Thursday, June 16, 2005

The World is Flat

Recently, I finished reading Thomas L. Friedman’s “The World is Flat.” Friedman is a writer for the NY Times and has won the Pulizter Prize three times for his work there. He has written three other books, the first dealing with the conflict in the Middle East, and the others about 9/11, and globalization and its affects on individual countries. The World is Flat, his fourth book, is about how the technologies and developments of the past 5-15 years have allowed a level of ‘horizonatal collaboration’ like never before and how this is affecting the world. The ‘flattening’ represents a levelling off of the economic playing field. Friedman discusses the fall of the Berlin Wall, the dot-com boom and bust, outsourcing, offshoring, insourcing, as well as the effects of web browsers, connecting cable, wirelessness and increasing computational technology. He analyzes companies (like Walmart and Dell), discusses America falling behind in science education, covers geopolitics (terrorism and economic issues), and wisely mentions the 3 billion people that might be left behind.

I highly recommend this book. Numerous things have changed in a short time and he acknowledges even he had missed most of it. As well, he is cautiously optimistic about the future. I felt more informed (at least about the level of my ignorance).

I still chastise the use of sweatshops and the companies that use contractors that do, but it doesn’t make as much sense to dislike outsourcing. I guess I might be moving from the “All these things happening are terrible for Canada (and my kids, friends, city, the Earth) to “Okay, this is happening, what can I do with it.” I’m not saying it isn’t important to fight ‘evil’ corporations or things that harm the environment or violators of human rights. I’m just seeing the validity of working with within these systems. If you get a massive corporation alongside your interests, they get accommodated because of their stature. Friedman gives some great examples of people doing good things working within the structures.
Anyway, onto some highlights (some of those more statistical have been posted on baserates).

1) It is possible to hire a personal assistant in India who can work on documents or a presentation during the night while you sleep.
2) In at least 3 McDonald’s in the US when you go to the drive-through you are talking to someone in a call centre in a different state. (Corporate Mc hasn’t done this yet, this is a franchise owner who found out it was more efficient.)
3) When you purchase something at Walmart an order for that specific item pops up on a computer screen in China (or wherever) to replace the order. Immediately.
4) UPS doesn’t just ship things. They are now involved in bill collecting, fixing computers and numerous other aspects of commerce.
5) When a Dell computer is purchased over the phone or online, it is actually built! The parts go to the warehouse, someone puts them into a bag, puts it together, downloads software and ships it. Including suppliers of suppliers, over 400 companies are involved in that computer.
6) The Dot-com bust actually flattened the world more. Optic cable was produced and laid down in such abundance that it became cheaper to connect in India and other parts of the world. Additionally, India was able to be the ‘second buyer’ on many things. (Meaning after the first buyer goes bankrupt and the banks sell it off at a much reduced price.)
7) It appears that an abundance of natural resources inhibits a country from having to innovate as well as tax its people. Less taxation, leads to less governmental responsibility to its people (think of many middle eastern and north African countries)
8) Taiwan has the third largest financial reserves in the world.
9) China and India. Oh boy… they’ll be doing almost everything. Yes, they are willing to work cheaper, but they are also much more motivated and possibly better. Those last points are hard to argue with. Good luck Western world.

Last two fav tidbits:
(a) Microsoft has three major software development centres. In the US, England and China. The Beijing centre, to recruit a new team, went to the top universities in China and handed out 2000 IQ and programming tests to PhD level people. From that pool, they cut it down to 400 and then to 20! After a year or so, 12 made the final cut. What a selection process! Getting the top 12 people out of 2000 PhD level people who already were good enough to make it to a top university. Gates said the stuff coming out of there is “mind-blowing.”
(b) Friedman said his parents used to say to him, “Finish your dinner because someone is China is starving.” He now says to his kids, “Finish your homework because someone in China is starving for your job.”


Post a Comment

<< Home