The Economist - USA (2020-02-22)

(Antfer) #1
“Weknowthatcountrieswithstrongconnectivityseesocietalimprovements
in business,education,healthcareandculture,”saysTimDanks,vice-
presidentof riskmanagementandpartnerrelationsat HuaweiTechnologies
USA.Stanford’sProfessorLeepointsto countriessuchasChina,India
andVietnamthathavemadetheleapfromthesupply/productionsideof
theequationto beingactivepartnersin theentireinnovationlifecycle.
Businessesin thesecountriesaredevelopingnewmaterials,components
andprocessdesigns.

Tosupportexpandeddigitalinclusion,Huaweioftenfocusesonruralareasof
theglobe,includingpartsof AmericalikePennsylvaniaandOregon,where
it helpsbringconnectivity.“Huawei’sworkin itsrst 15 yearsof operation
wasprimarilyin ruralChina,wherein 1987therewereonlytwotelephone
linesper1,000people,”saysDanks.Huawei’seffortsresultedin major
connectivityimprovementsoverthefollowingdecades.Belizeis a more
recentICTsuccessstory:fouryearsago,theincumbenttelecomsoperator
oversawaninefcientmish-mashof technologiesspanningbothlandline
andwirelessservices.Huaweioverhauledthedisjointedinfrastructure,and
today,thecountry’snetworksrankamongthetopin theCaribbean.

Whileprogressis beingmade,obstaclesremain:highcosts,incompatible
technicalstandardsandlackof marketincentiveto bringtechnologiesto
ruralareaspreventprovidersfromhavingsufcientmotivationto helpbuild
themuch-neededinfrastructure.Yetformany,thepotentialforinnovation
andsocietalbenets makesanyhurdlesworththestruggle.

Suchis thecasewithStahlstown,a ruralcommunityin Pennsylvaniawhere
LaurelHighlandTotalCommunications(LHTC)partneredwithHuaweito
bringconnectivityto customers.“Wehavea varietyof people,”saysJimKail,
PresidentandCEOof LHTCBroadband.“Wehavefarmersandtherearesome
smallmomandpoptypebusinesses.Mostof ourcustomersareresidential.
Nowadays,broadbandis critical,forschoolworkor workingfromhome.You
lookat everythingfroma businessstandpoint.Whatyouwantis somebody
whois goingto hearyouandtakeaction.They’regoingto addresstheissues
thatyouhave.”That’swhatwehavewiththeHuaweisolution,hesays.

Similarly,Leeseestheimportanceof expandingthesenetworksona
worldwidescale.“I ama rmbelieverthatwemustwork
onimprovingandco-ordinatingtheowsof theglobal
supply chain,” says Lee. “Connectivity is crucial,
allowing partners to have more real-time
information that enables them to make better
decisions and co-ordinate their actions.”

Aroundtheworld,in placeslikeChina,Ethiopiaandremotepartsof America,
advancednetworkingtechnologiessuchasbroadbandareforginga sort
of global“neuralnetwork”forcommerce.In theprocess,theyareputting
previouslyisolatedareasontheglobalsupplychainmap.

Thebenets of expandedinclusionaremanifestingin manyways.By
connectingonce-obscurecornersof theglobe,businessescanreducecosts,
expandR&Dandaccessuntappeddepthsof thetalentpool.Thiscreates
greateropportunityforinnovationrootedin inclusiveglobalperspectives
andcompetition.Andit is notjustlargecorporationsthatbenet from
connectedglobalisation;today’ssmallbusinessescaneasilybecome“micro-
multinationals”andexperimentwithdifferenttech-infusedbusinessmodels.

Thisenhancedconnectivityis provingvaluableto once-forgottenlocations,
butalsoto establishedplayers.“Thekeyto anefcientglobalsupplychain
is informationow,”explainsHauLee,a professorof informationand
technologyat StanfordGraduateSchoolof Business.“Accessto information
hasbeencrucialforefciency,andat thesametime,hasbroughtforth
positiveimpacts.”

Thenumbersshowcasejusthowimpactfulinformationandcommunications
technology(ICT)canbe.Fiveyearsago,thefreeowof datacontributed
$2.8trnto theglobaleconomy.TheGlobalEconomyandDevelopment
programmeat theBrookingsInstitutionprojectsthatthisgurewillreach
$11trnby2025.Thiscashinfusionreachesconsumersin theformof jobs,as
wellasinfrastructureimprovementswithinfactories,hospitalsandschools.
Efcientglobalsupplychainsalsopromotewideraccessto goodspreviously
availableonlyto thewealthy.

Notalltheeffectsof a tech-drivenglobaleconomyareanticipatedor
welcome. For example, various industries’, companies’ or countries’ differing
paces of technology adoption may lead to instances of multiple or disparate
supply chains, which could result in economic bottlenecks. And there are
some who balk at the idea of introducing technology to isolated communities
for fear of diluting local cultures. Still, many economists—and the
World Economic Forum—agree that connectivity stands to
improve rural citizens’ quality of life.

THE SOCIETAL


BENEFITS OF


GLOBAL SUPPLY


CHAINS


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“Enhanced connectivity is proving valuable to once-


forgotten locations, but also to established players.”


“Ef cient global supply chains also promote wider
access to goods previously available only to
the wealthy.”
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