Global versus International SMBs

A few weeks ago, I was part of a team facilitating an informal discussion on what it means to be a global company and a multicultural manager (I will come back on the later in future posts). We raised the question of what differentiates a global company from an international company. Not surprisingly, a consensus rapidly appeared that being global means sharing resources and initiatives across borders. Of course the example of large corporations creating shared services centres in countries with low labour costs comes to mind immediately. However, being global is not specific to large corporations. Medium-size companies and even small companies with only a few hundred employees can also be global. Here are some common examples:

- Service centres chartered to support all locations across the world (like for corporations)
- Research and Development labs spread over several continents (common among technology companies)
- Virtual practice teams chartered to develop and/or sell a leading-edge offering (common among consultancies)
- Virtual teams chartered to acquire and serve global clients (common in many industries)

Among all SMBs with international operations, there is a broad spectrum ranging from “only international” to “truly global”. “Only international” means that each country operates more or less in isolation with very lose operational linkage with other countries. “Truly global ” means that there is a holistic (cross-border) view of the company’s business, and a shared vision of what can and must be developed and implemented in several countries.

Many international SMBs are in the “only international” category, each country being a kingdom. The history of how the company developed abroad and the necessity to adapt to local specifics are presented as the main reason and justification for that. In such an environment, it is rather difficult to drive a global initiative. A direct consequence is the quasi impossibility to implement a coordinated approach to grow revenue with global clients. At the other extremity of the spectrum, those SMBs who manage to be global on some aspect of their business are more agile, faster to develop a new offering, and more able to serve global clients. They also tend to be more collaborative and to have better average intercultural skills. At the origin of this capacity to act globally, one almost always finds a management will and the capacity to implement it. This tells us that being or becoming more global is not only driven by cost consideration only. It reflects a strategic choice and it often serves a vision. One could conclude that, in the SMB space, being “truly global” rather than “only international” is the mark of the leaders. Based on my own experience, I would tend to say that it is often true. So, what about your own company?

Uber Olivier Riviere