The World Is Flat
At a recent conference, several presenters recommended reading the book, The World Is Flat, by Thomas L. Friedman. The presenters felt that educators need to understand why the world is flat and what implication that has on jobs and thus on how we are preparing students to enter this flat world. Therefore, I plan to share excerpts of the book with you via e-mail. As you read these excerpts, please think about whether schools are getting students ready to face this type of future.
Examples of Outsourcing
- Computer technical support
- Income taxes (accounting)
- Reading CAT scans and MRIs (radiology)
- Call centers
- Personal remote executive assistant
- Drive-thru orders at McDonalds
Globalization [Author’s viewpoint]
- Globalization 1.0
- 1492 to 1800
- countries globalizing
- companies globalizing
- 1800 to 2000
- birth and maturation of global economy
- individuals globalizing
Newfound power for individuals to collaborate and compete globally
Globalization 3.0 is going to be more and more driven not only by individual but also by a much more diverse – non-Western, non-white – group of individuals. Individuals from every corner of the flat world are being empowered. Globalization 3.0 makes it possible for so many more people to plug and play, and you are going to see every color of the human rainbow take part.
The World Is Flat – College degrees decreasing in value
Income tax preparation has been outsourced by the accounting firms. Thus, they are no longer hiring entry level accountants to do taxes.
These midsize firms “are getting a more level playing field, which they were denied before,” said Jerry Rao (CEO of Indian accounting firm). “Suddenly they can get access to the same advantages of scale that the bigger guys always had.”
“What we have done is taken the grunt work. You know what is needed to prepare a tax return? Very little creative work. This is what will move overseas.”
“The accountant who wants to stay in business in America will be the one who focuses on designing creative complex strategies, like tax avoidance or tax sheltering, managing customer relationships,” said Rao. “How or she will say to his clients, ‘I am getting the grunt work done efficiently far away. Now let’s talk about how we manage your estate and what you are going to do about your kids.”
Accounting Today (June 7, 2004) “This past tax season produced over 100,000 outsorced returns and has now expanded beyond individual returns to trusts, partnerships and corporations.” Wrote author L. Gary Boomer of Manhattan, Kansas
“We must be honest about it. We are in the middle of a big technological change, and when you live in a society that is at the cutting edge of that change [like America], it is hard to predict. It is easy to predict for someone living in India. In ten years we are going to be doing a lot of the stuff that is being done in America today. We can predict our future. But we are behind you. You are defining the future. America is always on the edge of the next creative wave. … So it is difficult to look into the eyes of that accountant and say this is what is going to be. We should not trivialize that. We must deal with it and talk about it honestly … Any activity where we can digitize and decompose the value chain, and move the work around, will get moved around. Some people will say, ‘Yes, but you can’t serve me steak.’ True, but I can take the reservation for your table sitting anywhere in the world, if the restaurant does not have an operator. We can say, ‘Yes Mr. Friedman, we can give you a table by the window.’ In other words, there are parts of the whole dining-out experience that we can decompose and outsource. If you go back and read the basic economics textbooks, they will tell you: Goods are traded, but services are consumed and produced in the same place. And you cannot export a haircut. But we are coming close to exporting a haircut, the appointment part. What kind of haircut do you want? Which barber do you want? All those things can and will be done by a call center far away.” Said Rao
Discovering a “flat” world – pages 7 – 8
[India] created a platform where intellectual work, intellectual capital could be delivered from anywhere. It could be disaggregated, delivered, distributed, produced, and put back together again – and this gave a whole new degree of freedom to the way we do work, especially work of an intellectual nature … And what you are seeing in Bangalore today is really the culmination of all these things coming together. [Bangalore is where a lot of the outsourced jobs have gone.]
Clearly, it is now possible for more people than ever to collaborate and compete in real time with more other people on more different kinds of work from more different corners of the planet and on a more equal footing than at any previous time in the history of the world – using computers, e-mail, networks, teleconferencing and dynamic new software.
When you start to think of the world as flat, a lot of things make sense in ways they did not before. … because what the flattening of the world means is that we are not connecting knowledge centers on the planet together into a single global network, which – if politics and terrorism do not get in the way – could usher in an amazing era of prosperity and innovation.
The playing field is not being leveled only in ways that draw in and superempower a whole new group of innovators. It’s being leveled in a way that draws in and superempowers a whole new group of angry, frustrated, and humiliated men and women.
What do we tell our kids?
There is only one message: You have to constantly upgrade your skills. There will be plenty of good jobs out there in the flat world for people with knowledge and ideas to seize them. In a flatter world, you really do not want to be mediocre.My advice to my daughters in this flat world is very brief and very blunt: “Girls, when I was growing up, my paprent sused to say to me, ‘Tom finish your dinner – people in China and India are starving.’ My advice to you is: Girls finish your homework – people in China and India are starving for your jobs.”Ever person should figure out how to make himself or herself into an untouchable. In a flat world, everyone should want to be an untouchable. Untouchables [in authors lexicon] are people who jobs cannot be outsourced. Untouchables come in 4 categories:1. workers who are special2. workers who are specialized3. workers who are anchored4. workers who are really adaptableSpecial workers – Bill Gates, Michael Jordan, Barbra Steisand – have global market for their goods and can command global-sized pay packages.Specialized workers – all sorts of knowledge workers – from specialized lawyers, accountants and brain surgeons to cutting-edge computer architects and software engineers, to advanced machine tool and robot operators. These are skills that are always in high demand and are not fungible. Fungible is work that can easily be digitized and transferred to lower-wage locations. Work that cannot be digitized or easily substituted is nonfungible.Anchored jobs – must be done in a specific location, involving face-to-face contact with a customer, client, patient, or audience. These jobs generally cannot be digitized and are not fungible. HOWEVER, there are fungible parts of even anchored jobs, and they can and will be outsourced – either to India or to the past – for greater efficiency.You actually want to become really adaptable. You wan constantly to acquire new skills, knowledge and expertise that enable you constantly to be able to create value – something more than vanilla ice cream. As parts of your work become commoditized and fungible, or turned into vanilla, adaptable people will always learn how to make some other part of an ice cream sundae. Being adaptable in a flat world, knowing how to “learn how to learn,” will be one of the most important assets any worker can have, because job churn will come faster, because innovation will happen faster.The people who are losing out are those with solid technical skills who have not grown those skills. The more we push out the boundaries of knowledge and technology, the more complex tasks that machines can do, the more those with specialized education, or the ability to learn how to learn, will be in demand, for better pay. And the more those without that ability will be less generously compensated.
World is Flat Resources
National Education Summit on High Schools – Remarks by Bill Gates http://www.gatesfoundation.org/MediaCenter/Speeches/BillgSpeeches/BGSpeechNGA-050226.htm
Science Friday – Thomas Friedman Interview
http://www.sciencefriday.com/pages/2005/Jun/hour2_062405.html (listen to broadcast on Windows Media)
Thomas Friedman MIT Interview – http://mitworld.mit.edu/video/266/
Is the World Flat? Education and Competing in a Global Economy
Workforce 2020 and Beyond: Root Causes of U.S. Workforce Changes
Creating Career Pathways in a Flat World
http://www.cord.org/uploadedfiles/2005%20NTPN%20Pres%20-%20Hans%20Meeder%20NTPN%20FLATTENING%20WORLD.ppt#256,38,Creating Career Pathways for a Flat World
Tom’s Thoughts – College Graduation http://www.amorenaturalway.com/thoughts/detail.asp?newsID=47
It’s a Flat World After All – NY Times http://www.signallake.com/innovation/TFriedmanDOMINANCE040305.pdf
Educational gap poses a threat to U.S. futureDeseret News (Salt Lake City)http://www.findarticles.com/p/articles/mi_qn4188/is_20050411/ai_n13595402
If the World Is Flat: why does American education go in circles?Education Nexthttp://www.findarticles.com/p/articles/mi_m0MJG/is_1_6/ai_n15969886