The World is Flat by Thomas Friedman - Book Report/Review Example

The World is flat I. General Review of the book Thomas Friedman’s book “The World is flat” is a paean to globalization. The central tenet of this book is that the barriers to trade and commerce are disappearing due to globalization and this ensures as level playing field for anyone who wants to enter the global economy and sell a product or a service. This, Friedman argues is the result of the ten “flatteners” in terms of the innovations and hard technology improvements like availability of bandwidth and structural changes accompanying globalization. Further, there is the “triple convergence” that happens which is described in the succeeding sections. A. Thesis and B. Method The method followed by the author is a mix of empirical and logical process. As described in the sections above, the empirical process is followed by listing out the different parameters of a “Flat World” and these are listed in a logical fashion. The title of the book is drawn from a conversation that the author has with the CEO of an Indian software company (Infosys) where the CEO (Nandan Nilekani) describes how his company is taking advantage of the flattening out of the barriers and capitalizing on the numerous opportunities thrown up by globalization. As Nandan puts it to Friedman, the world is indeed flat. Ten flatteners The ten flatteners are the major political events, innovations and companies that made the world sit up and take notice. (p. 48). These ten flatteners opened up nee possibilities in the sphere of a globalized world and ensured that the world was not the same again. The ten flatteners are described below: The fall of the Berlin Wall: This event is not only symbolic but also brought masses of people who were hitherto in the communist regimes to participate in the opportunities thrown up by globalization. Netscape going public: This event made the internet accessible to anyone with a computer and allowed the widespread acceptance of the web as a medium of exchange. The introduction of workflow software: This relates to adoption of the open standards that let applications talk to each other. Self organizing collaborative companies: This gave rise to the practice of collaborative projects bringing together developers from all countries in contact with each other. The Y2K outsourcing phenomenon: The outsourcing of work related to the Y2K bug allowed countries like India to get a toehold in the software outsourcing industry. This was then leveraged to provide high quality services at low cost to the western countries. Offshoring: As stated above, once the outsourcing took shape, the world with its flat nature enabled companies from all over the world to get a share of the global outsourcing pie. Supply chaining: The best example of a company gaining due practices similar to Just-in-time adapted to logistics made companies like Wal-Mart offer competitively priced products. Insourcing: This relates to the way in which employees of one company perform additional tasks for other companies. Informing: The advent of search engines like Yahoo and Google revolutionized the flow of information across the web. The steroids: Gadgets like mobiles and other devices. Thus, these are the factors that have made the world a “flat” place for businesses and anyone wishing to jump on the bandwagon of growth and prosperity. Triple convergence The first convergence has to do with all the ten flatteners coming together. They were around ever since the 1990’s but the tipping point was reached around 2000 when all the flatteners converged to make the collaborative form a multiple access thing that everyone can share and work with. The second convergence has to do with the fact that productivity jumps take place in discrete rather than in a continuous manner. Any technological innovation since the times of the industrial revolution has made the increase in productivity lag by a few years or decades, as the case may be. If we map out human history, the earliest innovations probably took centuries before there was a noticeable increase in productivity. But, with globalization we are seeing a productivity leap that is much more compressed in time scale than the others. The second convergence is when the people adjust to the coming together of the ten flatteners and make the adjustment in their work habits. While the second convergence is about processes and structural changes that are necessary to accommodate the flatteners, the third convergence is about people entering the global economy with specialized skills. This relates to the entry of highly specialized resources from India. China and other Asian countries with the necessary technical skills entering the workforce and providing an enriching as well as competitive labor market. The third convergence relates to those people who have benefited from the ten flatteners and are poised to make the next leap. Glocalisation One of the other key points made in this book is about how culture is the differentiating factor in how countries cope with globalization. Those countries that can absorb and assimilate the foreign influences in the exchange of goods and ideas are best suited to adapt to what is called the twin challenge of globalization and localization. II. Comments and Criticisms on Methodology A. Development of Thesis The central thesis of the world being “flat” has been developed well. The author takes the examples listed in the sections above to buttress his case that globalization does a good job of evening out the “barriers” to businesses that want to thrive in an increasingly globalized world. However, the main criticism of the book is about how globalization is producing more losers than winners. The fact that Thomas Friedman makes a case for globalization as being beneficial in the long run has been disputed by many who point to the increasing disparities between the rich and the poor. This is because the “flat world” envisaged by Friedman also needs equality of opportunity and access to basic and higher education that is lacking in many of the countries that Friedman holds up as glittering examples of globalization. Friedman is a cheerleader for the “trickle down” economics wherein a top-down approach to development wherein the benefits of the globalization can be trickled down to the lower rungs has not found too many takers. And the author’s premise of the “dell theory of conflict resolution” has also been disproved time and again. While the book is optimistic in its tone with the author being an acknowledged cheerleader for globalization, it strikes a realistic note as well. In recognizing the new realities of the global economy as well as being optimistic despite the setbacks caused by 9/11. Overall, the book is optimistic in its tone about the promise of globalization and is an important contribution to the overall debate on this process. B. Author’s argument Thomas Friedman is a persuasive writer who makes a very strong case supported by numerous examples, anecdotes and data. His travels around the world have made him an insightful and incisive journalist. He specializes in foreign affairs and the impact of the foreign policies on the rest of the world and in turn the impact of the attitudes of the world towards the US. III. Salient points Some of the salient points made in the book are about how the leaders of the world have to come to terms with the new realities of the global marketplace and what steps they can take to ensure the competitiveness of their economies. Perfect storm in the US Friedman’s book is as much about the ability of the developing countries to take advantage of the processes of globalization as the late realization in the developed world about some of these changes. The book also argues that there is a “perfect storm” brewing in the United States when the lack of highly skilled workforce from the native population and the inability of universities to develop curriculum consistent with the new realities come together. Thus, the book is also a wake up call to the world’s largest economy to engage in self correction before it is too late. There is an urgent need for the “thought leaders” of the world to come to grips with the process of globalization and devise effective strategies in terms of infrastructure, regulations and other forms of market mechanisms to deal effectively with the promise as well as the challenge of globalization. We are reaching the end of the “decision window” and the time to act is now. Conclusion In conclusion, it is worth mentioning that after the book was published, there have been several setbacks to the process of globalization including the latest credit crisis that threatens the global financial system and may lead to a worldwide recession. Thus, it is more than urgent now that the imbalances in the world economic system be corrected and world leaders take steps to contain the fallout of unfettered capital and the movement of goods and services across the globe. While the process of globalization is in itself a leveler and a “flattener” as Thomas Friedman describes it, there are tendencies to overstep the boundaries that cause large scale systemic disruptions. Historically, the world was globalized in a version 1.0 way in the 19th century. World War I and World War II were the reasons for the setbacks to the process and the need of the hour is to ensure that we do not let the process receive another setback apart from the damage already caused to it by 9/11. The last point has to do with the fact that the governments have to ensure that the benefits are evenly spread out and the bottom rung does not go deeper into the morass and by provision of social nets and other mechanisms ensure that all strata of society gain and fulfill the hope of the globalizers’ that this is a process that makes everyone better off in the long run. Overall, the book is a must read for anyone who wants to know more about the new trends shaping an increasingly globalized world. It is an important contribution to the existing literature surrounding globalization. Read More