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Sunday, April 8, 2012

The New Flat World

Sometimes when you look back at millennium gone by, you wonder how countries and their business functioned. Colonization, murder, slavery and war in the name of business and money. Your industry needs raw material, find a country which has in abundance, just capture the god damn country. Moreover, there was a gap in technology, knowledge and awareness, which facilitated in putting some countries to higher grounds. Millions benefited from this act of greed; living a very affluent, convenient and easy life for centuries. Thankfully, grounds are being leveled now and technology is playing a big role in it.

The dream of  'one world' was always there and people at various times in history contemplated on its viability. The definition, though, was never clear. Should the physical boundaries be gotten away with, should there be one constitution and law, so on and so forth. With serious differences in access to technology, resources and wealth, the idea never seemed probable. If 'one world' would ever come into being, a new kind of boundary should be defined and then it should be gotten away with.

Countries wealth now is judged by economic metrics which in turn is defined by the business houses there. Industries are playing big role in defining and influencing government action and policies. Businesses no longer work within the physical boundary of the country, their boundary encompasses the whole world now. They produce a product for the world collaborating with the world.

Entrepreneurs today build a global product leveraging the competency of various countries. They may use R&D of US, manufacturing of China and services of India to build a unique competitive product which can compete with the best in the world. Sony tried to do manufacturing in their own country with disasterous results. The labor costs play a big role, so while others are using a low cost destination, one can't just afford to ignore it. One cant wage a war to capture resources but one definitely can acquire it. Chinese and Indian companies are acquiring business from the west to add a competency or to meet a demand. It may have taken 100 years to build Ford but it doesn't necessarily means that every global automobile company will take a century to mature. One can get there in 20 years by acquiring design companies from Italy, factories in red and hiring best skills from around the world. Inorganic growth reduces the gestation period significantly.

Demand is the new king and its in the emerging market. Technology is facilitating the remote skill development and distributing knowledge capital. This unique demand will help in leveling the playing field and usher us into 'one world' era.

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