When you send your next email or visit a website on the other side of the world, just think for a moment that it all started with smoke signals.
As early as mid-1600s, people were thinking of ways to send messages over a distance. Smoke signals served a purpose for a time. Eventually technology accelerated to serve this need. Bare wires were strung between points and a system of coding electrical impulses was developed. Communications improved. If it was good enough on land, why not traverse the world’s oceans?
Technology encased and protected electrical wires from leaking current into the surrounding water. Cables were placed on ocean floors and telegraph messages and telephone calls began to flow between countries on either side of the ocean. This enabled global trade since messages could so easily cross the ocean.
The power of long-distance communications, of global communications made a giant leap forward once INTERNET came into being. As Web-2.0 matures into Web-3.0 more, larger, and faster communications is being enabled. Today, complex matters and documents can easily be sent by computer to distant parties anywhere in the world as if those parties were sitting in the same room as the sender.
Purchasing departments of large corporations are taking advantage of that communications power. At the press of a button a raw material can be sourced from some distant country and sent to a low-cost manufacturer in yet a different country. This process of seeking from outside the company what once was produced inside the company is called “OUTSOURCING”. Some companies, for example those in China, Korea, even in India, have learned to be responsive to the needs of manufacturers from everywhere in the world. Those companies which have made the transition to serving multi-languages, multi-cultures, and multi-regulatory jurisdictions are establishing themselves as a global hub, a global powerhouse for whatever skill they have chosen by which to distinguish themselves from the thousands of other competitors around the world.
As the internet advances and computing power increases, OUTSOURCING will continue unabated. It has to. Companies have to continue to cut costs and improve quality. Outsourcing is the only way to do so. Internet is making it easier for outsourcing. The benefit to companies of outsourcing is the ability to find ever-lower costs for just about every facet of doing business.
Large physical manufacturing plants are no longer needed in America. For a company to survive going into the future, it will have to establish itself as the fittest, lowest-cost, best quality, GLOBAL powerhouse in some business niche. As a global powerhouse, everything about it must be the best. By being best and lowest-cost, a customer is locked in for a much longer “lifetime” because of everything, from great relationships, to top-notch service, to lowest costs, to best packaging, to fastest shipping, etc. This also drives up “switching” costs for those acquired customers. In other words, acquired customers will have a very tough time finding a better company to turn to.
EVERY job function IN EVERY COMPANY around the world will eventually be outsourced to some global “hub”, some global powerhouse that specializes in that product or that particular niche. Companies everywhere must adjust to a global world of instantaneous OUTSOURCING for every facet of business. Those companies which are slow to change, slow to downsizing and driving down their costs, will become dinosaurs, but not in decades, in a matter of years.
The world is pressing in from all sides. Companies can no longer be satisfied being AMONG a group of world-class companies. Instead, companies must decide to become the ONE superior company and superior throughout the world. Part of becoming a global hub also entails becoming master, but not owner, of a massive, global SUPER-ECO-SYSTEM in which participation is fluid and some of that participation purely voluntary.
What started centuries ago in an effort to communicate across distances with smoke signals is now matured into Web 3.0 with the power to disrupt companies. Today, companies are FORCED by the latent power of this communications network to eliminate costs rapidly and to do so in innovative ways.