Example Of The World Is Flat- Financial Management Perspective Essay

According to Thomas L. Friedman (2005), globalization developed through three eras to the current era. Friedman noted that in the first error, globalization focused on specific countries. In the second era, the focus shifted to companies other than countries while in the third era-the current era, the focus is in both groups and individual companies with a 10-point of convergence. The ten “flatteners” i.e. the fall of the Berlin Wall, the Netscape going public, and the development of work flow software, uploading, outsourcing, offshoring, supply chain, insourcing, informing, and the steroid have made the world flat. What are the effects of the flat world to a finance officer?
As noted above, globalization affects almost all aspects of the economy. One can use the globalization aspect to gather data from any part of the world. One can even hire worker from different regions and manage them from a central point without moving. In addition, one can monitor, measure, and manage financial risks from central place using some recent developments. The economies in the world have also been globalized. In this case, it is evident that production, consumption, and company’s physical development has diffused to different regions and countries. Multinational companies have entered very many countries in the world distributing goods and services that span the whole globe.
Globalization has led to liberation of the financial and capital markets. Financial innovations have changes as technological innovations hit the market. Governments have liberated the rules and regulation that prohibit entrance of foreign finance institution as well as companies. Cross border investments has since become a reality with profound easiness than before. If fact, there are multinational financing organs that open can use today that were not there in the second era of globalizations.
Financial management in the flat world cannot be limited to the local company or country. One has to look beyond the borders. The global economies affect various aspect of the economy. For example, the dwindling oil prices and the strengthening dollar are affecting the multinational companies greatly. It is upon the finance managers to take into considerations factors that are beyond their borders so as to remain relevant. Competition on the other hand has gone global. As multinational companies takes centre stage, each financial manager must take into account aspects that are beyond the local so as to remain relevant. Any company ignoring the global trade trends risks being obsolete, inefficient, and may lose business.
Does the flat world keep financial managers in perpetual learning? There are rapid changes in the global trading environment. Many aspects keep on rising as technological innovations are introduced into the market. One cannot afford to fail to upgrade as the world rolls. For this reason, therefore, financial managers must keep learning as long they are in the field. For example, the introduction of computer in the last few decades has changed almost every aspect of financial management. Since then, software has been developed and keeps on being updated as others are been introduced. How can one learn to use these new inventions if not through learning? Moreover, governments are changes and policies too change as each country seeks to remain relevant in the flat world. One has to check the changing environments as each country introduces new rules and regulations within its boundaries. New threats emerge and, therefore, one has to keep abreast of them though intensive learning. It is worth noting that perpetual learning is not limited to financial managers, but also affects all other aspect of business.

Work cited

Thomas L. Friedman. The World is Flat. A brief history of twenty-first century. 2005. Farrar, Straus and Girouz, USA.