Executive Insight

Globalization Not as Prevalent as Many Believe, a New Report on Global Connectivity Asserts

Globalization continues to feature prominently in political debates, business strategy deliberations, and in everyday life. The dialogue, however, is seldom backed up with hard data, the authors of a new report on global connectivity assert.

The new report from logistics giant DHL finds that the world is less globally connected today than it was in 2007, and global connectedness also falls far short of the levels commonly assumed by business executives and the general public.

Increasing global connectedness can be a powerful lever for improving prosperity, the report suggests and that limited and faltering global connectedness imply that strengthening countries’ connectedness offers large untapped potential to help accelerate economic recovery.

Global Connectedness is defined in the report as the depth and breadth of a country’s integration with the rest of the world as manifest by its participation in international flows of products and services, capital, information, and people.

Depth measures how much of a country’s activities or flows are international versus domestic by comparing the size of its international flows with relevant measures of its domestic economy. For example, to assess the depth of Hong  Kong SAR (China)’s merchandise exports, its exports are compared to its GDP: Hong Kong’s merchandise exports-to-GDP ratio is 187%, the highest in the world and 37 times higher than Nepal’s (the lowest – only 5%).

Breadth complements depth by looking at how broadly the international component of a given type of activity is distributed across countries. To illustrate the importance of incorporating breadth into assessments of global connectedness, consider inbound tourism in the Bahamas. While the Bahamas ranks first in terms of the number of inbound tourists per capita (a depth metric), more than 80% of those tourists come from the United States. Thus, while depth of inbound tourism in the Bahamas is high, its breadth is limited, especially when one notes that less than 15% of outbound international tourists worldwide come from the United States.

The 2012 DHL Global Connectedness Index measures and analyzes the global connectedness of 140 countries, covering 99% of the world’s GDP and 95% of its population.

Source: DHL

Read the Report

Education to Employment: Designing a System That Works

• Globally, seventy-five million youth are unemployed and young people are three times more likely than their parents to be out of work.
• Half of youth are not sure that their postsecondary education has improved their chances of finding a job
• Only 43 percent of employers can find enough skilled entry-level workers and estimates suggest that by 2020 there will be a global shortfall of 85 million high- and middle-skilled workers

Around the world, governments and businesses face a conundrum: high levels of youth unemployment and a shortage of job seekers with critical skills. How can a country successfully move its young people from education to employment? What are the challenges? Which interventions work? How can these be scaled up? These are the crucial questions.

A new report from McKinsey attempts to answer them. To do so, it developed two unique fact bases. The first is an analysis of more than 100 education-to-employment initiatives from 25 countries, selected on the basis of their innovation and effectiveness. The second is a survey of youth, education providers, and employers in nine countries that are diverse in geography and socioeconomic context: Brazil, Germany, India, Mexico, Morocco, Saudi Arabia, Turkey, the United Kingdom, and the United States.

The report’s findings include the following six highlights:

• Employers, education providers, and youth live in parallel universes – or to put it another way, they have fundamentally different understandings of the same situation.
• The education-to-employment journey is fraught with obstacles - not least of which are cost, work relevancy and job access.
• The education-to-employment system fails for most employers and young people – positive outcomes are the exception rather than the rule.
• Innovative and effective programs around the world have important elements in common – most particularly when education providers and employers step into each others’ worlds.
• Creating a successful education-to-employment system requires new incentives and structures – distributed information, collaborative endeavor and systems integration.
• Education-to-employment solutions need to scale up – leveraging interactive technologies and employer-valuable curricula.

McKinsey started this research recognizing the twin crises of a shortage of jobs and a shortage of skills. In the course of it, though, it realized the need to take into account another key shortage: the lack of hard data. This deficiency makes it difficult to even begin to understand which skills are required for employment, what practices are the most promising in training youth to become productive citizens and employees, and how to identify the programs that do this best.

The authors conclude, “The journey from education to employment is a complicated one, and it is natural that there will be different routes. But too many young people are getting lost along the way”.

Read the report

Source: McKinsey Center for Government

New Study Finds Millennial Generation’s Power to Influence Is Increasing

Seventy-Four Percent of Millennials believe they influence the purchase decisions of their peers and those in other generations, a new study from PR firm Edelman finds.

The study provides updated insights around the ambitions and beliefs of the Millennial generation, born between 1980 and 1995, building on its 2010 benchmark study, 8095®. Encompassing interviews with 4,000 Millennials in 11 countries, 8095 2.0 revealed that 74 percent believe they can inspire the purchase decisions of peers and those in other generations. The new study was issued to better understand the evolving roles of brands in Millennials’ lives and how cultural changes like the global recession are impacting their behaviors.

8095 Refreshed from Edelman Insights

Global findings from the study include:

• The global recession has fundamentally changed Millennials: The economy is a key factor in Millennials’ lives and within their community. In fact, economic stability is the number one hope that Millennials have for their country. The troubling job market also has created a new breed of Millennial entrepreneurs, with 48 percent of Millennials saying that owning their own business is a top life goal (76 percent in Turkey and 65 percent in Brazil).
• Millennials are alpha-influencers:  Seven in 10 believe it is their responsibility to share feedback with brands when they have a good or bad experience.
• Millennials are surprisingly open to brand engagement and advertising, if brands have the right approach: Only 3 percent of Millennials thinks all advertising is boring, and 80 percent want brands to entertain them – the ability to co-create products and services (40 percent across 11 countries) being the most popular way.

Why Millennials Matter

According to the World Fact Book, the median age of the world population is 28, which falls within the Millennial generation and there are more than 1 billion Millennials around the globe. As the first generation to grow up inherently digital, it is also a group that has information at its fingertips and expects two-way dialog with preferred brands.

The Evolving Role of Brands for the Millennial Generation from Edelman Insights

While Millennials share many traits and behaviors, they are more diverse ethnically, economically and socially than any other generation in history. They are more connected by being grounded in a global network with perspective and purpose. They have instant access to one another and to information. They are aware of and believe in their own voice and power. They are each a unique and powerful member of a generation that by 2025 will amount to 70 percent of the global workforce. The time to pay attention to Millennials is now.

Source

More Information

Ostrich or Eagle? The Stark Choice Facing Organizational Leaders

Peter Drucker was once asked about the accuracy of predictions.

“I don’t predict,” he responded, “I look out of the window and identify what is most visible, but not yet seen.”

In 1987 the Hudson Institute published its seminal report, Workforce 2000. Ten years later it reprised the analysis with the publication of Workforce 2020. In between several important Harvard Business Review articles covered similar ground, though taking more of a global view. By the end of the decade, McKinsey’s War for Talent was capturing considerable executive attention.

Each took a long-term view of the confluence of societal trends, demographics, education sector deficiencies, globalization, technological advances and workforce supply & demand. Each warned advanced-economy government, business, labor and education leaders that, absent the collaborative development of fresh solutions, trouble lay ahead. In parallel, business thought-leaders like Peter Senge, Meg Wheatley, Charles Handy and Gary Hamel were challenging conventional wisdom and urging that new realities required fresh thinking.

The rest is history.

Fast forward to 2012. Several substantive and insightful new reports have been published this year that center on contemporary and impending global labor market discontinuities. They all cover somewhat related ground from different vantage points and paint a picture of the present that is quite consistent with that of the earlier forecasts. Importantly, each warns leaders in both advanced - and now also in developing economies - of the considerable economic and societal consequences of failing to act to solve the challenges ahead:

• Help Wanted: The Future of Work in Advanced Economies, The McKinsey Institute, March 2012
• Better Skills, Better Jobs, Better Lives - A Strategic Approach to Skills Policies, OECD, May 2012
• The World at Work – Jobs, Pay and Skills for 3.5 Billion People, The McKinsey Institute, June 2012
• False Summit – The State of Human Capital 2012, The Conference Board and McKinsey & Company, October 2012

This 2012 body of work is serious stuff. Its antecedents were serious too, but in the end issue-avoidance and short-term-ism - regretfully – brought the future home to roost.

Here’s the rub. Unless we pay attention and do something proactively to respond to these dynamics, organizations will increasingly struggle and competitiveness will continue to erode.  Form will follow function, we know this. The pivotal question is who will be ostriches and eagles this time around?

Clearly, we have a Point of View. We hope that executives earnestly examine the strategic implications of these forces and build out strategies and capabilities to future-proof their enterprise.

---

Charlesmore Partners International specializes in organizational strategy. We have a track-record of building high performance organizations and experientially-developed methodologies that help organizations get ready for the future.

More information:  +1 215.353.6472 or connect@charlesmore.com.

The Rise of the African Consumer

The single-largest business opportunity in Africa will be its rising consumer market. A new McKinsey report offers a detailed profile of African consumers, including their demographics, behavior, and needs.

The continent’s consumer-facing industries are expected to grow by $400 billion, representing its single-largest business opportunity, by 2020. In one of the first studies of its kind, McKinsey’s Africa Consumer Insights Center surveyed 13,000 consumers in ten African countries, with a focus on the largest cities. Five categories of consumption were covered: apparel, financial services, groceries, the Internet, and telecommunications.

Here are some highlights from the research.

• Cities offer the best opportunity: urban Africa is forecast to contribute nearly 40 percent of GDP growth. But companies may be wise to bypass high-profile megacities, such as Cairo, Johannesburg, and Lagos, for midtier cities, like Abidjan and Rabat, which are more accessible, have less competition, and offer better profit margins.
• Companies can better tailor products to local markets if they understand what quality means for African customers and know their preferences, lifestyles, and daily needs.
• Since affordability is critical, companies may have to reengineer products to hit a specific price point. The necessary moves may include offering lower-cost versions, smaller sizes, or alternative payment models.

Read the Report

Source: McKinsey & Company

The Five Make or Break Challenges of 21st Century Organizations - Gary Hamel

New Study: US Faces Leadership Time Bomb Unless Practices Change

A UK-based  alent measurement solutions company - SHL - has just released the results from a study of over a million workers in 251 countries. The study looked at the supply of future leaders per country relative to the size of its workforce, both as each country stands today and then as a projection of future leadership supply trends.

It reports that the US currently stands 5^th in the league table of leadership potential supply, and is on track to drop to 8^th place “tomorrow”  (although it never actually defines the timeframe that tomorrow represents).

The point from the study though is that rapidly developing economies such as Mexico, Turkey and Brazil are starting to outpace older economies such as the US, the UK and Germany in the supply of global leaders – a trend that SHL describes as a “leadership time bomb” and offers five guidelines to cultivating leadership capability:

1. Make It a Priority: Acknowledge the risk, and put a formal action plan in place. Start by clearly defining the behaviors and skills which make a successful leader in your organization.
2. Look Beyond Performance: Have a full picture of the leadership potential across your organization and don't restrict that view to only those you think are high potential. Do not confuse ambition with ability.
3. Replace Subjectivity with Objectivity: Gut instinct won't do. Using scientific data, benchmark your people against competitor talent and identify leadership shortages to avoid succession risk.
4. Be Pragmatic and Proactive: Don't wait for yearly review cycles, instead, employ development interventions at the point-of-pain with individual employees or across departments. This includes where and when to spend learning and development budgets throughout the company.
5. Cast a Wider Net: Take a global view of where your leadership talent is located and be prepared to use creative strategies to source talent across borders to fill leadership gaps.

Additional findings from the study:

Globally, only 1 in 15 (6.7%), managers and professionals qualify as leaders today. 1 in 3 managers and professionals have the next tier of leadership potential, but for this level of people the journey to realize that potential is longer and needs targeted investment. The value of investing in these people is substantial because there are six times as many managers and professionals with this level of potential than leaders for today.

In China (Taiwan), Germany, Sweden, Switzerland and United States, the supply of leadership for today and tomorrow is stronger than the average global supply. While competing for leadership talent remains a challenge in these geographies, the odds of finding effective leaders for today are significantly higher at 1 in 10 vs. the global average of 1 in 15.

Read the Release

Developing the Organization to Deliver Strategy

Today’s organization is rarely fully equipped to deliver tomorrow’s desired business results and varying degrees of transformation will be required to assure that strategic intent is fully realized.

Read our new Executive Insight thought-leader on organizational strategy development and implementation:

Download .pdf

Link to website.

Global Talent Shortage Worries Multinationals More than Revolution or Recession

Nearly 60% Fear Staffing Issues Can Impact Global Strategy

A majority of executives of multinational corporations cite a growing global shortage of talent as a factor that could limit their entry into both developed and emerging markets more so than economic weakness or even political instability, according to a new report from AXA Group and MetLife, Inc.’s MAXIS Global Benefits Network (GBN).

Forty percent of the multinationals surveyed say they intend to expand their operations in both developed and emerging markets, including but not limited to the so-called BRIC emerging markets encompassing Brazil, Russia, India and China. The findings of the study are based on an Economist Intelligence Unit (EIU) survey of more than 350 executives from multinational companies. The macroeconomic-focused research covers findings gathered from various industry sectors and locations, both in mature and developing countries. The report seeks to outline the international development strategies multinationals are employing to achieve successful growth at a global scale. The research also looks at the challenges to their growth.

War for Talent

As multinationals are expanding globally, so will their workforce. Of the largest multinationals surveyed (those with more than US$10B in annual revenue), close to one-fifth expect to have more than 85% of their total workforce outside their home country in the next five years. This figure represents nearly double the current figure.

In addition, the difficulty of simply attracting and retaining talent in non-home markets is clear in the survey findings. Nearly two-thirds (66%) of respondents say talent shortages are likely to affect their bottom line in the next five years. The focus on talent shortages and hiring challenges is highest amongst technology, professional services, healthcare, pharmaceuticals and biotechnology.

Both HR and business executives agree that employee benefits are critical in efforts to move talent among geographies in which they operate. Ninety percent say employee benefits are a key lever in the battle for local talent. In addition, benefits rank second only to salary in importance for their globalization strategies.

HR and Business Leaders: Wide Apart

Given that the global talent shortage is the number one issue for multinationals, the survey finds that there is still work to be done to align the gap in perceptions among HR and their business counterparts about assessing local talent in markets and the company’s readiness for expansion.

HR representatives are far more likely than business executives to say their firms are proactive in assessing the talent portion of market entry/expansion. Among business executives (excluding the HR function), 61% say their firms evaluate talent management issues (eg, acquisition and retention of functional capabilities or other expertise) only after they have identified markets for entry/expansion or don't see talent as an important globalization issue at all. By contrast, 63% of HR executives say talent is considered when markets are being identified.

The study also found the following trends:

• One in four companies plan to enter new markets in the next five years.
• Foreign markets are outpacing home markets as a source of future revenue for many multinationals. Nearly one in three multinationals expects more than 70% of its revenues to be generated from non-home markets in five years.
• Brazil, China, India and the U.S. are top choices for companies looking to sell products.
• Vietnam, South Africa and Sub-Saharan Africa are considered as being the ‘single biggest opportunity’ for those seeking to source products or components.

Source: Met Life

The Route to Sales Excellence

The Route to Sales Excellence

For over 20 years PLAYER MAP has been the sales process of choice for thousands of salespeople and hundreds of companies worldwide.

But sales mastery takes more than a world class methodology. It takes sales professionals with the capability to build enduring client relationships, skillfully position products and services to advantage and out-compete rivals. Recognizing this, PLAYER MAP and Charlesmore Partners International have created a Sales Certification Process to provide a systematic and sustaining route to competitive sales excellence for sales professionals and sales teams.

Based upon the proven principles of PLAYER MAP and best practices of professional development and learning, sales professionals and sales teams engage in an intensive, experientially-rich development process that builds the 10 core competencies of sales excellence.

Sales excellence can be readily validated by the consistent achievement of stretch sales targets set by companies and consistently achieved by the best performers. But to reach this level of achievement and to sustain these results year-on-year takes more than effort, it takes a highly developed skill set.

Over the last two decades we have worked with and studied successful sales people in some of the world’s best and most prestigious companies.

Consistently the most successful sales professionals role model a series of discernible and definable core competencies:

• They excel at sales skills, sales strategy, sales process management, and customer relationship management
• They possess deep market knowledge, strong industry relationships and comprehensive product and/or service knowledge
• They are emotionally intelligent, serve as peer leaders within their own organization and with customers, possess outstanding communications skills and consistently hit their numbers

We’ve codified and distilled these capabilities into their core elements so that we can help sales professionals understand the DNA of sales excellence.  From this knowledge base, we have created an engaging, intensive and experientially-rich development process to help guide and catalyze accelerated progression to sales excellence.

PLAYER MAP certification can be earned at three professionally demanding and progressive levels. Each level requires developed and validated competencies in the 10 dimensions of sales excellence. It is a long-term professional journey of competency development and accreditation that is designed to help sales people excel and win more. We also offer a certification process for sales managers charged with orchestrating the development and performance of intact sales teams.

PLAYER MAP certification works for professionally-ambitious individuals, intact sales teams and at enterprise-level. Companies can private label the certification methodologies and embed into their core talent development practices. It can be self-guided, sales manager guided, trusted advisor-guided or PLAYER MAP coach guided and really depends on needs, circumstances and preferences. The intention is to provide a robust and practical development platform to help sales professionals significantly and more rapidly improve their competencies.

For more information contact Edward Ferris or Scott Leland.