internet.

Former Democratic Senator Chris Dodd, chairman of the Washington-based Motion Picture Association of America, said he hopes Obama will use the trip as an opportunity to make the case that the Internet and entertainment industries must find a consensus on stopping content theft.

Common Approach

“Now is the time to come together to find meaningful solutions to protect American intellectual property from foreign criminals,” Dodd said in an e-mail. “We strongly believe that the content and tech industries need each other in order to succeed and grow.”

White House press secretary Jay Carney told reporters traveling with the president today that the administration is committed to finding a solution that will protect copyrights and intellectual property without impinging on the free flow of information.

“We believe its a ’both and,’ not an ’either or’ proposition,” Carney said.

Some of Obama’s top bundlers are entertainment industry giants, including Dreamworks Animation SKG Inc. Chief Executive Officer Jeffrey Katzenberg, the co-founder of Miramax Film Corp., Harvey Weinstein, and Katzenberg’s political consultant, Andy Spahn. Weinstein, through his publicist, declined to be interviewed. Katzenberg and Spahn didn’t respond to requests for comment.

Political Committee

Priorities USA Action, a super-PAC backing Obama, got one of its first checks from Katzenberg, who contributed $ 2 million a July Federal Election Commission filing shows. Steven Spielberg, the movie director, contributed $ 100,000 in July.

Still, there was a decline in contributions from employees and their families associated with the television, movie and music industries to Obama in the last three quarters of 2011 compared with the same period in 2007, according to the Center for Responsive Politics. In the last three quarters of 2011, the entertainment industry gave Obama $ 1.2 million compared with $ 1.8 million during the same period in 2007, according to the center.

The opposite was true for the computer and Internet industry, which gave to Obama’s re-election more in the last three quarters of 2011 than they did during the same period in 2007, according to the center. In 2011, the employees of computer and Internet companies gave Obama $ 1.7 million compared with $ 1.1 million during the same period in 2007, according to the center. Employees of Google, the world’s most popular search engine, were the third-biggest corporate source of Obama’s campaign cash.

Support From Both

Carney said Obama “enjoys support from people in both industries.”

Fred Wilson a managing partner at New York-based Union Square Ventures who has helped fund Web-based technology companies, said Obama “has been pro-innovation and technology and he should enjoy strong support from the tech community.”

Harold Feld, legal director of Public Knowledge, a Washington-based digital advocacy group, said that, while entertainment executives may be upset with Obama for not pressing on anti-piracy, they won’t hold a grudge for long.

Tough Questions

“I think Obama’s going to face tough questions, but after they’ve had a little time to think about how much they rely on the administration, to enforce trade agreements in particular, they are not going to want to jeopardize that relationship,” Feld said.

The president is seeking to raise more than $ 3 million today at the Los Angeles home of television producer Bradley Bell and his wife, Colleen, co-hosted by Ferrell and his wife, Viveca Paulin, according to a campaign official. The rock band Foo Fighters will perform for approximately 1,000 people, with tickets costing $ 250 and $ 500 each. A dinner will be held later at the home for approximately 80 people who paid $ 35,800, the legal limit.

Tomorrow, approximately 125 people are expected to pay at least $ 2,500 per person to attend a luncheon at the Corona del Mar home of Jeff and Nancy Stack. He is the managing director of Irvine-based developer Sares-Regis Group. The president will then travel to San Francisco where he will attend three more fundraisers. The next day Obama will attend a fundraising lunch with 65 people at a private residence in Medina, Washington, and a reception later in Bellevue, Washington.

The president will bookend the trip with remarks on the economy and about moving jobs back to the U.S. during a visit to a Master Lock Co. factory in Milwaukee, Wisconsin, today and at a Feb. 17 stop at a Boeing Co. factory in Everett, Washington, outside of Seattle. Obama is seeking re-election with an unemployment rate that been at or above 8 percent for three years.

–With assistance from Jonathan D. Salant and Eric Engleman in Washington and Anthony Palazzo in Los Angeles. Editors: Joe Sobczyk, Bob Drummond

To contact the reporter on this story: Kate Andersen Brower in Milwaukee at kandersen7@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net

By
John Tozzi
-

Last month, when Microsoft launched
Kinect, an accessory that lets players control Xbox 360 games by
moving their bodies, Limor Fried posted a challenge^[2] on her
company’s blog. Adafruit Industries, which sells do-it-yourself
electronics kits, would give $ 1,000 to the first person to
unlock Kinect’s sophisticated motion sensors from the Xbox so
that any tinkerer could repurpose the technology for such
projects as building robots. In a week Adafruit had a winner, a
Spanish engineer who got Kinect to work with his laptop just
hours after it was released in Europe^[3]. “Now it’s unlocked for
creativity,” Fried wrote^[4].

That could be the tagline for Adafruit, the company Fried
founded in 2005 while getting her masters in electrical
engineering and computer science at the Massachusetts Institute
of Technology^[5]. The electronics kits she sells are “open-source
hardware,” meaning that Adafruit shares the designs that
companies usually keep secret. “We’re giving away all our
intellectual property for free,” says Fried, 31. The eight-
employee company will ship more than $ 3 million worth of kits
this year from its top-floor loft four blocks north of Wall
Street^[6] in New York’s financial district.

The software industry^[7] has embraced open source over the past
decade, with such companies as Red Hat built around code that is
public and free for others to modify. The idea is newer to
manufacturing. About 50 companies worldwide are selling open-
source hardware, estimates Ayah Bdeir, who helped organize the
first Open Hardware Summit^[8] in September at the New York^[9] Hall of
Science. The business case for publishing product designs is
“counterintuitive for any person [who] invests or works in
product development,” she says. These companies succeed by
providing support and service to customers that distinguishes
them from competitors who could make identical products using
their designs. “The world knows they are experts in what they
do, and [customers] want to purchase from them,” Bdeir says.

LEANING TOWARD THE FANCIFUL

The strategy helped Adafruit double its revenue from 2009 to
2010, and Fried projects it nearly to double again next year, to
$ 5 million to $ 6 million. With no outside investment, Fried
launched the company with $ 10,000 her parents designated for her
MIT tuition to buy parts for her first kit, a synthesizer. “As
soon as we made a profit, I had to take it out to pay tuition,”
she says. Adafruit now sells two dozen unique electronics kits
to hobbyists and students and ships some 100 orders a day. The
projects, which range from about $ 20 to $ 100, tend to be
fanciful, such as the MintyBoost, a portable charger for cell
phones and other devices that fits inside an Altoids tin, and
the TV-B-Gone, a remote that can shut off televisions in a 150-
foot radius.

For each kit, the company publishes the computer-aided design
files, schematics for circuit boards, and the firmware or
software code that runs inside a device. Anyone can use this
material under a Creative Commons^[10] license, provided they credit
the source and publish any related works under a similar open-
source license.

In addition to publishing designs, the company offers online
tutorials, and Fried co-hosts a weekly video chat with Adafruit
designer Phillip Torrone to teach lessons and answer questions.
“She’s really educating people. It’s almost like she’s running a
school in addition to everything else she’s doing,” says Alicia
Gibb, another organizer of the Open Hardware Summit who works as
“gadget wrangler” at Bug Labs, an open-source hardware company
developing wireless devices.

BORN OF FRUSTRATION

Fried’s first kit was born of frustration with a company that
would not sell her the design for a synthesizer she wanted to
build, even though the product was no longer on the market.
“This is completely nonsensical,” she says. “You’re not selling
it, you’re not building it, but you won’t let us build our own.
… We said fine. We’re going to design our own. We’re going to
design it much better than yours. And we’re going to release it
open source so that nobody ever has to go through that again.”

A similar spirit animated Adafruit’s campaign to unlock the
Kinect, a move Microsoft initially condemned with a statement
saying the company “does not condone the modification of its
products.” In response, Adafruit raised its reward for unlocking
Kinect to $ 3,000. Microsoft later changed its tone, noting that
Kinect had not been modified. “Someone has created drivers that
allow other devices to display the raw data that is output from
Kinect for Xbox 360^[11]. We are perfectly comfortable with hobbyists
taking advantage of that raw data,” the company said in a
statement to Bloomberg.

Adafruit’s effort resonated with engineers, who have used Kinect
to power virtual puppet shows^[12], record video in three dimensions^[13],
and control vintage Super Mario Brothers games^[14]. Instead of
investing thousands of dollars and hours to develop
sophisticated sensors that detect light, depth, motion, and
sound, they can take Kinect off the shelf for $ 150. Fried says
her mission as an entrepreneur is to spread the kind of
innovation that flows from opening up electronics and learning
how they work. “We have so little connection to what’s in these
plastic boxes,” she says. “The point of the company is to teach
people and to learn. It’s not just to buy and consume.”

To contact the reporter on this story: John Tozzi at
jtozzi2@bloomberg.net^[15]

To contact the editor responsible for this story: Nick Leiber at
nleiber@bloomberg.net^[16]

References

1. ^{^} Enlarge image (www.bloomberg.com)
2. ^{^} Open Web Site (www.adafruit.com)
3. ^{^} Europe (topics.bloomberg.com)
4. ^{^} Open Web Site (www.adafruit.com)
5. ^{^} Massachusetts Institute
   of Technology (topics.bloomberg.com)
6. ^{^} Wall
   Street (topics.bloomberg.com)
7. ^{^} software industry (topics.bloomberg.com)
8. ^{^} Open Web Site (www.openhardwaresummit.org)
9. ^{^} New York (topics.bloomberg.com)
10. ^{^} Open Web Site (creativecommons.org)
11. ^{^} Xbox 360 (topics.bloomberg.com)
12. ^{^} Open Web Site (vimeo.com)
13. ^{^} Open Web Site (www.youtube.com)
14. ^{^} Open Web Site (www.youtube.com)
15. ^{^} Send E-mail (www.bloomberg.com)
16. ^{^} Send E-mail (www.bloomberg.com)