CESA IB 2011 03

International BusinessStephan Langdon, MBA, M.ED

Flatteners: first three are platforms contributing to collaboration11/9: the fall of the Berlin Wall opening WindowsFall of the “Wall” between East and West BerlinPolitical systems that were once closed opened upWindows8/9: Netscape goes publicEmergence of an internet browserWork flow software: Development of software which when installed in different computers and in different places allows them to work with each other

11/9 as a platform for collaboration11/9: the fall of the Berlin Wall which separated East and West Berlin and GermanyThe fall of the “wall” resulted in the eventual collapse of countries that were part of the Council for Mutual Economic Assistance or COMECON, sometimes referred to as the “Eastern bloc”, or the Soviet empireIncluded in this “bloc” were countries like the Czech Republic, Bulgaria, Romania, East Germany, Poland, etc.

Friedman’s claimthis event tipped balance of power across the world towards more democratic, free-market oriented governments

11/9 as a platform for collaboration (Continued)Centrally planned countries “opened up”In 1991, India abolished trade controlsChina accelerated reforms (although some of china’s economic reforms started in the 70s)Global exchange of digital information now possible as political restrictions eased upHuge personal empowerment

8/9 as a platform for collaboration8/9: Netscape goes publicThe initial browser was Mosaic which was designed to allow researchers/scientists in remote locations to access each other’s workMosaic was transformed into the first browser to be made available to the public (for free)Coupled with introduction of Windows 95, including GUI capability, these made accessing the internet much easierEarly access to the internet were text based

8/9 as a platform for collaboration (Continued)Browsers as gateway to Internet From internal systems to systems of systemsDot com bubble allowed massive investments in the internet highway; by the time the bubble burst, an initial physical infrastructure – fiber optic cables, switches, etc. – was in placeFrom resistance to email and cell phones (early 90s) to emergence of terms like B2B and B2C.

Work-flow software as a platform for collaborationWork flow software: software that allows computers and in different places to communicate and work with each other using different modes, e.g. audio, video, etc.Example: Wild Brain produces cartoons in SFRecording sessionsDesign and directionWritersAnimationAll in different locations using Virtual Private Network (VPN)

Work-flow software as a platform for collaboration (Continued)Example 2: Pay PalEmergence of protocols and standards to facilitate communication among systems

Flat World and NINFlat WorldBerlin WallWindowsNetscape BrowserWorkflowNIN

Flat World and NINFlat WorldBerlin WallWindowsNetscape BrowserWorkflowNINGlobal Market

Pay PalFlatteners: the next seven are new forms of collaboration

Flatteners: the next seven are new forms of collaborationUploadingOutsourcingOffshoringSupply-chainingIn-sourcingIn-formingSteroids

Flattener 4: UploadingPower or capability of individuals to send up, out, and around their own products and ideasApache – a web server that allow web browsers (in different computers) to interact with different web servers. Web servers allow a user to use his or her home or office to host a web site.

Flattener 4: Uploading (Continued)Open source communities“community rules”Examples:Linux operating system - offers a family of operating systems; can be adapted to run on the smallest desk top computer, laptop, palm pilot, etc.Firefox (Mozilla)Blogging, Wikis, etc.

Flattener 5: Outsourcing India as an example of how outsourcing beganEducational infrastructure in India7 Indian Institute of Technology 6 Institute of ManagementAs a result, Indian nationals would go to the US or developed countries to find workDot-com boom created “physical highway” to allow for India to get “connected”Reform of telecommunications system in India

Flattener 5: Outsourcing (Continued)US companies start looking for opportunities to utilize labor pool in IndiaLate in the 1990s, the Y2K issue emergedIndian “expats” return to India after “dot.com bubble” burstFriedman sees the massive amount of programming to prevent a “Y2K” disaster and return of expats catalysts India’s emergence as an outsourcing destination

Flattener 6: OffshoringOffshoring: move a strategic process or portion of a company’s value chain to a foreign locationDistinction Outsourcing: have another company do a specific, but limited function, e.g. accountingOffshoring: move production or an important process offshore

Flattener 6: Offshoring (Continued)China as an example of the emergence of offshoring1977: Deng Xiaoping starts economic reforms in ChinaMid 1980s: applies for membership in WTOFinally accepted into WTO mid 1990sWatershed moment in the sense that as a member of WTO, China has to play by international rules

Flattener 6: Offshoring (Continued)Example: ASIMCOFrom efforts to find “new china” managers to manage their business to investing in the US US operation takes care of finishing, also allows company to keep abreast with technologyFilm: China BrandsFriedman does mention possible limits to growth in China, including need for further reforms

Work-types companies avoid offshoringRelationship-oriented work Process where repeatable process map cannot be createdRoles with complex industry structure and/or long product learning curvesSuccess criteria are not well defined or measurableStrategic aspect to the businessHigh levels of sensitive intellectual property are shared across wide groups of people

Work-types companies push offshoringHigh transaction volumeHigh repeatabilityLow domain knowledge neededLow mission criticalityFew touch pointsLow complexityLow training effortsNon-strategicWell defined process and metricsEasily transmitted over electronic wiresOutcomes can be easily managed

India AdvantagesLow costNative EnglishEarly market entranceGovernmental software export strategy since 1972 Early adoption to quality standardsStrong educational programsGovernment incentives Technology park developmentTax advantages and tax breaksLow import duties

India DisadvantagesGeo-political risk with PakistanElectrical Power issues 24 hour travelTime zoneCostly Turnover Salaries rising 20% annually for skilled workersMid-manager staffing difficultiesCultural differences

Brazil AdvantagesLow costTime Zone and ProximityEarly adoption to quality standardsStrong educational programsMultilingual Support (Spanish and Portuguese support)Government incentives Technology park development (but need more)Tax advantages and tax breaks

Brazil DisadvantagesCorruptionLack of Qualified PeopleDelaysInfrastructureIP ProblemsEnglishBrain DrainHigher cost than India and ChinaPoor infrastructure especially off coastHigh sunk costCostly turnover

China AdvantagesScaleLaborSpeedLow costStrong educational programs and joint university programsGovernment incentives Technology park developmentTax advantages and tax breaks

China DisadvantagesFocus on AsiaEnglish Cultural differences and inward thinking Uncertain governmental actionsCommunist effect on property laws Communist bureaucracy Intellectual property theft is rampantData PrivacyPoor infrastructure especially off coastManufacturing focus Poor customer service Need for local representation/local partner Indian offshore companies are having problems with offloading their own work to China

Flattener 7: Supply ChainingWal-Mart as an example of a company that pursues supply chain management aggressivelyCoefficient of GlobalizationLearning to sell new products: sushi

Flattener 8: InsourcingWorld Synchronized: Supply ManagerTrust through systemesToshiba RepairsShoes.comUPS

CESA IB 2011 03

More Related Content

What's hot

Viewers also liked

Similar to CESA IB 2011 03

More from Stephan Langdon

Recently uploaded

CESA IB 2011 03