navigating the complexities of a global organization … · 2020-01-15 · navigating the...

CHAPTER 1

Navigating theComplexities of aGlobal OrganizationMariangela Battista, Patricia Pedigo,and Erica Desrosiers

We live and operate in a global world. A flu outbreak in Mexicohas an impact on fruit pricing in Asia. A mortgage meltdownin the United States has an impact on world financial markets.Globalization brings with it a web of interconnectedness thatdid not exist previously, or at least not to the extent that itdoes now. Organizations today are affected by nearly everythingthat transpires around the world, not just the local markets orcommunities in which they operate. Although global supply chainshave created huge market efficiencies, they have also broughtvulnerabilities. Disruption to a key node in the supply chain cancause dramatic and unpredictable turbulence in the whole system.The financial and economic events of 2008 have demonstratedhow tightly intertwined globalization has made the world and itssystems.

Globalization has also had significant implications for organi-zational processes, systems, and operations. Years ago, when mostof an organization’s employees were generally in the same countryand most of their business was conducted in their home country,life was simple. There was no need to worry about cultural differ-ences, language differences, time zones, or local relevance. Thatluxury has long since disappeared and the reality of organizations

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today is that operating globally is a more complex undertakingthan one might have expected. Becoming a truly global operatorentails far more than simply selling the same thing in more places,hiring the same people in more locations, or just pushing out thesame processes and procedures around the world. Operating inthis mind-set is likely a recipe for failure. Globalization requiresa business model that is adaptable and employees who openlywelcome new ways of thinking.

Human Resources professionals provide value to their orga-nization by successfully navigating the complexities of a globalorganization, and in doing so they bring the business strategy tolife for their employees. They understand the human dynamicsof operating in different cultures and how to facilitate the orga-nization’s success. HR professionals are tasked with the strategyand execution of all people-related processes and initiatives inthe organization. In global organizations, that role takes on theadditional complexity of operating across cultural and languagebarriers, operational differences, local relevance and appropri-ateness, time zones, and peak business and holiday schedules,just to name a few. This chapter will highlight examples ofsituations and contexts often encountered by HR practitionersoperating within global organizations that may present chal-lenges and offers specific suggestions for how to navigate inthese global waters.

What Does It Mean to Be Global?Although we live in a globalized world, there are still challengesin defining a global organization. Think of global organiza-tions as snowflakes—no two look exactly alike. Organizationscan operate under four distinct stages of globalization (Hewitt,2009)—multinational, international, transitioning to global, andglobal. Multinational organizations have cross-border operationsthat are primarily decentralized and autonomous. Internationalorganizations have a headquarters that retains some decision-making control but the organization is still largely decentralized.Organizations transitioning to global are taking concrete steps todevelop worldwide business strategies and policies (note thatmost organizations identify themselves as transitioning). Some

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organizations are truly global in that they develop strategies andpolicies on a worldwide basis and share resources across borders.Even for domestically focused organizations, globalization is justas salient, given relationships with suppliers, investors, and evennonnative employees.

What are the implications of those differences in global-ization? In more decentralized organizations operating in theearlier stages of globalization, systems and processes are largelyindependent and disconnected. There are certainly advantagesof this, in that these systems and processes can be tailored tothe unique needs of the local operation and are often easierto create, execute, and adapt when local conditions warrant.A local operation can often be more nimble when not restrictedto the longer and more effortful design and implementationof a global process (Sirkin, Hemerling, & Bhattacharya, 2008).If everyone is working independently and autonomously, how-ever, the organization is not poised to leverage the best practicescreated and implemented within their very own organization.In addition, there is a significant amount of duplicated andwasted effort, as everyone works to re-create the wheel over andover again.

Understanding and leveraging organizational-level insights isalso difficult. For example, assessing and securing enterprise-widetalent pools becomes much more of a challenge when there is littleconsistency in how things are measured and what information istracked or shared. In organizations that are further along on the‘‘global’’ continuum, everything often takes longer because ofthe required alignment and integration needed to be successful,but the synergies that are created are quite beneficial to theorganization in the longer term. Getting to that point, however,requires a significant amount of work.

The Inherent Complexity of Globalization

The people in and related to organizations—whether employees,shareholders, or customers—bring with them cultural, geograph-ical, geopolitical, and language attributes. How these differentand varying attributes are managed and leveraged across con-stituent groups within the organization has an impact on how well

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organizations are run and ultimately on the organization’s suc-cess. Cultures vary, even within countries, and certainly within andacross continents. Understanding the complexity both withinregions and on a global scale is especially important based onthe significant increase in regional and global trade since 1959(Kim & Shin, 2002). In the geographically structured organiza-tion, where divisions are represented by geography or country, asopposed to product or brand, understanding cultural complexi-ties is critical to business success. For example, leaders responsiblefor an Asia Pacific division must understand the cultural dif-ferences that exist between Taiwan and New Zealand, or Japanand China, and modify their products and marketing appropri-ately. This is similar for a North American division—one cannotassume that what works in the United States will work also inCanada.

CulturesThese cultural implications apply to customers as well as to employ-ees. In the late 1990s Walmart decided to open stores in Germanyas part of their strategic growth initiative. Walmart purchasedsome small German retail chains and had a successful Walmartexecutive from Bentonville, Arkansas, run the operations. Nineyears and one billion dollars later, Walmart pulled out of Germany.Their planned expansion was a total failure (Solomon & Schell,2009). Walmart made a then common mistake by assuming thatwhat worked in the United States would work everywhere. Theyexpected that German shoppers would react the same way thatAmerican shoppers do to the greeters at the door and the clerksbagging their purchases at checkout. However, the German cul-ture is more hierarchical. Shoppers were not as comfortablereceiving the ‘‘How are you?’’ greeting at the door, nor werethe German Walmart employees comfortable giving the greeting.German employees also participated in daily morning cheeringsessions led by store managers, a practice in all U.S. stores.Corporate culture and national culture clashed. The successfulBentonville executive did not even speak German and required hismanagement team to speak English. Walmart exported its entireU.S. corporate culture without appreciating the differences—andsuffered significant consequences.


Governments and RegulationsCultures are shaped by geography, language, politics, and lead-ership. Italy has seen over 60 governments in power since WorldWar II. Changing governments and administrations imply chang-ing laws and regulations. For example, if you are a globalorganization with operations in Italy, the changing governmentmay affect how your business operates and ultimately your verysuccess. Western organizations did very little business in Asianmarkets a generation ago. As governments lifted trade barri-ers, organizations recognized opportunities for new markets. Forexample, Pepsi was one of the first brands in Vietnam as soon asthe trade barrier was lifted. Navigating geopolitical relationshipscan also be a challenge and can often influence how geographicorganization structures are established. Do you put China andTaiwan in the same geography? How do you manage the MiddleEast? These political relationships spill over into how the organi-zation is structured and even how products are transported andservices provided.

In order to conduct business in a particular market, moreand more global companies are relocating key operations andproduction facilities to high-growth countries. In addition toproviding a significant local presence, this often enables thecompany to more effectively compete for local governmentalcontracts.

LanguagesOne cannot underestimate the power of language. In many globalorganizations, English is the official or de facto language of thebusiness. Yet, if an organization wants to engage the hearts andminds of its employees, then communication in the native tongueis essential to ensure effectiveness.

We know that the way an organization communicates has hugeimplications for the engagement of the employees and the successof the organization (Welch & Welch, 2008). Literal translationsoften do not communicate the correct message or with the pas-sion needed to motivate employees. Conducting translations andhaving in-country employees review the translation often works toensure that the right message is being communicated. Even thatmay not be enough, though. Just because a message is translated

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accurately, the content of the message itself may be perceivedas headquarters-centric. This may serve to alienate business unitsrather than bring them closer together as global units; they mayfeel that ‘‘corporate doesn’t ‘get us.’’’

Other examples can be quite basic in their headquarters-centric style. One of the authors worked with senior HR leadershipto create a global communication regarding an upcoming globalsurvey, noted as coming ‘‘later this summer.’’ That was fine foremployees who would actually be in the summer months but forsome regions, it would be winter. Such missteps are confusing atbest, and divisive at worst, implying a very headquarters-centricmind-set and attitude. For many HR practitioners, it usually takesat least one or two such missteps before they start to operate in atruly global mind-set, more appropriate for the organization.

Organizational StructureAs described earlier in the various stages of globalization, orga-nizations can have very centralized or decentralized operations.In a centralized organization there are typically centers of excel-lence which exist in a headquarters-type environment where theyare responsible for the design and execution of programs andinitiatives implemented in the field business units. Centralizedorganizations create standards of operation and performance toensure consistency in global deployment. For example, the Disneyexperience is expected to be the same whether it is in Orlandoor Paris. The organization is dependent upon the highest-qualitycustomer experience for business success. In decentralized organi-zations, every business unit operates independently with its own setof processes and initiatives. For a business whose success is depen-dent upon local adaptability and flexibility, this model enablesrapid response to changes in local markets. Each approach hasits advantages and disadvantages depending upon the businessmodel and market requirements. In at least one large globalcompany we know of, and likely many more, both models areoperating, centralizing some functions while decentralizing someoperations. HR can and should help organizations match the rightdesign with the business model and strategy.

To add to the complexity, many large, global organizations arematrixed in structure. There are product or brand lines overlayinggeographies. If leaders think that managing multiple product lines


is a challenge, it becomes exponentially more complex when prod-uct lines become matrixed with geographies. Key concern areasof staffing, resources, and customer coverage require ongoingnegotiation between the local geography and the brand and prod-ucts to ensure the right balance. Although global companies goto great lengths to interlock these requirements as part of theirannual planning processes, modifications and adjustments areoften needed during the year. Helping employees and leadersnavigate the matrix structure is an important contribution thatHR can make to overall organizational effectiveness, especiallywhen employees join through acquisitions or external hiring.

Successfully managed global organizations have a clear under-standing of how they work. As mentioned earlier regarding thecontinuum of definitions of globalization many companies under-stand which key business models are the sources of revenue.Even within the same industry, we see different operating or busi-ness models that drive how people interact and bring value intothe organization. For example, PricewaterhouseCoopers definesitself as a network of partners and limits its top-down influence.Accenture sees itself as is a matrixed organization that is ulti-mately project-centered with the focus on what is right for theclient project. PepsiCo and Starwood Hotels & Resorts are bothcollectives of clearly defined brands with a common set of coreorganizational values. Through its structure, each organization hasdefined for themselves how headquarters (HQ) and field are con-nected and how they work together to be successful. IBM is also ahighly matrixed organization with the integration of products andservices to meet customer needs as the core of its business success.

Headquarters versus the FieldFor centralized organizations with centers of excellence, it iscritical that input from the divisions or the field be solicited on aregular basis. It is a grand mistake to design a program or makedecisions in headquarters without ‘‘vetting it’’ through the globaldivisions so that issues of culture, language, and operational realityare addressed and a successful implementation can be ensured.Nothing kills an initiative faster than saying it is a mandate fromheadquarters.

Even more than soliciting input from or vetting plans withthe field, the best results come from true partnerships between

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the headquarters center and business partners in the field. Thefield partners are the ones with their ‘‘finger on the pulse’’ ofthe organization and can provide valuable input at all phases. Notonly does a partnership result in a better end product or process,but there is a sense of ownership and buy-in that comes from thiscollaborative effort. This regular dialogue secures critical localownership and sponsorship of the initiatives and their implemen-tation. For instance, some organizations create global councils ortask forces that meet regularly either for the duration of a discreteproject or on a more extended basis to ensure true global rep-resentation and partnerships. Business and field representativesthat participate are able to share not only how things should work,but also how they really are working, and what needs to changeand how.

Centers of excellence should be pragmatic in approach. Thereality is that programs and initiatives always seem to take muchlonger to implement than a project plan would suggest. Justbecause a decision is made and leaders are in agreement that aninitiative is the right course of action does not mean that exe-cution is as smooth and flawless as envisioned. Behavior changetakes time. New initiatives and processes take time to becomeinculcated into the organizational culture, and new behaviors andexpectations take time and effort to learn. This becomes expo-nentially more complicated when one considers issues of culture,language, and so on, not to mention the time and effort requiredfor a cascaded rollout, communications strategy and plan, andpossibly training for local HR, managers, and employees.

Centers of excellence (headquarters) should not assume thatjust because an initiative has launched that it is actually operatingas it should. Some anecdotal research suggests that it takes threeyears, or three cycles, for the new initiative to take hold. Ironically,just as processes are taking hold out in the field, leaders in head-quarters believe it is time to update and refresh or reengineerthe process. Though there may be a business-driven need for thechange, sometimes for the good of the organization it is better tokeep the process consistent longer to ensure the business valueis returned. Any type of change becomes a change-managementissue facing even more complexity associated with culture, lan-guage, and local support. Some initiatives may need a longer


shelf life than organizational development (OD) practitioners arewilling to give.

Although eventual change may be inevitable, it is also a‘‘must-do’’ for HQ to remember that employee consumers ofHR processes do not have a singular focus on all things HR.They’re busy and often overwhelmed with the content of theirown jobs, of which HR process plays but a small part. It is easyto forget in HQ or center-based jobs that employees in the fieldneed additional communication, explanation, and context tokeep everything straight. How does everything fit together? Whyam I doing this? What do I do with this? Why are we changingthings . . . again? HQ practitioners in global organizations oftenhave significant distance between themselves and the employeesthat are ultimately the consumers of their goods, so the impor-tance of a communications strategy and a set of well-designed andfield-tested tools should not be underestimated.

Having a close connection and working relationship betweenthe headquarters center of excellence and the field is criticalfor organizational success. There must be constant dialogue andfeedback from the field so that the organization is balancing globalorganizational needs with local field needs. Global programsand initiatives must be designed with the field in mind and,given the variety of countries, cultures, languages, skill levels,and so forth, simplicity and ease of use are nonnegotiable designelements. This can be a challenge when the center of excellenceis designing something perhaps ten steps removed from wherethey actually sit. For example, if the designer sits in the westernUnited States, and the end user sits in Dubai, then there has tobe some input from the employee in Dubai to secure effectiveimplementation. If a program cannot be easily implemented thenit is often deemed too complicated by the end user and chances ofsuccessful implementation are reduced. Practitioners can addressthis issue by conducting the appropriate focus groups, field testing,or pilot testing. Program execution without adequate field inputand testing will likely fail in deployment.

The key for organizations and practitioners is to walk thefine line between designing the framework with instructions toimplement and customize locally and trying to create consistent,global standards of excellence. Depending on the business model

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and sources of value to the company, organizations might bebetter served by erring on the side of encouraging local tailoringwithin defined boundaries to ensure that the program makesbusiness sense at the field or local level.

Organizational Values

Most organizations have vision and values that define their organi-zational culture. Vision and values provide a common frameworkacross the organization. They communicate what the organiza-tion stands for and how employees should conduct business andinteract with one another and with customers. They set the tonefor behavioral and performance expectations. Reward systems arebased upon these values.

Many of these values espouse socially desirable behaviors, suchas ‘‘treat others with respect and dignity,’’ ‘‘the customer is alwaysfirst,’’ ‘‘value teamwork and collaboration.’’ Almost no one wouldargue against these values.

Yet how organizational values are defined and interpreted maybe a source of confusion that can lead to conflict. How do orga-nizational values and national or ethnic values coexist? Althoughsocially desirable, organizational values are not necessarily fullyin line with national or ethnic values (Nelson & Gopalan, 2003).There may be some overlap, especially in the area of personalbehavior toward other employees, but there are also some differ-ences. Tensions and conflicts can arise between the two if theyare too divergent. For example, ‘‘treat others with respect anddignity’’ seems pretty innocuous. However, ethnically, it may beinterpreted quite differently. In Asian cultures ‘‘treating otherswith respect’’ may be interpreted to mean that feedback is keptrather mundane and to a minimum, whereas in Western cul-tures ‘‘treating others with respect’’ could be interpreted as theopportunity to provide every possible bit of detailed feedback.As reward systems are based on organizational values, organiza-tions then must take steps to ensure that there is consistency incommunicating and rewarding expected behaviors.

Recently one of the authors experienced the conflict of orga-nizational versus national culture over including a question onthe global engagement survey regarding a willingness to challengea superior when faced with a values issue. Though intended to


address issues of integrity and candor, there were cultural impli-cations to a question like this. In some cultures, employees wouldnever think to challenge a superior; it is just not done. How-ever, in order to create and maintain an ethical organizationalculture the company’s employees are encouraged to challengeothers, especially at a higher level. From a compliance standpointit is important to ask questions like this, but care is needed inthe interpretation of the results, keeping in mind the biases ofnational culture.

Values tend to be identified and set at the top of the orga-nization. Senior management has a role in defining what theorganization stands for. Sometimes these values come from anorganization’s founder and sometimes they are defined by currentmanagement. If the organization is reexamining and redefiningtheir values as a result of a new business strategy or leadershipteam, this is a great opportunity to get employee perspective andinput—especially global input. IBM did this several years ago withtheir ‘‘value jams’’ initiative. The new CEO, Sam Palmisano, andthe senior leadership team held an online, interactive dialoguewith all IBM employees to identify and select the appropriatevalues for the ‘‘new’’ IBM (Hempel, 2006). The ‘‘values jam’’ensured that the new IBM values would be embraced by allemployees worldwide and reflect the global IBM culture. The‘‘value jams’’ were a success with tens of thousands of globalemployees providing input and over a million employees andpartners viewing the discussion.

Organizational versus Local CultureAnother interesting intersection revolves around organizationalculture and local culture. Organizations tend to have a clearand somewhat dominating culture which may or may not beconsistent with local culture. For example, an organizationalculture of rapid response, results orientation, and working latenights and on weekends may not sit well in local cultures thatplace a heavy emphasis on family life, activities, and relaxation.Many have asked the question of which will win out when the twoare in conflict—organizational culture or local culture? The easyanswer here is probably the correct one—it depends. It dependson the strength and saliency of both cultures, and it dependson the individual and his or her desire for approval, and fromwhom. Another factor is likely to be the level of the individual

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employee. As individuals rise in the ranks within an organization,at a certain level they are often considered ‘‘corporate assets.’’There is more interaction with senior leadership, and more impactand influence from the top. At this level, individuals are morelikely to be driven by or at least influenced by organizationalculture to a greater extent. Lower in the organization, wheremost if not all interaction and collaboration is with other localemployees, local culture is likely to be the dominant one.

Global Mergersand Acquisitions

Global mergers andacquisitions carry uniquechallenges for the HRprofessional. Not only doyou need to worry aboutthe integration of twocompanies, but also thenational cultural nuancesof the acquisition. Keyissues to consider include:

• Being acquired by aU.S.-based company (orone based in anothercountry) and national-istic attitudes associatedwith the acquisition onboth the acquired andacquiring sides

• Managing the inte-gration locally with anonnative integrationteam and the potentiallanguage barriers

• Recognizing that locallaws will govern the rateand pace of some inte-gration activities—for

U.S.-Centric Not Alwaysthe Right Approach

As part of U.S.-based multination-als, we like to think that we areglobal and inclusive, and that weoperate with a global mind-set, buttoo often it is easy to fall into badhabits. No matter where one sits inthe world, that is the perspectivethat is usually taken. Considera-tion of our global colleagues inplanning and decision making willlead to more effective outcomes.

Time ZonesConducting conference calls withmultiple participants can be quitea challenge. Managing differenttime zones can also be difficult.Conducting conference callswith an international audience,however, requires the coordi-nation of a space shuttle launch.Conference calls scheduled forearly morning New York time arestill predawn hours in the westernUnited States, middle of the nightfor Hawaii, and late evening formost of Asia. It will always bethe middle of the night, or non-working hours, for someone in


example, when theteams can meet to planintegration, works coun-cil involvement, andso on

• Sensitizing the integra-tion team to companyand national culture dif-ferences between theacquiring and acquiredorganizations

• Planning for the travelcosts associated withsecuring the productiveworking relationshipsneeded for acquisitionsuccess

• Understanding thatreactions to the changewill differ widely by localcountry culture

• Securing local profes-sional change man-agement support todeal with the acquiredemployees in their lan-guage and consistentwith their culture

• Recognizing that effec-tive acquisition inte-gration requires trustand dialogue, which aremuch more complexand challenging in aglobal environment

When there are globalacquisitions, effectiveintegration is always alocal activity.

the world. If global representationon a project or initiative is criticalfor its success, how do you mini-mize the personal impact of thiscoordination so that it is not bur-densome for employees outsideof headquarters? If schedulingmakes it difficult for employeesto participate then you defeat thepurpose of having global repre-sentation. Ensuring that everyoneshares equally in the work, andthe burden, has been a work-able solution adopted by manyglobal companies. Rotating con-ference call times so everyoneshares equally in off-hours calls isoften the fair approach.

Work-Life BalanceWork-life balance is also taking onglobal meaning. Work-life balancehas predominately been discussedand studied as a U.S.-based issue.Organizations striving to creategreat places to work have focusedon work-life integration programssuch as flextime, job shares, com-pressed work weeks, and so on.Recent research from the BostonConsulting Group (2008) onglobal HR challenges has foundthat work-life balance is now aglobal issue. In Latin America,Africa, and the emerging Asianmarkets of China and India, thisissue has an impact on retentionand development. In addition,European Union policymakersare now looking at work-time

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regulations of global organizations and creating policies to ensurebalance.

VacationsThe culture of vacations is a related phenomenon. Outside theUnited States, employees actually use all their allotted vacationtime. In European countries, employees receive a minimum of30 to 40 days paid vacation which they will take seemingly regard-less of the business environment. Vacation is viewed as a timeto relax and renew, and employees are not in contact with theoffice. It is not uncommon to postpone important projects ormeetings during the July and August months to avoid the Euro-pean and Latin American holidays. Americans, on the other hand,are notorious for not using all their vacation time and workingwhile on vacation. ‘‘Blackberry vacations’’ are quite common inthe United States while unheard of (and not considered healthy)outside the United States. Unfortunately, this can set up differentexpectations regarding a person’s availability.

Meetings and ConferencesPromoting or espousing a global focus is critical but sometimesthere are practical considerations. What constitutes a ‘‘globalmeeting’’ really? For U.S.-based multinationals there is some-times push-back from the international managers (or non-U.S.managers) to have to travel to headquarters or a U.S.-based des-tination. ‘‘If we want to think and act like a global organization,we should not have all our meetings in the United States,’’ wasa statement often heard by one of the authors. This is a validpoint that would often be in conflict with practical reality. It isusually cheaper and much more cost-effective to have meetingsin the United States. Most of the meeting attendees (assumingmanagement team) are already in the States, making for cheaperflights and accommodations. There are also perception issues tocontend with. Global meetings held in exotic locations (anythingoutside the United States seems exotic) can be perceived as perksand boondoggles for those attending, creating bad press amongemployees and, potentially, among shareholders. Locations cho-sen for such meetings need to be tied to the meeting purpose andjustified. If you are building new operations in China, a meeting


in Beijing is definitely more appropriate than Chicago. If you’reholding a global strategy meeting with representatives from allregions, it may make sense on some level to hold the meetingoutside the United States, but when you realize you’re flying eightpeople from the States to an international location to meet withthree more people, it does raise a question of practicality.

Program Implementations

Business initiatives are more difficult to implement in a globalorganization. One has to maneuver language barriers, culturalissues, and business opportunities. It is a naı̈ve assumption tobelieve that whatever business strategy or initiative that is createdin headquarters will execute flawlessly worldwide. It is criticalto work closely with the field. Gaining local program managers toimplement the initiative will ensure the right rate and pace ofthe deployment in order to manage the change effectively. Theselocal resources are also a key link back to the HQ organizationon issues and challenges so that appropriate modifications canbe made.

Compromise Is GoldenAnother key challenge is to balance different business needswith successful implementation. Launching product initiativesand related training programs during an atypically busy time inthe business calendar does not make good business sense, andthe program is likely to receive limited attention. It also doesnot make sense to launch an initiative if the target audience—employees—will not be there to participate. One of the authorsexperienced just such a scenario with the launch of a worldwideemployee survey at a global hospitality company. Although a globaltask force of OD practitioners representing all the divisions wasin agreement that a two-week survey administration window wasappropriate, there was much disagreement as to when in the cal-endar year to administer the survey. Some hotels and resorts wereseasonal with increased staffing during these peak periods. How-ever, when resorts hit their peak, business travel or urban hotelswere slowing down. The compromise was a month-long windowduring which each hotel determined the two-week administration

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period that would best fit their individual occupancy and staffingcycle. Many global organizations today face similar challengeswith diverse business models and busy times coexisting within thesame organization. As always, the key is a true collaborative effortacross boundaries to manage that delicate balance required to besuccessful.

Communication Is KeyCommunication becomes an extraordinarily complex issue inglobal organizations. The organization needs to ensure thatthe intended meaning of the message is understood by thereceiver. Unfortunately, one cannot assume that translated mes-sages actually maintain the integrity of the original message. Forcommunication to be clear and accurate, it is important thatthe meaning is translated—not just the words. There are subtlenuances of language that get lost in the literal translations, not tomention the added complexity with local dialects When address-ing a lower-skilled, lesser-educated employee population, it can bechallenging to ensure that communications use the appropriatelevel of language and convey the intended meaning.

Translations can be very expensive and time consuming.Although translation agencies are a great resource with a fairlyquick turnaround time, an external agency may not be intimatelyfamiliar with the organization, its business, or its culture. All ofthese elements play into the meaning of the intended message.Literal translations often do not capture the entire meaning ofthe message, leaving out the important nuances that are criticalto the full meaning. For example, one of the authors was involvedin the launch of a brand campaign. Translations conducted by anexternal vendor, though accurately translating the words, missedsome subtleties that were reflective of the industry and specific tothe customer interaction. This could have been a huge problemfor the organization if not identified and corrected. Most orga-nizations have a translation faux pas story to share as a result offailure to fully vet translations before significant communicationsare already being launched.

We recommend that translations, whether conducted in-houseor externally, should always be followed by a back-translation. Back-translations will identify issues such as the one mentioned above.


If the language of origin is English, the subsequent translationshould be independently retranslated and compared to the orig-inal English to ensure that the translation captured the intendedmessage. If original translations are conducted by an externalagency, back-translations should be conducted by an in-countryemployee who understands the business, the company culture,and the local culture. Also, trying to keep translations in-housecan keep costs down, and participating in a translation exercise canalso be a great developmental opportunity for employees to haveexposure to an organizational initiative outside their immediatescope of work.

It is possible to say something multiple ways—all of which maybe correct. There may be disagreements between translations andback-translations. How to reconcile and choose the more appro-priate version (knowing that technically both are correct)? If themeaning is consistent, it is usually best to accept the employeetranslation over the translation agency as it assumes a better under-standing of the organization and culture, employee buy-in to theprocess, and the creation of an invested employee stakeholder.Translation and retranslation take a great deal of time. There areusually back-and-forth discussions taking place in order to validatethe translation. If employees are doing this, remember that theyare doing so in addition to their regular jobs. Translations do taketime and should be explicitly planned for in any project plan.Unfortunately, too often they are an afterthought and schedulesare tight.

Given the expense of translations, how should a globalorganization choose which languages to translate? Someorganizations provide global communication in English onlyand expect local management to handle translations locallyif necessary. Other organizations, which have the resources,coordinate translations globally from a central location workingwith in-country employees or translation agencies. In a globalorganization there can be hundreds of languages spoken. Someorganizations may have identified their standard list of languagesand all communication is translated in those languages. Thiscreates a standard and a process for communication. In otherorganizations, which languages are chosen will depend onthe nature of the communication For example, in the case

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of a U.S. multinational where the official language is English,communications geared mostly toward managers will often becommunicated in English.

If the communication is meant for all employees then one hasto decide whether all possible languages should be covered or ifthere is a logical list based upon the population. For example, oneauthor was faced with translating the Code of Conduct for theglobal population. Through various survey data it was determinedthat 12 languages covered 80% of the organization. These 12 lan-guages became the standards used for major communication. Thisignored the other 30 potential languages that were identified. TheCode of Conduct was communicated in the 12 major languagesand local human resources professionals were encouraged totranslate locally, and share globally, if they needed an additionallanguage. Some locations translated the Code of Conduct in theirlocal language (Turkish and Hebrew are two examples). Theyshared the translated Code of Conduct with the ethics and com-pliance team and these additional translated documents wereposted on the company intranet for other HR professionals to usefor any Turkish- or Hebrew-speaking employees.

Depending upon the initiative, there may be a grander pur-pose than just communicating a company message. Organizationalinclusion may be just as important. For employees to feel a sense ofbelonging and inclusion in the organization, translations becomea key mechanism to build this connection. An employee engage-ment survey is an example of building this connection betweenthe organization and its employees. When an organization imple-ments an employee engagement survey, by its very nature it isrequesting employee input and participation. Employees cannotparticipate in the process if they cannot read or understand thesurvey’s questions because it is not written in their language. In asituation such as this, a more inclusive list of languages for trans-lation is appropriate because the organization needs to create asense of belonging and inclusion for every employee.

Privacy Is the LawWorking in a global organization requires an awareness of thedifferent laws and regulations that affect employees. Employment


policies are guided by local laws and statutes including unions inthe United States and work councils in Europe.

In recent years, organizations now also have to address inter-national data privacy laws including whistleblower guidelines anddata transfers (EthicsPoint, 2009). In response to the growinguse of technology in database management, and the concernregarding technology intruding on personal privacy, the EuropeanUnion passed a broad law a decade ago that impacts cross-bordertransfer of personal data—including HRIS (Human ResourcesInformation Systems) data. Data privacy laws have tremendousimplications for HRIS databases and the kinds of information thatorganizations can collect. Data collected in European countriescannot be transferred to the United States easily. This law frus-trates U.S.-based multinational organizations, the headquarters ofwhich need to access HR data about their own European work-force. The EU data laws impose tight restrictions on transferringpersonal data outside of Europe, especially to the United Statesand other countries whose local laws do not offer EU-caliber pro-tections. The cross-border transfer restriction is an obstacle forany organization trying to create a global HRIS.

Data privacy laws have also made some HR-specific operationsmore challenging. France, Belgium, Spain, Canada, Germany,Ireland, and Japan all have data privacy laws which are differentfrom U.S. laws (Wugmeister, Retzer, & Rich, 2007). This cre-ates conflicting parameters by which to conduct business. Forexample, precoding of demographic information in employeesurveys becomes problematic in countries where data privacylaws prohibit capturing, and transferring, this information. Inthose situations, demographic information must be captured asself-report data, adding more time for the survey participant. Pre-coded data adds complexity when not consistently deployed. Forexample, ideally an organization should administer an employeesurvey in the same manner enterprise-wide to reduce any poten-tial variance, or noise, in the data. However, if organizations arelooking to provide some ease of use by precoding demograph-ics, this may work in some countries and not in others. It isoften required to create multiple versions of surveys and otherinstruments to accommodate such differences in practice, or tocomplicate the single version with assorted caveats regarding ‘‘do

20 Going Global

not complete this information if doing so would be consideredillegal in your country.’’

EU data privacy laws are being enforced with large fines andcriminal penalties such as prison time for the offenders whocommit unauthorized data disclosures. Compliance is key to thesuccessful transfer of employee data. Organizations can transmitHR data cross-borders if they implement one of the six EU-approved tools such as collecting consent from employees and thesafe harbor model (Dowling, 2007).

SummaryThe global organization presents a set of complex challenges tothe HR professional in designing, implementing, and managingglobal programs. The best practices and recommendations willbe presented in subsequent chapters. The global organization isa reality and requires embracing a new set of operating principlesto ensure success.

Globalization will be with us forever; there is no going back.Even though we may have seen some trend toward deglobaliza-tion or relocalization, the reality is that the world is now moreinterconnected than in any previous time. How we manage thisspells the difference between success and failure.

ReferencesBoston Consulting Group (2008). Creating people advantage: How to address

HR challenges worldwide through 2015.Dowling, D. (2007). Global HR hot topic—Global HRIS and EU data

privacy law compliance. White & Case LLP Newsletters, May 2007.EthicsPoint (2009). www.ethicspoint.com.Hempel, J. (2006). Big blue brainstorm. BusinessWeek, August 7, 2006.Hewitt Associates (2009). Managing HR on a global scale: Findings from

Hewitt’s 2009 Global HR Study.Kim, S., & Shin, E. H. (2002). A longitudinal analysis of globalization and

regionalization in international trade: A social network approach.Social Forces, 81(2), 445–471.

Nelson, R. E., & Gopalan, S. (2003). Do organizational cultures replicatenational cultures? Isomorphism, rejection, and reciprocal oppo-sition in the corporate values of three countries. OrganizationalStudies, 24(7), 1115 –1151.


Sirkin, H. L., Hemerling, J. W., & Bhattacharya, A. K. (2008). Globality:Challenger companies are radically redefining the competitivelandscape. Strategy & Leadership, 36(6), 36–41.

Solomon, C. M., & Schell, M. S. (2009). Managing across cultures: The sevenkeys to doing business with a global mindset. New York: McGraw-Hill.

Wugmeister, M., Retzer, K., & Rich, C. (2007). Global solution for cross-border data transfers: Making the case for corporate privacy rules.Georgetown Journal of International Law, 38, 449–498.

Welch, D. E., & Welch, L. S. (2008). The importance of language ininternational knowledge transfer. Management International Review,48(3), 339–360.

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