Test Tile Paper

The word “global” has now become the new buzzword of business. What isn’t global these days?

While we certainly live in a highly interconnected world, the business world is not as “flat” as Thomas Friedman once predicted. Quite the contrary in fact. There is no “global market” for goods and service, rather there are now a set of globally connected “local” businesses.

We are just completing a year long effort to study best-practices in the structure of Human Resources. What we found is that while companies want order and consistency around the world, the highest-performing companies don’t standardize everything: they localize.

An important piece of new research was launched last year: the DHL global connectedness study. This research, pioneered by Pankaj Ghemawat, shows how that since 2007 the world has become “less connected” each year. This is not because we don’t have communications between countries – it’s because local countries have their own economic conditions and each grows at its own pace.

He calls this “World 3.0,” the title of his new book. He argues for “rooted cosmpolitanism” in our business leaders. That is, respecting and understanding each economy and each culture for its own strengths. China and India, which are both growing rapidly, each have unique labor markets, a younger workforce, and particular regulatory and cultural environments. If you want to do business in China, you have to adjust your product, channel, and marketing strategies. And, as our research shows, also your leadership, recruiting, compensation, and career progression strategy.

This is the core of our new High-Impact HR research. Highly successful companies don’t “globalize” their businesses, they “localize them.”

The key to business localization is to have global platforms with local implementations.

For HR software, this means implementing global systems for HR, recruiting, and learning which are designed to enable local customization.

For...