Geography and politics in business

Geography may now be history in business, but politics remains the eternal present. In most multinational/ global organizations Pakistan is part of the EMEA operations while India is their APAC operations. Both are part of SAARC and were the same country before 1947. I am sure they would replicate products and services released in one over at the other. Pakistani branded “Shan” spice packets do wonders to the Indian curries my wife cooks in the US but her sister is deprived of the product in Calcutta.

In business geography may now have been declared as history, but politics remains the eternal present.

We had a client once who used to – and still does – run their container handling business from ports around the world. Our practice group implemented an ERP application for them primarily for their Mumbai and Chennai operations. By and by the client wanted to expand the solution footprint to the Karachi port. This triggered off a lot of fun.

Consultants from India would sure have visa issues if they were to go to Pakistan for the duration of the project. Client team members from Pakistan would face similar challenges to come over to India for a similar duration. What if consultants and the client team went to Colombo in Sri Lanka for the project?

No wonder Pakistan is part of the EMEA operations in most multinational/global organizations while India is clubbed along with APAC operations. Both these countries are part of SAARC and were in fact the same country before 1947.

That means in terms of market profiling, consumers would have similar values for a lot of attributes. Yet businesses are forced to run them under different organization structures. I am sure they would need to replicate a lot of products and services released in India (APAC) over at Pakistan (EMEA).

As I said, politics is the eternal present; and it is so across all geographies. This presence surfaces in different ways in different places. The recent instance I ran into this political segregation of a natural market was when I was shopping for ERP skills in the US market.

When one recruits an individual for an “open billable position” one normally has project imperatives breathing down one’s neck. So there is a strong impulse to say “for Dollar, the Client and the Skill” and pick up the first one that makes the cut. But then there is a fly that buzzes “what are you going to do with this guy once the project is over?” I would hum back “why send him back offshore”. The buzz would continue “but he has a green card”; and I would swat the fly.

But there would be this other little bird that would twitter “Isn’t he from Lahore? How would you send him to Amritsar?” I would be heartbroken and have a few extra BP pills that night.

It would not be fair to close this thought without a remark. My wife loves the spice packets with the brand “Shan”. They do wonders to her Indian curries. What a pity we are able to buy them only in the USA and her sister is deprived of the same in Calcutta.

Contradiction between Globalization and Migration

The subject of out-sourcing and off-shoring evoke strong emotions even with euphemisms like right sourcing and best shoring. At a certain level of abstraction such emotions seem to defy logic. Before globalization became a palpable reality businesses depended, in addition to the domestic workforce, on skilled immigrants. These immigrants needed visas with suitable work authorization. So, the foreign worker needs a H1B visa to work for in the US. But what about the worker who does almost the same work while located outside the US? I find it strange that if I had to, say fix code, sitting in US soil I would need an H1B but I can do the same work by sitting in an office in the outskirts of Chennai without convincing the Government of the USA that I am qualified to do the job.

The subject of out-sourcing and off-shoring evoke strong emotions even with euphemisms like right sourcing and best shoring. At a certain level of abstraction such emotions seem to defy logic. Then there are these statutes, laws of state, on migration. Googling the phrase “migration globalization contradiction” resulted in over 67000 results the last time I checked. There is however one aspect I find most funny that I would like to talk about.

But before I do so I will touch upon definitions of some words that are liberally used in this context. These are all sourced from http://www.dictionary.com. The first two are outsourcing and off shoring.

Outsourcing is a practice used by different companies to reduce costs by transferring portions of work to outside suppliers rather than completing it internally. Off shoring is the practice of moving business processes or services to another country, esp. overseas, to reduce costs. Both of these have gained prevalence in this era of globalization.

Globalization is the process by which the economies of countries around the world become increasingly integrated over time. The term also refers to phenomenon of businesses expanding their operations beyond national borders. Globalization has become serious business since computers became serious.

Before that businesses depended, in addition to the domestic workforce, to skilled immigrants whenever the scale of operations surged. Immigration is migration into a country of which you are not a native in order to settle there. Most of the times you need visas to get in.

A visa is an endorsement made by an authorized representative of the country appended to a passport of a visitor, permitting the visitor to enter and travel within a particular country or region. In the US, like in most of the countries, the visitor would need work authorization too if he or she wanted to work in exchange of salary.

For example, (as the USIS website says) the H-1B visa, commonly referred to as the “professional worker’s visa,” is reserved for people within “specialty occupations,” who are considered for admission to the United States on the basis of their professional education, their skills, or both. The H-1B visa permits U.S. companies to employ highly skilled foreigners in order to enhance their workforces.

So, the foreign worker needs a H1B visa to work for in the US. But what about the worker who does almost the same work while located outside the US? I find it strange that if I had to, say fix code, sitting in US soil I would need an H1B but I can do the same work by sitting in an office in the outskirts of Chennai without convincing the Government of the USA that I am qualified to do the job.

I would often need to convince the client company, though. So there is globalization thumbing its nose at immigration statues. The other interesting angle is that migration is movement of individuals across national – or political – borders. Globalization is, however, an economical imperative necessitating distribution of work across such borders.

Oh, the possibilities

Imagine there are no countries, it isn’t hard to do. The Médecins Sans Frontières or the doctors without borders have already dared to do so. There was once a time when the sun did not set on the British Empire. In modern times that very sun always shines on some regional head quarter of most multinational corporations. As corporations continue on their evolution from multinational corporations to global enterprises I cannot but wonder whether the process of challenging the concept of the nation state to that of an “enterprise state” has irreversibly begun. Imagine that humanity has come to terms with its biological and genetic limitations. Every one believes and needs peace, prosperity, wisdom and health. Imagine there are no countries; only corporations.

[This is a tweaked version of an earlier post of mine at Greater IBM Connections]

Imagine there are no countries, it isn’t hard to do. The Médecins Sans Frontières or the doctors without borders have already dared to do so. To be one of them is to make a statement. Are there other such entities quietly in the making? Where membership doesn’t need you to make a stand? Not yet anyway?

There was once a time when the sun did not set on the British Empire. In modern times that very sun always shines on some regional head quarter of most multinational corporations. As corporations continue on their evolution from multinational corporations to global enterprises I cannot but wonder whether the process of challenging the concept of the nation state to that of an “enterprise state” has irreversibly begun.

The current tide is rushing towards globalization. What is a global corporation? Let me quote Sam Palmisano of IBM here:

“Simply put, the emerging globally integrated enterprise is a company that fashions its strategy, its management, and its operations in pursuit of a new goal: the integration of production and value delivery worldwide. State borders define less and less the boundaries of corporate thinking or practice.”

Concepts of the Nation and the Corporation
Nation states sharing mutually acceptable borders is fairly a new concept in human history. There still are nations that have not been able to agree on the exact demarcation of “sovereign” rights. There are also cultures that are still struggling to establish their nation states.

Experiments with the modus operandi to running these nation states are far from over. The operating model of some version of governance by the people, for the people, of the people seems to have caught the imagination of a significant number of these nation states.

So the belief in the infallibility of the concept of the nation state is just to give ourselves a frame of reference. It allows us to build a lot of operating models. Quirks remain. Dual citizenship is a debated concept, but is not unheard of.  Now, what about the corporation?

If we look back at history, the corporation achieved the status of an individual or “legal entity” only when the owners were allowed “limited liability”. International or trans-national corporations, the East-India Company for example, arrived next. They relied on the muscle power and military might of the home nation to conduct their trade and commerce.

The MNC, or the multi national corporation, arrived as a solution to post war protectionism. They set up shop in multiple countries and followed the law of the land. This wasn’t a logical state of affairs and built in redundancies that were bottlenecks wealth generation.

Hence the strategic alliances; and now the global enterprise. Elsewhere, on the canvass of nation states came alliances. Along with political alliances came the economic ones. The European Union, for example, is something that was inconceivable during the World War days.

Imagine the possibilities
Now. It is at this point I would like you to imagine; it’s easy if you try. Imagine that humanity has come to terms with its biological and genetic limitations. We have learnt that we need to live as tribes and super tribes. Aggression is addressed by football, boxing, WWF and other such means. Every one believes and needs peace, prosperity, wisdom and health. Imagine there are no countries; only corporations. Oh, the possibilities….