Until recently India was seen by Western businesses primarily as a source of cheap, low-skill labor. But over the past decade the country has attracted a flood of high-skill jobs from the West. Meanwhile, India's economy has grown at roughly 9% a year, and some of its largest companies have grown at twice that rate. What accounts for this? A host of economic, policy, and other environmental factors have played important roles, but the authors ascribe much of this success to the distinctively inward-focused managerial approach of Indian leaders. Through interviews at 98 of the largest India-based companies, they have identified four ways in which these leaders develop and motivate employees: Far more than their Western counterparts, they create a sense of social mission, engage employees in give-and-take, empower them to find solutions, and invest in their training and development. Western leaders should understand the managerial approaches that have fueled the rise of India's largest companies, and mindfully adapt them.

In the past five years, a rising number of companies in North America and Europe have experimented with offshoring and outsourcing business processes, hoping to reduce costs and gain strategic advantage. But many businesses have had mixed results. According to several studies, half the organizations that have shifted processes offshore have failed to generate the expected financial benefits. What's more, many of them have faced employee resistance and consumer dissatisfaction. A three-part methodology can help companies reformulate their offshoring strategies. First, companies need to prioritize their processes according to two criteria: the value it creates for customers and the degree to which the company can capture some of that value. Companies will want to keep their core (highest priority) processes in-house and consider outsourcing their commodity (low-priority) processes. Second, businesses should analyze all the risks that accompany offshoring and look systematically at their critical and commodity processes in terms of operational risk (the risk that processes won't operate smoothly after being offshored) and structural risk (the risk that relationships with service providers may not work as expected). Finally, companies should determine possible locations for their offshore efforts, as well as the organizational forms--such as captive centers and joint ventures--that those efforts might take. They can do so by examining each process' operational and structural risks side by side. This article also describes a new organizational structure--the extended organization--in which companies specify the quality of services they want and work alongside providers to get that quality.