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HCS Monthly Insights (March 2016) – Part 1
By Ramesh Shahdadpuri (Programme Director, HCS)
In 2005, Thomas Friedman’s bestseller, The World Is Flat: A Brief History of the Twenty-First Century, helped us to make sense of the rapid pace of globalisation trends and how it impacted our lives. The flat world metaphor was a vivid reminder of how businesses and people have been crossing geographic boundaries and breaking cultural and mental barriers, changing the way we work and live. This created new opportunities on one hand but also aroused fears resulting from greater competition and the shift of jobs from home countries to cheaper, foreign locations.
A big factor in driving the globalisation trends has been technology, primarily information and communications technology (ICT). Continuous advancement and innovation in ICT has resulted in greater computing power, faster transmission speeds and accessibility to far and remote places, enabling more people to talk and share data easily, quickly and economically.
Led by China and India, developing countries became the key focus for corporations and entrepreneurs. With large populations, they are huge consumer markets and have abundant human resources, offering compelling value propositions in manufacturing supply chain processes and service support functions. Supported by a good ICT backbone, many business activities and jobs like call centres, computer programmers, research and healthcare have been outsourced to these countries, serving clients worldwide.
Today, a decade later, the pace of change is as relentless as ever. Globalisation has reached a stage where there is probably no country that is not digitally connected and cannot be reached by the internet and mobile connectivity (except where barriers have been placed by political dictators). The international trade volume of goods and services, and the movement of people – seeking work outside their home countries, business travellers, holidaymakers, foreign students – has grown by leaps and bounds.
The latest report by McKinsey Global Institute (MGI) has some great insights on the new era of globalisation. An interesting measure of our greater global interconnectivity today is the global flow of data. This digital globalisation goes beyond our traditional notion of physical goods and personal services. With the volume, velocity and voracity of digital traffic, the new measure is a helpful way to understand its impact in the sharing, shaping and advocacy of new ideas, knowledge, best practices, research and talent.