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Harvard Business Review
What Business Schools Don’t Get About MOOCs
Harvard Business Review
August 11, 2014

There’s trouble in business-education paradise.

Recent news stories have described significant dissension at Harvard Business School about MOOCs (massive open online courses).  For the uninitiated, MOOCs are courses that are taught over the internet, and which are usually open to all comers.  In the spirit of full disclosure, I recently taught a MOOC for IESE Business School on the Coursera platform.  I’m also a graduate of Harvard Business School and a former faculty member there.  So I am hardly a neutral party.

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Harvard Business Review
Become an Ex-Pat and Still Get Ahead: Research on Choosing the Right Company
Harvard Business Review
January 9, 2014

For young managers aspiring to climb the ranks, working at a big corporation within their home country can seem stifling. In the case of a Japanese or Korean business, workers may fear a slow career progression, as seniority tends to take priority over performance and potential. When it comes to a French company, not being part of the closely-knit and self-protective elite of “très grandes écoles” graduates could feel like a disadvantage.

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Harvard Business Review

Ghemawat, Pankaj
“For Corporate Cosmopolitanism, Start at the Top”
Harvard Business Review
July 2013

If your company's management team isn't as global as its target markets, you aren't alone. Some 30% of U.S. companies admit that they have failed to fully exploit their international business opportunities because of insufficient internationally competent personnel. Could the problem start all the way at the top? 

In my 2011 HBR article, The Cosmopolitan Corporation, I argued that a cosmopolitan leadership team just might be the critical organizational ingredient for firms to succeed in a world that is neither global nor local but rather a complex combination of the two (what I call World 3.0). 

And now there's new data to support that.

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Harvard Business Review

  Ghemawat, Pankaj
"The Cosmopolitan Corporation"
  Harvard Business Review
  May 2011

Unbalanced growth, pockmarked by financial distress. The threat of protectionism brought on by persistently high unemployment, particularly in developed countries. Tensions, in wealthy nations as well as poor ones, around ethnic, religious, and linguistic divides, and talk of a new age of secession or tribalism. These are some of the developments that contradict the story we had just gotten used to - the one about how markets were becoming perfectly integrated across borders, technology was obliterating distance, and national governments were now irrelevant. The aftermath of the financial crisis of 2008 reminds us of the many ways in which differences  still matter

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Harvard Business Review

Ghemawat, Pankaj, and  Hout, Thomas
China vs the World: Whose Technology Is It?
Harvard Business Review
December 2010

In the city of Shanghai, a few churches conduct daily services for the faithful, just as churches all over the world do. However, China’s Patriotic Catholic Association doesn’t operate under the auspices of the Roman Catholic Church, which the Chinese government has banned. It is controlled by a state agency, the Religious Affairs Bureau. That’s how the Chinese government deals with foreign organizations, be they churches or companies. They are tolerated in China but can operate only under the state’s supervision. They can bring in their ideas if they deliver value to the country, but their operations will be circumscribed by China’s goals. If the value—or danger—from them is high, the government will create hybrid organizations that it can better control. This approach, which never ceases to shock foreigners, guides those who are boldly fashioning a new China

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Harvard Business Review

  Ghemawat, Pankaj.
"Finding Your Strategy in the New Landscape"

  Harvard Business Review
  March 2010

The 2008 crash hit cross-border business hard. The value of international trade was projected to decline by as much as 9% in 2009. Foreign direct investment has plunged even more: After dropping 15% in 2008, it fell by more than 40% in 2009. Though we may have reached the bottom, the prospects for the medium term don’t look promising. For much of the next decade, we can reasonably expect to see weak global growth, pressures from overcapacity, persistently high unemployment, volatility in the financial markets, costlier capital, a greatly expanded role for governments, a much larger burden of regulation and taxation for all, and maybe even increased protectionism. If we experience a second crash, as some experts worry, these conditions could all worsen.

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Harvard Business Review

Ghemawat, Pankaj, and  Hout, Thomas
"Tomorrow's Global Giants"
Harvard Business Review, November 2008

WESTERN COMPANIES' INTEREST in emerging markets, especially China and India, is reaching a new level of intensity. Usual suspects such as IBM and Unilever, of course, are aggressively expanding their presence there, but so are nippy newcomers like Orbea, a $100 million Spanish manufacturer of ultralight carbon fiber bikes. At the same time, developing countries are pulsating with companies that think of themselves as the next multinationals, pushing outward from their home bases to establish global presence if not dominance...

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Harvard Business Review

Ghemawat, Pankaj.
"Managing Differences: The Central Challenge of Global  Strategy."
Harvard Business Review 85, no. 3 (March 2007).
The main goal of any international strategy should be to manage the large differences that arise at the borders of markets. Yet executives often fail to exploit market and production discrepancies, focusing instead on the tensions between standardization and localization. The AAA Triangle stand for the three distinct types of international strategy. Through Adaptation, companies seek to boost revenues and market share by maximizing their local relevance. Through Aggregation, they attempt to deliver economies of scale by creating regional, or sometimes global, operations. And through Arbitrage, they exploit disparities between national or regional markets, often by locating different parts of the supply chain in different places--for instance, call centers in India, factories in China, and retail shops in Western Europe. Examples illustrate how organizations use and balance these strategies as well as the trade-offs they make as they do so. Because most enterprises should draw from all three As to some extent, the framework can be used to develop a summary scorecard indicating how well the company is globalizing. Given the tensions among the strategies, the strategic choice requires some degree of prioritization--and the framework can help with that as well. While it is possible to make progress on all three strategies, companies usually must focus on one or two when trying to build competitive advantage.

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Harvard Business Review

Ghemawat, Pankaj.
"Regional Strategies for Global Leadership."
Harvard Business Review
83, no. 12 (December 2005): 98-108.
The leaders of such global powerhouses as GE, Wal-Mart, and Toyota seem to have grasped two crucial truths: First, far from becoming submerged by the rising tide of globalization, geographic and other regional distinctions may in fact be increasing in importance. Second, regionally focused strategies, used in conjunction with local and global initiatives, can significantly boost a company's performance. Regionalization is apparent in trade within regions, in foreign direct investment, companies' international sales, and competition among the world's largest multinationals. Ghemawat says that the most successful companies employ five types of regional strategies in addition to--or even instead of--global ones: home base, portfolio, hub, platform, and mandate. Some companies adopt the strategies in sequence, but the most nimble switch from one to another and combine approaches as their markets and businesses evolve. Toyota's exports from the home base continue to be substantial even as the company builds up an international manufacturing presence. Toyota achieves economies of scale and scope with a strong network of hubs, where the company also pursues economies of specialization through interregional mandates. Regional strategies requires flexibility and creativity where a company must decide what constitutes a region, choose the most appropriate strategies, and mesh those strategies with the organization's existing structures.

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Harvard Business Review

Ghemawat, Pankaj.
"Growth Boosters."
Harvard Business Review
82, nos. 7-8 (July-August 2004): 35-40.
Hundreds of books on business growth are published each year, but which ones are really worth reading? Harvard Business School professor Pankaj Ghemawat takes a close look at three recent offerings: Chris Zook's Beyond the Core, Ram Charan's Profitable Growth Is Everyone's Business, and Adrian Slywotzky and Richard Wise's How to Grow When Markets Don't. He finds that all three are likely to succeed at prompting readers to take action. Zook defines the various adjacencies along which a business might extend its scope. Charan presents 10 tools that can be put to use immediately. And Slywotzky and Wise advise executives to inventory their companies' "hidden assets" and conduct an analysis of ways to solve customer problems. But Ghemawat wonders if the current crop of books harbors a subtle pro-growth bias. Ghemawat makes a sobering case for the dangers of setting growth targets too high. Ryanair and Coca-Cola, for instance, stumbled badly when they set unreachable growth targets. Even companies that are considered efficient growth machines run into constraints related to their size. Wal-Mart, for example, has had to accept declining growth rates as it has grown ever larger. Yet none of the three books discusses this dynamic. According to Ghemawat, readers interested in growth would be well advised to revisit a classic: Alfred Chandler's The Visible Hand. Chandler's propositions about growth and the managerial enterprise have withstood years of scrutiny, and his central idea--that technological changes, broadly defined, can affect the relative efficiency of different modes of organizing economic activity--still provides a frame for rich debate.

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Harvard Business Review

Ghemawat, Pankaj.
"The Forgotten Strategy."
Harvard Business Review
81, no. 11 (November 2003): 76-84.
Most multinationals see globalization as a matter of replication--spreading a single business model as widely as possible to maximize economies of scale. From this perspective, the key strategic challenge is choosing how much of the model to keep standard and how much to grudgingly adapt to local tastes. This choice blinds companies to the very real opportunities they can still gain from arbitrage--from exploiting differences as opposed to similarities. Indeed, the scope for arbitrage is as wide as the differences that remain among countries, and those differences continue to be broad and deep. They can be divided into four main categories: cultural, administrative, economic, and geographic. Consider the continued cachet of French culture in its wines and haute couture or how swiftly the Finns have become known for their expertise in wireless communications. Clearly, legal and other administrative differences, particularly in tax laws and the cost of capital, remain large. So do purely economic wage differentials. Both the differences that make arbitrage valuable and the similarities that make replication important will remain with us for the foreseeable future, and combining the two, while necessary, is tricky.

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Harvard Business Review

Ghemawat, Pankaj.
"Building Strategy on the Experience Curve."
Harvard Business Review
63, no. 2 (March/April 1985): 143-149.
(Reprinted in:
The Economics of Business Strategy, edited by John Kay. The International Library of Critical Writings in Economics. Cheltenham: Edward Elgar Publishing Limited, 2003.)
Many managers see the experience curve as out of date, but experience curve strategies can improve competitive performance in some clearly defined situations. Successful use of the curve requires understanding why and how it works and when to apply it. Industry examples explain how products have different experience curve slopes, experience bases, and cost reduction sources. Managers should study three critical variables to discover both the opportunities and traps in putting the experience curve to work for their companies: industry structure, the relative position of key competitors, and government impact.

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Harvard Business Review

Ghemawat, Pankaj.
"Distance Still Matters: The Hard Reality of Global Expansion."
Harvard Business Review
79, no. 8 (September 2001): 137-147.
Companies routinely overestimate the attractiveness of foreign markets. Dazzled by the sheer size of untapped markets, they lose sight of the difficulties of pioneering new, often very different territories. The problem lies in the use of analytic tools such as country portfolio analysis (CPA) that focus on national wealth, consumer income, and people's propensity to consume. CPA emphasizes potential sales and ignores the costs and risks of doing business in a new market that result from the barriers created by distance which does not refer only to geography. The CAGE framework of distance presented here considers four attributes: cultural distance (religious beliefs, race, social norms, and language); administrative or political distance (colony-colonizer links, common currency, and trade arrangements); geographic distance (the physical distance between the two countries, the size of the target country, access to waterways and the ocean, internal topography, and transportation and communications infrastructures); and economic distance (disparities in the two countries' wealth and variations in the cost and quality of financial and other resources). The article explores how (and by how much) various types of distance can affect different types of industries and shows how dramatically an explicit consideration of distance can change a company's picture of its strategic options.

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Harvard Business Review

Ghemawat, Pankaj, and Fariborz Ghadar.
"The Dubious Logic of Global Megamergers."
Harvard Business Review
78, no. 4 (July-August 2000): 64-72.
The almost universal belief among executives today is that bigger is better: companies are entering into huge, pricey cross-border mergers at an unprecedented rate. Common wisdom is that industries will become more concentrated as they become more global. In this article, the authors debunk the myth of increased concentration; the perceived links between the globalization of an industry and the concentration of that industry are weak. Empirical research shows that global--or globalizing--industries have actually been marked by steady decreases in concentration since World War II. The authors present the biases that managers often have about consolidation and offer alternative strategies to pursuing the big M&A deal. Those strategies include buying up cast-off assets from merging rivals; focusing more on domestic or regional growth rather than on global expansion; taking advantage of merging rivals' weakened market position during integration and launching an aggressive marketing campaign; and building alliances with other companies rather than buying them up.

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Harvard Business Review

Ghemawat, Pankaj.
"Sustainable Advantage."
Harvard Business Review
64, no. 5 (September-October 1986): 53-58.
The success of a business depends on its ability to sustain its competitive advantage over time. Product innovation, production processes, and marketing are areas in which intense competitive pressure has multiplied with the increase in domestic and international competition. Analyses of companies identified as outstanding performers in their industries are sought to understand the sources of their competitive advantage, to determine why the advantages proved sustainable, and to assess their future security.

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