Level Playing Field--Globally

In the past few years, massive investments in technology—satellite broadband connectivity, undersea cables—have changed the shape of the world, making global communications cheap and abundant. At the same time, computers have become cheap commodities, available everywhere. The results were explosion of e-mail and software that facilitates working remotely to do what Drucker called “knowledge work.”

When all of these things suddenly came together around the turn of the century, intellectual capital could be delivered from anywhere. It could be disaggregated, delivered, distributed, produced and put back together again. And this brought whole new degrees of freedom to the way work is done—especially work that needs brains, not physical interaction.

In his April 2005 book, “The World is Flat,” Thomas Friedman insists that the confluence of these developments is as revolutionary as the printing press in the 15th century. How it plays out will be the central global drama of the early 21st century. The business landscape has been leveled, creating a flat global political, economic and cultural playing field. This allows countries that were previously disconnected from the power centers to participate in the pursuit of wealth—provided they have the skills, the infrastructure (broadband connections) and the motivational drive to win.

Blow the barriers

In this new century, old barriers blew open—everyone in the world was talking to everyone else through the common platform of computers and Internet browsers. The Web provided prolific, universally available content, allowing instant publishing to a world audience. Suddenly there were common Web-based standards with workflow software applications talking to each other. Collaborative communications precipitated the decline of closed, proprietary systems.

Businesses realized that doing everything in-house was needlessly expensive, and outsourcing became common—outside specialists, part-timers and home-office workers. Manufacturing could be done somewhere else; delivery was just a matter of logistics. Worldwide high-speed communications meant that knowledge work could be done anywhere. The decisions related only to where these jobs could be done better, faster and cheaper.

Friedman describes the “triple convergence”: The global, Web-enabled playing field allows multiple forms of collaboration without regard to distance or geography, and soon even language. Global companies lose walls, floors and buildings; employees are now part of a vast, global pool of specialists, assembled (and disassembled) according to needs. New opportunities are created for individuals to compete against anyone, anywhere in the world using new, “flat” rules.

Recognizing their newly acquired power, offshore suppliers began to flourish beyond just providing low-cost outsourcing services. They started to actively promote and expand their own knowledge-based capital. Software companies such as Infosys and Wipro flourished, with 80 percent of their business in the United States.Because of continuous technology acceleration, the change is rapid, inevitable and unstoppable. While this certainly poses a threat to historical U.S. and European prosperity and power, the proper response is not to fight it, but to embrace it and adapt. What America, and other new century economies need are better education, pervasive high-speed broadband connections, and more globally aware government policies. Outsourcing and offshoring are just symptoms of the much broader global shift.Don’t look for “flatness” on the other side of the world—look for it around you, in your own company: no more “secretaries;” minimal levels of hierarchy; old org-charts becoming quickly outdated; e-mails spreading good news and bad within minutes, inside and outside the company; long-standing jobs being outsourced around town and around the world.

It’s a new game out there. Don’t complain about it—join it and enjoy it. If you are not good enough to play in this different kind of game, you’ll simply be sitting on the sidelines watching others play.         

Jim Pinto is an industry analyst and commentator, writer, technology futurist and angel investor. You can e-mail him at: [email protected]. Or review his prognostications and predictions on his Web site: www.jimpinto.com