“Thomas L. Friedman”
“When I was growing up in Minneapolis, my parents
always said, “Tom, finish your dinner. There are
people starving in China and India.” Today I tell my
girls, “Finish your homework, because people in
China and India are starving for your jobs.” And in a
flat world, they can have them, because there’s no
such thing as an American job anymore.”
“The World is Flat”
--Book Review--
Presenters
Mariam Hussain
Sara Hasan
(MBA)
Globalization - a whole new level
Shrinking Monitor
Era 1.0
(1492-1800)
Era 2.0
(1800-2000)
Era 3.0
(2000 onwards)
Size large
to
Size medium
Driving Forces
Country power
Knitting the world
Size medium
to
Size small
Global MNC’s
Hardware breakthroughs
Size small
to
Size tiny
Empowering individuals
Software breakthroughs
Flattening Forces – Flattener #1
11/9/89 - “When the walls came down and the Windows went up”

The fall of the Berlin Wall is a symbol for a general global shift towards
democratic governments and free-market economies.

Capitalism was dominant and annual rate of India’s growth soared from 3%
per year to 7%.

6 months after the fall of the Berlin Wall, in May 1990, Microsoft shipped its
breakthrough operating system, Windows 3.0

“The diffusion of personal computers, fax machines, Windows, and dial-up
modems connected to a global telephone network all came together in the
late 1980s and early 1990s to create the basic platform that started the global
information revolution,”
Craig J. Mundie, CTO Microsoft.
Flattening Forces – Flattener #1
Bin Laden’s Discordant Side
Flattening Forces – Flattener #2
8/9/95 - “When the web went around and Netscape went Public”

In the early 1990s, a scientist at CERN named Tim Berners-Lee created the
programming language for writing web pages (called HTML) that allowed
authors to do things like make “links” from one page to another and to store
and share images. Thus, WWW was born.

Release of the first Netscape web browser in December 1994.

Everyone, no matter what computer they were using, could see the same
web pages, access the same data.

Standards emerged for email, file transfer (FTP), and secure data
transmission (SSL).

On 8/9/95, Netscape “went public” – they began selling stock on the open
market… impact? – lower connectivity costs after bubble burst.
Flattening Forces – Flattener #2
… me and my computer interacting with
anyone anywhere
on any machine, …me and my computer
interacting
with anybody's Web site on the Internet…
Flattening Forces – Flattener #3
Work Flow Software

Software that enables workers in different locations to collaborate
efficiently.

Higglytown Heroes Example: The writers work from home: Florida,
London, New York, Chicago, etc. Visual design and direction is done
by a team in San Francisco. Voice recording takes place in LA or
New York. Computer animation is handled by programmers in
Bangalore, India. Work flow software enables all of them to access
and manipulate everyone else’s contributions as they are made.

“Standards don’t eliminate innovation, they just allow you to focus it.
They allow you to focus on where the real value lies, which is
usually everything you can add above and around the standard.”
Joel Cawley, head of IBM’s strategic planning unit
Flattening Forces – Flattener #3
--Paypal---MS Word--
Flattening Forces – Flattener #4
Open-sourcing - “Self-organizing collaborative communities”

People can be creators of new information as well as consumers. Instead of
people just downloading music or news, they are increasingly likely to
contribute information: writing a review of a product they bought on
www.Amazon.com, rating their professor at www.ratemyprofessor.com, or
editing an encyclopedia entry on their favourite trivia topic on
www.wikipedia.com.

Community-Developed Software – Apache!

Blogging - “an army of citizen journalists”

•
The news media is increasingly using the community of bloggers (known as
the “blogosphere”) as a source of new leads.
Wikipedia: Community-uploaded content
Flattening Forces – Flattener #4
-From winner takes all to lets all win
-Individual genius to gifted communities
-Free software movement
-The Case of Chinese automakers
Flattening Forces – Flattener #5
Outsourcing - “Y2K and India”

Outsourcing has allowed companies to split service and
manufacturing activities into components which can be
subcontracted and performed in the most efficient, cost-effective
way.

The Beginning of the India-US relationship.

Indians were lucky to be the second –buyers of fiber optic
companies
Flattening Forces – Flattener #5
"Fortune favors the prepared mind.“
Louis Pasteur
Flattening Forces – Flattener #6
Offshoring - “Running with gazelles, eating with lions”… China???

When a company moves its production from its home country to
another country, where it can be done with “cheaper labour, lower
taxes, subsidized energy, and lower health-care costs”

China signing the WTO agreement in 2001

Focusing too much on this “race to the bottom” of wages may blind
us to an even more unsettling development: China’s race to the top,
making it the lion!
Flattening Forces – Flattener #6
-Japan’s China + 1 approach
-Off-shoring benefits all
Flattening Forces – Flattener #7
Supply- chaining - “Wal-Mart - Eating Sushi in Arkansas”

Supply-chaining is a method of collaborating horizontally- among suppliers,
retailers, and customers- to create value. Supply-chaining is both enabled
by the flattening of the world and a hugely important flattener itself, because
the more these supply chains, grow and proliferate, the more they force the
adoption of common standards between companies, the more they
eliminate points of friction at borders, the more the efficiencies of one
company get adopted by the others, and the more they encourage global
collaboration.

Just-in-Time (JIT)

Wal-Mart installed RFID (radio frequency identification) Microchips

Drawbacks to efficiency obsession – Wall-Mart controversy
• locking overnight workers into its stores
• contracting illegal immigrants to work as janitors.
Flattening Forces – Flattener #5
Flattening Forces – Flattener #8
Insourcing - “UPS - What the guys in the funny brown shirts are
doing”

Insourcing is hiring another company to handle your supply chain.

UPS (United Parcel Service)handles all the routing and scheduling
of Papa John’s supply trucks.

Toshiba insourced with UPS and was told it could save a lot of
money by moving its laptop repair facility inside of UPS’ central
distribution centre in Louisville.

Order a pair of shoes from www.nike.com and a UPS employee
receives the message, picks the shoes off the shelf, inspects them,
and ships them to you.
Flattening Forces – Flattener #9
In-forming - “Google, Yahoo!, MSN Web Search”

One piece of evidence that Google is a flattener is its user base: only 1/3 of
searches are U.S.-based and less than 50% are in English

In-forming is searching for knowledge. It is about seeking like-minded
people and communities.

Google connects users with information and media, Yahoo! Groups
connects people with similar interests to each other. It currently has about
13 million individuals participating every month in 4 million active groups.
You can now communicate with like-minded people in private, semi-public,
or public discussions regardless of time or distance.

“If someone has broadband, dial-up, or access to an Internet café, whether
a kid in Cambodia, the university professor, or me who runs this search
engine, all have the same basic access to overall research information that
anyone has. It is a total equalizer.” (Sergey Brin, Google’s co-founder)
Flattening Forces – Flattener #5
Testimonial from Google user
I just want to thank Google for teaching me how to find love. While looking for my
estranged brother, I stumbled across a Mexican Web site for male strippers-and I
was shocked. My brother was working as a male prostitute! The first chance I
got, I flew to the city he was working in to liberate him from this degrading
profession. I went to the club he was working at and found my brother. But more
than that, I met one of his co-workers . . . We got married last weekend [in
Mexico], and I am positive without Google's services, I never would have found
my brother, my husband, or the surprisingly lucrative nature of the male stripping
industry in Mexico!! Thank you, Google!
Flattening Forces – Flattener #10
The Steroids - “Digital, Mobile, Personal and Virtual”

Combination of small factors that amplify the effects of outsourcing,
off-shoring, uploading, supply-chaining, insourcing, and in-forming.

An emerging digital flattener is VoIP (“voice over Internet Protocol”),
which allows people to make phone calls using a broadband Internet
connection.

Wireless Internet access allows people to work online from their
portable computers in airports, hotel lobbies, libraries, and even
coffee shops. (mobility)

Search engines, personal computers and peer-to-peer file sharing are
examples of personalization and virtual accessibility to any
information.
Triple Convergence
Convergence I

Around the year 2000, all the flatteners converged with one another. This convergence
could be compared to complementary goods, in that each flattener enhanced the other
flatteners; the more one flattener developed, the more levelled the global playing field
became.
Convergence II

Businesses needed to begin collaborating horizontally. Horizontalization means
companies and people collaborate with other departments or companies to add value
creation or innovation. Friedman's Convergence II occurs when horizontalization and the
ten flatteners begin to reinforce each other.
Convergence III

When the communist model nations like Russia, India, China etc converged with the rest
of the globalized marketplace, they added new brain power to the whole playing field
and enhanced horizontal collaboration across the globe. In turn, Convergence III is the
most important force shaping politics and economics in the early 21st century.
Thank You