Content uploaded by Jennie Walker
Author content
All content in this area was uploaded by Jennie Walker on Dec 12, 2018
Content may be subject to copyright.
36 PEOPLE & STRATEGY
A Whole New
Global Mindset for Leadership
By Mansour Javidan and Jennie L. Walker
VOLUME 35/ISSUE 2 — 2012 37
to 63,000 (Gabel, Medard and Bruner, 2003).
During that same time period, multinationals
in the United States created 31 percent of the
country’s growth in private-sector real GDP
and 41 percent of labor productivity gains
(McKinsey Global Institute, June 2010).
Despite the exponential growth (or perhaps
because of it), leaders continue to be unpre-
pared for global contexts. A recent survey of
senior HR executives revealed that a shortage
of global executive talent was the primary
concern in their rm’s global expansion plans
Global Mindset includes specific
knowledge, skills and abilities that
have been dened through scientic
research at the Naja Global Mindset Insti-
tute at Thunderbird School of Global
Management. This article discusses the criti-
cal importance of Global Mindset
development for leaders. It also denes and
describes each component.
A Whole New Global
Mindset for Leadership
In 1969, Howard Perlmutter was among the
rst researchers to point out that running suc-
cessful global operations required a whole
new mindset. This gives pause for reection.
How did this mindset differ from status quo
leadership? Perlmutter found that global
leaders needed to navigate increased com-
plexity in organizational culture, management
practices and recruitment of top talent (1969)
— the very domains human resources profes-
sionals are charged with developing. This
holds true today. Global leadership is excit-
ing, challenging and certainly complex (see
Exhibit 1). It has only been recently, however,
that the whole new mindset to which Perl-
mutter referred was scientically dened by
the Naja Global Mindset Institute at Thun-
derbird School of Global Management.
Are Your Leaders
Prepared for Global
Complexities?
Before we dive into the specics of Global
Mindset, take a moment to assess the global
leadership needs in your own organization
(see Exhibit 2). Chances are that your orga-
nization is touched by global complexities,
even if it does not have geographically dis-
persed operations.
In the past 40 years, both the number and
impact of multinational companies grew
exponentially. Between 1990 and 2003 alone,
the number of multinational corporations
throughout the world increased from 3,000
Global leaders need to navigate increasing complexity in organizational culture, management
practices and recruitment of top talent — the very domains human resources professionals are
charged with developing. This requires a whole new mindset for leadership: Global Mindset.
➤
ExHIBIT 1: THE COMPLEXITY OF GLOBAL LEADERSHIP
• International JV,
global partners
and alliances
ExHIBIT 2: GLOBAL MINDSET NEEDS ASSESSMENT (SHORT-FORM)
1. Throughout the next five years, your corporation’s opportunities, in terms of markets and
supplies, are mostly outside of your country.
2. Throughout the next five years, managers at your firm will increasingly need to work with
people from other par ts of the world.
3. Throughout the next five years, managers at your firm will increasingly need to work with direct
reports who are located in different parts of the world.
4. Your company believes that a key to its sustainable competitive advantage in the future
resides in its capability to manage cross-cultural complexity in its value chain of suppliers,
managers, employees, distributors and customers better than its competitors.
5.
Influencing people who are different from you is harder than influencing people who are like you.
Javidan & Dastmalchian, 2009
38 PEOPLE & STRATEGY
(Smith, A., Caver, K., Saslow, S., & Thomas,
2009). And managers agreed: In a survey of
managers in global positions, more than 60
percent reported themselves to be poorly pre-
pared for their jobs (Howard, A. & Wellins,
R.S., 2009, September). It is important to
note that even domestically based leaders are
faced with increasing global diversity. In a
survey of 500 senior executives at 100 global
corporations, almost 60 percent reported
that their workers will have more diverse
backgrounds and experiences and more than
half expected managers to become more
international in composition (Economist
Intelligence Unit report, 2010).
The Global Mindset
Project
Based on an extensive research project that
now includes data from more than 13,000
managers from companies around the world,
we view Global Mindset as the set of attri-
butes that help a manager influence
individuals, groups and organizations from
diverse cultural, political and institutional
backgrounds. In short, Global Mindset is the
capability to inuence others unlike yourself
— and that is the key difference between lead-
ership and global leadership. Leadership is all
about inuencing others. In terms of the clas-
sic distinction that leaders must manage
“data, people and things,” ask any manager
and they will almost certainly tell you that the
management of people is the most complex
and difcult of the three. And for a global
leader, it is all the more challenging, because
they must influence people different from
themselves in numerous, compounded ways.
The Global Mindset Project (GMP) started in
late 2004 at the Thunderbird School of Global
Management. Eight professors reviewed the
literature on global leadership, cross-cultural
leadership and Global Mindset, conducted
interviews with another 26 Thunderbird pro-
fessors who are experts in various aspects of
global business, and interviewed 217 global
executives in the United States, Europe and
Asia. We also convened an invitation-only
conference where more than 40 academic
experts known for their scholarly contribu-
tions to the global business eld from around
the world were asked to test, stretch and rene
our thinking — and so they did.
The above process helped us identify the
scope and components of the concept of
Global Mindset. We then worked with the
Dunnette Group, a renowned instrument
design firm, to empirically verify the con-
struct of Global Mindset and to scientically
design an instrument that would measure an
individual’s prole of Global Mindset. We
used an iterative process involving more than
200 MBA students and more than 700 man-
agers working for two Fortune 500
corporations in a series of surveys and pilot
tests. The process resulted in an empirically
verified construct of Global Mindset that
consists of three major dimensions: Intellec-
tual Capital (IC), Psychological Capital (PC)
and Social Capital (SC). Exhibit 3 shows the
scientic structure of Global Mindset.
Toward a Theory of
Global Leadership
Despite the plethora of advice and writing on
global leadership, there is little effort to
clearly dene the concept. With few excep-
tions, much of the literature on global
leadership tends to focus on lists of compe-
tencies and suggestions for improvement
without offering a clear denition of global
leadership (e.g., Brake, 1997 Rhinesmith,
1996; Mendenhall, et al., 2001; Black, Mor-
rison and Gregersen, 1999). This is in part
due to the fact that no theory of global lead-
ership currently exists, despite the plethora of
published leadership theories. Case in point,
Stephen Covey wrote a very concise and use-
ful review of leadership theories in the
appendix of “The 8th Habit: From Effective-
ness to Greatness” (Covey, 2004). He lists 20
leadership theories that were put into prac-
tice from 1936 through 2003. For those of us
in the business of leadership development, the
chart should serve as a reminder that, as our
world changes, so must our leadership
approach. Yet there is a noticeable absence of
a theory of global leadership on the chart.
This was not an oversight on Covey’s part;
the truth of the matter is that it simply did
not exist as of 2004. Enter our work at the
Naja Global Mindset Institute. We dene
global leadership as:
The process of inuencing individu-
als, groups, and organizations (inside
and outside the boundaries of the
global organization) representing
diverse cultural/political/institutional
systems to help achieve the global
organization’s goals (Beechler and
Javidan, 2007).
We view global leadership as a process of inu-
ence, in line with the conventional literature
on leadership where most denitions reect
the notion of intentional inuence exerted by
one person over other people (Yukl, 2006).
While much of the extant literature is focused
on how leaders can motivate their direct
reports toward common goals, we also explic-
ExHIBIT 3: THE STRUCTURE OF GLOBAL MINDSET
VOLUME 35/ISSUE 2 — 2012 39
itly acknowledge that the direct reports may
be scattered around the world and may not
neatly t in a typical hierarchical structure.
Additionally, since a typical global organiza-
tion is more of a network of supply chain
partners, joint venture partners or strategic
alliance partners trying to execute integrated
global strategies (Brake, 1997), the boundaries
of the typical global organization are more
permeable and fuzzy than the traditional orga-
nization (Ashkenas et al, 1995). Global leaders
need to inuence individuals, teams and orga-
nizations from different parts of the world to
help achieve their organizations’ objectives.
And they need to do this without relying on
traditional lines of authority.
Global Leadership
Requires More Than
Cross-Cultural
Intelligence
Much of the literature on global leadership
tends to focus on leading across cultures
(Adler, 1997; House, Hanges, Javidan, Dorf-
man, and Gupta, 2004; Javidan and Carl,
2004; Dorfman, 2004). While the difference in
national cultures is indeed critical, it is not the
only issue. The global leader’s targets of inu-
ence may come from cultural backgrounds,
institutional systems, legal frameworks and
social structures that are different from those
in the global leader’s home context (North,
1990). They may even have different views on
the whole notion of the corporation and its
role in the society (Hunt, 2000). Because
global leadership is about inuencing those
who are different from the leader in many
important ways, it is useful to identify what
those key differences may include.
Global Leadership
Requires Intellectual,
Psychological and
Social Capital
Exhibit 3, developed from our research,
shows the three core “capitals” and nine
underlying building blocks of a global mind-
set that enable managers to inuence others
unlike themselves in achieving their organiza-
tions’ global ambitions. Here is a closer look
at each, and why they matter.
Intellectual Capital (IC) — the cognitive side
of Global Mindset
IC refers to the leader’s knowledge of his/her
global surroundings, as well the ability to
digest and leverage the additional level of
complexity embedded in global environ-
ments. It consists of three building blocks:
Global Business Savvy: Knowledge of the
way world business works
• Knowledge of global industry
• Knowledge of global competitive business
and marketing strategies
• Knowledge of how to transact business
and manage risk in other countries
• Knowledge of supplier options in other
parts of the world
advances in information technology, trans-
portation and distribution, it remains very
bumpy in terms of cross-cultural differences.
As Douglas Ivester, former CEO of Coca-
Cola, summarized, “As economic boundaries
come down, cross-cultural barriers go up,
presenting new challenges and opportunities
in business.”
Our work in the GLOBE project has identi-
ed a number of cross-cultural bumps that
show, for example, American managers are
typically much more performance oriented
than are Greek managers. We have also
shown that American managers expect their
supervisors to be much more enthusiastic
than do French managers. A typical American
The global leader’s targets of inuence may come from
cultural backgrounds, institutional systems, legal
frameworks and social structures that are different
from those in the global leader’s home context.
Cosmopolitan Outlook: Understanding that
the manager’s home country is not the center
of the universe
• Knowledge of cultures in different parts of
the world
• Knowledge of geography, history and im-
portant persons of several countries
• Knowledge of economic and political is-
sues, concerns, hot topics, etc., of major
regions of the world
•
Up-to-date knowledge of important world
events
Cognitive Complexity: Global is just more
complicated than domestic-only
• Ability to grasp complex concepts quickly
• Strong analytical and problem-solving
skills
• Ability to understand abstract ideas
• Ability to take complex issues and explain
the main points simply and understandably
IC matters because, despite what you may
have heard, the world is not at. Although
Thomas Friedman’s world is at, with respect
to its being much more interconnected via
manager may find it difficult to make the
necessary adjustments in working with his
Greek or French team. Also, the United States
is relatively low on “power distance” versus
Thailand, which is very high. So the U.S. man-
ager who goes on assignment in Thailand and
engages her direct reports in empowered,
consultative decision making may be greeted
with confusion, dismay or disbelief.
These bumpy challenges are why, in a recent
survey of CEOs, “mobilizing teams” and
“working across cultures” were the top two
critical leadership competencies (Howard, A.
and Wellins, 2008/2009). The same CEOs
reported that “decision making in complex
environments and ability to read cultural
nuances and to adapt leadership style accord-
ingly” is the key to successful global
leadership. This was reinforced in a more
recent survey of senior executives who identi-
ed “ability to inuence people from other
cultures” as the most important skill for a
global executive (Smith, A., Caver, K., Saslow,
S., & Thomas, N., 2009).
Psychological Capital (PC) — the affective
aspect of Global Mindset
PC helps a manager leverage his/her Intel-
lectual Capital. Without a strong ➤
40 PEOPLE & STRATEGY
psychological platform, extensive knowledge
of global industry and global environment is
less likely to result in successful action. Psy-
chological Capital consists of:
Passion for diversity: Do not just tolerate or
appreciate diversity, but thrive on it
• Interest in exploring other parts of the
world
• Interest in getting to know people from
other parts of the world
• Interest in living in another country
• Interest in variety
Quest for Adventure: The Marco Polos of the
world
• Interest in dealing with challenging
situations
• Willingness to take risk
• Willingness to test one’s abilities
• Interest in dealing with unpredictable
situations
Self-Assurance: The source of psychological
resilience and coping
• Energetic
• Self-condent
• Comfortable in uncomfortable situations
• Witty in tough situations
A senior executive we have been working
with, who is low in psychological capital, is
originally from New Zealand. He had a suc-
cessful track record at home and was
promoted to a senior position for the rm in
a Middle Eastern country, reporting to an
Italian senior executive in Milan and working
closely with his colleagues in the Mediterra-
nean. His one-year tenure was full of
frustration and confusion. He was having a
hard time building trust with his direct
reports. He had a hard time guring out what
was really going on and felt uneasy about the
local culture. He was also struggling with his
supervisor and the Mediterranean colleagues.
After a few months, he found himself gravi-
tating toward other New Zealand or
Australian expats and Western clubs and res-
taurants in his city. He was so stressed during
the day that he wanted the relief of a familiar
environment in the evening. He was spending
more of his time with other expats who were
also suffering, avoiding those who were
enjoying their experiences. In sum, he lacked
the psychological and emotional resilience
necessary to make sense of cultural and
national differences, manage them and enjoy
the process while doing so.
Social Capital (SC) — the behavioral aspect
of Global Mindset
SC reects the individual’s ability to act in a
way that would help build trusting relation-
ships with people from other parts of the
world and also consists of three building
blocks:
Intercultural Empathy: Display “global”
emotional intelligence
• Ability to work well with people from
other parts of the world
• Ability to understand nonverbal expres-
sions of people from other cultures
• Ability to emotionally connect to people
from other cultures
• Ability to engage people from other parts
of the world to work together
Interpersonal Impact: Difference maker; sel-
dom ignored across boundaries
• Experience in negotiating contracts in
other cultures
• Strong networks with people from other
cultures and with inuential people
• Reputation as a leader
• Credibility
Diplomacy: Seeks rst to understand, then to
be understood
• Ease of starting a conversation with a
stranger
• Ability to integrate diverse perspectives
• Ability to listen to what others have to say
• Willingness to collaborate
Social Capital includes the trust-building and
networking behaviors that allow managers to
knit together the various elements in their
increasingly cross-cultural, complex, global
network of relationships. As Sam Palmisano,
outgoing CEO of IBM, observes: “Today’s
global corporations are shifting their focus
from products to production — from what
things companies choose to make to how
they choose to make them, from what ser-
vices they offer to how they choose to deliver
them. Simply put, the emerging globally inte-
grated enterprise is a company that fashions
its strategy, its management, and its opera-
tions in pursuit of a new goal: the integration
of production and value delivery worldwide.
State borders dene less and less the boundar-
ies of corporate thinking or practice”11.
A high stock of Social Capital, together with
Intellectual Capital and Psychological Capi-
tal, equips companies to pursue a new source
of sustainable competitive advantage: superi-
ority in managing the cross-border
complexity of their global supply chain. In
sum, Intellectual Capital (IC) ensures that the
manager is aware of the many dimensions of
global complexity. Psychological Capital
(PC) generates the enthusiasm, energy and
self-condence to deal with such level of com-
plexity. And Social Capital (SC) helps the
manager behave in ways that are likely to
build trust and help achieve his objectives.
In order to nd Global Mindset in people and
have a basis for nurturing it, companies must
be able to measure it with condence. One
means for doing so is through the use of the
Global Mindset Inventory (GMI) survey
instrument. The GMI measures a manager’s
prole of Global Mindset in terms of nine
dimensions and three capitals.
Identifying Global
Mindset in Managers
Our research to date has identied a number
of factors that point to a high Global Mindset
in individuals:
• Prociency in more than one language is a
strong predictor of Global Mindset. Anglo
speakers (citizens of the United States,
Canada, the United Kingdom, New Zea-
land and Australia) who speak other lan-
guages are more likely to have higher
Global Mindset scores. But proficiency
level is a major factor. For those with low
proficiency, the magic number is three.
Those who have low prociency in more
than three languages actually score lower
on Global Mindset. For those with moder-
ate to high levels of prociency, the more
languages, the better. (The more languages,
the better? Is there not a level where “di-
minishing returns” occur?) We also found
that for non-Anglo managers, their pro-
ciency in the English language is a strong
predictor of their Global Mindset.
• The number of countries one has lived,
studied and worked in is also important. In
VOLUME 35/ISSUE 2 — 2012 41
general, the more countries a manager has
lived in, the higher the average Global
Mindset score. However, there is an impor-
tant caveat: The length of stay is also an
important consideration. The optimum
length of stay in each country seems to be
between six months and two years. Rela-
tively speaking, stays of between six
months and two years have the largest im-
pact on a manager’s Global Mindset. We
also found that the number of countries a
person is educated in, up to four, has an
impact on Global Mindset score. Further-
more, we found that the more friends a
manager has from other countries, the
higher his/her Global Mindset score.
• An international graduate degree matters.
Those with a graduate degree in interna-
tional management, international business
or international affairs have a higher aver-
age score on Global Mindset. While such a
degree is indicative of an individual’s inher-
ent interest in global issues, it has other
important contributions. Our data show
that the impact of living and working in
multiple countries on the Global Mindset
score is quite larger for those with an inter-
national master’s degree. Of those with
experience in several countries, managers
with an international master’s degree have
much higher scores than those without it.
In other words, an international degree
boosts the manager’s ability to leverage the
international experience. Finally, our re-
sults show that those without an interna-
tional degree need to live in two additional
countries to achieve the same Global
Mindset scores as those with an interna-
tional graduate degree.
• Age matters, and that’s the bad news! In
our database of more than 12,000 indi-
viduals, we found that those in the age
group of low-40s to mid-50s had the low-
est average scores on Global Mindset com-
pared to other age groups. It is not entirely
clear why this is the case, but whatever the
reason, it is cause for concern, because this
is the age group that is typically in charge
of running corporations and governments.
Most CEOs, senior executives, senior gov-
ernment ofcials and politicians in many
countries are in this age group. This raises
the question: How easy will it be for cor-
porations to globalize their mindset if their
senior leadership is not leading by exam-
ple? But perhaps an even bigger concern is:
How will governments prepare their citi-
zens for the globalized world if those in
charge just don’t get it?
Building the
Company’s Stock of
Global Mindset
To build the company’s stock of Global
Mindset, the options are largely to find it
from outside talent or nurture it from within.
It would be ideal if we could nd individuals
with high levels in all three capitals (IC, PC
and SC). But we don’t live in an ideal world.
We live in a world with few super men or
women. In an imperfect world, which of the
three capitals should you look for when hir-
ing managers? Our work with hundreds of
mangers shows that Psychological Capital
has some unique features compared to the
other two. You can teach people about glob-
al business and cross-cultural issues, and you
can help them improve their Social Capital
through a variety of experiential experiences.
But enhancing someone’s Psychological Cap-
ital is much harder and takes much more
time. For example, it is not that easy to
improve someone’s low passion for diversity.
Therefore, at a minimum, companies need to
make sure the people they hire or promote
have reasonably high levels of PC.
In our work with one Fortune 50 corpora-
tion, we helped them incorporate Global
Mindset as an integral component of their
senior executives’ annual personal develop-
ment plans. Every year, all executives set an
objective regarding their own Global Mind-
set prole. They also prepare a set of action
plans to achieve those objectives.
All such interventions have benecial out-
comes, but our view is that to have maximum
impact, you need an integrated strategy that
has elements from your talent management
system, your performance management pro-
cess and your leadership development
strategy. Global Mindset should be an impor-
tant part of your talent management system.
It should be a critical competency for several
managerial levels in your organization. Your
leadership development strategy should
ensure that Global Mindset capitals are prop-
erly developed, and your performance
management system should ensure that they
are properly assessed and rewarded.
References:
Bloomberg Businessweek. 2010. Charlie Rose Talks to
Mike Duke. Bloomberg Businessweek website: http://
www.businessweek.com/magazine/content/10_50/
b4207000177109.htm.
Boyacigiller, N., Beechler, S., Taylor, S., Levy, O. “The Cru-
cial Yet Elusive Global Mindset.” pp. 81-93. In Lane, H.
W., Mazrevski, M. L., Mendenhall, M. E., and McNett, J.
Handbook of Global Management: A Guide to Managing
Complexity. Oxford, UK: Blackwell Publishing Ltd. 2004.
Gabel, Medard, and Bruner, Global Inc.: An Atlas of the
Multinational Corporation. The New Press. 2003.
Global Firms in 2020, Economist Intelligence Unit report,
2010.
Hamel, G. The Future of Management. Boston: Harvard
Business School Press. 2007.
House, R.J., Hanges, P.W., Javidan, M., P. Dorfman, and
V. Gupta (eds). Culture, Leadership, and Organizations:
The GLOBE Study of 62 Societies, SAGE. 2004.
Howard, A. and Wellins, R.S. Global Leadership Forecast,
2008/2009. Development dimensions International Inc.
Available on the Internet: http://www.ddiworld.com/pdf/
globalleadershipforecast2008-2009_globalreport_ddi.
pdf, accessed Sept. 6, 2009.
Palmisano, S. J. The globally integrated enterprise. Foreign
Affairs, May/June 2006.
James Reed and Paul Stoltz, Put Your Mindset to Work,”
by, Portfolio, 2011.
Javidan, M. and R.J. House (2001), “Cultural acumen for
the global manager: Lessons from GLOBE.” 30th Anniver-
sary Special Issue of Organizational Dynamics, vol. 29, no.
4. pp. 289-305.
Javidan, M., Teagarden, M., and Bowen, D. 2010. Making
it Overseas. Harvard Business Review, April.
Smith, A., Caver, K., Saslow, S., & Thomas, N. Developing
the global executive: Challenges and opportunities in a
changing world. Pittsburgh: Development Dimensions
International. 2009.
Multiple award-winning executive edu-
cator and author whose teaching and
research interests span the globe,
Dr.Mansour Javidan received his MBA
and Ph.D. degrees from the Carlson
School at the University of Minnesota.
He is former dean of research at Thun-
derbird School of Global Management
and is currently the Garvin Distin-
guished Professor and Founding
Director of the Global Mindset Institute.
Dr. Jennie Walker is a faculty associate
for the Naja Global Mindset Institute
at Thunderbird School of Global Man-
agement. Her area of expertise is in
global leadership development. She
began work in human resources devel-
opment in 1995 and has specialized in
developing corporate leadership pro-
grams for Fortune 500 companies
since 2002. She earned her Ph.D. at the
University of Denver.
