To begin with, generally what the 10% presumption is when we
are dealing with numbers and the fraction of gross domestic product (GDP), we
see that mostly everything is connected locally rather than globally. In other words, Ghemawat predicts that less
than 10% of any type of activity takes place in a truly global manner than
locally. For instant, an issue related to the 10% presumption is the foreign direct
investment (FDI) which stayed about less than 10% in the last three years and the
remaining 90 percent of the fixed investment around the world is still
domestic. Another good example is telephone calls which was mention by
Ghemawat. In today’s generation many of us have smart phones and internet which
made communication around the world so much easier than buying a phone card and
calling international. Therefore, telephone calls as a fraction of gross
domestic product, it stands at a rate of 10% than compare to 100 percent. Don’t you agree that hardly anyone make
telephone calls everyone just text or chats on their cell phones. Some don’t
even have a house phone. What are some other issues you can think of related to
the 10% presumption? The issue with the 10% presumption is that most people have no contact outside of their local environments. While this might make our global community seem as large as ever, if we believe in the idea of six degrees of seperation we might just be a friend of a friend away.
Pankaj Ghemawat is the Anselmo Rubiralta professor of global
strategy at IESE Business School and the Jaime and Josefina Chua Tiampo
professor of business administration at Harvard Business School. His
new book is Redefining Global Strategy (Boston: Harvard Business School Press, September 2007).
First i'd like to agree to the 10% presumption because everything stated above is happening to me. My family used to own a house phone but due to the popularity of cell phones we no longer own a house phone. Everyone is so localized and comfortable where they are that the global world is much less likely to be explored. I've realized that although its easy to connect through an internet community such as Facebook, our friends or connections are still so localized. The friend map on Facebook showed me that my friends were mostly all around me. I feel like we all are connected by the six degrees of separation but the connection is weak and somewhat insignificant so the 10% presumption exists.
ReplyDeleteInterconnecting what we have learned this week it seems interesting in a way that there is a 10% presumption. The world in many ways has shrunk over the past 150 years. At the time of inception, the train, automobile and airplanes brought us closer to one another. Gone were the days where it could weeks to travel within one large country let alone between different continents, and as technology grew so did the desire for speed and more efficiency. In the present day and age media has only decreased the size of the world to a greater extent. The relatively new idea of a flat world explains how media such as telephones, and the internet have created a clear line of communication amongst the different industrial nations. On the flip side of the coin, however, Ghemawat proposes an interesting opinion to the contrary of the globalized world; the 10% presumption is the belief that only 10 percent of any activity occurs on the global scale. At first, my opinon was that how could this be? With the aforementioned ways in which the world has gotten smaller, how could we still be so centralized locally? The friend-tracker on facebook proved to be an excellent example to prove Ghemawat's point. Other than about 10 friends, the majority of my friends live in Southern California. I work here, go to school here, and have lived here my whole life. Why would I have friends elsewhere? Because I am so rooted in Los Angeles, all of my disposable income is a part of the local economy. My only income that goes beyond my own home borders, is the federal income tax which I pay. The same could be stated for a person who lives in New York City. Financially they would be a part of the NYC economy and would have little connection beyond and/or abroad.
ReplyDeleteWhat Gemawat says about telephones is also true. Many people have smartphones so the need of phone cards is a thing of the past. The system also prefers international text to calling. In some places it can cost as much as five dollars a minute for a call, an international text is a flat twenty cents incoming/outgoing.
While I agree with the six degrees of separation, it still doesnt mean that I have direct contact with a person four people removed, the idea proves still that as a rule we are bound within our own localities
In my opinion, the idea of 10% presumption is completely valid when you take a broad look at the world. I definitely agree that we perceive the world as being much more interconnected than it actually is. As Americans, we are mostly all aware that we outsource jobs to other countries, sell our debt internationally, and depend on foreign resources, but at the end of the day a large portion of our goods can/ are produced domestically. America could be a nearly self sufficient country, if needed, supporting the idea that only 10% of activity occurs globally rather than locally. When I think about this idea and how it could correlate to me personally, I have a different stance. Although Ryan made a good point about a majority of his friends being located fairly close to him, I have had a different situation that has caused my friends to be a bit more spread out. Before college I lived in the Sacramento area while my mom worked near San Jose which automatically geographically expanded my relationships. Since then, I have moved to Southern California and my circle has geographically grown even larger. I also have family spread across the country. This gives me a lot of diverse friend groups and locations, yet it still upholds the idea that the world is not nearly as interconnected as it seems. Although my life situation has created more spread out relations across the United States, for the most part my friend map is still within the boundaries of this country. I believe that the reason that our global perceptions don't quite align with reality is because of the technology that has began to link us. In our modern society, we do have the ability to easily make long distance calls, connect through the internet, or even travel internationally, but these advances don't necessarily correlate to more dependence or connection. These new forms of assembling have made countries more available to each other, and I think that having that option tricks most people into assuming that the world is unavoidable linked in every way. In reality, I believe there are still many cultural boundaries that will have to be crossed and solved in order to really connect the world past a mere 10%. We may have the technology to facilitate communication and travel, but language barriers and diverse cultural/ religious perspectives could keep the world divided for centuries. For example, America depends greatly on oil from the middle east, but religious and cultural conflict, has forced America to reconsider this dependence as President Obama mention in the State of the Union. Overall, I believe that if the world intends to become entirely globalized and interconnected, many cultural compromises will need to be instated before people will shy away from their local communities and turn towards global options.
ReplyDeleteI completely agree, with Ghemawat's views on how land-lines are no longer needed due to the interconnection of people all around the world. Based on my own personal life it has been maybe like 5 years that in my house there is no need for a land-line based phone. The need for cell phones or should I say smartphones is becoming crucial for very high demanding well paying careers whether we like the change or not it is happening right before our eyes. I did the My Friend Map on Facebook and I realized that I do have friends that are in other countries, people or should I say family that I had forgotten about living in other countries for the sole reason that I am always talking to them. Facebook and other social networking sites are unbelievably useful for people that want to stay connected to far away family members or friends.
ReplyDeleteI completely agree with the 10% presumption, especially with the fact that the use for landlines is obsolete. My family still has a landline but we never answer it. We always say "If it is someone that I actually talk to, then they have my cellphone number and they can call me there". But even with the use of cellphones, we tend to text a lot more than we actually have a vocal conversation on the phone. Smart phones are not only used to text or call, but people with careers check their emails, and even prepare presentations for work. If I do talk on the phone I talk to people who I frequent. When I did my friend map I realized that I have family that live in Mexico, and that is it. The rest of my friends live in California, Texas, or New York. I talk to my family in Mexico all the time, and that is when social networking sites are the most valuable, especially when talking to my younger cousins who like to come to me for advice. Even programs like Skype can help people connect more efficiently.
ReplyDeleteI feel that 10% presumption is valid. I can agree with Ghemawat that landlines are fading away. The advancement with technology has enabled us to stay connected to those within our circle and beyond by granting us capabilities to access communication. Communication advancement has revolutionized the way we stay connected to others and how we interact with others, such as, mentioned above, through text messages, social networking, and smart phones. These advancements have easily helped me to stay connected to my friends, family, and work at any given time at any given place. I find this blog topic ironic since my home internet is down, do I'm using my phone to respond. Recently, I befriended someone where our phones won't allow us to chat though text. He mentioned to me that it looks like we'll have to communicate the "old school way" and talk on the phone. Our communication has suffered because of this issue. It's strange to think how we have become so dependent on technology.
ReplyDeleteI truly believe in globalization but I also agree with the theory of 10% presumption. When I did the Facebook Map I discovered all of my friends to all in the same city! Having smart phones, Facebook, Twitter and other social medias has allowed people to feel more connected but definitely not in a global way as others have proven through their previous responses. Even when I went to Italy, as apart of the study abroad program, there did not seem to be connections outside of the Italy. My italian friends did not have landlines and only two of them had connections outside of Italy and that was me! Of course if you focus on corporations and finance, the countries cannot seem prosper without being global. What I mean is, is that "The World is Flat" is a definition based on corporations such as Facebook and it fails to look at individuals within the world. So as these responses prove, the 10% presumption on an individual scale seems is true but from a corporate perspective "The World is Flat".
ReplyDeleteStephanie Panozzo for the comment above :)
DeleteMy Friend Map on Facebook was far more spread out then maybe any one else's, the reason being I am from India and I have lived there for 16 years, all my friends are from different parts of India and when I moved here, I had friends from California. Most of my friends from India moved to different parts of the U.S.A such as New Jersey, New York, Florida, Chicago, Arizona as well as Washington. And the rest moved to different parts of the world including Australia, Europe and Malaysia. Irrespective of having friends so spread out across the globe, I still believe that the concept of 10% presumption is absolutely correct. Why? Many reasons. Agreeing with the communication example posted in the blog, I would say that I still prefer to either Skype, chat or text them rather than "call" because of two main reasons: 1)Calling internationally is still more expensive than any of the other means of communication that the internet provides and 2)Staying in touch through the social media or other chatting facilities provided by the internet is definitely better, in the sense that you can not only talk, but also see each other or you know everything new about them through Facebook! Also, many of the people living in the third world or developing countries either do not have a computer, or do not know how to use it or do not know what internet is! These people only know more about their own countries and little about the others. Another point that Mr. Ghemawat made was that even though the countries would expand globally, they will still require to hire the "local" people, consider the "local" culture and take in mind the "local" geography in order to have a successful business. Just like conveyed in the Week 1's discussion about "Fast Food Globalization", in order to succeed in a foreign country it is very important to have the local knowledge and local employees from that country. This again brings us back to the idea of how the world is "Globalizing" on the exterior but when we look inside, we can see how it is just strengthening its connections around the locality of the regions.
ReplyDelete(From Meagan McMillen):
ReplyDeleteI do not agree with the theory of 10% presumption that Ghemawat believes and advocates. I will say that I agree with the fact that people definitely use cell phones over landlines, but I do not agree that they should completely do away with actual telephone lines. Three years ago I moved into a new home with my sister and I wanted to do away with the whole landline concept myself, why waste the extra money? However, my mother pointed out that in the event of an emergency, whether it be an immediate attack on my person or a natural disaster like an earthquake, the landline could be an asset to me. If I was in immediate danger at my new house, by calling 911 from a landline the authorities would be able to pinpoint my geographic location within seconds. Yes, some new smartphones have an application that would give the same information, but not everyone has smartphones. A regular cell phone does not have this capability. If there were an earthquake, of which there are many in southern California, receiving towers that relay all calls could be knocked down. There are different towers for landlines than for cell phones and I for one would much rather have more options than less when trying to contact my loved ones. Further reasoning as to why I disagree with Ghemawat's theory is due to all of the social networks available today, world-wide transportation, and more travel opportunities than ever before. I performed the 10% presumption test with the Facebook App "My Friend Map" and not so surprisingly discovered that it definitively did not apply to me. I got to travel the world on a cruise ship for the last two years where the minority of crew were United States citizens. Not to mention the friends of the crew who came to visit, the guests who chose to sail, and the friends I made while in port with the people who called my vacation destination their home. I have friends all over the world that I still maintain contact with, so I am not operating in a 10% capacity. While I admit that not many people have had an opportunity like mine, they can if they so choose! There are more travel opportunities than ever before. Cruise ships, studying abroad, a simple vacation, and even the armed services can all provide experiences on a global level. Another reason to disagree with Ghemawat is that 10% is an extremely low number, and I cannot believe that Globalization today would reap such minuscule results. I also disagree with the last few sentences of the original argument posted above. It is stated that "The issue with the 10% presumption is that most people have no contact outside of their local environments. While this might make our global community seem as large as ever..." I have to say that using the phrase "no contact" might be a bit extreme. While the average person might not have much contact outside their local environment, it is a bit remiss to automatically assume that they have none. I also have to say that Ghemawat's 10% Presumption Theory does the opposite of making our global community seem large as ever, Globalization is the force that does so.
I agree with the 10% presumption that Ghemawat makes about telephone use. My family and I barely use our landline telephone anymore because there are so many other resources that we can use. Other resources such as smartphones and webcams are much more convenient. Technology has become so advance now that you can video chat with people through your phone. This leads to less use of telephone calls. Everyone is too lazy to call to talk because they rather just text. Texting is more convenient because you have the freedom to answer whenever you like. There are so many social networks out there that people use to stay connected with friends; such as Facebook, Facebook chat, Twitter, blogs, etc. WIth that being said, I do not agree with the last part that states, "The issue with the 10% presumption is that most people have no contact outside of their local environment." I highly disagree with this because I have family in different countries. My parents webcams with them a couple times a month and they stay connected through technology. They don't use landlines anymore because they found a cheaper, easier, and more convenient way to talk. Everyone can reach out of their local environment because of the advanced technologies. Thanks to smartphones and webcams, we can connect and communicate with people all around the world. This might not be true in some parts of the world, but lucky for us here in the U.S., we can.
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