RTBreview. Help wanted: The future of work in advanced economies. Some 40 million workers across advanced economies are unemployed. With many nations still facing weak demand—and the risk of renewed recession—hiring has been restrained. Yet there are also long-range forces at play that will make it more difficult for advanced economies to return to pre-recession levels of employment in the years to come. As a result, we see that the current disequilibrium in many national labor markets will not be solved solely with measures that worked well in decades past. To help develop appropriate new responses, MGI examines five trends that are influencing employment levels and shaping how work is done and jobs are created: 1. Technology and the changing nature of work Over the past three decades, technology has altered how production and routine transaction work is done, substituting machines for assembly-line workers and ATMs for bank tellers, for example.
Exhibit 1 Enlarge 2. Exhibit 2 Jobs in advanced economies are increasingly for high-skill workers. 3. 4. 5. The Shifting Economics of Global Manufacturing. Cost Competitiveness: A Country View For the better part of three decades, a rough, bifurcated conception of the world has driven corporate manufacturing investment and sourcing decisions. Latin America, Eastern Europe, and most of Asia have been viewed as low-cost regions. The U.S., Western Europe, and Japan have been viewed as having high costs. But this worldview now appears to be out of date. Years of steady change in wages, productivity, energy costs, currency values, and other factors are quietly but dramatically redrawing the map of global manufacturing cost competitiveness. The new map increasingly resembles a quilt-work pattern of low-cost economies, high-cost economies, and many that fall in between, spanning all regions.
In some cases, the shifts in relative costs are startling. In developing the index, we observed that cost competitiveness has improved for several countries and become relatively less attractive for others. Under Pressure. See Harold L. The emerging global labor market. MGI's latest research takes a look at the emerging global labor market in services and explores the notion of "global resourcing," the process a company goes through to decide which of its activities could be performed anywhere in the world, where to locate them, and who will do them. It also explores the real demand and supply of offshore talent. Interactive Overview of global supply and demand of offshoring services. Pop out Part I—The demand for offshore talent in services Although the practice of offshoring is growing among companies in developed countries, a wide gap exists between the number of service jobs that they could locate remotely and the actual number of jobs that they have located offshore, or plan to offshore, by 2008.
Read more Video Diana Farrell looks at the governing forces at work in offshoring. Part II—The supply of offshore talent in services Part III—How supply and demand for offshore talent meet. Search Results: outsourcing. Explicit cookie consent. Corbis EARLIER this month, President George Bush's chief economic adviser, Gregory Mankiw, once Harvard's youngest tenured professor, attracted a storm of abuse. He told Congress that if a thing or a service could be produced more cheaply abroad, then Americans were better off importing it than producing it at home.
As an example, Mr Mankiw uses the case of radiologists in India analysing the X-rays, sent via the internet, of American patients. Mr Mankiw's proposition, in essence, is the law of comparative advantage, first postulated by David Ricardo two centuries ago and demonstrated to astonishing effect since. Yet the Republican speaker of the House of Representatives, Dennis Hastert, joined Democrats in their rebuke of Mr Mankiw for approving of jobs going overseas; another Republican called for his resignation. As for what might be called the business lobby, this is in disarray. So what is really happening? The “jobless recovery” first, then. And what of China? Trust, Responsibility and the Globally Integrated Enterprise. There is general agreement that the corporation is going through dramatic changes in the 21st century, driven by a combination of advances in information technologies - especially the Internet - and the heightened competitive pressures brought about by globalization.
For example, consider one of the major findings of IBM's Global Innovation Outlook (GIO) 2.0: "The nature of competition — increasingly intense, global and unpredictable — requires strength across the board. So the objective is to decompose the enterprise into its component parts, understand with great precision what is truly differentiating — where the enterprise has strengths and weaknesses — and then make decisions about how to build, buy or partner for world-class capability.
In this model, companies can focus their energies on their true point of differentiation, instead of trying to master many domains and ultimately squander competitive advantage by dispersing focus and investment. Think about it. IBM's Sam Palmisano: 'Always Put the Enterprise Ahead of the Individual' Mic Listen to the podcast: As far as a legacy goes, says IBM chairman Sam Palmisano, “I just want to leave the company better than I found it.”
Judging by IBM’s successes over the past decade, Palmisano, who was CEO of IBM until he stepped down earlier this month, did just that. During an interview with Wharton management professor Michael Useem, Palmisano discussed the sale of the company’s personal computer business, the PricewaterhouseCoopers acquisition, how a big company can encourage innovation, and what he learned from his mentors, among other observations drawn from almost 40 years at IBM. Below is an edited transcript of the conversation. Michael Useem: I am at the headquarters of IBM here in Armonk, N.Y., with Sam Palmisano, who joined IBM in 1973, became chief executive in 2002 and today — having stepped down as chief executive — continues as chairman of the company. Sam Palmisano: When you first take over, it’s hard to separate your leadership from the company itself….
Re-think | Search Results | The Center for Global Enterprise. “The IBM spirit, the IBM heart, and the IBM language were the same in all tongues and in all countries” After reading Re-Think: A Path to the Future it is immediately apparent to me that Sam Palmisano bleeds IBM, and that he wholeheartedly agrees with the sentiment expressed in the above quote by Thomas J. Watson, Sr, founder of IBM. Much more than a self-indulgent autobiography, Re-Think instead opts to detail the approaches that Palmisano – and the organisation as a whole – took in order to transform IBM from a company operating within various countries, to a company that operates between countries.
At its core Re-Think addresses one of the biggest issues facing the Millennial generation – globalisation – and roots its debate firmly in case studies from around the globe. Re-Think is brief. Throughout the UK – and many other countries – economics professors teach globalisation as a theory, but Re-Think allowed me to comprehend the real successful applications of the academic idea. 'Re-Thinking' Tax: Are you Ready for the Globally Integrated Tax Function? | Vertex, Inc.
Former IBM CEO Sam Palmisano puts several interesting questions to business leaders in his new e-book, “Re-Think: A Path to the Future.” Similar questions also face leaders of tax functions. Here’s one passage that got me thinking: Today, global economic integration presents enormous opportunity for the future of business and society. And while many point to the risks of this integration, the more pressing and more pragmatic questions to me are the following: How do we deal with the future?
Do we embrace it? Palmisano knows a thing or two about what it takes to prepare a business for a more global future. In his book, Palmisano expresses pride for leading IBM’s transition from a mere “multinational company” to what he describes as a “globally integrated enterprise (GIE).” Palmisano’s thinking generates highly practical questions we ought to be asking right now. Sustainable scale of an organization: A case study at IBM?
How many employees can IBM sustain? At Dec. 31, 2013, IBM reported 431,212 employees for the company and wholly-owned subsidiaries. In February 2014, there were projections that 13,000 to 15,000 employees would be released within the year. The estimate for 2015 of 26% further reductions calculates to leave about 300,000 IBMers worldwide. This leads to three questions about the current situation (and potential other cases with similar circumstances). 1. The domain of business is a social science, so corporate decisions lead to paths where alternatives (i.e. the path not taken) can never be tested in reality. 1. Let’s look at history, published in annual reports. The employees to be cut, mostly from overseas operations, will be given incentives to leave, but just what the financial package will be has not been determined.
At the end of 1994, IBM reported a population of 219,839 employees. The U.S. So what happens if revenues don’t increase over time? 2. 3. References Bettencourt, Luís M. "The Globally Integrated Enterprise" Jb170.infusionsoft. Globally integrated enterprise. The globally integrated enterprise is a term coined in 2006 by Sam Palmisano, the then CEO of IBM Corp, used to denote "a company that fashions its strategy, its management, and its operations in pursuit of a new goal: the integration of production and value delivery worldwide.
"[1] The Argument[edit] Palmisano argues that in the international model of the 20th century, most operations were centred in their home country, with only elements of sales and distribution happening overseas. The multinational model of the 21st century—in which companies created small versions of themselves in each country—was a response to the trade barriers that arose after the World Wars. For IBM—Palmisano's employer—this was a successful model because it enabled the company to grow in those markets, understand local customer requirements and cultivate local talent. Criticisms[edit] Brad Setser of Roubini Global Economics (RGE) Monitor wrote: See also[edit] References[edit] External links[edit] Former IBM CEO Sam Palmisano On The New Rules For Global Business Leaders.