Reframing Globalization
by Cynthia Cherrey & Mansour Javidan
Cynthia Cherrey is President and CEO of the International Leadership Association. Previously, Cynthia served as Lecturer in the Woodrow Wilson School of Public and International Affairs at Princeton University and Vice President of Campus Life. She publishes in the areas of leadership, organizational development, and higher education including co-authoring Systemic Leadership: Enriching the Meaning of Our Work. Her most recent publication is Women and Leadership Around the World (co-editor). She is a Fellow at the World Business Academy and a recipient of a J.W. Fulbright Scholarship. Cynthia’s interests and research explore new ways to live, work, and lead in a knowledge driven, interdependent, global society. She consults and speaks to for-profit and non-profit organizations around the world on leadership and organizational change. She can be reached at ccherrey@ila-net.org.
Mansour Javidan is Vice Chair of the ILA Board of Directors and is Garvin Distinguished Professor and Director of Najafi Global Mindset Institute at Thunderbird School of Global Management. Mansour is Past President and Chairman of the Board of Directors of the world-renowned GLOBE (www.globeproject.com) research project. His 2004 GLOBE book won the Society for Industrial and Organizational Psychology’s M. Scott Myers Award for Applied Research in The Workplace. His 2014 GLOBE book received the University of San Diego award for Scholarly Rigor and Critical Thought. He recently received the Decade’s Best Paper Award (2006- 2016) by the Academy of Management Perspectives. Mansour has designed and taught executive development courses and workshops in 31 countries. His publications have appeared in such journals as Harvard Business Review and Leadership Quarterly among others. He can be reached at mansour.javidan@thunderbird.edu.
Throughout all sectors of society a new civilization is being formed by individuals and organizations. A dynamic, ever evolving integration of traditions and innovations from around the world is gradually taking shape. The system that we call the economy — the way we extract and produce, transport, and consume — dominates our global society. Post WWII saw the beginnings of the need for new governance structures for a global economy. Since then, the economy has changed from an industrial economy with a focus on diminishing natural capital, to a knowledge economy, which embraces all forms of capital — financial, industrial, human, and environmental. And, it is changing yet again.
Globalization is driven by the:
- expanding economic interaction and integration among countries,
- growing numbers of economic and political treaties, partnerships, and alliances,
- innovations in communication and transportation technologies that allow people from all over the world to interact personally and electronically, and
- instantaneous spread of accurate and inaccurate information.
As societies are increasingly influenced by political, social, economic, and technological transactions across borders, societal development and change is influenced not only internally but also by individuals interacting across other organizations, institutions, and countries. This creates the first ever semblance of a global civilization, connecting diverse cultures within and across all continents.
A global civilization is beneficial in many ways and in other ways creates complex problems. Globalization imposes new demands on what we expect and should expect from leadership in all sectors — business, education, political, community. Globalization is impacting us today in ways we know and in ways we don’t know.
It is a time of uncertainty. The complexity of the world today — in politics, business, and modern life in general — lies at the core of the populist appeal. It is a time of stark contrasts in which some want to hold on to the familiar and even return to the past. For example, with BREXIT, people want to return to the “old Britain” or, in the United States, Americans disappointed by the vanishing American dream — by the “promise” that they will be better off than their parents — wish a return to “good old days.” Yet others see Britain and the U.S. through a very different lens. Both the U.K. and the U.S. are examples of countries that are fractured and divided with very different visions about the future. What happened in the U.S. and the U.K. is not unique. Liberal democracies are being challenged all around the globe. Countries such as France, Austria, and Australia have been experiencing growing tendencies toward nationalism and populism.
It might be easy to conclude from the most recent events that we are seeing the end of globalization. Over the past few decades, the world witnessed a massive opening of borders to trade. In their pursuit of greater domestic prosperity, governments viewed their role as facilitators of global trade and they streamlined and coordinated their rules to facilitate foreign direct investment. There is strong evidence that they have been successful. Economies have benefited hugely from global trade. However, it is also true that not everyone in these countries benefited from globalization. The older, less skilled populations in developed countries have seen their opportunities diminish because of globalization. Younger professionals that are more skilled have benefitted from much greater opportunities, but have struggled with suppressed wages.
What we are witnessing now is a new role for governments in developed countries. Instead of focusing on opening borders, governments are being pressured by their voters to focus on helping those who have not benefited from globalization. As a result, instead of seeing the end of globalization, we are witnessing an evolution of the role of governments where they will become more aggressive and assertive in encouraging foreign investment and in supporting their local economies.
The U.S. is a good example: For decades, the U.S. government has been opening its economy to other countries and benefitting from both foreign direct investment and lower costs for consumers of all kinds of products. The present administration has vowed to restrict access to the U.S. market and offer policies that encourage further investment in the U.S. both by American and foreign companies. Therefore, we can expect an increase in consumer costs and an increase in foreign investment in the U.S., as evidenced by the recent $350 billion agreement with Saudi Arabia.
As another example, while Brexit is causing many uncertainties, one thing is clear: The U.K. post-Brexit will be much more open to foreign investment. It will compete very heavily against other European countries, as well as the U.S., in attracting foreign investment to ensure its continuing economic growth. This will force the EU to respond with its own aggressive approach towards foreign funds. To sum up, we are entering a phase of globalization where governments will become more active players in the process and will compete more aggressively for foreign direct investment.
A continuing challenge in our globalizing world is cross-cultural understanding. For too many of us today, “global” simply means projecting our own particular set of values, beliefs, and perspectives on the world around us. Too often, it means visiting other countries or increasing the numbers of international students on our campuses. Global understanding, however, is more than geography. It is also cultural, in terms of peoples, and intellectual, in terms of a global mindset and skill set.
We may be more connected but that does not mean we are well versed in the diversity of the world. The world may be flat in terms of technology and interconnectivity but it is still quite bumpy in the sense that people in different organizations in different areas of the world work in different ways.
While there is strong agreement about the need to develop a global understanding, many are struggling to do so. For example, in a research study conducted from 2008-2009, the Center for Creative Leadership, an ILA group member, found that 86% of senior executives believe it is “extremely important” to work effectively across cultural and geographic boundaries in their current leadership role. Yet, only 7% believe they are “very effective” at doing so (Yip, Ernst, & Campbell, 2016, p. 9).
Today’s leadership requires an understanding of multiple and diverse cultures, engaging and influencing those different from ourselves, and searching out and learning from diverse perspectives. We need to find ways to continue to expand our understanding of globalization. We must search for solutions that unite across divides of nationality, culture, religion, and political beliefs as well as societal sectors and social class.
The ILA is a great place to grow your global mindset and skill set around leadership. You can learn and exchange with others who have varying perspectives on the latest global issues impacting leadership in an environment where we all have the common core purpose of studying, understanding, and practicing effective leadership. As we watch governments work to restrict economic and physical borders, it is more important than ever that the ILA and its members play key roles in building bridges of understanding across the globe.
References
Yip, J., Ernst, C., & Campbell, M. (2016). Boundary Spanning Leadership: Mission Critical Perspectives from the Executive Suite. Greensboro, NC: Center for Creative Leadership