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be among the world's premier universities；〃 Wrighton later explained to me in an
e…mail。 〃The event involved all of the leaders of the Chinese government； from the
Mayor of Beijing tothe head of state。 Each expressed the conviction that an investment
in the university to support its development as one of the world's great universities
within ten years would be a rewarding one。 With Tsinghua University already regarded
as one of the leading universities in China； focused on science and technology； it
was evident that there is a seriousness of purpose in striving for a world leadership
position in ＇all the areas involved＇ in spawning technological innovation。〃
And as a result of China's drive to succeed； Microsoft chairman Bill Gates argued
to me； the 〃ovarian lottery〃 has changed…as has the whole relationship between
geography and talent。 Thirty years ago； he said； if you had a choice between being
born a genius on the outskirts of Bombay or Shanghai or being born an average person
in Poughkeepsie； you would take Poughkeepsie； because your chances of thriving and
living a decent life there； even with average talent； were much greater。 But as the
world has gone flat； Gates said； and so manypeople can now plug and play from anywhere；
natural talent has started to trump geography。
〃Now；〃 he said； 〃I would rather be a genius born in China than an average guy born
in Poughkeepsie。〃
That's what happens when the Berlin Wall turns into the Berlin mall and 3 billion
people converge with all these new tools for collaboration。 〃We're going to tap into
the energy and talent of five times as many people as we did before；〃 said Gates。
From Russia with Love
I didn't get a chance to visit Russia and interview Russian zippies for this book；
but I did the next best thing。 I asked my friend Thomas R。 Pickering； the former U。S。
ambassador to Moscow and now a top international relations executive with Boeing；
to explain a new development
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I had heard about： that Boeing was using Russian engineers and scientists； who once
worked on MiGs； to help design its next generation of passenger planes。
Pickering unraveled the story for me。 Beginning in 1991； Boeing started assigning
out work to Russian scientists to take advantage of their expertise in aerodynamic
problems and new aviation alloys。 In 1998； Boeing decided to take this a step further
and open an aeronautical engineering design office in Moscow。 Boeing located the
office in the twelve…story Moscow tower that McDonald's built with all the rubles
it made from selling Big Macs in Moscow before the end of communism… money that
McDonald's had pledged not to take out of the country。
Seven years later； said Pickering； 〃we now have eight hundred Russian engineers and
scientists working for us and we're going up to at least one thousand and maybe； over
time； to fifteen hundred。〃 The way it works； he explained； is that Boeing contracts
with different Russian aircraft companies…companies that were famous in the Cold War
for making warplanes； companies with names like Ilyushin； Tupolev； and Sukhoi…and
they provide the engineers…to…order for Boeing's different projects。 Using
French…made airplane design software； the Russian engineers collaborate with their
colleagues at Boeing America …in both Seattle and Wichita； Kansas…in computer…aided
airplane designs。 Boeing has set up a twenty…four…hour workday。 It consists of two
shifts in Moscow and one shift in America。 Using fiber…optic cables； advanced
compression technologies； and aeronautical work flow software； 〃they just pass their
designs back and forth from Moscow to America；〃 Pickering said。 There are
videoconferencing facilities on every floor of Boeing's Moscow office； so the
engineers don't have to rely on e…mail when they have a problem to solve with their
American counterparts。 They can have a face…to…face conversation。
Boeing started outsourcing airplane design workto Moscow as an experiment； a sideline；
but today； with a shortage of aeronautical engineers in America； it is a necessity。
Boeing's ability to blend these lower…cost Russian engineers with higher…cost； more
advanced American design teams is enabling Boeing to compete head…to…head with its
archrival；
Airbus Industries； which is subsidized by a consortium of European governments and
is using Russian talent as well。 A U。S。 aeronautical engineer costs 120 per design
hour； a Russian costs about one…third of that。
But the outsourcees are also outsourcers。 The Russian engineers have outsourced
elements of their work for Boeing to Hindustan Aeronautics in Bangalore； which
specializes in digitizing airplane designs so as to make them easier to manufacture。
But this isn't the half of it。 In the old days； explained Pickering； Boeing would
say to its Japanese subcontractors； 〃We will send you the plans for the wings of the
777。 We will let you make some of them and then we will count on you buying the whole
airplanes from us。 It's a win…win。〃
Today Boeing says to the giant Japanese industrial company Mitsubishi； 〃Here are the
general parameters for the wings of the new 7E7。 You design the finished product and
build it。〃 But Japanese engineers are very expensive。 So what happens？ Mitsubishi
outsources elements of the outsourced 7E7 wing to the same Russian engineers Boeing
is using for other parts of the plane。 Meanwhile； some of these Russian engineers
and scientists are leaving the big Russian airplane companies； setting up their own
firms； and Boeing is considering buying shares in some of these start…ups to have
reserve engineering capacity。
All of this global sourcing is for the purpose of designing and building planes faster
and cheaper； so that Boeing can use its cash to keep innovating for the next generation
and survive the withering competition from Airbus。 Thanks to the triple convergence；
it now takes Boeing eleven days to build a 737； down from twenty…eight days just a
few years ago。 Boeing will build its next generation of planes in three days； because
all the parts are being computer…designed for assembly； and Boeing's global supply
chain will enable it to move parts from one facility to another just in time。
To make sure that it is getting the best deals on its parts and other supplies； Boeing
now runs regular 〃reverse auctions；〃 in which companies bid down against each other
rather than bid up against each other。 Theybid for contracts on everything from toilet
paper for the Boeing factories to nuts and bolts…the off…the…shelf commodity
parts…for Boeing's supply chain。 Boeing will announce an auction for a stated time
on a specially designed Internet site。 It will begin the auction for each supply
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item at what it considers a fair price。 Then it will just sit back and watch how far
each supplier wants to undercut the others to win Boeing's business。 Bidders are
prequalified by Boeing； and everyone can see everyone else's bids as they are
submitted。
〃You can really see the pressures ofthe marketplace and how they work；〃 said Pickering。
〃It's like watching a horse race。〃
The Other Triple Convergence
I once heard Bill Bradley tell a story about a high…society woman from Boston who
goes to San Francisco for the first time。 When she comes home and is asked by a friend
how she liked it； she says； 〃Not very much…it's too far from the ocean。〃
The perspective and predispositions that you carry around in your head are very
important in shaping what you see and what you don't see。 That helps to explain why
a lot of people missed the triple convergence。 Their heads were completely somewhere
else…even though it was happening right before their eyes。 Three other things…another
convergence… came together to create this smoke screen。
The first was the dot…com bust； which began in March 2001。 As I said earlier； many
people wrongly equated the dot…com boom with globalization。 So when the dot…com boom
went bust； and so many dot…coms （and the firms that supported them） imploded； these
same people assumed that globalization was imploding as well。 The sudden flameout
of dogfood。com and ten other Web sites offering to deliver ten pounds of puppy chow
to your door in thirty minutes was supposed to be proof that globalization and the
IT revolution were all sizzle and no beef。
This was pure foolishness。 Those who thought that globalization was the same thing
as the dot…com boom and that the dot…com bust marked the end of globalization could
not have been more wrong。 To say it again； the dot…com bust actually drove
globalization into hypermode by forcing companies to outsource and offshore more and
more functions in order to save on scarce capital。 This was a key factor in laying
the groundwork for
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Globalization 3。0。 Between the dot…com bust and today； Google went from processing
roughly 150 million searches per day to roughly one billion searches per day； with
only a third coming from inside the United States。 As its auction model caught on
worldwide； eBay went from twelve hundred employees in early 2000 to sixty…three
hundred by 2004； all in the perio