Tuesday, January 31, 2012

Module 5

I can’t help but start out by criticizing Friedman.  He was incredibly unclear on what the first convergence was.  I finally gathered what he was trying to get across, but he never specifically stated what it was.  He just gave a series of examples and expected the reader to make the connection.  But I digress.  Triple convergence is, as the name implies, the combination of three convergences.  From what I gathered, the first convergence was that all of these new technologies, together, had to become widespread to take root.  I really liked the simple example he gave of pencils and paper.  As you get pencils, you need more paper.  As these products become more and more demanded, the quality improves as new businesses enter into the market.  As quality improves, productivity improves. 
Friedman calls the second convergence horizontalization.  By this, he is referring to the birth of a new set of business practices and skills that would help us use the new technology to become productive.  I love that Freidman points out that new technology alone doesn’t boost productivity.  It has to be used in business in order to be effective.  I had never thought about the aspect that Friedman brings up: that new technologies are around long before they are implemented because it takes time for us to learn how to use them.  I think that there is a lot of validity to this point.  I am an accounting major, and I have learned a fair share about the history of accounting.  Even as computers became more and more widespread in business, accounting was still largely done on paper.  It wasn’t until programs like Excel were created that accounting shifted to being done almost entirely on computers. 
However, although there is truth to Friedman’s point that it takes a while for us to learn how to use technology, I disagree with the reason why.  According to Friedman, it takes managers and innovators getting comfortable with the new technology so that they can learn how to implement it, but that makes it sound like new technology is really difficult to learn, understand, and innovate with, which simply isn’t true.  I think a more relevant point is that a lot of technology is useless, and intelligent people in important business positions confront new technologies with a healthy dose of skepticism, which is a good thing.  If CEOs and other business decision-makers instantly implemented any new technology that was developed, they would run their companies into the ground, because a lot of new technologies are either fads or quickly obsolete.  This reminds me of a guy who worked for my uncle.  My uncle is the CEO of a manufacturing company in Salt Lake City, and his vice president of operations was a guy who was obsessed with implementing the latest technologies into the business.  He was a brilliant VP, but spent huge amounts of the company’s money on these cutting-edge technologies, which began to paralyze the company financially, and it ended up costing him his job. 
            The third convergence is the new playing field created by billions of people being able to compete.  This makes sense as we are all becoming interconnected. This ‘triple convergence’ is important because it is shaping the world into a world of unbelievable technologies and limitless possibilities.
            In the story about Indiana and India, I would say that both parties are exploiting each other.  India is exploiting the United States by taking work from it because there isn’t enough work in India, and Indiana is exploiting India by using their brilliant minds at cheap rates.  I don’t really have an opinion about this topic because both sides can make a valid argument.
            Intellectual property is when someone invents something based upon an idea they had, and the idea that they have rights to it.  It is important because the protection of intellectual property is essential for innovation and continued technology advancement.  However, it is difficult to enforce intellectual property rights worldwide. 
            This reading was very interesting.  Every time I read the required material for the module, I am awed at how much the world is ‘flattening.’  I can only imagine what the world will become in my lifetime.

Thursday, January 26, 2012

Module 4

            Although there are a myriad of jobs that are connected to computers, there is a unique skillset in being able to fix any computer problem that arises.  I couldn’t find a specific job with “the responsibility of fixing all possible computer problems” listed in the job description, but, ironically, there is a high demand for such a skillset.
            A person with this skillset, and the person I decided to interview, is my brother-in-law, Aaron.  He is an information technology specialist for the Utah Highway Patrol.  I have known for a while that he dealt with computers, but I never talked to him about what he did until I interviewed him for this Module.  He actually started as a normal Utah Highway Patrol State Trooper, but it didn’t take long for his co-workers to discover his talent with computers.  He became the go-to guy for computer problems.  He said that there is a huge level of satisfaction in relieving other people’s headaches.
            Over the course of a several years, his career slowly faded from pulling speeders over to working more and more on computers.  Today, he doesn’t do any traffic enforcement.  He is basically a traveling IT specialist.  He travels from patrol car to patrol car.  He also fixes computers in 911 dispatch centers and even computers in the Highway Patrol State Offices.  The transition was almost comical.  I was on a ride-along with him about eight years ago, and as we were patrolling I-15, he got a call over the radio from dispatch.  I can’t reiterate the exact conversation, but the dispatcher said “we have a huge problem.”  When I heard the dispatcher say that, I thought ‘Yes, I get to see some real police action!’  He flipped his lights and sirens on and started driving as fast as he could.  The anticipation built as I was envisioning experiencing something like a runaway bank robber or a drug-dealer sting operation.  My hopes were abated, however, when we pulled into the dispatch station so that Aaron could fix a critical computer that had gone down.  After Aaron fixed the computer, I said to him “We drove that fast so that you could fix a computer?”  He responded by saying “without that computer operating, dispatchers can’t act as quickly, and seconds can make the difference between life and death in this line of work.”
            As soon as he said that, I realized his job of maintaining information systems was just as important as anything he could have been doing out in a given community, if not more so.  Information systems are critical to everything that police officers do.  Each police car has a laptop with wireless internet so that officers can connect to different databases, such as the DMV database.  Dispatch centers are also incredibly computerized, as are Highway Patrol offices.  If the computers used by the Highway Patrol go down, law enforcement is basically incapacitated.  
            The most interesting thing about being a computer-repair professional is that having actual knowledge is more important than having formal schooling.  Aaron has no schooling beyond high-school.  He is just a computer junkie, and he is now one of the lead computer specialists in the department.  The information technology field changes so rapidly that having a degree isn’t enough.  Continual updating and learning is required more so in the IT field than in any other field.  For some people, it takes work to keep themselves updated, but for people like Aaron, it takes very little effort because it is so much fun to them!  That was the impression I got when I interviewed Aaron about what he did – that this was something he just loved.

Friday, January 20, 2012

Module 3

There is a significant difference between offshoring and outsourcing.  Offshoring is when an entire company relocates for financial reasons.  Outsourcing, on the other hand, is when a company purchases a good or service from an outside supplier, rather than using internal resources.  In terms of offshoring, it makes perfect sense that a company would re-locate to where it could build its product(s) at the cheapest rate possible, but it absolutely baffles my mind that moving an entire company across an ocean, producing the product, and then shipping the product back to the U.S. could be cheaper than just producing the product here.  My brother is in the accounting department of a company in the Freeport Center, and his company is planning on re-locating to a larger building, literally across the street.  When I asked him how much the move would cost, he told me “tens of millions of dollars.”  Tens of millions of dollars to move across the street!  Imagine how much, then, it would cost to move to a different country!  Are materials and labor really that expensive here?  I guess so!
One of the lines in the reading that stood out to me most was the statement that Oded Shenkar gives to American companies: “If you still make anything labor intensive, get out now rather than bleed to death.  Shaving 5% here and there won’t work.  You need an entirely new business model to compete.”  This correlates with my thoughts above: that the U.S. just can’t compete with what China has to offer.  The ‘flattening’ process has made a lot of industries almost impossible to compete in here in America.
            A supply chain is pretty simple to understand, as it is almost self-explanatory.  It is the journey of a given product from a supplier to a retailer to a customer.  However, in spite of being a simple idea, it is very difficult to create a supply chain that is as streamline and efficient as Wal-Mart’s.  I really liked the way the reading demonstrated how difficult it is to create.  It pointed out that Wal-Mart doesn’t make a single thing, and yet it is the biggest retailer in the world due to its supply chain.  This struck me as to how powerful an efficient supply chain can be.  Wal-Mart has used its supply chain to climb to the top, and has done so through information technology that offers real-time information across the world.
            On a critical note, I want to point out one thing that I don’t think Friedman describes effectively.  The whole point of an efficient supply chain is to avoid large amounts of inventory.  Friedman does dance around this idea, but the main reason he gives is that products go in and out of fashion fast, and this is why an efficient supply-chain is important. This isn’t even close to the main reason, as even Wal-Mart doesn’t completely avoid over-stocking.  As an accounting major, I can assure you and Friedman that the main reason for an efficient supply chain is to free up cash.  Inventory costs money – a lot of money.  Not only does inventory require huge amounts of storage space, which costs a lot of money to provide and maintain, but also, the inventory itself ties up vast amounts of cash.  If a grocery store has a million dollars in inventory sitting in its back room, that is a million dollars that it can’t use to reinvest into the business today.  It might not seem like that big of a deal to have money tied up in inventory, but the time value of money is critical, and companies today absolutely can’t afford massive inventories if they want to remain competitive.
            Like supply-chain economics, Google has affected business in a significant way.  Because Google is so prevalent, businesses are offering products and services online more and more.  In fact, many companies are solely online companies.  I use Google often to search for products that I want, and as Google becomes more and more of a powerhouse, businesses compete more and more in cyberspace, using Google to their advantage, not because they have to, but because it is necessary to do to compete.

Thursday, January 12, 2012

Module 2

Workflow software is the Henry-Ford version of software.  By that I mean it is basically the digitized version of the assembly line, which Henry Ford invented (Henry Ford was the founder of the automobile company Ford, for those who don’t know).  In an assembly line, much more can be accomplished because people can specialize in one particular task, which allows for greater efficiency.  After a person is finished with his/her specialized task, he/she can pass the project to the next person who has his/her own area of expertise.  On Henry Ford’s assembly line, one person specialized in attaching a muffler, headlights, or tires to a vehicle before sending it down the line to the next station.  This allowed high quality vehicles to be produced quickly and efficiently.  It is a concept that revolutionized manufacturing as a whole; however, its implications are much more widespread than just manufacturing.  Today, this concept is used in an electronic form called workflow software.  It allows workers to work on part of an electronic project in their fields of expertise and then send it ‘down the line’ to the next worker regardless of the physical distance separating them.  For example, in today’s film industry, 3D animation is used in a large number of films.  As one would suspect, 3D animation is done entirely through the use of computers, and there is a huge range of specialization within this aspect of film.  To demonstrate, I remember watching ‘the making of’ feature on a popular 3D-animated film, and there was an animation specialist whose sole job was to animate dirt and grime on the scenes that were sent to her.  After she was finished with a scene, it was then sent to the next phase of its creation.  This example demonstrates how workflow software allows for the transfer of data from one computer to another. 
Honestly, I take workflow software for granted.  I don’t think twice when I start a homework project at the computer lab, email it to myself, and finish it later on my computer at home.  When one of my professors puts something on his/her website for the class to download, I don’t really appreciate how simple it is to do so.  After reading this section of The World is Flat, I more fully appreciate the privilege that we have of being so interconnected.
Another type of important software is called open-source software.  It is software whose source-code is available so that its users can modify and improve the software, as well as freely distribute it.  From what I can surmise, open-source is created, not by software companies, but by unpaid ‘geeks’ who know how to program.  They collectivize their knowledge to create and fine tune software that rivals professionally-made software.
Open-source software is important because it allows for major improvements where the software is lacking.  It can continually be improved upon.  The book gives an example of this with the story of the creation of Apache, which was such a good program that commercial companies couldn’t compete with it.  Open-source software allows people to have cutting-edge software for free, which I think is good.
Outsourcing is when a company purchases a good or service from an outside supplier rather than an internal resource.  Information systems contribute to this through connecting everyone, so a good or service can be purchased from the cheapest supplier, regardless of where they are.
Outsourcing is a controversial topic.  While it can cut product costs, making products cheaper and more available to everyone, it also takes potential jobs out of our economy and places them in other economies.  In my opinion, however, outsourcing is good.  Outsourcing creates huge competition.  Competition drives people to educate themselves and become smarter.  Those who are not willing to compete will have a harder time finding a job, which encourages everyone to compete, making society smarter and better off.
I really have nothing to criticize in this module’s reading in terms of content.  The stories were entertaining and informative.  I particularly liked the ‘Apache’ story, because I thought it was funny that a huge corporation like IBM couldn’t compete with a private community of computer geeks.

Tuesday, January 3, 2012

Module 1

Because Friedman begins his book, The World is Flat, with a fairly lengthy defense of its title, I’m going to begin by criticizing it.  I have never read a book where the author has to explain so deliberately why he/she chose a given title.  This is because if an author has to actually spell out the reason for a title, it’s probably a bad title.  Likewise, Friedman’s explanation for his title, The World is Flat, makes no sense.  That’s not to say that I didn’t understand the metaphor, because I did.  It’s just ridiculous.  How does increased international competition make the world flat?  When people actually believed the world was flat, this belief was a great economic hindrance.  For example, this lack of knowledge made certain trade routes arduous and costly.  How, then, are technology advancement and globalization, both of which are huge economic facilitators that together connect the world in real time, being tied to that same idea?  I had an instant distaste for Friedman’s logic, but I will end my criticism with that. 
            According to Friedman, have been three major eras of globalization, globalization 1.0, 2.0, and 3.0.  Globalization 1.0 lasted between Columbus setting sail in 1492 and about 1800; globalization 2.0 lasted from 1800 to 2000; and globalization 3.0 happened at about 2000.  The distinguishing factors are that globalization 1.0 was about countries as a whole, and how they competed with other countries.  This era also focused on natural resources and how countries harnessed them.  Globalization 2.0 was about companies going multinational as transportation costs came down.  And finally, globalization 3.0 is about individuals competing against individuals as technology has made it possible to connect everyone.  This will make competition much more diverse and outsourcing much more common.
            It scared me as I read about globalization 3.0 because I am going into accounting, and to find out that a lot of accounting practices are being outsourced to places like Bangalore was more than slightly depressing.  However, as I continued to read, I found comfort in the fact that outsourcing will create more opportunities for the country doing it.  So really, it’s just a matter of change.  The jobs available in the United States will not necessarily be fewer in number, they will just be different.
            Friedman then begins laying out the ten forces that flattened the world, and he begins with the fall of the Berlin Wall.  To Friedman, the fall of the Berlin Wall meant the obvious liberation of the people of the Soviet Union, but it also meant, on a greater scale, that the world as a whole had shifted towards democracy.  It meant that individuals would be the ones with power, rather than huge, regulatory, centralized governments.  It meant that capitalism would be the new direction for the world rather than communism or socialism.  This was the first major force that would begin the “flattening” of the world.  The fall of the wall allowed people to do what was most productive and most efficient.
            The second force that flattened the world was the World Wide Web and its ability to connect everyday people without their knowing a lot about computers.  The major flattening force in the midst of this was Netscape going public.  The internet existed prior to Netscape, but Netscape offered an easy-to-use browser that even the most computer-illiterate people could operate.  From that point, the number of internet users hasn’t stopped growing.
            To end, I thought one of the most interesting insights Friedman had was that technology, while uniting the world, is also being used by terrorists and other enemies as a facilitator to our destruction.  This rang true to me as I thought about organizations like Al Qaeda, which can, because of technology, infiltrate the United States while still maintaining contact with its leaders in foreign countries.  What is being used for great things is also being used for terrible things.