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Employers, workers adapt to need for flexibility, collaboration across continents

WASHINGTON, DC – 09/21/07 – “Connect and Develop” has displaced “Research and Development” as the corporate mantra at multi-national, consumer product giant Procter and Gamble Company (P&G).

P&G, which produces and markets a dazzling array of consumer products, seeks ideas from entrepreneurs worldwide, according to Jodi Starkman, a talent-management expert with Organization Resources Counselors (ORC)

ORC is management counsultancy with offices in Washington, DC, Los Angeles, Sacramento, San Francisco, New York, and several other cities.

Work, she said, “is changing for Americans who clock in at global companies, whether those companies are multinationals or high-tech startups.”

According to Starkman, US firms tap into a world talent pool and increasingly manage those workers with technology.

“They operate with fewer employees and facilities…many workers do not report to offices, do not keep set hours or are not governed by a companywide vacation policy,” she said.

Other changes are in the offing, due to the increasing global nature of business, say other experts – most importantly, US businesses will be led by foreign nationals, and even the notion of “US headquarters” will eventually fade.

Navi Radjou of Forrester Research in Cambridge, Massacusetts cites International Business Machines' (IBM) move from its traditional focus on activities in the US.

Today, the company’s Bangalore, India, unit designs business models with the aid of logistics experts in Switzerland and software engineers in Japan.

A global work force and the Internet mean manufacturers can make design changes on 3-D product models in 24 hours. Engineers on one continent make initial changes, others several time zones away offer feedback and a third group makes fixes.

“Short product lifecycles put a premium on innovation,” said Radjou. “Projects get under way quickly, so companies want a nimble work force.”

Jobs are “short-term,” said Paul Saffo, a Silicon Valley-based technology expert and professor at Stanford University.

For example, more than half of IBM’s entire workforce has been with the company less than five years.

Companies increasingly compensate with cash, rather than benefits, said Dallas Salisbury of Employee Benefit Research Institute, adding “they [employers] don’t want people to stay for decades.”

More than 30 years after the lifestyle began inching into mainstream corporate culture, and in spite of the potential pitfalls, there were almost 14 million Americans telecommuting at least part time in 2004, and an additional 7 million running businesses from home, according to the Labor Department.

Salisbury said US companies – like IBM, General Electric Company, and Emerson Electric Company – have begun to push “for redesigns of benefit programs and laws in other countries as readily as they’ve done that historically in the United States.”

Day-to-day operations at IBM are changing, according to company spokesman Clint Roswell, who said 40% of employees are “mobile,” meaning they don’t report to an office.

No one at the company abides by a set vacation policy; they take time off when needed.“Employees don’t have to be a certain place at a certain time; it allows us to be much more flexible,” he said.

Santa Clara, California-based Sun Microsystems Inc. has a similar proportion of mobile staffers.

It is not all free time – workers join conference calls at 5 a.m. and they are available to colleagues across continents via e-mail, instant messaging and “electronic team rooms” - password-protected websites that allow document sharing.

“We do a lot of collaboration with [instant-messaging] type systems,” said Roswell.  And with employees in 170 countries, conference calls are “world calls,” he said.  “We can do three or four continents most times.”

Starkman, who formerly worked at IBM, said that company’s database of employees’ expertise helps.

When Starkman once was at a client’s workplace, a problem arose with another vendor’s product. 

Using the database, she found IBM employees in Europe and Asia with experience with the application and e-mailed them.

“The next morning, two of them made themselves available to speak with the client,” she said.

Cable and wireless Internet connections are spreading, making collaboration easier.  Soon, hand-held devices will be used by workers, who will be on the Internet as they walk down the street.

US companies are grooming foreign employees for leadership because the alternative is expensive; moving one American worker to China costs $600,000 per year, according to Boston University economist Fred Foulkes.

“The multinationals – Procter & Gamble, Colgate Palmolive, GE – are working to make sure they have non-Americans ready to move into executive positions.  They don’t want leadership that has spent their whole careers in [New York],” he said.

Foulkes holds up Swiss food company Nestle as a model – 35 of 100 executives are not even Swiss.

As India and China become centers of innovation, it makes sense for P&G’s chief executive, A.G. Lafley, to set a goal of finding half of new-product innovations from worldwide entrepreneurs, outside the traditional P&G labs.

Radjou reports that Lafley said, “We want P&G to be known as the company that collaborates.”

It is a cultural shift, but one that is paying off in product “hits,” Radjou says.

As US companies become borderless – in staffing, hours and strategies – the “they will have no meaningful geographic nexus, no headquarters,” Saffo predicts.

Finland-based Nokia, for example, has a chief executive in Helsinki, Finland, and a chief financial officer in New York.

For US consumer companies, though, it's not just about managing workers and product innovations – it’s about selling.

“Probably after I’m dead, but not long after, the major consumer market will be in India or China or both,” said Martha Farnsworth Riche, a busines analyst and former head of the US Census Bureau.

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