The World is flat according to three times winner of Pulitzer prize Thomas Friedman. The theory came into existence when he visited India where he was witnessed to Indians with American names and accent communicating to Americans miles away. What he means is level playing field that we have today. Wherein third world countries have access to resources which first world country like America does and hence the opportunity to compete with each on the same field. This was not thinkable a decade ago. Hence the world is flat today and not round. He justifies his theory beautifully.
Apart from outsourcing and India, the book deals with various issues thereby making it a good read. A must read if one avoids the outsourcing chapters. Never the less it’s nice to know from an American’s perspective.
America and Free Trade
According to Friedman, the Indians and Chinese are not racing them to the bottom. We are racing Americans to the top. We want high standard of living. We want brand names and not junk etc. The more we spend, the more diverse product markets are created and the more niches for specialization are created in America.
He further adds that American companies are sending their knowledge work to India. Indians are using their earnings and insights to produce new low cost products which the poorer Indians can use to lift themselves from poverty to middle class where they can purchase American products.
Both China and India are developing from their focus on low cost production to low cost innovations of their own. For example Nano Car.
The worry that recession may cut down on many jobs that are being offered to Indians at present, is also addressed. Friedman says that the way to succeed for America is not by stopping railroad line from connecting us but by firing imagination, upgrading skills and adopting those practices, rules, policies and educational institutions that will enable America to claim healthy slice of the bigger and more complex pie.
The Untouchables: Finding the New Middle
In Globalization 1.0 countries had to think globally to thrive, or at least survive. In Globalization 2.0 companies had to think globally to thrive, or at least survive. In Globalization 3.0 individuals have to think globally to thrive, or atleast survive. In a flat world , there is no American jobs. There is just jobs and will go to the best, smartest, most productive or cheapest worker wherever he or she resides. In a flat world, the key to thriving as an individual is figuring out how to make yourself untouchable.
Friedman defines, untouchables are people whose jobs cannot be outsourced, digitized or automated.
How Companies can cope in a flat world?
1. When the world is flat whatever can be done will be done. The only question is whether it will be done by you or to you. So if you have an idea pursue it.Because someone else will have a similar idea and will pursue it faster than you .
2. The Competition is between you and your imagination. When individuals can upload and globalize their ideas, products or services as individuals, then what they imagine matters more than ever.
3. And the big shall act small. One way that big companies learn to flourish in the flat world is how to act small by enabling their customers to act really big.For example Starbucks allowed its customers to customize their drinks to their specifications.
The Rise of Al Qaeda in a Flat World
Thanks to internet and satellite TV , Al Qaeda has been able to build up its Muslim identity and solidarity. Muslims of one country can sympathize with other country. There has proliferation of informal mutual supply chains throughout the Arab Muslim world today. Small networks, of people who move money, through hawalas, who recruit through alternative education system like madrassas, and who communicate through the internet and other tools of the global information revolution. Through internet they can broadcast themselves to your computer. Internet has helped them secure publicity and raise funds.
