Haunting Effects of Globalization - Nu Leadership Series

"You must be the change you wish to see in the world."

Mohandas Gandhi

As competition continues to increase around the globe, why are some organizations unprepared for globalization? Senge, author of The Fifth Dimension, suggests that many businesses suffer a narrowness of focus. This causes leaders to miss the root cause of problems. Senge argues, "Yet the primary threats to our survival today come not from events but from slow gradual processes to which we are 90 percent blind."

Obviously, globalization is forcing organizations to change. However, these corporate changes are beyond nontraditional organizational structures, such as spider plants. First, structural indeterminacy is the issue. Galbraith, author of Designing Organizations, argues no single organizational structure is the answer in an international environment. This reality is clear for multinational companies. They must be able to integrate activities in different countries.

Therefore, organizational structure gets blended into culture. Second, some management gurus believe that decentralization isn't achievable, even globally. Peters, management guru, argues, "It is easier to kill an organization than to change it. Therefore, decentralization is hard to do." Furthermore, Senge warns that organizations that rely solely on their past experience to solve future problems will make fatal mistakes.

Drucker, author of Managing for Results, maintains that some of these organizational issues stem from ineffective leadership. Drucker argues, "Business tends to drift from leadership to mediocrity. And the mediocre is three-quarters down the road to being marginal." Given the unforgiving nature of the market, why are leaders being caught unprepared for globalization?

Clearly, leaders must understand the needs of the international markets while optimizing the efficiency of the whole supply chain. Leaders cannot afford to neglect any component in their socio-technical systems. This means staying on top of technology, interconnecting with suppliers, and monitoring the needs of this global market. As a result, 21st century organizations face another paradox. Will today's organizations be ready to transform themselves into international champions or become extinct? Time will tell.

References:

Drucker, P. (1964). Managing for Results. New York: Harper & Row, Publishers.

Gailbraith, J. (2000). Designing the Global Corporation. San Francisco, CA: Jossey-Bass.

Peters, T. (1997). The Circle of Innovation. New York: Alfred A. Knopf.

Senge, P. (1990). The Fifth Discipline. New York: DoubleDay.

© 2007 by Daryl D. Green