The USA is just losing the grip it had on the world through
multinational corps that it formed just after WWII.
What Friedman means by "flat" is "connected": the lowering of trade
and political barriers and the exponential technical advances of the
digital revolution have made it possible to do business, or almost
anything else, instantaneously with billions of other people across
the planet. This in itself should not be news to anyone. But the news
that Friedman has to deliver is that just when we stopped paying
attention to these developments--when the dot-com bust turned interest
away from the business and technology pages and when 9/11 and the Iraq
War turned all eyes toward the Middle East--is when they actually
began to accelerate. Globalization 3.0, as he calls it, is driven not
by major corporations or giant trade organizations like the World
Bank, but by individuals: desktop freelancers and innovative startups
all over the world (but especially in India and China) who can
compete--and win--not just for low-wage manufacturing and information
labor but, increasingly, for the highest-end research and design work
as well. (He doesn't forget the "mutant supply chains" like Al-Qaeda
that let the small act big in more destructive ways.) Friedman tells
his eye-opening story with the catchy slogans and globe-hopping
anecdotes that readers of his earlier books and his New York Times
columns will know well, and also with a stern sort of optimism. He
wants to tell you how exciting this new world is, but he also wants
you to know you're going to be trampled if you don't keep up with it.
His book is an excellent place to begin.
The World Is Flat: A Brief History of the 21st Century
by Thomas L. Friedman
http://www.amazon.com/World-Flat-History-Twenty-first-Century/dp/0374292884
Friedman defines ten "flatteners" that he sees as leveling the global
playing field:
#1: Collapse of Berlin Wall--11/'89: The event not only symbolized the
end of the Cold war, it allowed people from other side of the wall to
join the economic mainstream. (11/09/1989)
#2: Netscape: Netscape and the Web broadened the audience for the
Internet from its roots as a communications medium used primarily by
'early adopters and geeks' to something that made the Internet
accessible to everyone from five-year-olds to eighty-five-year olds.
(8/9/1995)
#3: Workflow software: The ability of machines to talk to other
machines with no humans involved. Friedman believes these first three
forces have become a "crude foundation of a whole new global platform
for collaboration."
#4: Open sourcing: Communities uploading and collaborating on online
projects. Examples include open source software, blogs, and Wikipedia.
Friedman considers the phenomenon "the most disruptive force of all."
#5: Outsourcing: Friedman argues that outsourcing has allowed
companies to split service and manufacturing activities into
components, with each component performed in most efficient, cost-
effective way.
#6: Offshoring: Manufacturing's version of outsourcing.
#7: Supply chaining: Friedman compares the modern retail supply chain
to a river, and points to Wal-Mart as the best example of a company
using technology to streamline item sales, distribution, and
shipping.
#8: Insourcing: Friedman uses UPS as a prime example for insourcing,
in which the company's employees perform services--beyond shipping--
for another company. For example, UPS itself repairs Toshiba computers
on behalf of Toshiba. The work is done at the UPS hub, by UPS
employees.
#9: In-forming: Google and other search engines are the prime example.
"Never before in the history of the planet have so many people-on
their own-had the ability to find so much information about so many
things and about so many other people", writes Friedman.
#10: "The Steroids": Personal digital devices like mobile phones,
iPods, personal digital assistants, instant messaging, and voice over
IP (VoIP).
Triple convergence
In addition to the ten flatteners, Friedman offers "the triple
convergence," three additional components that acted on the flatteners
to create a new, flatter global playing field.
Up until the year 2003, the ten flatteners were semi-independent from
one another. However, around the year 2003, 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 leveled the
global playing field became.
After the emergence of the ten flatteners, a new business model was
required to succeed. Instead of collaborating vertically (the top-down
method of collaboration, where innovation comes from the top),
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.
After the fall of the Berlin Wall, countries that had followed the
Soviet economic model--including India, China, Russia, and the nations
of Eastern Europe, Latin America, and Central Asia--began to open up
their economies to the world. When these new players 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.
http://en.wikipedia.org/wiki/The_World_is_Flat
