The World Is Flat(ter)…

The World Is Flat: A Brief History of the Twenty-First Century by Thomas Friedman
(New York: Farrar, Straus & Giroux, 2005) 

Written by New York Times columnist Thomas Friedman, best-selling author of Longitudes & Attitudes, The Lexus & The Olive Tree and From Beirut to Jerusalem, it was based on a series of 2003-04 NYT columns and multi-part Discovery Channel series on outsourcing jobs to India. Since it was published over one year ago, Friedman has elevated & extended the outsourcing offshoring debate in the US the way Nicolas Carr’s Harvard Business Review article (and later book) “IT Doesn’t Matter” did for post-Y2K IT debate in 2002.  Friedman’s thesis is well-known to many who have not even read the book: the world started flattening on 11/9/89 with the fall of the Berlin Wall, and nine other flatteners (including outsourcing, offshoring, supply-chaining & in-sourcing) have emerged since then & converged to make the world more global, competitive & horizontal instead of vertical.

The two biggest unintended consequences of this were Y2K putting India on outsourcing map in 2000 and China joining WTO in 2001 which accelerated offshoring, and these two factors have led to what he calls competitive flattening. Friedman watches countries like Malaysia, Thailand, Ireland, Mexico, Brazil & Vietnam scramble to see who can give companies the best tax breaks, education incentives, and subsidies, on top of cheap labor, to encourage offshore outsourcing. 

One consequence of this flattened world is that Friedman believes we are part of this morality play, whether we think we are or not in a daily basis. No company epitomizes the tension that global supply chains evoke in the consumer in us and the worker in US than Wal-Mart. As consumers, we love supply chains because they deliver all sorts of goods at lower & lower costs. As workers, we are ambivalent or hostile to these supply chains because they expose us to higher pressures to compete, cut costs, & drive wages & benefits lower for employees. 

This leads Friedman to ask a fundamental question central to the book’s staying power on the bestseller list: where do companies start and stop? In his analysis, management, shareholders & investors are largely indifferent to where their profits come from or even where the employment is created – but they do want sustainable companies. Politicians are compelled to stimulate the creation of jobs in a certain place, and residents want to know the good jobs are going to stay close to home. 

The whole view of a flat world depends on our US view of free trade, and he believes that both sides of the politics of globalization can agree that we know free trade won’t necessarily benefit every American, and our society will have to help those who are harmed by it. Friedman puts out 5 point “compassionate flatism” agenda of leadership (like IBM’s Lou Gerstner in 1993), muscles (portable benefits & lifelong learning for all workers), “good fat/cushions worth having” (wage insurance), social activism (brought on by global supply chains) & parenting (getting kids to rise up to the challenge of a flat world.)  Some might argue “wouldn’t individual Americans be better off if government erected some walls and banned some outsourcing and offshoring?” Friedman says no, and points to challenge of making workers “untouchable” – jobs that are unable to be outsourced because they are too special, specialized, anchored or really adaptable. Friedman also points to quiet crisis of innovation in US around science, addressing the numbers gap, ambition gap & education gap as more important than myopic protectionist legislation. 

Friedman closes the book by contrasting the three greatest dangers America faces in a flattened world: excess of protectionism: excessive fears of another 9/11 that prompt us to wall ourselves in, in search of personal security – and excessive fears of competing in an 11/9 world that prompt us to wall ourselves off, in search of economic security. In a flat earth, the most important attribute to have is creative imagination: the ability to be first on your block to figure out how all the enabling tools can be put together in new & exciting ways to create products, communities, opportunities and products. That has always been America’s strength because Friedman calls the US “the world’s greatest dream machine.” 

He ends with a message to the children which summarizes the book’s thesis and the author’s optimism in the primacy of America in this flattened world: “…The world is being flattened. I didn’t start it & you can’t stop it, except at a great cost to human development & your own future. But we can manage it, for better or for worse. If it is to be for better, then this generation must not live in fear of either the terrorists or tomorrow, of either Al-Qaeda or Infosys. You can flourish in this flat world, but it does take the right imagination and motivation. While your lives have been powerfully shaped by 9/11, the world needs you to be forever the generation of 11/9 – the generation of strategic optimists, more dreams than memories, who wake up each morning and not only imagines things can be better but also acts on that imagination every day…”

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