The World is Flat

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    Thomas Friedman, New York Times foreign affairs columnist, spoke last week on Terry Gross’ show, Fresh Air. You can listen to the interview here:

    http://www.npr.org/templates/story/story.php?storyId=4600258

    I bring up the interview for a couple of reasons. First, Mr. Friedman recently published a new book, The World is Flat, which I haven’t read yet, but I know will be thoughtful, thought-provoking and entertaining. (He’s a highly readable author.)

    Second, he has some unique ways of looking at the complex questions around outsourcing.

    In the interview, Mr. Friedman outlined three eras of globalization. The first happened between 1492 and 1800, when western countries started globalizing by exploring the world and colonizing pieces of it. This was a movement that shrunk the world “from large to medium.”

    The second era ran from the early 1800s to the year 2000. That era — 2.0 — shrunk the world from a medium to a small. It was an era in which companies globalized.

    We’re just about to enter globalization 3.0. As Mr. Friedman explained, “This era is shrinking the world from a small to a tiny. This era isn’t going to be built on countries globalizing. And it’s not necessarily going to be built around companies globalizing. What’s really interesting about this era of globalization is that it’s going to be built around individuals and small groups globalizing. That’s the new new thing. It’s not going to be just a bunch of white westerners. It’s going to be people of every color of the rainbow… More people are going to be able to plug and play and collaborate than ever before.”

    Ms. Gross asked Mr. Friedman, “When you describe something as flat, what do you mean?” His answer: “The convergence of technologies and companies that came together around the end of the 1990s, converging right around the year 2000, has created a global, Web-enabled platform that allows for multiple forms of collaboration on different kinds of work and sharing of knowledge irrespective of distance, geography, time and increasingly even language. It is this global platform for sharing knowledge and work that came together right around the year 2000 that I argue flattened the world. Flat countries are those that can plug and play seamlessly with this platform.”

    Regarding the extreme opinions held on globalization, I agree with Mr. Friedman: “If you think it’s all good or you think it’s all bad, you don’t get it! It’s built on networks, which are flat and go both ways. It’s about how to get the best out of it and cushion the worst.” What that means, he said, is that “nobody can guarantee you lifetime employment.”

    Using the state of Indiana as an example, Mr. Friedman discussed the complexity of the issue. That case involved outsourcing of a project to overhaul Indiana’s automated unemployment systems. The contract — which was issued to Indian firm TCS using Indian workers — was canceled after a firestorm of publicity, and after a Republican-led bid to keep the work in Indiana, no matter what the extra expense. Going the TCS route was going to save the state $8.1 million. As Mr. Friedman points out, who was exploiting whom? Were the Indians exploiting the citizens of Indiana, who could have directed that savings of $8.1 million into education or road construction or other initiatives? Or were the residents of Indiana exploiting the Indian workers who were pursuing work they’d trained for and sought? There are no easy answers.

    “As a society, we’ve now got to be making the right choices to make sure more and more of our citizens are going to be employable and be able to take advantage of this bigger global economy, [which is] more complex and one that will require more knowledge and skills,” concluded Mr. Friedman.

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