Indeed, most globalisation stories follow a predictable course. As companies expand beyond their original markets, they first move from a structure with a dominant global headquarters to one that replicates essential functions – HR, marketing, sales, distribution, manufacturing and so on – within each country of operations. Yet such a regional or national focus often results in fragmentation and operational redundancy, and can even undermine a company's reputation as a good place to work.
So employers then enter the next predictable phase: harmonising and standardising HR systems, practices and processes. But too much standardisation can be just as harmful. Motivational philosophies that work well in some Asian cultures, for example, such as receiving demotions for perceived subpar performance, may not motivate employees in western geographies. Likewise, workforce legislation and union agreements can very significantly across countries.
To truly improve workforce performance, our research shows that talent management practices should be tailored to an individual or groups of individuals that share common values and traits, such as those in a common geographic location and shared culture. But according to an Accenture survey conducted for the book Workforce of One: Revolutionising Talent Management through Customisation, in 2012, only 31% of workers felt that their organisations' HR practices were relevant to their unique cultural background, and only 35% felt that they were relevant to their geographic location. When people practices aren't relevant, organisations risk poor employee performance.
What is needed is an approach that combines the benefits of globally consistent policies on the one hand and local relevance on the other. In other words, companies need to adopt a "glocal" HR approach that is both super global and super local. Here are some suggestions on how to achieve such an approach:
Strategically decide what to standardise and what to localise. When value is driven by consistency and standardised operations (HR transactions, for example), a company needs global policies, services and technology platforms. But when value is driven by the needs and variations of specific markets - sourcing talent, motivating, rewarding. An employer may need to be intensely local in its focus. In other words, variation should exist, but only in a highly coordinated, controlled manner-and only when there are good, strategic business reasons for how variation can maximise employee performance.
Create global standards, but ones that can flex. Standards need not be rigid and one-size-fits-all. An organisation may create a few segments of its workforce based on shared values and needs of workers across multiple geographies - offering one set of practices for emerging markets, for example, and another for developed markets. Or it may define a policy so broadly that it can be interpreted in multiple different ways based on local conditions, or centrally manage a global set of options from which each geographic location can choose based on which suits their unique employee base best.
Leverage off a common platform. To achieve a coordinated and strategic approach to customisation, most employers first need to go through the evolutionary stage of reducing uncontrolled and nonstrategic variation to build common shared services platforms from which to support strategic, controlled customisation. Employers using common, global systems for HR information and processing can more easily meet the challenges of conflicting regional policies and systems, accompanied by a redesign of HR processes to achieve both consistency and local relevance.
Grow global leaders locally. As companies grow they need to adopt a global mindset without presumptions about what region should be dominant, especially as other centers of power and influence are rising. Decisions should often be made locally in areas into which an organisation is expanding, encouraging local innovation. New talent and leadership should also be drawn not simply from a company's old base but from areas where there is significant market potential.
As companies expand across markets and face the challenge of globalisation while remaining locally relevant and flexible, HR must play an active part from the start, streamlining processes and consolidating systems and being an active participant in creating the globalised vision.
David Gartside managing director in the Accenture Talent & Organisation practice, responsible for the company's global Human Resources consulting practice and Richard Coombes managing director responsible for Acenture's HR consulting practice actoss Europe.
