The World Is Flat

  

Title: The World Is Flat – The Globalized World In The 21^st Century

Author: Thomas Friedman

Publisher: Allen Lane 2005 (First)

ISBN: 0-713-99878-4

Pages: 469

A well read journalist and renowned for his expertise on international affairs and economic issues, Friedman has won the Pulitzer Prize three times and has travelled all around the globe. His latest title, Hot, Flat and Crowded has been reviewed earlier in this blog. This book was published just before that one and is a good prelude to the new one. In both the works, the reader is amazed at Friedman’s superhuman talent of compressing so many facts in so few pages, in so enrapturing a way. He is the human equivalent of zip archiving! The thrust on the present title is the post-globalized world, bringing out the best in people and paying back the best to them, dependent only on their adaptability to changing conditions. The  walls that separated people, both physical (like the Berlin wall) and invisible (like tariff protections) came crashing down before the relentless push of globalization, making the playing field level. Friedman calls such a world ‘flat’, in the sense that there are no hurdles to travel of ideas, business, products and also, people.

Friedman postulates three stages of globalization, which started more than five centuries ago, with Columbus discovering America. The first stage lasted from 1492 to around 1800 when nations were forcing the pace, while the second stage, termed Globalization 2.0 started around 1800 to around 2000. The multi-national company emerged as the flag bearer during this era. The third phase (Globalization 3.0) started around 2000 and still continuing is marked by the ‘flatness’ of the world and individual human beings are the thrust behind it. Outsourcing of knowledge, services and manufacturing to developing countries like India and China, particularly to prosperous pockets like Bangalore and Dalian in China are symbols of this latest phase. Companies just started to give the task of running their business processes to other partners, sometime in the same country, called homesourcing or to individuals sitting half way around the globe (outsourcing). The old regime of top-down, hierarchical command structures gave way for horizontal, collaborative models.

Friedman lists out ten aspects, calling them flatteners, which was behind this silent revolution. They are

1) The coming down of Berlin Wall on Nov 11, 1989 (referred to as 11/9, as opposed to 9/11). This single event symbolised the fruition of the ambitions of freedom of a large multitude of people imprisoned behind the iron curtain of Soviet empire. At the same time, it paved the way for the growth of bin Laden and the dangerous ideology he represented. The growing spread of PCs and Internet helped people download the future, while the same tools enabled the Jihadists to upload the past.

2) Netscape went public – This seemingly unremarkable event in fact spurred growth in the internet browser technology, which was the basic tool of collaboration for billions of people today.

3) Development of workflow software enabled applications to talk to one another, ensuring better coordination.

4) Emergence of open source software like Linux and Firefox helped spread the basic tools to every part of the world.

5) Outsourcing

6) Off-shoring

7) Growth of supply chains

8) In-sourcing, where companies outsourcing part of their logistics

9) In-forming which enabled every individual with access to the Internet to gain information about any topic, free of cost, thanks to Google.

10) Steroids of growth like digital platforms, mobile phones and wireless technology.

Convergence of the technologies at the right time germinated the seeds of revolution in the globalized world. The author is keen to address the fears of an American readership on outsourcing. He argues that the less glamorous, less skilled jobs are the ones that are being shipped to India and China and the creative, highly skilled processes demanding cutting edge technology still remain in the U.S. The people should strive for value addition on their skills, otherwise they may end up as vanilla, whom can be made available in a developing country at a fraction of the manpower cost. Rise in the living standards of people in the less developed countries would boost the demands of American products, like software finding increased requirements from India and China. There are still plenty of jobs in the flattened world for the people who have the knowledge and ideas to seize them. Friedman complains that three gaps divide the present U.S. society with that goal – the number gap, the diminution of people enrolling for science and engineering courses in a university, ambition gap, and the education gap. The stress on science and technology in the career options of American students faded right after the Kennedy presidency to the legal profession in the 1970s and to management in the 1990s and 2000s.

The developing countries also need to take lessons in greasing their journey smooth in the flat world. Openness and ability to adopt and adapt are of prime importance. Glocalizing, another term invented by the author demands global actions assimilating and broadening the local mindset. This is done best in India or Malaysia while the going is extremely difficult in Muslim theocratic societies like Saudi Arabia or Pakistan where intolerance stops innovation. The pattern in developing countries was like a leader setting out the path to globalization with macroeconomic reforms, called reform wholesale and then structural readjustments following in its wake in every sphere of economic activity, called reform retail. Many countries just stop short at the wholesale reforms. Readers may justifiably suspect that India at present is stuck at this point! Mexico also stalled after wholesale reform. Companies also should adapt to the flattened world. They must strive to be global players right from day 1 itself, unlike the previous instances where decades of growth was a prerequisite for global presence. They should outsource to grow more and not to save costs by firing people. Outsourcing should be done to extract the best talent at an affordable price. Also, big companies shall be able to act small and small companies shall be encouraged to act big, riding on technological marvels.

Friedman also discusses about various factors which may derail the flattening process and set the course about turn. Even now, almost half of the world’s populace reside in the unflattened world. Poverty, diseases like malaria and AIDS and religious intolerance are keeping people chained to where their hopeless lives are led. Islamic terrorism is another aspect trying to put obstacles in setting a level field with the West. The terrorists should be seen in a new light in view of the author’s study of them. He likens them to the anarchists of the 19^th century who were motivated by a political philosophy and calls them Islamo-Leninists, who are propelled by the destructive ideology of political Islam rather than the pacifying morals of religious Islam, which seeks to build bridges between people. Frustration in the Muslim youths are also a result of the autocratic, illegitimate regimes of most of the Arab states. The energy crisis, soon to follow, if 3 billion more people start to imitate the profligate consumption pattern of the West, is another bottleneck to be surpasses. Alternate, green energy offers the only salvation out of this dilemma and Friedman urges America to take the lead in this. In fact, this is the central theme of his book, Hot, Flat and Crowded.

The author also argues that globalization helps to keep peace in the world. Elaborating the supply chain of Dell’s notebook computers, which happened to propagate through thirty countries, he concludes that those countries which formed part of the supply chain won’t like an interruption on their part, by breaking the chain. The same argument will ensure that a war between China and Taiwan over the latter’s bids for de jure independence will never occur, considering the vast business interests at stake in both countries, which are so intertwined in commerce that you can’t separate them except through a painful surgery like an all-out war.

The book is delightfully written, with easy, flowing language and illustrations crystal clear. Extensive references to statistical data without the attendant drudgery is interestingly effective. The author acts like a mixer who seemlessly weaves the data even from nonharmonious sources and presenting it in convincing style. The author’s wide travel around the globe and to numerous countries have definitely helped him to keep a sense of proportion between the achivements of the Davids as well as the Goliaths. Friedman’s advice on outsourcing should ring in the ears of overzealous managers trying to cull the workforce in a thankless way, like “The best companies outsource to win, not to shrink. They 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” (p.360). The author’s assertion that only those countries with a net surplus of dreams over memories are going to prosper is really a thought provoking logic. He says, “In societies that have more memories than dreams, too many people are spending too many days looking backward. They see dignity, affirmation, and self-worth not by mining the present but by chewing on the past. And even that is not usually a real past but an imagined and adorned past. Indeed, such societies focus all their imagination on making that imagined past even more beautiful than it ever was, and then they cling to it like a rosary or a strand of worry beads, rather than imagining a better future and acting on that” (p.451).

The book is a gospel on India and her potential. The tolerance, enterpreneurial spirit, secularism, democracy and empowerment of Indians have received glowing tribute from Friedman. But, age old predilection of western authors to see the worst in it more vividly is not altogether absent. References may be made to his description of travel through Bangalore in potholed roads with horse drawn carts and sacred cows (p.5) and the Indian helpline operator’s offhand exclamation that India is the country next to Pakistan (p.25) in reply to an ignorant Western customer’s queries about where India is situated. Employment in India was rather limited in the pre-Globalization era, but graduates from IITs driving taxis was an unheard of thing, as claimed by him (p.207).

The book is eminently readable and very highly recommended.

Rating: 4 Star