Building Innovation Teams Across National Borders

Restrictive immigration policies are forcing multinational enterprises to rethink their R&D strategies. Here are four approaches to maintain innovation excellence with geographically dispersed teams.

- By Solon Moreira, Ram Mudambi, and Deepak Nayak

MULTINATIONAL ENTERPRISES TODAY FACE MOUNTING CHAL- lenges as the complexity of innovation increasingly demands a highly skilled, diverse pool of R&D professionals, often recruited from around the world.

Access to global talent lets employers bring in specialized expertise and fresh perspec- tives that can lead to breakthrough innovations.

However, immigration policies are tightening in many countries. For example, Australia, New Zealand, Singapore, and the U.K. have all recently introduced or plan to implement immigration restrictions targeting the high-skilled talent pool that forms the backbone of multinational R&D operations.

Such restrictions are making it difficult for multinational enterprises (MNEs) to recruit and allocate skilled workers to the locations where they are most needed. How should companies reorganize their R&D efforts to manage the constraints imposed by restrictive immigration policies? Our research found that MNEs have a set of strategies from which they can choose, depending on the nature of the research they are conducting and how tightly they need to control knowledge flows. But first, it helps to understand why MNEs are reliant on global R&D talent and how immigration restrictions affect organizations’ ability to innovate.

The Case for Global Talent Acquisition

The breadth of specialized knowledge and skills required for innovation leads many MNEs to implement global recruitment strategies to staff their headquarters’ R&D operations. For example, most R&D in U.S.-based MNEs remains domestic, with studies indicating that 60% to 70% of R&D activities are centered at home.1 Official administrative data indicates that 61,786 U.S.-based MNE units applied for visas to bring foreign knowledge workers to the U.S. from 2022 through 2024.2