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The World Is Flat

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The World Is Flat A Brief History of The Twenty-First Century Thomas L. Friedman Presented By: Michael Edwards Manlu Liu Ping Yan – PowerPoint PPT presentation

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Title: The World Is Flat


1
The World Is Flat
  • A Brief History of
  • The Twenty-First Century
  • Thomas L. Friedman

Presented By Michael Edwards Manlu Liu Ping Yan
2
Thomas L. Friedman
  • Columnist for the NY Times
  • Won third Pulitzer Prize in 2002
  • Served as chief economic correspondent in the
    Washington bureau and was the chief White House
    correspondent.
  • Other publications
  • "From Beirut to Jerusalem" won the National Book
    Award for non-fiction in 1989
  • "The Lexus and the Olive Tree" (2000) won the
    2000 Overseas Press Club award for best
    nonfiction book on foreign policy
  • "Longitudes and Attitudes The World in the Age
    of Terrorism" (2002)
  • Received a B.A. degree in Mediterranean studies
    from Brandeis University in 1975. In 1978 he
    received a Master of Philosophy degree in Modern
    Middle East studies from Oxford.

3
While we were sleeping, what happened
  • Order drive through food in Missouri via Colorado
    call center
  • Your tax return is completed in India
  • Your Jet Blue reservation is taken by Betty in
    her house coat and slippers in Salt Lake City
  • Dads X-rays read overseas at 200 a.m.
  • US share of papers in Physical Review fell from
    61 in 1983 to 29 in 2003

4
  • Its not the strongest of the species that
    survives nor the most intelligentbut the one
    most responsive to change.
  • - Charles Darwin

5
How the World Became FlatTwo The Ten Forces
That Flattened the World - Summary
  • Flattener 1 11/9/89
  • The events of November 9, 1989, tilted the
    worldwide balance of power toward democracies and
    free markets
  • Flattener 2 8/9/95
  • The August 9, 1995, offering sparked
  • massive investment in fiber-optic
  • cables and connected the world

6
How the World Became FlatTwo The Ten Forces
That Flattened the World - Summary
  • Flattener 3 Work Flow Software
  • The rise of apps from PayPal to VPNs enabled
    faster, closer coordination among far-flung
    employees.
  • Flattener 4 Open-Sourcing
  • Self-organizing communities, Linux,
  • launched a collaborative revolution.

7
How the World Became FlatTwo The Ten Forces
That Flattened the World - Summary
  • Flattener 5 Outsourcing
  • Migrating business functions to India saved
    money and a third world economy
  • India - emerging IT center
  • Flattener 6 Offshoring
  • Contract manufacturing elevated
  • China to economic prominence
  • Asia - sourcing center of the world

8
How the World Became FlatTwo The Ten Forces
That Flattened the World - Summary
  • Flattener 7 Supply-Chaining
  • Robust networks of suppliers, retailers, and
    customers increased business efficiency. See
    Wal-Mart.
  • Flattener 8 Insourcing
  • Logistics giants took control of customer
    supply chains, helping mom-and-pop shops go
    global. See UPS and FedEx.

9
How the World Became Flat Two The Ten Forces
That Flattened the World - Summary
  • Flattener 9 In-forming/Searching
  • Power searching allowed everyone to use the
    Internet as a "personal supply chain of
    knowledge." See Google.
  • Flattener 10 The Steroids
  • Wireless technologies pumped up collaboration,
    making it mobile and personal.

10
How the World Became FlatRecap
  • Berlin Wall
  • Netscape
  • Work Flow
  • Outsourcing
  • Offshoring
  • Open-Sourcing
  • Insourcing
  • Supply-Chaining
  • In-forming
  • Steroids

Platform
Collaboration
11
How the World Became FlatThree The Triple
Convergence - Summary
  • All flatteners converged, creating a global
    playing field for multiple forms of collaboration
  • Both business and individuals moved from largely
    vertical means of creating value to more
    horizontal ones
  • Several billion people in India, China, and the
    former Soviet Union are given access to this new
    playing field

12
How the World Became FlatThree The Triple
Convergence - Summary
  • The Other Triple Convergence
  • The dot-com bust
  • 9/11
  • Enron, Tyco, WorldCom
  • Because of these three, at the moment when the
    world was being flattened, most people missed it

13
How the World Became FlatFour The Great Sorting
Out - Summary
  • Multiple Personality Disorder
  • Where do companies stop and start?
  • From Command and Control to Collaborate and
    Connect
  • Multiple Identity Disorder
  • Who owns what?
  • Death of the salesman

14
America and the Flat WorldFive America and Free
Trade - Summary
  • America as a whole will benefit more by sticking
    to the basic principles of free trade.
  • Fiber-optic cable has allowed for knowledge work
    and services to become tradable.
  • American low-skilled workers will have to upgrade
    their education/knowledge skills to maintain
    their standard of living.
  • There is no limit to the number of idea-generated
    jobs in the world.

15
America and the Flat WorldFive America and Free
Trade - Summary
  • America integrated a broken Europe and Japan into
    the global economy after WWII, and our standard
    of living has increased every decade.
  • Its easier to see people being laid off than
    being hired.
  • Donaldson Co., Inc.
  • Economists compare Chinas and Indias entry into
    the global economy to the railroad lines first
    connecting New Mexico to California.

16
America and the Flat WorldFive America and Free
Trade - Impressions
  • Although the overall viewpoint that a free and
    open society is beneficial in the long run, what
    about the details?
  • It wont happen overnight, so some American
    knowledge workers may be affected in the
    transition, but the effect will not be
    permanent.
  • Detroit and the automotive industry

17
America and the Flat WorldSix The Untouchables
- Summary
  • Untouchables are people whose jobs cannot be
    outsourced.
  • You must be specialized
  • Skills that are in high demand and non-fungible
  • You must be anchored
  • Must be done in a specific location, involving
    face-to-face contact
  • Being adaptable and knowing how to learn how to
    learn will be the most important asset.

18
America and the Flat WorldSix The Untouchables
- Summary
  • The American system is ideally suited for
    nurturing individuals who can compete and thrive
    in a flat world
  • Every state has institutions trying to generate
    economic growth and innovation
  • Best-regulated and most efficient capital markets
    for turning ideas into products
  • Security and regulation of our capital markets
  • Openness of American society
  • Quality of American intellectual property
    protection
  • Flexible labor laws
  • Largest domestic consumer market
  • Political stability
  • One of the great meeting points in the world

19
America and the Flat WorldSix The Untouchables
- Impressions
  • How does everyone become an untouchable?
  • Is it realistic that every fungible part of every
    job will be outsourced for efficiency?

20
America and the Flat WorldSeven The Quiet
Crisis - Summary
  • The quiet crisis is the steady erosion of
    Americas scientific and engineering base.
  • The source of our success is our ability to
    constantly innovate new products, services, and
    companies
  • The Perfect Storm the U.S. is falling behind in
    its capacity for scientific discovery,
    innovation, and economic development.
  • In the 2005, the budget of the NSF was cut by
    1.9, or 105 million.

21
America and the Flat WorldSeven The Quiet
Crisis - Summary
  • Dirty Little Secret 1 The Numbers Gap
  • The generation of scientist and engineers that
    were motivated to go into science are reaching
    retirement and are not being replaced.
  • The number of jobs that require SE will grow
    the number of people prepared will decline and
    the availability of people from other countries
    will decline.

22
America and the Flat WorldSeven The Quiet
Crisis - Summary
  • Dirty Little Secret 2 The Ambition Gap
  • When jobs are sent abroad, there is a 75 savings
    in wages and a 100 increase in productivity.
  • Average kids in U.S. grow up in a wealthy country
    with many opportunities and have a sense of
    entitlement.

23
America and the Flat WorldSeven The Quiet
Crisis - Summary
  • Dirty Little Secret 3 The Education Gap
  • Many jobs that go abroad today are high-end
    research jobs.
  • At Intel International Science and Engineering
    Fair, US had 65,000 participants. China had six
    million.
  • Federal funding for research in physical and
    mathematical sciences and engineering declined by
    37 between 1970 and 2000.

24
America and the Flat WorldSeven The Quiet
Crisis - Impressions
  • The dropping enrollment of the MIS department.
  • Demographics of our group.

25
America and the Flat WorldEight This is Not a
Test - Summary
  • Meeting the flat challenge requires a
    comprehensive, energetic, and focused response.
  • National peril is a lot easier to convey than
    individual peril.
  • Compassionate flatism
  • Leadership
  • Muscle Building
  • Cushioning
  • Social Activism
  • Parenting

26
America and the Flat WorldEight This is Not a
Test - Summary
  • Compassionate flatism
  • Leadership
  • We need politicians who are able to both explain
    and inspire
  • Lifetime employment vs. lifetime employability
  • Legacy project of alternative energy and
    conservation
  • Muscle Building
  • Workers need portable benefits and opportunities
    for lifelong learning ? mobile and adaptable
  • Everyone should have a chance to be educated
    beyond high school

27
America and the Flat WorldEight This is Not a
Test - Summary
  • Cushioning
  • Wage insurance
  • Model proposed by Kletzer and Litan
  • Social Activism
  • McDonalds socially responsible food supply
  • HP-Dell-IBM supply chain standards

28
America and the Flat WorldEight This is Not a
Test - Summary
  • Parenting
  • We need a new generation of parents willing to
    administer tough love
  • Education, in addition to cognitive skills, must
    include character building
  • Push young people to go beyond comfort zones, do
    things right, and endure short-term pain for
    long-term gain.
  • A crisis is a terrible thing to waste

29
Developing Countries and the Flat WorldNine The
Virgin of Guadalupe - Summary
  • Two examples of where people were when they
    first discover that the world is flat
  • Some statuettes of Mexicos patron saint, the
    Virgin of Guadalupe, were being imported into
    Mexico from China
  • plastic Chinese-made Ramadan lanterns crippled
    the traditional Egyptian workshop
  • When developing countries start thinking about
    the challenge of flatism, the first thing they
    need to do is engage in some brutally honest
    introspection

30
Developing Countries and the Flat WorldNine The
Virgin of Guadalupe - Summary
  • Reform wholesale
  • Broad macroeconomic reform
  • Initiated by leaders in countries like China,
    Russia, Mexico, Brazil, and India
  • They pushed their countries into more
    exported-oriented, free-market strategy, the top
    down
  • As the world started to get smaller and flatter,
    reform wholesale was no longer sufficient to keep
    countries on a sustainable growth path

31
Developing Countries and the Flat WorldNine The
Virgin of Guadalupe - Summary
  • Reform retailer
  • Looking at four key aspects of your society
    infrastructure, regulatory institutions,
    education, and culture, upgrading each one to
    remove as many friction points as possible
  • Enable the great number of people to have the
    best legal and institutional framework
  • Reform from the bottom up
  • Push the reform in a democratic context

32
Developing Countries and the Flat WorldNine The
Virgin of Guadalupe - Summary
  • Culture matters glocalization
  • As the world goes flat, and more and more of the
    tools of collaboration get distributed and
    commoditized, the gap among different cultures
    will make difference
  • The more you have a culture that naturally
    glocalizes, the greater advantage you will have
    in a flat world
  • This explain why so many Muslim countries have
    been struggling as the world goes flat
  • Culture tolerance is one of the greatest virtues
    a country and community can have, tolerance
    breeds trust, and trust is the foundation of
    innovation and entrepreneurship
  • Culture can change

33
Developing Countries and the Flat WorldNine The
Virgin of Guadalupe - Summary
  • The intangible things
  • A societys ability and willingness to pull
    together and sacrifice for the sake of economic
    development and the presence in a society of
    leaders with the vision to see what need to be
    done in terms of development and the willingness
    to use power to push for change rather than to
    enrich themselves and preserve the status quo
  • How much your culture prizes education
  • Comparison of Mexico and China

34
Developing Countries and the Flat WorldNine The
Virgin of Guadalupe - Impressions
  • Current situation developing countries like
    China, Russia, Mexico, Brazil, and India are
    taking advantage of globalization, and catching
    up rapidly
  • Problem
  • more difficult to reform retail than reform
    wholesale
  • Different cultures in different countries affect
    the future development
  • Future trend of different countries will also
    rely on different leaderships

35
Companies and the Flat WorldTen How Companies
Cope - Summary
  • Rule 1 when the world goes flat and you are
    feeling flattened reach for a shovel and dig
    inside yourself.
  • Rule 2 And the small shall act big
  • Rule 3 And the big shall act small
  • Rule 4 The best companies are the best
    collaborators.
  • Rule 5 In a flat world, the best companies stay
    healthy by getting regular chest X-rays and then
    selling the results to their clients
  • Rule 6 the best companies outsource to win, not
    to shrink.
  • Rule 7 outsourcing isnt just for Benedict
    Arnolds. Its also for idealists

36
Companies and the Flat WorldTen How Companies
Cope - Impressions
  • If a company want to grow and flourish in a flat
    world, you better learn how to change and align
    itself with it

37
Geopolitics and the Flat WorldEleven The Unflat
World Summary
  • There is absolutely no guarantee that everyone
    will use these new technologies, or the triple
    convergence, for the benefit of themselves, their
    countries, or humanity.
  • No guns or cell phones allowed
  • Too sick
  • There is no question that poverty causes ill
    health, but ill health also traps people in
    poverty, which in turn weakens them and keeps
    them from grasping the first rung of the ladder
    to middle-class hope
  • Too disempowered
  • They have just enough information to know that
    the world is flattening around them and that they
    arent really getting any of the benefits
  • The antiglobalization movement lost touch with
    the true aspirations of the worlds poor

38
Geopolitics and the Flat WorldEleven The Unflat
World Summary
  • Too frustrated
  • One of the intended consequences of the flat
    world is that it puts different societies and
    cultures in much greater direct contact with one
    another
  • Muslim world and Muslim communities are
    threatened, frustrated, and even humiliated by
    this close contact.
  • Too many Toyotas
  • Natural resource constraint
  • We will be strengthening the very worst political
    systems in the world like Sudan, Iran, and
    Saudi Arabia

39
Geopolitics and the Flat WorldEleven The Unflat
World - Impressions
  • How the flattening could go wrong is a subject
  • To approach it by trying to answer the following
    questions
  • What are the biggest constituencies, forces, or
    problems impeding this flattening process, and
    how might we collaborate better to overcome them?

40
Geopolitics and the Flat WorldTwelve The Dell
Theory of Conflict Prevention
  • How these classic geopolitical threats might be
    moderated or influenced by the new forms of
    collaboration fostered and demanded by the flat
    world particularly supply chaining
  • No two countries that are both part of a major
    global supply chain, like Dells, will ever fight
    a war against each other as long as they are both
    part of the same global supply chain
  • How these classic geopolitical threats might be
    moderated or influenced by the new forms of
    collaboration fostered and demanded by the flat
    world (like mainland versus Taiwan)

41
Conclusion ImaginationThirteen 11/9 Versus
9/11 Summary
  • 11/9 versus 9/11
  • The dismantling of the Berlin Wall on 11/9 was
    brought about by people who dare to imagine a
    different, more open world.
  • The destructive imagination of 9/11 brought down
    the World Trade Center,closing its Window on the
    World restaurant forever and putting up new
    invisible and concrete walls
  • eBay
  • eBay didnt just create an online market. It
    created a self-governing.
  • India
  • The second largest Muslim country
  • No Indian Muslims that we know of in al_Qaeda, in
    Americas Guantanamo Bay post-9/11 prison camp.
    No Indian Muslim have been found fighting
    alongside the jihadists in Iraq
  • Reason the secure, free-market, democratic
    context of India

42
Conclusion ImaginationThirteen 11/9 Versus
9/11 Summary
  • The curse of oil
  • If America and its allies will not collaborate in
    bringing down the price of crude oil, their
    aspirations for reform in all these areas will be
    stillborn
  • Just one good example
  • Aramex, the only one Arab company that developed
    a world-class business strong enough to get
    itself listed on Nasdaq
  • From untouchables to untouchables
  • An Indian man started a software firm , sold it
    in 1998, and decided to come back to India and
    use his American-made fortune to try to change
    India from the bottom up, So he started a
    journalism school
  • Interviewed with three young Palestinian
    militants, who spent a lot of their time
    imagining how to unleash their anger, not
    realizing their potential

43
Conclusion
  • The IT Revolution of the last 20 years was only
    the warm-up the real revolution is starting
    now.
  • The most important attribute is creative
    imagination, which has always been, and should
    always be, Americas great strength.

44
Final Thoughts
  • Individual overall impressions Ping
  • the idea of this book is not that novel, in fact,
    free trade marketand the emergence of the
    economy of China and India have been talked about
    for some while.
  • http//www.washingtonpost.com/wp-dyn/articles/A173
    14-2005Mar31.html
  • Individual overall impressions Michael
  • Verbalizes issues that were aware of, but with a
    greater sense or urgency
  • Written from an overhead, long-term point of
    view, but the devil is in the details
  • Individual overall impressions Manlu
  • This world is going to be more and more global.
    As MIS PhD students, we should think about how we
    could take advantage of this trend
  • The problems regarding the untouchable groups
    will become a serious issue if the flattened
    world can not be handled well.

45
If you need more
  • MIT World has streaming video of a presentation
    given May 16, 2005.
  • http//mitworld.mit.edu/video/266/
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