We took a look at where the “optimal” global and regional corporate headquarters should be located if a company wants to be truly global.
We used two consideration: where are the customers, and is there a large city nearby? Many other considerations are valid such as transportation infrastructure, company sales footprint, availability of talent, executive preferences, and costs. But this calculation nevertheless helps inform the difficult decisions many companies face.
On the map we plot the center of economic activity globally and regionally (excluding activities that a global company is unlikely to participate in because they are local or aimed at poor consumers).
We also plot possible cities for headquarters. Corporate regional units are assumed to correspond to continents (except Americas, which we split into northern and Latin America).
Red = Center of global economic activity in 2014 or 2034. Green = Center of regional economic activity. Black = Possible headquarters locations. (Coordinates are calculated using sub-national data for globally relevant part of economies.)
A few observations:
- Locating global headquarters is difficult because the economic center of the world is moving rapidly to eastern Asia
- London looks like a good global choice currently. Is Dubai a future option? A U.S. location is difficult.
- Asia headquarters is also difficult. This is mainly because we treated Asia as one organizational unit, which doesn’t make much sense
- Bogota, Chicago, Frankfurt and Lagos are almost perfectly located for their continents
NOTE THAT THE LOGIC BEHIND THE MAP DOES NOT APPLY TO FINANCIAL SERVICES. WE’LL RETURN TO THIS TOPIC IN FUTURE