The word “globalization” has always been a loaded term, meaning different things to different people at different times. Until recently, white collar professionals thought that globalization affected the other guy; for professionals, it was synonymous with expanding markets for their company’s wares and services.
Fast forward to the present, and in the back office, globalization is probably associated with that sucking sound of software jobs going to India. If you take the headlines too seriously, you might be tempted to believe that San Jose will become the next Akron.
But go ask manufacturers about globalization, and you’ll probably get a more nuanced view. Yes, many of them closed obsolete plants in the 1980s when the Japanese invaded with faster, better, cheaper. Ironically, they did so based on ideas of continuous improvement preached by Americans like W. Edwards Deming and Joseph Juran.
Fast forward to the 90s. The same Japanese automakers are busily setting up shop along I-85 and opening design centers in Southern California. Increasingly, their suppliers are becoming more domestic too. The bottom line: the market changed, consumer tastes are changing more rapidly, and suddenly, being close to the end customer became a competitive benefit. And today, those same Japanese automakers are playing catch-up ball with Detroit in SUVs.
Don’t fool yourself, even with the resurgence of domestic manufacturing, production remains as global as ever. The difference is the value chain itself. It still makes sense to make commodity parts abroad but differentiating it locally. And it makes even more sense that labor in developed nations have higher skill sets — such as computer literacy and the ability to take wider responsibility — to justify their higher pay scales.
The same will be true in software. Global fiber backbones will continue enabling countries with the right educational systems, skills bases, and business climates to join the software value chain. In developed regions, geeks in turn will have to stop being just geeks. Mastery over Java, .NET, or XML will no longer suffice. In the new software value chain, geeks must learn to communicate, comprehend business plans, and add management skills to avoid becoming tomorrow’s laid-off coal miners. They might even have to get a life.
The jobs will still be here — it’s no surprise that the high-end offshore firms are bulking up their North American and European presences. Because, as manufacturers learned the hard way, being faster, better, cheaper cannot be performed by remote control.