In today's ultra-competitive marketplace, executives who reach the upper echelons of management tend to have set themselves apart from their peers through their keen intelligence, strong communication skills, organizational acumen, or some powerful combination of savvy and foresight. But one stripe is common to a full three-quarters of Fortune 100 CEOs today: They have all spent at least two years working in a senior position overseas, according to a new study by Healthy Companies International.
Although globalization is by no means new, the data suggests a rapid transformation in résumé requirements for leaders of the world's largest corporations. Just 10 years ago, about half of CEOs had held senior positions overseas, according to the study. It's not just CEOs who are going abroad. The percentage of Fortune 100 "C-suite" executives—those whose titles often begin with "chief"—who have had senior responsibilities overseas has jumped to 71 percent from 48 percent 10 years ago, according to the study. Go back even further—to, say, 20 years ago—and you'll find many companies in which overseas assignments actually took employees off the internal executive track. The mindset was such that, "once you step out of that arena, you've made a choice. Your passion is to live internationally, not to be a company man," says Mark Smith, president of Healthy Companies Research Institute.
Today, the mindset in such a company has likely flipped. "Now, that same company is aggressively seeking people with overseas experience, recognizing that not only their future growth but also much of their production is being performed overseas and they're hampered because they don't have the same diversity in their senior executives that their competitor does," Smith says.
There was a time that corporate America tended to believe that America had all the answers, says Benjamin Cole, an assistant professor of management systems at Fordham University. "If you go back historically, there was what you'd say was an ethnocentric view of the firm—that the headquarters had all the knowledge and if you opened a subsidiary in another country, basically you'd send someone over from headquarters who would then receive their marching orders," Cole says. "But as time went on, these foreign subsidiaries would show themselves to be versatile and creative."
It is safe to assume that many corporations have learned to embrace international understanding and experience the hard way. AT&T CEO Randall Stephenson spent several years working in Mexico City in the mid-1990s, serving as SBC International's director of finance. In an interview in March, Stephenson talked about the lessons he learned from running a business overseas—specifically, learning to embrace a different model in a different country. "If you are going to serve a diverse market, you better have on your leadership team people who know those markets, and not just from a numerical, demographics standpoint but people who have actually lived and breathed and operated in those markets," Stephenson said.
Business schools have been ramping up partnerships with schools and businesses overseas to allow MBA students some international experience. It's a little preparation for the road ahead. Most young business people today anticipate doing some work overseas, Cole says.
So much of what's learned abroad concerns cultural differences. The trend toward international experience may signal how much companies now value employees who understand the differences. "You have to have people who have an understanding that people can look at the same picture and see different things," Cole says. Firms over time have learned to make adjustments when expanding, particularly into countries that can be quite different culturally, like Japan or France. For example: "What does a deadline mean? It means a very different thing in Italy than it does in Japan," Cole says.