I have the amazing opportunity to lead a global team – within a global company. Not just a company that has figured out how to take Western products and services and “localize” them, but a company that is truly global. Within the top 2 tiers of my team there is representation from 7 time zones, 3 continents, spread across cities like London, Paris, Bangkok, Beijing, New York, Boston, Tel Aviv, Bangalore and St. Paul, Minnesota.

This is not done for wage arbitrage. In fact, a simple economic principle nearly dashes all expectations of cheap tech-labor: Market equilibrium. Ultimately, a java developer who lives in Bangkok will be earning a wage substantially equivalent to a Java developer in Palo Alto. There are a few mitigating forces providing downward pressure on wages - efficiency in communication and management of the “remote” developer, liquidity of the market with respect to job alternatives for the employee… a whole range of factors come into play. Many of which are short-term. Communications will be worked out. Time shifting will become natural, remote places will fill up with companies competing for talent. Just look at Bangalore. I am not expecting a 1:1 ratio any time soon, but far more importantly, I believe companies expecting to continue 3:1 economics better prepare their balance sheets for an upset.

Additionally, the concept of offshoring is old – and pejorative. It locates the center of the action in the Western world. How imperialistic of us all. The effective way to think about it is creating a Global mix. My experiences over the last 4 years with my previous team in Bangalore taught me one thing: Talent is universal, but it takes work to establish the relationships, trust and working rhythm to harvest it. I also learned another thing – cultural “barriers” are befuddling. These things pop up unexpectedly and disappear unexpectedly. I could write a book about the situations where I have scratched my head and asked “what just happened???” Diligence always required…

So why build a global workforce?
- First of all we live in an increasingly global world. There is a very good argument to be made that a global economy (and all of its inefficiencies) is becoming efficient. Foreign currency exchanges are very efficient. Investments can now be shifted from one country to another very easily – even for the casual investor. The world is truly a small place, and to be competitive in the new world, you need to be operating in it. (By the way, if you want to read about the potential negative cultural effects, read John Hagel’s post here). This will show up in greater success in global markets. I will pick this topic up in more depth soon…
- Second, talent is scarce. My leaders can’t hire enough developers in New York, London, or even St. Paul to keep up with the demands of the business. Regardless of price. To have access to a large market of potential talent can dramatically change a project’s (or a company’s) prospects. In my world, this pays immediate dividends in time-to-market.
- Third, a globally diverse team will be resilient to the movement of any one economy, cultural situation and, in unfortunate situations, disaster. Basic portfolio theory, applied to people. Good, responsible management.

What have I found to be the critical factors?
- Critical mass in locations: A small team – or even a large team without diversity in its tasks, will burn out within 2 years. Each center of presence needs to be thought of as an integrated, yet independent organic system. This shows up as the opportunity, or lack of opportunity, for sustained career growth for the team’s individuals. A team (anywhere) without career advancement opportunities will begin to turn on itself over time. It’s universal. Additionally, diversity in roles in a location provides a healthier system. There is a magic spark when a product person, a program manager and a developer work together to solve a tough problem.
- Getting over the temporal hurdles quickly. Communication barriers, time zone differences, creating a shared understanding of “quality” – these are all problems that can be largely solved once, and built into the DNA of the team. Without solving them a team will languish. By solving them well, collaboratively, it becomes competitive advantage. In my experience this is best done by getting the team set up and then giving them something very hard to accomplish – something that reaches across the geographical boundaries of the extended team.
- Multi-cultural leadership. There is no way around it – success in starting up a team requires a leadership “bridge” – someone who is considered to be an accepted member of both cultures. There are many ways to get there, but it’s critical that while a nascent team is establishing there’s an accurate, trusted translation of leadership between cultures.
- Recognizing and driving forward into “phase 2.” Once a team is operating relatively well, it’s time to loosen the reins, encourage more collaboration and independence within the team. While phase 1 is about fostering a new shared culture and carefully managing things, phase 2 is about getting out of the way. Trust your new leaders and continue to give them hard things to do. Much more to write on that one, too.
- Fostering innovation. This is the tough one. Not even going to begin to tackle it today.