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"Globalization is much like fire. Fire itself is neither good nor bad. Used properly, it can cook food, sterilize equipment, form iron, and heat our homes. Used carelessly, fire can destroy lives, towns and forests in an instant." Keith Porter, in his article Globalization: Good or Bad

Over the past decade, the term 'globalization' has become a hot-button issue. There are those that believe that the global market encourages efficiency through competition and division of labor-allowing a specialization that enables people and businesses to focus on what they do best. That the global marketplace offers the opportunity to tap into more and larger markets around the world, and creates hundreds of millions of jobs; many critically needed in developing countries, lifting millions out of poverty.

There are those that want to isolate America by erecting trade and investment barriers. Those that object to outsourcing, believing that it takes away American jobs, especially from the unskilled worker, and weakens the American economy. Some believe that globalization will spoil cultural diversity and the ways of indigenous people, leading to a world homogenization.

The majority of people stand somewhere in the middle. Most often, objectors are not against free trade or globlaization per se, but are more cautious about the stability, transparency and predictability which business needs to operate at global level. Anti-trust laws, the Securities and Exchange Commission, labor unions, the Federal Trade Commission, OSHA, etc. keep American commerce in check. There is no equivalent for these agencies in the global marketplace. Many objectors simply believe that a balance must be found between rules and freedom if the global economy is to realize its full potential. That rules must be set by an international organization, such as the World Trade Organization or the like.

"Globalization is not a phenomenon. It is not just some passing trend. Today it is an overarching international system shaping the domestic politics and foreign relations of virtually every country, and we need to understand it as such." Thomas Friedman, in his book The Lexus and the Olive Tree

The big winners of globalization are the consumers. Global competition increases product quality, widens the range of available goods and services, and keeps prices low. Globalization allows people to be more connected than ever; to enjoy ethnic foods, relatively inexpensive foreign travel, and low-cost products. Inexpensive, fast, and reliable communication and transportation options enable producers of goods and services in low-wage countries to challenge high-cost producers in rich countries on their home turf. Globalization rewards firms that are innovative and competitive, whether they be small businesses or multi-million dollar operations. In a global economy, there is a niche for everyone.

This is a critical moment for U.S. commerce. Yes there is some risk, but there are also rich possibilities. Take Caterpillar, Inc. Caterpillar is a company that has thrived in this age of globalism because, rather than protecting themselves against it, they have embraced it. Caterpillar is one of America's major manufacturers, exporting more than $9 billion in products. But they have also become a major British manufacturer, a major Brazilian manufacturer, and a major Chinese manufacturer, to name three of the 40 countries where they have established a presence. By expanding globally, they have maintained their ability to grow, refusing to concede markets to competitors. When it made sense to invest for local access, they did, and found that their U.S. exports to these countries increased as well. In fact, in the past several years, Caterpillar has more than doubled their Chinese workforce, and significantly expanded their sales there. At the same time, they increased their U.S. exports to China by 40%--creating 5,000 new production jobs here in the U.S.

Caterpillar's global presence also gives them a natural hedge position. History shows that the world's major currencies-the dollar, euro, yen-can fluctuate anywhere from 15-40% against one another in a two-year period. Having a presence in each currency zone protects them from this instability.

American manufacturers must stay aggressive with product development programs-and ensure that the goods they manufacture are desired all over the world. To keep costs low and productivity high, they must embrace lean manufacturing principles-- increasing the use of robotics and automation, and focusing on just-in-time delivery. They must invest in their people-providing the education and workforce training they need to succeed. Our international competitors are working to produce better products and adopting world-class processes, but they cannot replicate our market size and proximity. The ideas and competitive spirit that American employees bring to the table must be nurtured.

Finally, and probably most important, U.S. manufacturers must believe that they can compete on the world stage. They must look at globalization and international competition as an opportunity to make themselves stronger and more efficient. What's good for the world is good for the U.S. Look at it this way: The U.S. comprises only 5% of the world's population. This means that 95% of potential customers are located abroad. Trade liberalization brings more and more of these people into the global economy. As their quality of life improves, they become potential consumers of the products that U.S. manufacturers provide.

The next generation-today's students-must be ready to compete on a global level. Butler Technology and Career Development Schools (Located in Hamilton, Ohio) has developed a Global Business and Marketing Student Education Program that takes up to 25 students on an 18-day trip to China to experience Chinese culture and life as a Chinese student.

"China has the fastest growing economy in the world, and will be a major player in the world's economic and social future," says Bob Sommers, Butler Tech CEO. "Today's students need to understand that, in the future, they can either be competitors or partners with the Chinese. American schools aren't focused on the right things to keep our students competitive in the future. Chinese students go to school almost year round, learning technological skills and languages to prepare them for globalization. American students will need to understand the Chinese culture."

"Science and technology are driving today's innovation. Forty to seventy percent of the world economy is digital-using not cash, but credit cards and digital transactions. Meaning that, as long as you have a broadband connection, you can work anywhere in the world. The old-boy system of having the right connections is rapidly disappearing. Outsourcing works because there are a lot of people out there willing to do a lot more for a lot less money," Sommers continues.

Education is mandatory for Chinese students, free until the eighth grade. Students pay for high school education, usually living far away from their families in dorms housing up to 9,000 students. Chinese high schools resemble our college campuses--higher education being only for those students who have passed rigorous entrance examinations. Shanghai is one of the most developed areas in China in terms of education, with 215 technical schools educating almost 247,000 students. Asian students face crushing workloads and are very disciplined. The education system is rooted in standardized tests, which are the single most important factor in deciding one's general career path.

Chinese students achieve near-perfect scores on Western standardized tests. However, when they come to America, they often find themselves ill-prepared for Western education. Chinese students are taught that all questions have only one correct answer, and have a shocking capacity for memorization. This lack of creativity in China's education system will prove to be a major stumbling block in student development. Chinese government and business leaders worry about a manufacturing-based economy, which is unable to create new technology, lacks major research and development projects - and lags far behind in creative sectors like marketing and design. For China to become a true player on the world stage, and move beyond being the world's factory, it must instill a creative thinking that cannot be taught through rote learning and memorization.

As for American students, there is little debate that our math scores rank well below those of most Asian countries, and that we are falling behind in sciences and engineering. Many believe, that to compete on the world stage, U.S. education must move away from an emphasis on flexibility and individual learning styles toward a more strict, disciplined teaching environment emphasizing math and science.

"By the time Chinese students are 18 years old, they have the technology and language skills our students don't have until they're at least 22-23 years old. That's 4-5 years of more productivity. Our kids need a more technological education. They need to develop skills they'll need to compete in life," Sommers explains.

America can compete and win on the world stage if we embrace globalization as an inevitable force, focus on enhancing its positive aspects and diminish the negative. Adopt traits of other cultures that will make ours even stronger. Learn what works for other countries and economies and find ways to apply them to our own. Teach other countries practices that have made our country so great. Above all, approach it with the spirit of optimism and fierce competitiveness that has made America succeed for all these years. It's a win-win-win.

Robin Lynd is Public Relations Associate for Edoc Marketing, Inc. She can be contacted at:
Robin@edocmarketing.com

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