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The World is Flat

By 8th October 2018 No Comments

Part 1

Zakaria speaks of three globalisation eras that occurred, the first being globalisation that shrunk the world from large to medium size and second era of globalisation and here the world was shrunk from medium to small size and third globalisation era from year 2000 to present time and the world was shrunk from small to tiny size and flattening the global economic playing field. Global dynamic agent are individuals that are able to globalize themselves and are able to compete globally against other individuals. Friedman believes there are technological forces that came together to flatten the world. Being Windows 3.0 operating system, Netscape company that gave the world the internet that was easy to use, freely download the internet browser and triggered the dot-com boom and triggered the dot-com. That led to countries becoming closer than ever. Revolution in software made everyone’s software inter-operable, allowing one’s software to be able to communicate with another individuals software from anywhere. Six collaborations being outsourcing content, off-shoring content, uploading content, supply and chain in market, insourcing content and being able to stay informed as an individual. Including wireless technology that enabled the platform for sharing content such as work and entertainment globally. The issue is that nobody is talking about the flattening of the world at a political level.

Zakaria lightly talks about the pointers brought up by Friedman such as the economic playing field being levelled by barriers being destroyed. The reviewer states there is no way you can switch off the wave it would cost your own economic wellbeing. The countries that opened themselves up to the world prospered compared to the countries that did the opposite. He believes that by using the neo-liberal method of using the government in market-friendly way, it would further country’s ability to compete in a flat world. Argues that one of the driving forces of the flat world is the shifting attitudes and policies of government around the world.  From Brazil to South Africa to India the governments are becoming more market-friendly, accepting the best way to cure poverty and aim for high-growth policies. Therefore this has resulted in the energy of private sector. He asks did government policies create the technological boom or vice-versa? One could say each furthered each other. The flat earth has been created by an non-flat political world. He is talking about the flat world being created by political factors within around and does not seem to agree with Friedman fully.

Friedman believes that the flattening of the world came about through technological forces and on how technological collaboration accidentally opened up ways for individuals to have a platform that allows one to share content and have access to content whether it is to stay informed or to compete globally in the economic field. He mentions that a country needs to adapt to the new era of the flattening of the world or else it would not be successful. By teaching students in learning institutions about the new era and new skills to adapt to the globalised world to be able to be successful in the economic field, since politically nobody is talking about the flattening of the world. Whereas Zakaria argues that one of the primary forces driving the flat world is the shifting attitudes and policies of the government around the world.  Zakaria questions if government policies created technological boom or the other way around, refers to it as being a chicken and an egg situation. Zakaria does not agree with Friedman’s theory, but with Friedman’s vast information through experience and exploring and travelling to get first hand, his theory and opinions make sense.

Part 2

The bottom of the pyramid is known as the largest and poorest socio-economic group, the people live on more or less of two dollars and fifty cents daily. This segment of people is excluded from modernity of the rest of the globalised civilised societies, including having choices on products to consume as well as access to organized financial services. Which then led to socio-economic concept being developed called the Bottom of the Pyramid; this concept allows us to group the vast segment of the approximate four billion living that are less privileged. This segment constitutes of an invisible, unserved market blocked by challenging barriers that prevent them from realizing their own benefit. This approach focuses on the less privileged as business partners and innovators, rather than just potential producers or consumers. This will allow Bottom of pyramid consumers to receive world-class quality and affordable products and to be empowered and while doing so create a large market in the world’s underserved poor. Leads to a win-win solution. Companies that implement this concept will assist with developing partnerships that bring income for both their company and poor communities, by co-creating businesses and markets, leading to both mutually benefitting. Concept is implemented in Latin America, Asia and Africa. Companies such as SC Johnson and Unilever entered the Bottom of the pyramid and brought about change to consumer’s lives, even though not much profit generated for the company, it assisted with providing necessity of goods and services to the poor

The Bottom of the Pyramid is a concept that is still growing and still needs to be put into practice by spreading the idea of the concept globally through programs. Such as in universities and community talks, and this ups the chances of planting the seed of the Bottom of the Pyramid concept and having new ideas for creating businesses or to solve obstacles that have emerged in the Bottom of the Pyramid market. Thunderbird school of Global management Global strategic management course and in the University of Stellenbosch, program known as business School in South Africa have such programs to help contribute to the future of the Bottom of the Pyramid markets.

Numerous companies have failed or walked away from the Bottom of the pyramid market. There were difficulties on generating enough profit, but some companies are not walking away so easily. Therefore these companies are working to find workable business models to improve conditions in developing countries. It comes down to companies being able to clearly identify their target market, economic and cultural landscape, in order to be successful. “It is all in the details…company needs to set aside goals and be clear in business.” states Milstein.

Another helpful strategy is that companies do not need to always recreate economic and commercial structures, because even the less developed countries have economic and commercial structures. Companies would have to integrate themselves into existing structures and the chances of making profit would be greater and will also avoid costs from making new structures. For example, the SAB Miller Company integrated itself into the Bottom of the Pyramid markets by working with store owners to improve their sales and assisted with building the traditional commercial structures. “No company has made a fortune in the Bottom of Pyramid.” Says Milstein. It does not mean there have not been any successful companies. An example, the ‘d.light’ company that sells solar-powered products to the poor and is doing well. They took up the strategy to get close to their consumers, even if it was in remote rural areas, by doing surveys, asking questions and communicating and getting involved with the consumers. Resulting in the company finding out first hand if the product they want to sell on market would be successful or not. Micro-lending is successful to a certain point, by helping the poor start up businesses, but some fall into more debt or misuse the loan for other household needs or wants. Micro-lending does not help to end poverty and, since the interest rates are too high ranging from thirty percent to hundred percent. Even though it helps make ends meet. An alternative could be giving mini-loans instead of micro-loans, NGO’s focus on neglected sectors of medium sized businesses in developing countries and buying equity stakes in companies to provide them with interest free capital. The bigger the investments leads to the bigger the returns. The Bottom of the Pyramid concept has potential if one does not rush the process.

Oliver

Author Oliver

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