IT's Contribution to Globalization

IT's Contribution to Globalization

Robert A. Schultz (Woodbury University, USA)
DOI: 10.4018/978-1-60566-922-9.ch003
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In this chapter we will consider this question: To what extent is IT responsible for globalization? But before we can address this question, we need more clarity on what globalization is. Some authors, for example, Thomas Friedman, view globalization very broadly. Friedman uses an invented term, flattening, to include a wide range of phenomena both social as well as economic.1 (Friedman 2005) Friedman’s flattening is always a good thing. The danger in this approach is that there cannot be bad cases of flattening; good and bad aspects of globalization can seem to be completely linked when in fact they are not. For example, I believe that Friedman may tend to view negative features of offshoring to be compensated for just by offshoring’s contribution to “flattening.”
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Globalization And ‘Flattening’

It is worth some effort to unpack what Friedman means by flattening, because that will enable us to gain some insight into what does and does not belong to globalization. For Friedman, flattening can occur within one nation or economy. IT and improvements in communication are very largely its causes, and its effects are largely economic. Some hallmarks of flattening are greater equality in access to information, greater speed of access to information, greater collaboration, shared standards, dissolving boundaries (both national and company), and greater productivity brought about by these hallmarks. (Friedman 2005)

New business models are valuable for Friedman not just because of their increased efficiency or productivity, but because they contribute to “flattening.” For example, Wal-Mart’s supply chain efficiency and UPS’s supply chain management produce their beneficial results by breaking down barriers between separate companies and intermingling their business processes.

About halfway through the book, Friedman quotes (apparently approvingly) Harvard political theorist Michael Sandel’s short definition of Friedman’s term “flattening”:

What you [Friedman] are arguing is that developments in [IT] are enabling companies to squeeze out all the inefficiencies and friction from their markets and business operations. That is what your notion of ‘flattening’ really means. (Friedman 2005, 203-4; my emphasis)

In other words, “flattening” is untrammeled free market capitalism enabled by IT. Friedman follows Sandel’s discussion with a long quote from The Communist Manifesto of Marx and Engels which, in 1848, presciently describes globalization or “flattening” as an inevitable stage in the development of capitalism. (Marx and Engels 1848, section 1) Of course, Marx and Engels see this state of no boundaries and cosmopolitanism as the precursor to the inevitable death of capitalism. Friedman, on the other hand, sees that other values than market efficiency need to be taken into account, such as “social cohesion, religious faith, and national pride.” We also need to determine what to keep in the way of worker protections and democratic traditions. Friedman calls this process ‘sorting out.’ (Friedman 2005, 204-205)

Two points are worth noting about this discussion so far: First, both Friedman and Marx regard globalization as inevitable, but have opposing views about its value. Second, on Friedman’s account, IT plays an enormous role in globalization. It turns out that Friedman believes what I have called the Technology Principle:

Technological progress is inevitable, unstoppable, and mostly beneficial. The results of technology come about through its unimpeded progress. Hence, technological development must have priority over other considerations. (Schultz 2006, Ch. 11, 165)

Friedman actually believes that technology is entirely beneficial. Friedman says in italics, “I am a technological determinist! (2005, 374) People can misuse technology, but technology itself does nothing but provide opportunities on which we must capitalize or go under.

This raises a large topic which we will discuss later more thoroughly in Chapter 15, The Value of IT-enabled Globalization. But the view of technology as a neutral enabler, providing only positive opportunities, is very naïve at this point in history. Friedman recognizes threats to the ecosystem as important. But he does not recognize technology’s role in this threat. Global warming and ozone depletion are only two of the threats technology is totally or largely responsible for. The critical feature of modern technology is its willingness to treat anything as a resource to be reordered in the furtherance of human aims, including its own. It builds a new and incompatible order on top of what was there. The point of view of modern technology regards everything as a potential resource, as “standing reserve” to be used or reused later in other processes of the same kind.2 A forest has status only as a timber resource. Land itself is only a resource for the building industry. Even human beings themselves, from this point of view, become “human resources.” (Heidegger 1955, 14-17) Friedman’s world is a technologized world, the pattern of production and consumption enabled by technology. His flattened world contains resources, with human beings having roles only as producers and consumers.

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