Global Class Mindset: The next competitive advantage for entrepreneurs and corporate innovators
The pandemic caused a tremendous shift in global business with the acceleration of distributed work and competition emerging from international markets. In this new situation, the question arises: What are the important factors for businesses to operate at scale globally?
We’re seeing a new trend of companies who are embracing the acceleration of distributed work and competition emerging from global markets. We define them as, “Global Class Companies.” They have the following characteristics:
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They take advantage of access to a larger pool of diverse talent
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They have local knowledge of how to scale the business in each unique market where their employees reside
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They have the ability to expand internationally early in their growth journeys
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They are made up of team members with sought-after skills to support an international footprint
There is a shift in business
According to a recent Accenture Business Futures report, “71% of executives have already decentralized or are planning to decentralize decision-making in parts of their business,” and 82% said they see their business as operating more like a “broad federation of enterprises,” given the “increasingly fragmented” business environment.
This goes to show that the focus of business operations is shifting from a top-down, centralized HQ model, to one based on distributed success and teams with localized missions and focus. Two examples are Meta and Rocket.Chat’s shift to more remote work.
Meta and Rocket.Chat Scatters Exec Team
An example of a company embracing this new future of work is Meta. The Hustle reports that Meta’s execs are working all over the world. The company’s HQ is in Menlo Park, California but its top team members are dialing in anywhere from Cape Cod to Israel.
Another example is Rocket.Chat, the world's largest open-source communications platform. Rocket.Chat has HQs in US and Brazil but operates fully remote with employees from 70+ cities globally.
Despite being remote, finding opportunities to connect in person are still important. In understanding this, Rocket.Chat’s co-founder and CEO Gabriel Engel shared how they set this up: The company’s HQ in Porto Alegre, Brazil, is located in a house with a swimming pool, an outdoor kitchen for weekly barbecues, and a large indoor kitchen.
Gabriel explains, “Everyone doesn’t have to go there all the time, but it’s an important representation of what the company cares about our headquarters is more about finding interaction and building relationships than being designed for people to just do their work.”
Companies like Meta and Rocket.Chat are realizing the benefits of making decisions at the edges, instead of clinging to the command-and-control mantra of the past. This goes hand in hand with decentralized innovation, where best practices from anywhere can be implemented globally instead of only being top-down from headquarters.
Introducing the Global Class Mindset
If the way that companies have successfully built international businesses in the past is less effective in today’s global economy, then what should you do?
The answer is: Embrace the “Global Class Mindset.” This mindset is based on the notion that everyone must be a leader when expanding globally, not just those at HQ. It doesn’t matter whether the company is scaling in one country or 100; it’s about having the right approach to global growth.
The Global Class Mindset means having the vision to think global day one, leveraging a decentralized talent strategy, positioning HQ to be an enabler and supporter of local markets, and implementing a strategy that finds the local way of running a business. This is in direct opposition to the legacy mindset.
The Global Class mindsets components fit into 4 categories:
1. Vision: Think Global Day One
A “born global” company is a myth. A company must find validation and prove scale in an initial market before expanding to build the right foundation for international success. Instead, Global Class Companies think global day one by building all aspects of their business—product, team, culture, operations—to localize for multiple markets.
2. Talent and Culture: Distributed Strategy
The Global Class believes that talent is skills-driven, not location-driven. They hire where the talent is, understanding that sourcing talent only from their local area is limiting.
3. HQ Role: Enabler and Support
Within Global Class Companies, HQ’s primary roles are to support and enable local teams, not command and control them. These companies practice two-way innovation, looking to gather insights from best practices implemented in every local market as much as sharing a best practice discovered at HQ.
4. Strategy: Local Way
Global Class Companies strive to find a balance, doing things the “local way.” They localize the business to fit the local market while staying true to company principles.
In summary, companies born during and after the pandemic will look and operate differently than companies founded before. Like the examples of Meta and Rocket.Chat, these smart companies are taking advantage of access to a larger pool of talent, as one way to acquire local knowledge in scaling the business in each unique market where its employees reside.
About Global Class
The Global Class team has developed THE playbook that teaches organizations the right mindset, culture, and strategies to successfully build global businesses. Through consulting engagements and practical tools (+ case studies built from conversations with over 400 executives from the world’s fastest-growing companies), we help executives with companies valued at $1B to $100B reach global scale. From market entry to global scale, we help companies build the foundation for successful global growth through management consulting services, customized platforms, and more.
