GLOBALIZATION AND INNOVATION. Globalization Traditional definition of globalization? Movement of...

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Transcript of GLOBALIZATION AND INNOVATION. Globalization Traditional definition of globalization? Movement of...

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  • Globalization Traditional definition of globalization? Movement of resources across national boundaries: money, people, goods, services, ideas Globalization as complexity: The complexity inherent in doing business in a global economy comes from: Multiplicity many things happening at once Interdependence all things being connected Ambiguity less knowledge about all aspects Flux rapid and consistent change Implications for managing: rather than tactical solutions to problems, need people who can engage in collaboration, discovery, architecting and systems thinking.
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  • Global Innovation A process for innovating that transcends local clusters and national boundaries. Sourcing and integrating knowledge from dispersed geographic locations, companies can generate more innovations of higher value and lower cost. E.g. from China, Inc.
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  • COMPLEXITY AND INNOVATION Global Innovation Complexity Organizational Complexity Global Management Complexity Intra-organization Complexity Importance of knowing the where and why of complexity, remaining flexible, and collecting a toolbox of appropriate choices.
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  • GLOBAL INNOVATION COMPLEXITY Integrating multiple evolving technologies Tapping globally dispersed technology sources Serving globally distributed customers
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  • Chief Executive Officer Manufacturing/ Operations Marketing Finance Human Resources Chief Executive Officer Division 1 Division 2 Division 3 Division 4 Purchasing Engineering Operations Marketing Human Resources Purchasing Engineering Operations Marketing Human Resources Human Resources Human Resources PlanningLegal Finance Organizational Complexity
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  • ConsumerPharma- ceutical Medical Devices Franchise Mgmt (Marketing Support) Group Operating Committee (Strategic Support) CEO Human Resources Finance Environ- ment 190 Autonomous Business Units (Brand Focus) Corporate Functions Markets Business Segment Structure Science & Technology Additional Corporate Functions Customer Support
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  • ABBs Geography-Based Internal Network CEO Projects Finance HR Corporate R&D Global Staffs Accounts Financial Industrial Power Power Europe / Americas Asia Services & Building Transmission Generation Middle East / Systems Africa Business-Area Transformers 140 Countries 4 Business Segments 3 Regions 40 Business Areas 1,000 Companies 5,000 Profit Centers Finance Products/Functions R&D Spanish Transformer Business Spain Shell Espana ~ Shell
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  • Management Complexity Innovation is a strategic mandate leading to value- added outcomes Innovating is about the actions, behaviors and management practices that create innovations. Managers in a global business world come with their own culturally derived values, attitudes and norms; and they function within organizational and societal values, attitudes and norms. Greater diversity = greater variation in beliefs about what, how, where and why.
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  • Global Partnering Interorganizational complexity Manage tensions (cross cultural and cross organizational) Build networks (finding the right partners and acting like the right partner) Achieve Outcomes
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  • CROSS BORDER INNOVATION What role does culture play in the study of innovation?culture
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  • Culture is Hidden Image by R.A. Clevenger ARTIFACTS Visible, tangible. NORMS, VALUES, ATTITUDES Less visible, but can be talked about. DEEPLY ROOTED ATTITUDES Usually not visible at all, often held subconsciously, rarely (if ever) questioned in everyday life.
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  • 3-13 The culture of McDonalds Localized menus reflect norms, values, attitudes PhilippinesMcSpaghetti GermanyMcBeer SwitzerlandVegi Mac MalaysiaSugar Cane Juice NetherlandsCappuccino Donuts GreeceShrimp, Veggie Burgers, & Spring Rolls (sold during Lent) Artifact looks the same everywhere Deeply Rooted Values change the way McDonalds is used Deeply rooted values change the way McDonalds looks in France where a McDonald's breakfast meal in Villeurbanne, France includes fresh baguettes and jam spreads with coffee for $4.55 BUT WHY? Naturally, the U.S. is its no. 1 market, but guess who is no. 2? You got it: France. McDonald's is such a success in the land of Michelin three-star restaurants because it has adapted to French eating habits and tastes. There are now 1,200 franchises in France; the company opened 30 restaurants per year in the past five years alone.
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  • 14 Influences on Culture History, Language Religion, Climate, Physical Environment, etc. Culture Shared Assumptions and Values, Systematic, Learned Individual Perceptions and Interpretations based on Values and Attitudes Individual Behavior Cultural Institutions Educational, Social, Political, Legal, Economic, etc. Influences on, and of, Culture B:f(P*S) Person Situation
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  • 3-16 Daily Coffee Consumption per Capita Source: Business 2.0. July 2002.
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  • 3-17 Did You Know? In Turkey its rude to cross your arms while you are facing someone. In the Arab world the left hand is considered unclean; dont eat with it! In India never pat someones head, its the seat of the soul. The Chinese associate gifts such as straw sandals, clocks and handkerchiefs with funerals.
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  • 3-18 Favorite Campbell Soups Around the World Hong Kong - Watercress & Duck Gizzard United States - Chicken Noodle, Cream of Mushroom Britain - Tomato Japan - Corn South America - Cream of Asparagus Australia- Cream of Pumpkin
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  • 3-20 Days of Annual Vacation Source: AAA World
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  • 3-21 Nations That Have Not Converted to the Metric System United States Liberia Yemen Myanmar (Burma) Brunei
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  • Is everyone an equal player? Friedman claims the World is Flat Technology has leveled the playing field across nations Richard Florida, author of The Flight of the Creative Class claims the World is Spiky. The most populated areas of the world are also the least economically and innovatively active.
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  • World Population
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  • Light Emissions
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  • World Patent Activity
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  • Scientific Citations
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  • Global Innovation Index Generates a ranking of countries based on innovation. Source: The World Business/INSEAD Global Innovation Index (GII). The Global Innovation Index (GII) was conceived at INSEAD as a formal model to help illuminate the degree to which individual nations and regions are currently responding to the challenge of innovation. The framework groups the eight pillars of innovation into two categories: Inputs and Outputs.
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  • The five Input pillars: Institutions and Policies Human Capacity Infrastructure Technological Sophistication Business Markets and Capital These represent aspects which enhance the capacity of a nation to generate ideas and leverage them for innovative products and services. The three Output pillars: Knowledge Competitiveness Wealth These represent the ultimate benefits of innovation for a nation - more knowledge creation, increased competitiveness and greater wealth generation.
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  • Global Innovation Index Overall Rankings 1United States5.80 2Germany4.89 3United Kingdom4.81 4Japan4.48 5France4.32 6Switzerland4.16 7Singapore4.10 8Canada4.06 9Netherlands3.99 10Hong Kong SAR3.97
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  • Brain Drain Quality of human resource approach Quality of Math and Science Education Graduates in Engineering Graduates in Science Population 15-64 Urban population Schools Connected to the Internet Human Capacity
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  • 1Singapore6.31 2Finland5.83 3United States5.70 4Canada5.50 5United Arab Emirates5.46 6Israel5.45 7Luxembourg5.41 8Australia5.34 9Kuwait5.26 10France5.24
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  • Knowledge Local Specialized Research and Training Nature of Competitive Advantage Quality of Production Process Technology High-Tech Exports Manufactured Exports ICT Exports Insurance and Financial Services Patents Registered (domestic and non-domestic) Royalty and License Fee Receipts
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  • Knowledge 1United States6.01 2Germany5.03 3Japan4.70 4United Kingdom4.42 5Switzerland4.07 6United Arab Emirates4.03 7France3.87 8Belgium3.52 9Denmark3.48 10Netherlands3.39
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  • World Competitiveness Report The IMD World Competitiveness Yearbook, published since 1989, ranking and analysing how a nation's environment sustains the competitiveness of enterprises.
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  • Understanding Diversity Provide frameworks for using diversity to get higher performance Increase awareness of ourselves and others, and the imp