North to South

North to South

You’ve accepted the post in India. Now what?

By Ram Charan with Geri Willigan and Charles Burck

 

Ram Charan is a top speaker and consultant and author or co-author of several best-selling management books. Adapted from Global Tilt: Leading Your Business Through the Great Economic Power Shift. Copyright ©2013 by Ram Charan. Published by Crown Business, a division of Random House Inc.

As a rising leader working in the home market of your business, you succeeded because you developed a way to find the right balance, the right focus, and the right priorities. You delivered results while growing accustomed to being accountable without having the total authority or necessary resources under your command. You not only succeeded but helped others do so as well, specifically by learning how to work cross-functionally—getting people to collaborate with you and at times exchanging resources, sometimes without a quid pro quo.

You’re comfortable in this company and this industry, even if growth has only been in the 2 percent to 3 percent range. But you are looking for a challenge and opportunity for personal growth, and one day you get it in spades: Your boss calls you in to tell you he would like you to run the company’s India unit, the company’s fastest-growing geographic market. It means relocating to Delhi for up to four years.

It’s a huge opportunity, but one also fraught with complications. There are career concerns, especially the “out of sight, out of mind” syndrome: Will you be forgotten by key people if you move eight thousand miles from headquarters? You remember the going-away party several years ago for your close friend Elizabeth, who took a position at her company as product development manager in Pune, India. At the party and before, she was teased that she was crazy to go there. People reminded her that the United States was still the largest market, where new ideas were initiated and cutting-edge technological innovation was being developed, and where the depth of technological talent resides. “Besides, Elizabeth,” her colleagues said, “you’ve never lived outside the United States. It’s tough over there. You’d be much better off staying put.”

Then there are the personal issues. What will your husband think? He’s a success in his own right as a mechanical engineer. Even if he agrees to go, will he be able to continue his career? What about schooling for your kids?

But since you pride yourself on always looking at the facts, you put these concerns momentarily aside. You see a world that is tilting from North to South, specifically the reality that as of 2012, 46 percent of the earnings of S&P 500 companies now originate outside of the United States, a number that will only increase in the future. Moreover, looking further out, the United States, now the dominant market, will be a smaller part of a larger pie, and some positions at so-called headquarters will have shifted from North to South. In fact, it’s already happened at companies like P&G, which has shifted the headquarters for its personal-care line of business from Cincinnati to Singapore. You recall the old line from hockey great Wayne Gretzky: “I don’t skate to where the puck is—I skate to where it is going to be.” Over the long run, every business goes where the markets are, to those places where it can create shareholder value and where it can find the resources it needs—human talent as well as natural resources it can depend on. You suspect the time to make the leap is now, before it is too late.

The logic and the facts are there, and you’ve seen how prescient Elizabeth was. Her colleagues didn’t see what was coming—a reduced number of senior-level posts like vice president at the home base and promotions going to those who had significant global experience. By going to a market where the growth was, Elizabeth developed herself and thereby was better positioned for future opportunities—both inside her company and outside it if she ever decides to leave.

 

You realize that both the local and the national context of this new job in Delhi will be completely different from your job leading a single product line based in the United States. While you’re now the global leader of a $200 million product line that’s part of a $1 billion global business unit, your job is narrow in its business scope but geographically broad. Now you will be going to a critical country to head the total business unit there. You’ll be focused on only one geographic market with sales half what you’re in charge of now—just $100 million—but you’ll be responsible for all three product lines. You’ll have to carry out the core of your leadership work—dissecting and reformulating the moneymaking recipe, deciding what to do, and then getting it done—without relying on old rules of thumb. The work content will be different. The competition is different, resource allocation is different, and the number of variables you’ll have to deal with is different, perhaps greatly so.

You wonder whether you have what it takes to succeed, so you take a personal inventory. Do I have the motivation and drive to actively search for, listen to, and comprehend what is different from what I have known and has made me successful? Can I make the changes I will need to make? Do I have the temperament to deal with multiple unreliable governments and poor infrastructure?

You’ve heard some of your friends talk about moving to another country as students or volunteers. They found it exciting and mentally challenging to learn about the community and build the trust of the people, who were both intelligent and eager to work for a better life. You’ve always envied their sense of adventure. And now, as you think about having to master the ins and outs of the people, the sources of information, the formal and informal power structures, the “way things are done around here” in a new, unique place, you think, What could be more exciting?

You recognize that you will have to override many of your familiar rules of thumb, but that’s fine. You’re one of those people who enjoy breaking through mental barriers to sharpen their perceptual ability. You’ve always tried to “look around corners” to see what was coming without any preconceived expectations. You’re prepared to develop new ways of acting, thinking, and making decisions.

You realize that you may get off balance at first as you grapple with cultural differences. It won’t be as easy to get the kind of information you rely on to make managerial decisions in the North. You’ll have to learn the social norms that affect information-sharing, both vertically and horizontally, especially among your direct reports and one level below. Connecting with people will be important to engendering trust and getting into the information flow—something executives from New York, Munich, or Tokyo typically struggle with.

Loyalty is a much bigger deal in the South. People are loyal to those in power—sometimes overly so—and vice versa. Fidelity to the person rather than the organization is a centuries-old cultural phenomenon. Promotions are often made on the basis of seniority, loyalty to a higher-level person, or invisible social networks. As a result, it’s hard to tell if a subordinate is being candid or just aiming to please. While it’s natural to gravitate to those who can communicate quickly and clearly and who think like you, you’d have to guard against the tendency to go with those who seem simpatico because they speak your language. You’ll have to gauge whether a person truly agrees with you or is saying yes merely out of politeness and a desire to please you. You’ll search for competent people who are willing to give you the real information and have the courage to tell you unwelcome facts and truths. That will mean linking with the local social networks and building trust and personal credibility within them.

Many local CEOs, entrepreneurs, and industrialists have deeply ingrained business acumen. Many who have had no formal professional education are extremely bright and are fast thinkers who developed their business savvy early through work experience in their family shops, a trait common in most countries of Asia. They may not have your wide worldview, but their understanding of the business may be broader. They typically understand the total anatomy of moneymaking in a business—the relationships between variables such as cost, turnover, profit, and cash flow, for example—better than functionally trained leaders in the North. You would want to figure out a way to motivate and retain them.

On the other hand, some of the local university-trained managers—who are also bright, fast thinkers—rely on basic theories they have learned and speak in generalities. It would be smart to distinguish those who can deliver from those who just talk in theory and generalities.

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