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The Global Initiative in 2018 OCTOBER 1, 2018 The Global Initiative in 2018 In January 2011, a few months after becoming the tenth dean of Harvard Business School, Nitin Nohria outlined in a letter to the community five strategic priorities—what would become known as the "five Is"—for the School. They reflected input and feedback he had gleaned through hundreds of conversations with alumni, faculty, staff, students, and other friends of HBS. In addition to innovation, intellectual ambition, inclusion, and integration, Nohria outlined in the letter his thoughts about internationalization: Our strategy is to leverage Harvard Business School's scale and size not by greatly expanding our physical footprint, but by expanding our larger intellectual footprint.... Our plan is to prudently develop the regional centers my predecessors were so perspicacious in starting, so as to facilitate the research and teaching activities that will enable us to form important relationships and develop and test new ideas across the globe. Ultimately, we'll bring that knowledge back to HBS, and we'll seek to provide an experience for our students and participants that is unmatched in its global breadth of analysis and understanding. Fast forward almost eight years later, and Nohria and colleague Lynn Paine, Senior Associate Dean for International Development,1 were preparing for the October meeting of the Global Advisory Boards and Global Leadership Council. With the 20th anniversary of the opening of the Asia-Pacific Research Center (APRC) just a few months away, it seemed an opportune moment to take stock and examine which aspects of the School's global strategy were working well and which were not. Much had changed—within the School and in the world—in the intervening two decades. Did the original aspirations of the Initiative still hold up? What forces and factors were creating pressures—and opportunities—today and in the future? Was there a shared vision for the next 20 years of internationalization at the School? Background Harvard Business School's roots as a U.S.-based institution and a school that was global in outlook and reach could be traced to its founding. On the one hand, the School was created in response to solidly American concerns, including railroad management, the merchant trade, and the financial panic and crash of 1907. Yet the first MBA class included students from Brazil and Canada and courses in German, French, and Spanish correspondence were offered. Similarly, one of the School's earliest researchers both carried out an in-depth survey of the retail shoe trade in the U.S., and went on a five- 1 Prior Senior Associate Deans for International Development included John Quelch (2001-2005); Krishna Palepu (2005-2012); Felix Oberholzer-Gee (2012-2014) and Luis Viceira (2014-2017); their administrative partners included Karen Wilson (1996-2002), Eileen Keohane (2002-2005), Andy Elrick (interim), and Victoria Winston (2006-present). Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright © 2018 President and Fellows of Harvard College. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School. The Global Initiative in 2018 year traveling fellowship to learn about the economic resources and commercial organization of Central and South America—traveling 26,000 miles and crossing the Andes six times. Over time, efforts to be more international in outlook and understanding became more intentional. Dean Donald David (1942-1955) sought to help "businessmen in this country be concerned about and be literate about the problems and attitudes of other nations." During the 1950s and 1960s, HBS and its faculty aided in founding business schools in Japan, Chile, Turkey, Mexico, India, Nicaragua, Iran, and the Philippines, among other countries—nearly a dozen in total. In 1973 the International Senior Managers Program (ISMP) for executives was launched at a campus in Lausanne, Switzerland, with the understanding that the faculty teaching group would relocate to the country for one- to two-year stints while engaging in extensive regional research and case development. The most recent iteration of the School's international engagement was the Global Initiative, launched early in the tenure of Dean Kim Clark (1995-2005) to, in his words, "develop intellectual and human capital." Early in his tenure Clark had identified technology and globalization as key forces transforming business and society, and he wanted HBS to understand and respond proactively to them. Although many other business schools at the time were pursuing a global strategy predicated on partnerships involving degree programs and students, Clark—despite receiving offers of this nature— did not choose this path. It was a poor match for the structure and pedagogy of the MBA Program (most partner schools did not share HBS's commitment to a first year required and second year elective curriculum or the case method). Moreover, the Lausanne experiment had highlighted the challenge of requiring faculty members (and their families) to move abroad, and ISMP had been brought back to campus in the 1980s. Instead, following the recommendations of a faculty committee chaired by Professor Ken Froot2 and recognizing the value that had been created when the research and teaching materials developed in Europe found their way back to the on-campus curricula, HBS opted to begin building a network of regional centers. As outlined in an early strategy statement, the centers were intended to: • Develop more in-depth research and course materials that would translate into richer classroom experiences in the MBA Program and in Executive Education; • Encourage faculty members to develop a deeper understanding of global business based on work that would keep them close to the most important, relevant, and interesting management issues and practices—wherever they occurred; and • Strengthen the School's relationships with important constituencies around the world (alumni, companies, etc.) that were critical to ensuring the highest quality implementation of the School's overseas activities. The center in Hong Kong, formally opened in January 1999, was the first3 outside the U.S.; its staff included an Executive Director (an MBA graduate), administrative support, and a researcher. Bob Hayes and Warren McFarlan were named faculty chairs and asked to serve as a bridge between the APRC staff and the faculty in Boston, an Asia Faculty Group4 was formed to bring together colleagues doing work in the region, and an Asia Advisory Committee was named—19 members hailing from 12 countries5—comprising primarily alumni of the School's MBA, Executive Education, and Doctoral 2 Members included Professors Christopher Bartlett, Dwight Crane, Tarun Khanna, Gary Loveman, Krishna Palepu, John Quelch, Debora Spar, Stefan Thomke, and David Yoffie. 3 The California Research Center had been established in Silicon Valley in 1997 to support rapidly growing interest among faculty and students in entrepreneurship and dot-com firms. The California Center was brought into the Global Initiative’s network of centers and offices in 2017-2018. 4 Chris Bartlett, Yasheng Huang, Krishna Palepu, David Yoffie, and Mike Yoshino. 5 Australia, China, India, Indonesia, Japan, Korea, Malaysia, Philippines, Singapore, Taiwan, Thailand, and United States. 2 The Global Initiative in 2018 programs. In the first three months, the APRC team largely coordinated travel and meetings in support of initial case writing efforts (see Exhibit 1). Evolution New centers followed in Latin America (Buenos Aires, 2000, and São Paulo, 2015), Japan (Tokyo, 2002), Europe (Paris, 2003), India (Mumbai, 2006), China (Shanghai, 2010), and the Middle East and North Africa (Istanbul, 2013); smaller offices also were established in Mexico City (2004), Singapore (2015), Dubai (2015), Tel Aviv (2015), and Johannesburg (2017). They all adopted a similar model of lean staffing in modest facilities (see Exhibit 2 for a summary of space and staff), though exceptions were made as HBS found itself co-locating with or sponsoring other Harvard entities in a region. In Shanghai, for example, the School had taken the lead in funding and establishing the Harvard Center Shanghai, which opened with office space as well as a classroom and breakout rooms to support executive education programs. Conversely, in Johannesburg, HBS staff shared space with the University's Center for Africa Studies. As these new centers and offices came on line, their staff—perhaps not surprisingly—increasingly were asked to help with other activities at the School, and finding the right balance between tapping regional understanding and leveraging Boston-based expertise sometimes created friction. Executive Education, for example, had invested heavily in building corporate relations, marketing, and program delivery capabilities, and the team wanted to ensure that programs, no matter where they were offered, were consistent on dimensions such as the quality of participants and an engaged learning experience. But the regional teams knew more about which programs were likely to be successful and often had longstanding relationships with key local companies. It took some time for HBS to adopt a more truly multinational approach and rely more heavily on the centers, but eventually the regional center teams also became engaged in activities such as MBA Admissions and Career
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