Maryville University EDL

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Maryville UniversityEDL 763THE World is flat

• Book Presentation
• by
• Chris Garland, Kim Tooley, Marcie
  Burkemper, and Todd Benben

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DEFINING THE FLATTNERS
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iNTRODUCTION While I Was Sleeping

• Realization The field is being leveled and
  other countries are able to compete for global
  knowledge. In essence, the world is being
  flattened.
• The flattening means that we are connecting all
  knowledge centers on the planet together into a
  single global market.
• The use of computers, email, fiber-optic
  networks, teleconferencing, and new software are
  the tools that are allowing the world
  communicate.

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Problem with the flattening

• The playing field is being leveled in more ways
  than with just innovators is also drawing in and
  giving power to a group of angry and frustrated
  people Al Qaeda.

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THE FlattenerS
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Flattener 1- 11/9/89When the Walls Came Down
and the Windows Went Up

• The fall of the Berlin Wall liberated many
  captive people of the Soviet Empire.
• It tipped the balance of power across the world.
  
• The power shifted to those in favor of
  democratic, consensual, free-market oriented
  governance.
• Until the fall of the Wall, the Cold War had been
  a struggle of between 2 economic systems-
  capitalism and communism. After the fall,
  communism diminished.

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The Fall of the Wall cont.

• Finally, the fall of the wall paved the way for
  adopting common standards such as
• how economies should be run
• how banking should be conducted
• how PCs should be made
• how economics papers should be written
• Enhanced the free movement of best practices

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The Opening of Windows

• 1st version hit markets in 1985.
• Eliminated a barrier the limit on the amount of
  information that an individual could amass,
  author manipulate and diffuse.
• The Windows-powered PC enabled millions of
  individuals, for the first time ever, to become
  authors of their own content in digital form,
  which meant that content could be shared far and
  wide
• Craig J. Mundie- CTO Microsoft
• This level of connectivity put the nail in the
  coffin of communism. Freidman

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Flattener 2 8/9/95When the Web Went Around
and Netscape Went Public

• Breakthrough in Connectivity World Wide Web and
  Netscape going public on 8/9/95
• Netscape brought the internet alive and more
  accessible.
• Netscape demanded more computers, software and
  telecommunication networks that could digitize
  words, music, data and photos.

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Flattener 2 cont.

• This flattener is responsible for the birth of
  AOL, newer versions of PC-Windows, Google, Yahoo
  and the dot-com boom.
• It also allowed the telecommunications giants
  such as the Baby Bells and ATT to provide both
  phone service and infrastructure for internet.

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Flattener 3 Work Flow Software

• Work Flow Software created the seamless transfer
  of work from place to place and continent to
  continent. This innovation allowed people to
  shape things, design, create, sell things, buy
  things, keep track of inventories, taxes, etc.
• The first big breakthrough was the combination of
  the PC and email - Windows enabled this.
• SMTP simple mail transfer protocol enabled
  the exchange of email between different computer
  systems.

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• Examples
• Higglytown Heroes by Disney
• Pay Pal 1998 anyone with email can send money
  to anyone else with an email

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Flattener 4 Uploading

• Uploading is a term used for getting information
  and the ability for anyone to be a producer, not
  just a consumer
• Is potentially the most disruptive of the
  flatteners how many people will be in the game?
• Types of uploading
• Community Developed Software Movement
• Wikipedia
• Blogging/Podcasting

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CommunityDeveloped Software Movement

• Also known as open-source communities
• Derived from the notion that companies and ad hoc
  companies should make available online source
  codes - the instructions that make software work
• Peer-reviewed science

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Example

• Apache Open Source Web server community
• Virtual, online, bottom-up software factory
• Single server that can host thousands of
  different virtual websites

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Flattener 5 - Outsourcing

• Outsourcing- to purchase good or services from
  and outside source
• The US began purchasing serviced from India for
  one-fifth of the rate in the US Y2K
• Example Health Scribe India

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Flattener 6 Offshoring

• Is when a company takes one of its factories that
  is operating in say Canton, Ohio and moves the
  whole factory offshore to Canton, China.
• There it produces the very same product in the
  very same way, only with cheaper labor, lower
  taxes, subsidized energy and lower health-care
  costs.

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• This has created a process of competitive
  flattening, in which countries scramble to see
  who can give companies the best tax breaks,
  education incentives, and subsidies, on top of
  their cheap labor, to encourage offshoring the
  their shores.

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China is a threat, China is a customer, and
China is an opportunity.-Kenichi Ohmae,
Japanese business consultant
The average wage of a high-skilled machinist in
America is 3,000 to 4,000 a month. The average
wage for a factory worker in China is about 150
a month. If Americans and Europeans want to
benefit from the flattening of the world and the
interconnecting of all the markets and knowledge
centers, they will all have to run at least as
fast as the fastest lion and I suspect that
lion will be China, and I suspect that will be
pretty darn fast. -Thomas Friedman
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Flattener 7 Supply-Chaining

• Is a method of collaborating horizontally among
  suppliers, retailers, and customers to create
  value.
• The more these supply chains grow and proliferate
  they force the adoption of common standards
  between companies and the more they encourage
  global collaboration.

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WALMART

• No company has been more effective at improving
  and perfecting its supply chain than Walmart.
• Theyre a phenomenal channel but a tough
  customer. They demand excellence.
• -Joseph F. Eckroth Jr., CIO at Mattel Inc.

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Flattener 8 Insourcing

• Is a whole new form of collaboration and creating
  value horizontally, made possible by the flat
  world and flattening it even more.
• It came about because once the world went flat,
  small companies could suddenly see around the
  world in a matter of seconds.

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UPS

• UPS now comes inside a lot of companies and takes
  over their branded vehicles to assure on-time
  delivery
• Papa Johns
• Nike
• Jockey
• HP,
• eBay
• Ford,
• (to name a few)
• UPS is the largest private user of wireless
  technology in the world

.
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Flattener 9 In-forming

• Is the ability to build and deploy your own
  personal supply chain a supply chain of
  information, knowledge, and entertainment.
• Informing is searching for knowledge.

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Characteristics of InforminG

• There is no bigger flattener than the idea of
  making all the worlds knowledge, or even just a
  big chunk of it, available to anyone and
  everyone, anytime, anywhere.
• The access to the worlds knowledge is in our
  pockets.
• Google is now processing roughly one billion
  searches per day.

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Flattener 10 The Steroids

• These are certain new technologies that are
  amplifying all other flatteners.
• They are
• -Virtual transmit content at very high speeds
  and with total ease
• -Mobile with wireless technology all can be
  done from anywhere, with anyone, through any
  device, and can be taken anywhere
• -Personal can be done by you, just for you, on
  your own device

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The Steroids
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America and the Flat World
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America and Free Trade

• Who is Ricardo and why do we care what he thinks?
• David Ricardo (1772-1823) English economist who
  developed the Free Trade theory If each nation
  specializes in production of goods and then sells
  it to another nation at a comparative cost
  advantage, each nation will benefit.
• Americans fear free trade because they see
  outsourcing of jobs as a death toll to our
  economy.

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Is Ricardo Right?

• Friedman says Protectionism would be
  counterproductive, free trade will not work
  without a focused domestic strategy aimed at
  upgrading skills and the education of Americans.
• It must be accompanied by foreign strategy of
  opening restricted markets bringing more
  countries into the global free-trade system,
  increasing demand for goods and services,
  encouraging innovation and reducing unemployment
  and job migration.

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Free Trade The Lump Theory

• People in India and China will work for less and
  will gobble up all the middle level jobs, leaving
  Americans with nothing.
• This theory assumes that everything that is going
  to be invented has already been invented
  resulting in a zero gain.
• Wages are low in other countries because they are
  trapped in a stifled economy. When borders open,
  salaries will rise.

Free Trade The Lump de-bunk
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Look at Past History
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Look at Past History
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When one door closes, another opens

• Example
• Semiconductors could be manufactured cheaper in
  other countries. As more chips became available
  more computer applications were created. Google,
  Yahoo, Microsoft offered video searches which
  required new chips...
• Companies were able to focus on other areas when
  one area disappeared.
• The Pie grows, but no one saw it.

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End Result

• People fear change
• Fear is good because it activates the fight or
  flight instinct
• That instinct allows for creation of new ideas
  and jobs that connect to others
• Upgrading skills, firing up imagination, seeing
  the bigger picture in a global society

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Finding the New Middle

• New jobs will go to the best, smartest, most
  productive or cheapest worker, wherever these
  people reside
• Find ways to make yourself untouchable doing
  something no one else can do or cannot be
  outsourced
• The flatter the world gets, the more digitized it
  becomes

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The Untouchables?

• Specialized or special
• Michael Jordan, Elton John, JK Rowling, your
  brain surgeon
• Localized or anchored
• Repairmen, a dentist, an audience,
• Formerly middle class jobs these are at risk
• Assembly line workers, accounting, data analysis,
  radiology

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What shape are we?

• U.S. economy used to be a bell curve The bulge
  in the middle was the working class
• We are quickly become a bar bell. Our middle
  class is dwindling
• We have to embrace the ebb and flow of a moving
  economy

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What does the new middle look like?
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The Right Stuff

• In the future, how we educate our children may
  prove to be more important than how much we
  educate them
• Rich nations will have to transform the
  educational systems to produce a more flexible
  labor force

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What class should I take?

• Learn How To Learn
• Navigation classes
• CQPQgtIQ
• Liberal Arts
• Right Brain thinking skills

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And now, a musical interlude

• Tubas vs Test Tubes
• The Georgia Tech affect

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Is this a great country?

• The key to getting through the crisis is to
• Have resources
• Have access to higher education
• Have flexibility
• Be open to new ideas
• Have high trust

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The Quiet Crisis

• We still believe we are invincible based off of
  past history
• The Olympic basketball team
• World War II
• We have a solid educational structure that cant
  be beat

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Post WWII problems

• First generation out nose to the grind stone
• Second generation holds it together
• Third generation feels entitled, becomes
  complacent
• While we took things for granted, other countries
  were gaining on us.
• Years later, we are on the edge of crisis

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Things that make you go hmmm

• a pronounced tendency in recent years to extol
  consumption over hard work, and investment,
  immediate gratification over long-term thinking
  and sacrifice. When we got hit with 9/11, it was
  a once in a lifetime generation opportunity to
  summon the nation to sacrifice, to address some
  of its pressing fiscal energy, science and
  education shortfalls all the things we had let
  slide

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.hmmm

• But our president did not summon us to
  sacrifice. He summoned us to go shopping.
• Thomas Friedman

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Dirty Little Secret 1

• The Numbers Gap
• In 2004, nearly 40 of the people at NASA are age
  50 or older
• Only 4 of workers are under 30
• NASA is having trouble finding competent,
  sufficient science, engineering, and
  informational technology specialist that are
  crucial to its operations.

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Dirty Secret 1 cont.

• By 2010, two-thirds of the nations mathematics
  and science teaching force will retire
• We are educating fewer math/science students, but
  the need is growing
• The number of American 18-24 year-olds who
  receive science degrees has fallen to 17th in the
  world We were ranked 3rd three decades ago

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Dirty Secret 2

• The education gap at the top in 2004 the Intel
  Fair attracted 64,000 American students. In
  China there were 6 million kids competing.
• Our test scores are stagnant Asian countries
  are setting the pace
• In 2005, The New York Times reported that college
  graduates were scoring lower in English literacy.
  There were steep declines in Hispanic and African
  American populations

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Dirty Secret 3

• The Ambition Gap Our kids are not working hard
  enough. They are distracted by other things
  (video games, professional athletics, the music
  business)

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Dirty Secret 4

• The Ambition Gap at the Bottom Find a way to
  educate every American it will look diffent
  than we now know

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Dirty Secret 5

• The funding gap - Stop cutting the science and
  math funding

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Dirty Secret 6

• The Infrastructure Gap We lack the digital
  capabilities of the rest of the world.

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The Bottom Line

• We have to focus on educating more people in
  science and math
• We have to be more creative, innovative
• We must open ourselves up to new ideas in
  business and education
• Everyone must have an opportunity to be
  retrained/educated
• We have to hire talent wherever it resides

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The Flattening impact

• What does flattening mean to countries,
  companies, communities, and individuals?

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Overview

• The how and why according to Thomas Friedman,
  globalization has shifted into warp overspeed due
  to technology and communications.
• What does this mean to countries, companies,
  communities, and individuals?
• How will governments and societies adapt?

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Developing Countries and the flat world

• Mexican journalist realized he was living in a
  flat world when he read on the internet that The
  Virgin of Guadalupe (Mexicos patron saint)
  statues were being imported into Mexico from
  China.
• In 2003, China replaced Mexico as the number two
  exporter to the United States. Canada remains
  number one.
• Chinese central bank official told a reporter in
  their relationship with the United States,
• First we were afraid of the wolf, then we wanted
  to dance with the wolf, and now we want to be the
  wolf.

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Introspection

• The first thing any developing country needs to
  do is to engage in brutally honest introspection.
• Like an AA meeting, developing countries need to
  say, I am underdeveloped, I am underachieving, I
  have not lived up to my full potential.
• Each country needs to go through an x-ray
  examination and find out your limits. Take a
  brutally honest look at your strengths and
  weaknesses.

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3 basic principals for developing countries in a
flat world
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Examples

• Egypt guarantees all college graduates a job each
  year. They have been mired in poverty with a
  slow-growing economy for 50 years.
• It is not just jobs, but increasingly productive
  employment that allows living standards to rise.
• It takes 2 days to start a business in Australia,
  but 203 days in Haiti and 215 in the Democratic
  Republic of Congo.

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Suggestions for Economic growth

• Make reform a continuous process
• Regulation must make it
• Easy to start a business
• Easy to adjust a business
• Easy to close a business.
• Excessive regulation tends to hurt most of the
  very people it supposed to protect.

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Ireland- from sick man to rich man in Europe in
less than a generation

• In late 1960s Irelands government eliminated
  the fee for secondary education.
• Joined European union.
• Slashed corporate taxes by 12.5
• In 1996, Ireland made public college education
  basically free, creating an even more educated
  work force.
• Ireland is actively recruiting the best and
  brightest from all over the world to come and
  study and research in Ireland. They know
  industry will go to where major research is
  centered.

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Culture

• Key factors internalize the values of hard
  work, thrift, honesty, patience, and tenacity as
  well as being open to change, new technology and
  equality for women.
• According to Jerry Rao, MphasiS CEO, Cultures
  that are open and willing to change have a huge
  advantage in this world.
• Culture matters but culture is nested in contexts
  not genes and as those contexts and local leaders
  change and adapt so too can culture.

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Will Rogers

• Even if youre on the right track, youll get
  run over if you just sit there.

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How companies cope in a flat world

• Rule 1 When the world goes flat-and you are
  feeling flattened- reach for a shovel and dig
  inside yourself. Dont try to build walls.
• Rule 2 And the small act bigOne 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 The 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 The next layers of value creation-whether
  in technology, marketing, biomedicine, or
  manufacturing-are becoming so complex that no
  single firm or department is going to be able to
  master them alone.

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How companies cope in a flat world

• 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 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 people.
• Rule 7 Outsourcing isnt just for Benedict
  Arnolds. Its also for idealists.

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Summary

• Imagination 11/9, vs 9/11
• When the Berlin wall came down on 11/9 it spoke
  opportunity and creative imagination
• 9/11 brought fear of terrorism and destructive
  imagination of the worst that could happen
• We encourage creative imagination when authority
  comes from the bottom up, where people feel
  self-empowered to improve their lot
• Without this empowerment, people look for who to
  blame
• In this flat world, we need educational systems
  to inspire the creative imagination of the next
  generation by fostering this sense of
  self-empowerment
• We need to prepare kids to meet the challenges of
  this future world
• Reach their full potential
• Get validation and respect from achievements in
  this world
• Foster them with more dreams then memories