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Business
Driven
Technology
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U N I T
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1
Achieving Business
Success
W h a t ’s i n I T f o r M e ?
bunop_ha
This unit sets the stage for diving into Business Driven Technology. It starts from the ground floor by
providing a clear description of what information technology is and how IT fits into business strategies
and organizational activities. It then provides an overview of how organizations operate in competitive
environments and must continually define and redefine their business strategies to create competitive
advantages. Doing so allows organizations to not only survive, but also thrive. Individuals who understand and can access and analyze the many different enterprisewide information systems dramatically
improve their decision-making and problem-solving abilities. Most importantly, information technology is
shown as a key enabler to help organizations operate successfully in highly competitive environments.
You, as a business student, must recognize the tight correlation between business and technology.
You must first understand information technology’s role in daily business activities, and then understand information technology’s role in supporting and implementing enterprisewide initiatives and
global business strategies. After reading this unit, you should have acquired a solid grasp of business
driven information systems, technology fundamentals, and business strategies. You should also have
gained an appreciation of the various kinds of information systems employed by organizations and
how you can use them to help make strategically informed decisions. All leaders must appreciate the
numerous ethical and security concerns voiced by customers today. These concerns directly influence
a customer’s likelihood to embrace electronic technologies and conduct business over the web. In this
sense, these concerns affect a company’s bottom line. You can find evidence in recent news reports
about how the stock price of organizations dramatically falls when information privacy and security
breaches are publicized. Further, organizations face potential litigation if they fail to meet their ethical,
privacy, and security obligations concerning the handling of information in their companies.
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U N IT ON E OPE N I N G CAS E
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Apple—Merging Technology, Business, and Entertainment
This might sound hard to believe, but a bit more than a decade ago, Apple was on the
brink of bankruptcy. Apple Computer Inc., now back from near oblivion, is blazing a trail
through the digital world with innovation and creativity that has been missing from the
company for the past 20 years. The unique feature of Apple’s competitive advantages is
that they come from customers and users, not Apple employees. That’s right; the company
welcomes products created by consumers to sell to consumers, a trend new to business.
Capitalizing on the iPod
With millions of iPods in the hands of consumers, many people are finding ways to capitalize on the product. John Lin created a prototype of a remote control for the iPod and
took his prototype to Macworld, where he found success. A few months later, Lin’s company had Apple’s blessing and a commitment for shelf space in its retail stores. “This is
how Apple supports the iPod economy,” Lin said.
In the iPod-dominated market, hundreds of companies have been inspired to develop
more than 500 accessories—everything from rechargers for the car to $1,500 Fendi bags.
Eric Tong, vice president at Belkin, a cable and peripheral manufacturer, believes that 75
percent of all iPod owners purchase at least one accessory—selling more than 30 million
accessories to date. With most of the products priced between $10 and $200, that puts
the iPod economy well over $300 million and perhaps as high as $6 billion. Popular iPod
accessories include:
■
Altec Lansing Technologies—iPod speakers and recharger dock ($150).
■
Belkin—TuneCast mobile FM transmitter ($40).
■
Etymotic Research—high-end earphones ($150).
■
Griffin Technology—iTrip FM transmitter ($35).
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Kate Spade—Geneva faux-croc mini iPod holder ($55).
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Apple—socks set in six colors: green, purple, blue, orange, pink, and gray ($29).
■
Apple—digital camera connector ($29).
Capitalizing on the iPhone
Looking at someone using an iPhone is an interesting experience because there is a
good chance they are not making a phone call. They could be doing a number of things
from playing a game to trading stocks, watching a TV show, or even conducting business
with a mobile version of salesforce.com’s customer-management software. In a brilliant
strategic move, Apple let outsiders offer software for the iPhone and in less than six
months, more than 10,000 applications had been created. In fact, more than 15,000 applications are available at its App Store section of iTunes, and they have been downloaded
a total of 500 million times. Now, many of the iPhone apps are available for the iPad.
The iPhone and iPad App Store market is getting so huge relative to other
smartphone markets that some developers argue there is little point adapting applications for Google’s Android or any other iPhone competitor. According to Jeff Holden,
CEO of Pelago Inc., when he created his social networking company he fully intended
to follow the conventional wisdom for how to build a sizable, fast-growing software
company: Get your programs on as many platforms and devices as possible. But when
he crunched the numbers he came to an interesting business conclusion: The 13 million
iPhone owners had already downloaded more applications than the 1.1 billion other
cell phone owners! To entrepreneurs, developing a program for the iPhone automatically provides a significantly larger market—almost 94 times larger than its competitors. “Why would I ever build for anything but the iPhone?” Holden asked.
Capitalizing on the iPad
Apple’s latest release, the iPad, is a lightweight, portable, tablet computer, similar to the iPhone, that allows customers to download applications, check email,
and play music all at the touch of a button. Both the iPhone and the iPad can multitask, allowing customers to read a web page while downloading email in the background over wireless networks. The arrival of the iPad brought a simultaneous
expansion of the network of accessories. Because the iPad was designed with an
exposed screen and without a camera, separate keyboard, memory card slots, or
expansion ports, one might say it was specifically built for accessories. Many owners will modify it in some way, whether for mere decoration or hard-core protection.
A few of the new accessories include:
■
iPad Clear Armor screen protector—$35.
■
iPad Antique book case cover—$40.
■
iPad wireless keyboard—$99.
■
iPad overcoat sleeve—$35.
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iPad Joule luxury stand—$130.1
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Introduction
Information is everywhere. Most organizations value information as a strategic asset.
Consider Apple and its iPod, iPod accessories, and iTunes Music Store. Apple’s success depends heavily on information about its customers, suppliers, markets, and
operations for each of these product lines. For example, Apple must be able to predict
the number of people who will purchase an iPod to help estimate iPod accessory and
iTunes sales within the next year. Estimating too many buyers will lead Apple to produce an excess of inventory; estimating too few buyers will potentially mean lost sales
due to lack of product (resulting in even more lost revenues).
Understanding the direct impact information has on an organization’s bottom line
is crucial to running a successful business. This text focuses on information, business,
technology, and the integrated set of activities used to run most organizations. Many
of these activities are the hallmarks of business today—supply chain management,
customer relationship management, enterprise resource planning, outsourcing, integration, ebusiness, and others. The five core units of this text cover these important
activities in detail. Each unit is divided into chapters that provide individual learning
outcomes and case studies. In addition to the five core units, there are technology
and business “plug-ins” (see Figure Unit 1.1) that further explore topics presented in
the five core units.
The chapters in Unit 1 are:
■
■
■
■
■
Chapter One—Business Driven Technology.
Chapter Two—Identifying Competitive Advantages.
Chapter Three—Strategic Initiatives for Implementing Competitive
Advantages.
Chapter Four—Measuring the Success of Strategic Initiatives.
Chapter Five—Organizational Structures That Support Strategic Initiatives.
FIGURE UNIT 1.1
The Format and Approach
of This Text
B1: Business Basics *
B2: Business Process *
B3: Hardware and Software *
B4: Enterprise Architectures *
B5: Networks and Telecommunications *
B6: Information Security
B7: Ethics
B8: Supply Chain Management
B9: Customer Relationship Management
B10: Enterprise Resource Planning
B11: Ebusiness
B12: Global Trends*
B13: Strategic Outsourcing*
B14: Systems Development
B15: Project Management
B16: Operations Management
B17: Organizational Architecture Trends
B18: Business Intelligence
B19: Global Information Systems
B20: Mobile Technology
T1. Personal Productivity Using IT *
T2. Basic Skills Using Excel *
T3. Problem Solving Using Excel *
T4. Decision Making Using Excel *
T5. Designing Database Applications *
T6. Basic Skills Using Access *
T7. Problem Solving Using Access *
T8. Decision Making Using Access *
T9. Designing Web Pages *
T10. Creating Web Pages Using HTML *
T11. Creating Web Pages Using
Dreamweaver*
T12. Creating Gantt Charts with Excel
and Microsoft Project*
CORE UNITS
Unit 1: Achieving Business Success
Unit 2: Exploring Business Intelligence
Unit 3: Streamlining Business Operations
Unit 4: Building Innovation
Unit 5: Transforming Organizations
Business Plug-ins
Technology Plug-ins
* Plug-In is Located on www.mhhe.com/baltzan
Chapter 1
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Business Driven Technology
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1
C H A P T E R
Business Driven
Technology
LEAR N IN G OUTC OMES
1.1.
1.2.
Describe the information age and the differences
among data, information, business intelligence,
and knowledge.
Identify the different departments in a company
and why they must work together to achieve
success.
LO. 1.1 Describe the information
age and the differences among
data, information, business intelligence, and knowledge.
1.3.
Explain systems thinking and how management information systems enable business
communications.
Competing in the Information Age
Did you know that . . .
■
■
■
The movie Avatar took more than four years to create and cost $450 million.
Lady Gaga’s real name is Stefani Joanne Angelina Germanotta.
Customers pay $2.6 million for a 30-second advertising time slot during the Super
Bowl.2
A fact is the confirmation or validation of an event or object. In the past, people primarily learned facts from books. Today, by simply pushing a button people can find out
anything, from anywhere, at any time. We live in the information age, when infinite
quantities of facts are widely available to anyone who can use a computer. The impact of
information technology on the global business environment is equivalent to the printing press’s impact on publishing and electricity’s impact on productivity. College student startups were mostly unheard of before the information age. Now, it’s not at all
unusual to read about a business student starting a multimillion-dollar company from
his or her dorm room. Think of Mark Zuckerberg, who started Facebook from his dorm,
or Michael Dell (Dell Computers) and Bill Gates (Microsoft), who both founded their
legendary companies as college students.
You may think only students well versed in advanced technology can compete in the
information age. This is simply not true. Many business leaders have created exceptional opportunities by coupling the power of the information age with traditional business methods. Here are just a few examples:
■
■
■
Amazon is not a technology company; its original business focus was to sell books,
and it now sells nearly everything.
Netflix is not a technology company; its primary business focus is to rent videos.
Zappos is not a technology company; its primary business focus is to sell shoes,
bags, clothing, and accessories.
Amazon’s founder, Jeff Bezos, at first saw an opportunity to change the way people purchase books. Using the power of the information age to tailor offerings to each
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customer and speed the payment process, he in effect opened millions of tiny virtual
bookstores, each with a vastly larger selection and far cheaper product than traditional
bookstores. The success of his original business model led him to expand Amazon to
carry many other types of products. The founders of Netflix and Zappos have done the
same thing for videos and shoes. All these entrepreneurs were business professionals,
not technology experts. However, they understood enough about the information age
to apply it to a particular business, creating innovative companies that now lead entire
industries.
Students who understand business along with the power associated with the information age will create their own opportunities and perhaps even new industries, as
co-founders Chris DeWolfe and Tom Anderson did with
MySpace and Mark Zuckerberg did with Facebook. Our
primary goal in this course is to arm you with the knowledge you need to compete in the information age.
FIGURE 1.1
Technology in
BusinessWeek and
Fortune
Information Technology’s
Role in Business
Students frequently ask, “Why do we need to study information technology?” The answer is simple: Information
technology is everywhere in business. Understanding
information technology provides great insight to anyone
learning about business.
It is easy to demonstrate information technology’s
role in business by reviewing a copy of popular business magazines such as Bloomberg Businessweek, Fortune, or Fast Company. Placing a
marker (such as a Post-it Note) on each page that contains a technology-related article FIGURE 1.2
or advertisement indicates that information technology is everywhere in business (see
Business Benefits and
Figure 1.1). These are business magazines, not technology magazines, yet they are filled
with technology. Students who understand technology have an advantage in business, Information Technology
and gaining a detailed understanding of information technology is important to all stu- Project Goals
dents regardless of their area of expertise.
The magazine articles typically discuss such topics
Business Functions Receiving the Greatest Benefits from
as databases, customer relationship management,
Information Technology
web services, supply chain management, security,
Customer Service
70%
ethics, business intelligence, and so on. They also
focus on companies such as Siebel, Oracle, Micro51%
Finance
soft, and IBM. This text explores these topics in detail,
42%
Sales and Marketing
along with reviewing the associated business oppor39%
IT Operations
tunities and challenges.
Operations Management
INFORMATION TECHNOLOGY’S IMPACT
ON BUSINESS OPERATIONS
Figure 1.2 highlights the business functions receiving the greatest benefit from information technology,
along with the common business goals associated
with information technology projects according to
CIO magazine.
Achieving the results outlined in Figure 1.2, such
as reducing costs, improving productivity, and generating growth, is not easy. Implementing a new
accounting system or marketing plan is not likely to
generate long-term growth or reduce costs across
an entire organization. Businesses must undertake
enterprisewide initiatives to achieve broad general
HR
17%
Security
17%
Information Technology Project Goals
Reduce Costs/Improve Productivity
81%
71%
Improve Customer Satisfaction/Loyalty
Create Competitive Advantage
Generate Growth
Streamline Supply Chain
66%
54%
37%
Global Expansion 16%
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business goals such as reducing costs. Information technology plays a critical role in
deploying such initiatives by facilitating communication and increasing business intelligence. For example instant messaging and WiMax allow people across an organization
to communicate in new and innovative ways.
Understanding information technology begins with gaining an understanding of
how businesses function and IT’s role in creating efficiencies and effectiveness across
the organization. Typical businesses operate by functional areas (often called functional
silos). Each functional area undertakes a specific core business function (see Figure 1.3).3
Functional areas are anything but independent in a business. In fact, functional areas
are interdependent (see Figure 1.4). Sales must rely on information from operations to
understand inventory, place orders, calculate transportation costs, and gain insight into
product availability based on production schedules. For an organization to succeed,
every department or functional area must work together sharing common information
FIGURE 1.3
COMMON DEPARTMENTS IN AN ORGANIZATION
Departmental Structure of
a Typical Organization
ACCOUNTING
HUMAN
RESOURCES
FINANCE
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OPERATIONS
MANAGEMENT
MARKETING
PRODUCTION
MANAGEMENT
SALES
MANAGEMENT
INFORMATION
SYSTEMS
■
Accounting provides quantitative information about the finances of the business including
recording, measuring, and describing financial information.
■
Finance deals with the strategic financial issues associated with increasing the value of the
business, while observing applicable laws and social responsibilities.
■
Human resources (HR) includes the policies, plans, and procedures for the effective
management of employees (human resources).
■
Sales is the function of selling a good or service and focuses on increasing customer sales,
which increases company revenues.
■
Marketing is the process associated with promoting the sale of goods or services. The
marketing department supports the sales department by creating promotions that help sell the
company’s products.
■
Operations management (also called production management ) is the management of systems
or processes that convert or transform resources (including human resources) into goods and
services.
■
Management information systems (MIS) is the academic discipline covering the application
of people, technologies, and procedures—collectively called information systems—to solve
business problems.
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FIGURE 1.4
Marketing Working with
Other Organizational
Departments
Marketing
Sales
Operations
Accounting
Logistics
Human
resources
Functional organization—Each functional area has its own systems
and communicates with every other functional area (diagram
displays Marketing communicating with all other functional areas
in the organization).
and not be a “silo.” Information technology can enable departments to more efficiently
and effectively perform their business operations.4
Any individual anticipating a successful career in business whether it is in accounting, finance, human resources, or operation management must understand the basics of
information technology.
Information Technology Basics
Information technology (IT) is a field concerned with the use of technology in managing and processing information. Today, the term information technology has ballooned
to encompass many aspects of computing and technology, and the term is more recognizable than ever. The information technology umbrella can be quite large, covering
many fields that deal with the use of electronic computers and computer software to
convert, store, protect, process, transmit, and retrieve information securely. Information
technology can be an important enabler of business success and innovation. This is not
to say that IT equals business success and innovation or that IT represents business success and innovation. Information technology is most useful when it leverages the talents
of people. Information technology in and of itself is not useful unless the right people
know how to use and manage it effectively.
Management information systems is a business function just as marketing, finance,
operations, and human resources are business functions. Formally defined, management
information systems (MIS) is a general name for the business function and academic
discipline covering the application of people, technologies, and procedures—collectively
called information systems—to solve business problems. When beginning to learn about
management information systems it is important to understand the following:
■
■
■
■
Data, information, and business intelligence.
IT resources.
The challenge: departmental companies.
The solution: management information systems.
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DATA, INFORMATION, AND BUSINESS INTELLIGENCE
It is important to distinguish between data, information, and business intelligence. Data
are raw facts that describe the characteristics of an event. Characteristics for a sales event
could include the date, item number, item description, quantity ordered, customer name,
and shipping details. Information is data converted into a meaningful and useful context. Information from sales events could include best-selling item, worst-selling item,
best customer, and worst customer. Business intelligence refers to applications and technologies that are used to gather, provide access to, and analyze data and information to
support decision-making efforts. Business intelligence helps companies gain a more comprehensive knowledge of the factors affecting their business, such as metrics on sales, production, and internal operations, which help companies make better business decisions
(see Figures 1.5, 1.6, 1.7).
IT RESOURCES
The plans and goals of the IT department must align with the plans and goals of the
organization. Information technology can enable an organization to increase efficiency
in manufacturing, retain key customers, seek out new sources of supply, and introduce
effective financial management.
FIGURE 1.5
Data in an Excel
Spreadsheet
Rows of data in an Excel spreadsheet.
FIGURE 1.6
Data Turned into
Information
Data features, such as Autofilter, turn data into information.
This view shows all of Roberta Cross’s chicken sales.
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FIGURE 1.7
Information Turned into
Business Intelligence
Advanced analytical tools, such as Pivot Tables, uncover business
intelligence in the data. For example, best customer, worst
customer, and best sales representative’s best-selling product.
■
on
ati
orm
Inf
Those three key resources—people, information, and information technology (in that order of priority)—are inextricably linked. If one fails, they all fail. Most important, if one
fails, then chances are the business will fail.
Business
Success
on
■
People use
information technology to work with
information (see Figure 1.8).
ati
In essence,
■
orm
Tec
Putting It All Together
Inf
hn
olo
gy
It is not always easy for managers to make the right
choices when using IT to support (and often drive) business
initiatives. Most managers understand their business initiatives well, but are often at a loss when it comes to knowing
how to use and manage IT effectively in support of those initiatives. Managers who understand what IT is, and what IT
can and cannot do, are in the best position for success.
People
FIGURE 1.8
The Challenge: Departmental Companies
The Relationship among
People, Information, and
Information Technology
Companies are typically organized by department or functional area such as:
■
■
Accounting: Records, measures, and reports monetary transactions.
Finance: Deals with strategic financial issues including money, banking, credit,
investments, and assets.
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LO 1.2 Identify the different
departments in a company and
why they must work together to
achieve success.
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■
■
■
■
Human resources: Maintains policies, plans, and procedures for the effective
management of employees.
Marketing: Supports sales by planning, pricing, and promoting goods or services.
Operations management: Manages the process of converting or transforming
resources into goods or services.
Sales: Performs the function of selling goods or services (see Figure 1.9).
Each department performs its own activities. Sales and marketing focus on moving
goods or services into the hands of consumers; they maintain transactional data. Finance
and accounting focus on managing the company’s resources and maintain monetary
data. Operations management focuses on manufacturing and maintains production
data, while human resources focuses on hiring and training people and maintains
employee data. Although each department has its own focus and data, none can work
independently if the company is to operate as a whole. It is easy to see how a business
decision made by one department can affect other departments. Marketing needs to
analyze production and sales data to come up with product promotions and advertising
strategies. Production needs to understand sales forecasts to determine the company’s
manufacturing needs. Sales needs to rely on information from operations to understand
inventory, place orders, and forecast consumer demand. All departments need to understand the accounting and finance departments’ information for budgeting. For the firm
to be successful, all departments must work together as a single unit sharing common
information and not operate independently or in a silo (see Figure 1.10).
FIGURE 1.9
Departments Working
Independently
Accounting
Records, measures, and
reports monetary
transactions.
Finance
Tracks strategic financial
issues including money,
banking, credit,
investments, and assets.
Sales
Performs the function of
selling goods or services.
Operations
management
Manages the process of
converting or transforming
resources into goods or
services.
Human resources
Maintains policies, plans,
and procedures for the
effective management of
employees.
Marketing
Supports sales by
planning, pricing, and
promoting goods or
services.
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Accounting
Monetary data
Sales
Transactional data
Finance
Monetary data
Business Decisions
Operations management
Production data
Human resources
Employee data
Marketing
Transactional data
FIGURE 1.10
Departments Working
Together
The Solution: Management
Information Systems
You probably recall the old story of three blind men attempting to describe an elephant.
The first man, feeling the elephant’s girth, said the elephant seemed very much like a
wall. The second, feeling the elephant’s trunk, declared the elephant was like a snake.
The third man felt the elephant’s tusks and said the elephant was like a tree or a cane.
Companies that operate departmentally are seeing only one part of the elephant, a
critical mistake that hinders successful operation.
Successful companies operate cross-functionally, integrating the operations of all
departments. Systems are the primary enabler of cross-functional operations. A system
is a collection of parts that link to achieve a common purpose. A car is a good example
of a system, since removing a part, such as the steering wheel or accelerator, causes the
entire system to stop working.
Systems thinking is a way of monitoring the entire system by viewing multiple inputs
being processed or transformed to produce outputs while continuously gathering feedback on each part (see Figure 1.11). Feedback is information that returns to its original
transmitter (input, transform, or output) and modifies the transmitter’s actions. Feedback helps the system maintain stability. For example, a car’s system continuously
monitors the fuel level and turns on a warning light if the gas level is too low. Systems
thinking provides an end-to-end view of how operations work together to create a
product or service. Business students who understand systems thinking are valuable
resources because they can implement solutions that consider the entire process, not
just a single component.
MIS incorporates systems thinking to help companies operate cross-functionally. For
example, to fulfill product orders, an MIS for sales moves a single customer order across
all functional areas, including sales, order fulfillment, shipping, billing, and finally
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LO 1.3 Explain systems thinking
and how management information systems enable business
communications.
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FIGURE 1.11
Overview of Systems
Thinking
Input
Process
Output
Feedback
customer service. Although different functional areas handle different parts of the sale,
thanks to MIS the sale is one continuous process to the customer. If one part of the company is experiencing problems, however, then like the car without a steering wheel, the
entire system fails. If order fulfillment packages the wrong product, it will not matter
that shipping, billing, and customer service did their jobs right, because the customer
will not be satisfied when he or she opens the package.5
O P E N I N G CA S E S T U DY Q U E S T I O N S
1. Explain how Apple achieved business success through the use of information, information
technology, and people.
2. Describe the types of information employees at an Apple store require and compare it to
the types of information the executives at Apple’s corporate headquarters require. Are
there any links between these two types of information?
Chapter One Case: The World Is Flat—Thomas Friedman
In his book The World Is Flat, Thomas Friedman describes the unplanned cascade of technological and social shifts that effectively leveled the economic world and “accidentally made
Beijing, Bangalore, and Bethesda next-door neighbors.” Chances are good that Bhavya in
Bangalore will read your next X-ray, or as Friedman learned firsthand, “Grandma Betty in her
bathrobe” will make your JetBlue plane reservation from her Salt Lake City home.
Friedman believes this is Globalization 3.0. “In Globalization 1.0, which began around 1492,
the world went from size large to size medium. In Globalization 2.0, the era that introduced
us to multinational companies, it went from size medium to size small. And then around 2000
came Globalization 3.0, in which the world went from being small to tiny. There is a difference
between being able to make long-distance phone calls cheaper on the Internet and walking
around Riyadh with a PDA where you can have all of Google in your pocket. It is a difference
in degree that’s so enormous it becomes a difference in kind,” Friedman states. Figure 1.12
displays Friedman’s list of “flatteners.”
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FIGURE 1.12
1. Fall of the Berlin Wall
The events of November 9, 1989, tilted the worldwide balance of
power toward democracies and free markets.
2. Netscape IPO
The August 9, 1995, offering sparked massive investment in
fiber-optic cables.
3. Work flow software
The rise of applications from PayPal to VPNs enabled faster, closer
coordination among far-flung employees.
4. Open-sourcing
Self-organizing communities, such as Linux, launched a
collaborative revolution.
5. Outsourcing
Migrating business functions to India saved money and a Third
World economy.
6. Offshoring
Contract manufacturing elevated China to economic prominence.
7. Supply-chaining
Robust networks of suppliers, retailers, and customers increased
business efficiency.
8. Insourcing
Logistics giants took control of customer supply chains, helping
mom-and-pop shops go global.
9. Informing
Power searching allowed everyone to use the Internet as a
“personal supply chain of knowledge.”
10. Wireless
Thomas Friedman’s 10
Forces That Flattened
the World
Wireless technologies pumped up collaboration, making it mobile
and personal.
Friedman says these flatteners converged around the year 2000 and “created a flat world: a
global, Web-enabled platform for multiple forms of sharing knowledge and work, irrespective
of time, distance, geography, and increasingly, language.” At the very moment this platform
emerged, three huge economies materialized—those of India, China, and the former Soviet
Union—”and 3 billion people who were out of the game, walked onto the playing field.” A final
convergence may determine the fate of the United States in this chapter of globalization. A
“political perfect storm,” as Friedman describes it—the dot-com bust, the attacks of 9/11, and
the Enron scandal—”distract us completely as a country.” Just when we need to face the fact
of globalization and the need to compete in a new world, “we’re looking totally elsewhere.”
Friedman believes that the next great breakthrough in bioscience could come from a
5-year-old who downloads the human genome in Egypt. Bill Gates’s view is similar: “Twenty
years ago, would you rather have been a B-student in Poughkeepsie or a genius in Shanghai?
Twenty years ago you’d rather be a B-student in Poughkeepsie. Today, it is not even close.
You’d much prefer to be the genius in Shanghai because you can now export your talents
anywhere in the world.”6
Questions
1. Do you agree or disagree with Friedman’s assessment that the world is flat? Be sure to
justify your answer.
2. What are the potential impacts of a flat world for a student performing a job search?
3. What can students do to prepare themselves for competing in a flat world?
4. Identify a current flattener not mentioned on Friedman’s list.
Chapter 1
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