Explain the changing nature of globalization.
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Answer:
In April, 2005, NY Times columnist Tom Friedman published The World is Flat: A Brief History of the Globalized World in the Twenty-first Century. Mr. Friedman's bestseller did much to explain to a wide audience the impact of the Internet and related technologies on the connected, global economy that was rising all around us.
A few years later, Mr. Friedman was a keynote speaker at a 2011 conference commemorating IBM Corp.'s Centennial. To illustrate the incredibly fast pace of change, Mr. Friedman noted that in the short time-span since World is Flat was published, we were already transitioning from a connected to an increasingly hyperconnected world. Many of the companies and technologies that are now part of our every day conversations--Facebook Inc., Twitter Inc., the cloud, smartphones, Big Data, LinkedIn Inc., 4G, Skype--were not mentioned in the connected global economy he wrote about only six years earlier because they had not been born or were in their infancy.
What do we mean by a hyperconnected economy? I recently found a really good answer in an excellent study by the McKinsey Global Institute, Global Flows in the Digital Age. The study takes an in-depth look at the expansion of cross-borders flows in the economy. It carefully analyzed these flows in five different categories: goods, services, finance, people and data and communications. It then developed the MGI Connectedness Index, which measures these five flows in 131 countries, examined how the flows had changed over the past 10 to 20 years, and predicted how they are likely to evolve over the next decade.
Two major forces have been driving the growth of cross-border flows. First is the continuous advances in digital technologies, in particular, the spread of Internet access around the world. We've been going through a kind of digital perfect storm, where a number of major IT trends are each gathering speed while interacting with and amplifying each other: mobile devices, cloud computing, Internet of Things, social networks and Big Data and analytics.