These guys still can't decide! Here are some alternate viewpoints to our "The World is Flat" author. Amar Bhidé, in his new book, "The Venturesome Economy" argues the world isn't flat after all, and some other theories (which frankly, I didn't quite get, but I hope you'll do better).
Check out this HBS article on it and people's comments on it here.
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Well I think that Amar Bhidé´s message is something that other people including one of his peers, Pankaj Ghemawat of HBS, have said before in other words. The World is "semi globalized" and that there are differences that still matter when you cross your country´s borders.
ReplyDeleteI think one way to move forward with this discussion is to think about the new balance between codified and contextual knowledge. The World is extremely flat on those areas or functions where knowledge is based on learned skills and the World is extremely round in those areas where the context is still a source of differentiation. But for me these ground-level know-how and ground-level products and services, what Bhidé associates with sources of differentiation, is shifting.
Think of the way energy is managed. 10 years ago all energy transactions and monitoring was done by utilities and distributors. They were doing the ground-level work. The reason was that no other person or organization had access to this information. Today you have intelligent meters that allow this ground-level work be done by Energy Response intermediates who connect utilities with consumers much more efficiently, not only reducing blackout risks but also enabling users have control over their bill.
so..I believe there is a possibility of disruption in Bhidé´s theory when context (the source of differentiation) is placed at the individual level.
Having gone though pros and cons of these theories, I tend to think of the world as Spiky, as outline by Richard Florida in the link below. While Technology connects all of us, it is also increasing the gap between the 'connected' and 'unconnected.' If I can get on a video call in an instant with China and India, that puts me at a huge advantage, but it puts those who can’t at an even bigger disadvantage then before. Looking at the images in this article is very telling, esp. when you think of where innovation is coming from. The gov in China is spending millions creating villages of innovation and research the size of Cambridge based on the premise that when all of these great minds are together they get benefits that they would not have alone.
ReplyDeletehttp://isites.harvard.edu/fs/docs/icb.topic30774.files/2-2_Florida.pdf
Here is another perspective: this is a video of Joseph Stiglitz speaking at Google about globalization.
ReplyDeleteIn this talk, Stiglitz disagrees with Friedman, asserting that the forces Friedman talks about have actually made the world less flat. While acknowledging that China and India have benefited from the advances in communications technology, Stiglitz believes that countries which don’t have the technology or the education on how to use it will fall further and further behind. Furthermore, Stiglitz believes that globalization is not creating a level economic playing field primarily because large multinational corporations are creating the rules for globalization s.t. they favor their own interests. He presents hard facts that the playing field is not being leveled, citing the increase in the disparity between rich and poor not only between countries but also within countries.
I believe that Friedman and Stiglitz’s arguments can be reconciled to an extent. Stiglitz acknowledges that China and India have benefited from the technologies that Friedman asserts are leveling the economic playing field. Friedman also agrees with part of Stigliz’s argument, devoting a chapter of his book to “the unflat world” in which he argues that much of the developing world is either too sick, too radical in its ideology, or has too much government corruption/too little infrastructure to benefit from the technologies that enable the level playing field.
I tend to agree more with Stiglitz than with Friedman, however, since Friedman doesn’t appear to consider several important problems that Stiglitz points out, such as economic globalization outpacing political globalization, special interests controlling the rules of globalization and thereby preventing a level playing field, and that fact that globalization exerts downward pressure on real wages at the bottom of the income scale, leading in increased income inequality.
We are in the early stages and the debates are healthy.. What all these different perspectives accept at one level is that the world is getting more connected (not perfectly flat--which is Utopian ideal anyway) and that IT allows for the possibility that work (and working) can be moved more readily than we could otherwise. There will be natural differences and variations across industries and across countries. And these differences should be recognized and dealt with as part of developing appropriate ways to take advantage of the shifts.
ReplyDeleteI am also on the side that doesn’t believe… “the world is flat” and here there are some supporting evidence:
ReplyDelete• 2009 article: HBS Prof Jim Heskett, commenting on Amar Bhidé’ book (The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World), is speaking about how “innovation game” works: “entrepreneurial behavior that adapts and combines high-level ideas and know-how, adjusts them to the needs of particular markets, and actually sells them to willing buyers” (http://hbswk.hbs.edu/item/6090.html );
• 2007 article/book: HBS Prof. Pankaj Ghemawat, in his book (Redefining Global Strategy: Crossing Borders in a World Where Differences Still Matter) speaks about four dimensions of business landscape (cultural, administrative/political, geographic, and economic) that help us to see “the world as it really is, rather than in idealized terms”, emphasizing that “we continue to live in a semiglobalized world” (http://hbswk.hbs.edu/item/5719.html )
• 2007 book: HBS Prof. Richard H. K. Vietor in his book How Countries Compete: Strategy, Structure and Government in the Global Economy, speaks about “economic performance being a function of government policy”. He explains the “range and breath of government influence” on economy: “little growth or development could be happen without property rights, contracts, sound financial systems, a stable money supply, security, infrastructural services and equitable regulation of monopolies, health care, pensions and externalities”.
Continuing on the same line of reasoning that the “world is not flat” and referring to how governance doesn’t “level the playing field” as shown in “How countries compete” (the other two sources I quoted previously were insightfully commented by my colleagues), this week issue of The Economist is briefing on... ”Globalization under strain”
ReplyDelete“Homeward bound: A great financial retrenchment is under way, the product of both market forces and political pressure on banks to lend at home rather than abroad. In other industries (see article) globalization looks harder to unpick”
(http://www.economist.com/displaystory.cfm?story_id=13057265 )
… for our discussion purpose, in short: world is connected, but not flat