World not flat, adoptability is the key

New Delhi: CEO’s of super efficient corporations might be visualising a "flat world" without boundaries, but the global risks are still very much there on account of socio-cultural and geopolitical differences.

The growing socio-cultural and geopolitical risks could spoil the expansion plans of Fortune 500 companies, said technology research firm Forrester in a study.

And to minimise the global risk exposure while capturing opportunities worldwide, innovative CEOs will have to transform their monolithic firms into globally adaptive organisations (GAOs) by instilling flexibility, efficiency, altruism, and openness into their globally networked talent, processes, and partnerships.

Due to higher acceptability, these socially responsible GAOs will enjoy far superior financial performance and corporate sustainability relative to their peers, Forrester's Vice President Navi Radjou says in the report.

Incidentally, it was a visit to India and talks with IT major Infosys' CEO Nandan Nilekani that influenced Thomas Friedman, the Pulitzer award-winning columnist of The New York Times, to write a best seller – "The World is Flat."

This was followed by a number of MNCs adopting the 'flat-world' vision, even Infosys which now calls its business perspective "Think Flat."

With exponential global trade growth in recent decades, the world appears increasingly smaller and flatter, while promising massive new market opportunities for the companies, Forrester said.

Worldwide exports have tripled from $3.45 trillion in 1990 to $9.12 trillion in 2004, as developing nations like India and China integrated into global economy.

However, the direction and pace of globalisation is not decided by market forces alone and geopolitical as well as socio-cultural concerns might spoil the party, it said.

To make things worse for MNCs, socio-cultural and environmental factors are exerting an increasingly negative influence. Weak social and physical infrastructure, along with poor education and health systems, are curbing MNCs' expansion efforts in BRIC countries, the report said.