Balancing Global Governance

Global enterprises need standard processes. Here are three approaches for creating equilibrium.

By Stacy Collett

February 20, 2006 12:00 PM ET

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Computerworld - It seemed like a reasonable request. Six years ago, Pat Smith Fernandez, corporate vice president of worldwide IT and MIS operations at Stiefel Laboratories Inc., directed every business unit in the company's 30 subsidiaries in six countries to use a common code in its financial and sales systems for each of its 2,500 products. Stiefel is a pharmaceutical company that specializes in dermatology.

It was the first test in a plan to globalize IT and business processes in a company that, until that time, had allowed each of its five geographic areas to do their own thing. Common global product codes would make it easier to consolidate financial information and product sales worldwide. But employees abroad didn't see it that way.

For starters, Stiefel's subsidiaries already had their own product codes. What's more, they didn't understand the value of the information that could be gleaned by consolidating financial and sales data. It took three years of forums and discussions to get the product codes consistently adopted worldwide, and it served as a valuable lesson for Smith.


Pat Smith Fernandez, vice president of IT at Stiefel Laboratories Image Credit: Andrew Itkoff/Silver Image Photography

"One thing I've learned is that top-down-driven standards and procedures will not get adopted," Smith says. "You need to sell, not tell, and the best way to sell is for them to own it."

These days, Smith takes a ground-up view of governance. She now sets target dates for adopting new standards and lets the IT staffers in each geographic area come up with a migration plan based on their own priorities. "Governance is now created by people who use it," she explains. "I haven't had any problem with adopting the standards at all."

Such is the balancing act of globalization. As more companies expand offices, distribution centers and manufacturing facilities abroad, IT executives are faced with the challenge and frustration of getting all employees around the world to do things the same way - from IT to business staffers. Long-standing regional practices, executive politics and a lack of clarity about what the business is trying to accomplish are major roadblocks, according to Gartner Inc. analyst Susan Dallas, who says that about 60% of companies fail to create effective governance.

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