The World Is Flat

!e World is Flat!e globalized world in the twenty-first century

Thomas L. Friedman

summarized byAndi S. BoedimanStrategic Innovation Consultantandisboediman@gmail.comwww.ideonomics.com

Globalization

1492-1800 Globalization 1.0Shrank world from a size Large to Medium

Countries globalizing

1800-2000 Globalization 2.0Shrank world from a size Medium to Small

Companies globalizing

2000+ Globalization 3.0Shrank world from a size Small to Tiny

Individuals collaborating & competing globally

Flattener

10 Flattening Factors

• Berlin Wall Coming Down• Netscape IPO• Work Flow So"ware• Uploading• Outsourcing

10 Flattening Factors

• Offshoring• Supply-chaining• Insourcing• In-forming• !e Steroids

11/9/89

• Berlin Wall comes down• Tipping point for free market societies• Moved away from central planning• Empowered individuals• “Evil Empire” defeated by:

– Reagan?– CNN?– Gates, Jobs, McNealy,…?– Bin-Laden?

8/9/95

• Netscape IPO• 4 years a"er Berners-Lee invented the Web• Universal usability, accessibility and

interoperability of the Web• Win 95 shipped 15 days later• Number of Internet users doubling every 53

days

8/9/95

• Spawned Internet bubble• Overabundance of fiber optic capacity• Communication costs plummeted• “Second buyer” (India) made out like a

bandit

Workflow SoftwareLet’s Do Lunch: Have Your Application Talk to My Application

• Collaboration• Rapid development• Rapid deployment• Cheapest sources for coding, testing,

implementation• Everyone can create and maintain digital

content

UploadingSelf-Organizing Collaborative Communities

• Open source– For production– Apache blessed by IBM– Geeks making business decisions

• Blogs• Wikipedia• Not controlled by corporations or Government

Outsourcing

• Y2K and India• Talented competent programmers and

engineers who will work for less• Economic imperative• Outsource everything you possibly can

Offshoring• Rather than outsource jobs,• Send the whole factory to India or China

or Indonesia or ……• Not just manufacturing

– Management– Medical– Consulting– Accounting

Walmart

Supply-chaining

Supply-chaining

• Wal-Mart is the 800-pound gorilla• JIT to the nth degree• Totally integrated• IT infrastructure as a key competitive advantage• Suppliers as partners• RFID

Insourcing

Example #1: UPS fixes laptops for companies to speed up service. 3 day turn-around, instead of week (s) for product repairs

Point 1 - UPS is not only shipping parcels, but also providing smart business solutions

Example #2: Take orders from Nike.com, fill the order from a warehouse staffed and operated by UPS and ship with UPS.

Insourcing

• UPS• Intimate collaboration• 3rd-party managed logistics• “!ey” act as part of “Your” company

– Fixing Toshiba laptops– Managing delivery of Papa John’s Pizza supplies– Packaging Segrest Farms live tropical fish for delivery– Picking, inspecting, packing and delivering Nike shoes– Same for Jockey shorts– Working with Plow and Hearth furniture suppliers to improve

packaging and reduce breakage

In-forming

• Building and deploying your personal information supply-chain

• Google – now 1 billion searches per day• Soon “everything” will be searchable

The Steroids

• “Making collaboration digital, mobile, personal, virtual” – Carly Fiorina– Computing capabilities - including speed, I/O rate and storage

capacity– IM and file sharing – BitTorrent, Kazaa– VoIP – Skype– Video Conferencing – HP & SKG– Advanced graphics – from video games– Wireless – communicate with anyone from anywhere

Triple Convergence

It is this triple convergence - of new players, on a new playing field, developing new processes and habits for horisontal collaboration -that I believe is the most important force shaping global economics and politics in the early twenty-first century.

The New Middlers

The New Middlers

• !e Great Collaborators and Orchestrators• !e Great Synthesizer• !e Great Explainers• !e Great Leveragers• !e Great Adapters• !e Green People• !e Passionate Personalizers• !e Great Localizers

Education

The most important ability is to learn how to learn

CQ + PQ >IQ

CQ: curiosity quotientPQ: passion quotientIQ: intelligent quotient

Now that foreigners can do left-brain work cheaper, we in the US must do right-brain work better

!e

coming

tsunami

in public

education

Challenges

• Numbers gap• Ambition gap• Education gap (top & bottom)• Funding gap• Infrastructure gap• In the Age of Flatism, these gaps are what

most threaten our standard of living.

Rules

Rule # 1

“When the world goes flat – and you are feeling flattened – reach for a shovel and dig inside yourself. Don’t try to build walls.”

Rule #2

“And the small shall act big . . . One way small companies flourish in the flat world is by learning to act really big. And the key to being small and acting big is being quick to take advantage of all the new tools for collaboration to reach farther, faster, wider, and deeper.”

Rule #3

“And the big shall act small . . . One way that big companies learn to flourish in the flat world is by learning how to act really small by enabling their customers to act really big.”

Rule #4

“!e best companies are the best collaborators. In the flat world, more and more business will be done through collaborations within and between companies for a very simple reason? !e next layers of value creation are becoming so complex that no single firm or department is going to be able to master them alone.”

Rule #5

“In a flat world, the best companies stay healthy by getting regular chest X-rays and then selling the results to their clients.”

Rule #6

“!e best companies outsource to win, not to shrink. !ey outsource to innovate faster and more cheaply in order to grow larger, gain market share, and hire more and different specialists – not to save money by firing more people.”

summarized byAndi S. BoedimanStrategic Innovation Consultantandisboediman@gmail.comwww.ideonomics.com

notes

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