Abstract
Amazon’s success depends on the access it enjoys to a single and global market. While this has been true for now, the firm’s CEO wonders whether he and others have taken globalization for granted. The case reviews the evidence and discusses the extent to which globalization could go into reverse mode. It then explores the options a firm like Amazon would have to hedge against this risk. The case has several implications for architects of change. In particular, it shows how important it is for them to consider what they are taking for granted and how much they depend on it. It also shows the importance for actors looking for impact of remaining nimble in a turbulent business environment.
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Notes
- 1.
“The Steam Has Gone out of Globalisation,” The Economist, January 24, 2019, https://www.economist.com/leaders/2019/01/24/the-steam-has-gone-out-of-globalisation.
- 2.
Martin Sandbu, “Three Reasons Why Globalisation Will Survive Protectionist Rebellions,” Financial Times, March 9, 2017, https://www.ft.com/content/1a4e31ce-0333-11e7-aa5b-6bb07f5c8e12.
- 3.
Martin Wolf, “Donald Trump Faces the Reality of World Trade,” Financial Times, November 22, 2016, https://www.ft.com/content/064d51b0-aff4-11e6-9c37-5787335499a0.
- 4.
See Wolf; Wen Wang, “Emerging Markets Are Set to Lead Globalisation,” Financial Times, April 10, 2017, https://www.ft.com/content/f60d77a4-1ded-11e7-b7d3-163f5a7f229c.
- 5.
“Globalisation Has Faltered,” The Economist, January 24, 2019, https://www.economist.com/briefing/2019/01/24/globalisation-has-faltered?fsrc=scn/tw/te/rfd/pe.
- 6.
Ralf Dreischmeier, Karalee Close, and Philippe Trichet, “The Digital Imperative,” The Boston Consulting Group (blog), March 2, 2015, https://www.bcg.com/publications/2015/digital-imperative.aspx.
- 7.
Jeff Desjardins, “This Is What Happens in an Internet Minute in 2018,” World Economic Forum (blog), May 16, 2018, https://www.weforum.org/agenda/2018/05/what-happens-in-an-internet-minute-in-2018/.
- 8.
New York Times journalist Tom Friedman called this the Dell Theory of Conflict Prevention which he stated this way: “No two countries that are both part of a major global supply chain, like Dell’s, will ever fight a war against each other as long as they are both part of the same global supply chain.”
- 9.
Niall Ferguson, The Ascent of Money: A Financial History of the World, 1 edition (New York London: Penguin Books, 2009).
- 10.
Graham Allison, “The Thucydides Trap: Are the U.S. and China Headed for War?,” The Atlantic, September 24, 2015, http://www.theatlantic.com/international/archive/2015/09/united-states-china-war-thucydides-trap/406756/.
- 11.
“Why Is World Trade Growth Slowing?,” The Economist, October 12, 2016, http://www.economist.com/blogs/economist-explains/2016/10/economist-explains-5.
- 12.
Shawn Donnan, “Global Trade Slowdown Worse than Thought,” Financial Times, July 13, 2016, https://www.ft.com/content/97a10864-490b-11e6-8d68-72e9211e86ab.
- 13.
World Trade Organization, “WTO Downgrades Outlook for Global Trade as Risks Accumulate,” September 27, 2018, https://www.wto.org/english/news_e/pres18_e/pr822_e.htm.
- 14.
International Monetary Fund, “Global Trade: What’s Behind the Slowdown,” in World Economic Outlook, 2016, 63–87, http://www.imf.org/external/pubs/ft/weo/2016/02/.
- 15.
Greg Ip, “Can Globalization Be Salvaged?,” Wall Street Journal, November 2, 2016, sec. Economy, http://www.wsj.com/articles/can-globalization-be-salvaged-1478102789.
- 16.
See for instance Claire Jones, “G7 Signs off on Watered-down Free Trade Pledge,” Financial Times, May 13, 2017, https://www.ft.com/content/6cdbdba6-37c9-11e7-821a-6027b8a20f23; Claire Jones and Sam Fleming, “G20 Drops Vow to Resist All Forms of Protectionism,” Financial Times, March 18, 2017, https://www.ft.com/content/241cdf2a-0be9-11e7-a88c-50ba212dce4d.
- 17.
Jinping Xi, “Speech to Davos” (January 17, 2017), https://www.weforum.org/agenda/2017/01/full-text-of-xi-jinping-keynote-at-the-world-economic-forum/.
- 18.
Allison, “The Thucydides Trap.”
- 19.
“Globalisation Has Faltered.”
- 20.
You can find a summary of the debate here: Lorenzo Bini Smaghi, “How Far Will the Pendulum Swing against Globalisation?,” Financial Times (blog), November 15, 2016, https://www.ft.com/content/0c777dda-bed4-326e-b130-2ab08079e5a9.
- 21.
Branko Milanovic, “Why the Global 1% and the Asian Middle Class Have Gained the Most from Globalization,” Harvard Business Review (blog), May 13, 2016, https://hbr.org/2016/05/why-the-global-1-and-the-asian-middle-class-have-gained-the-most-from-globalization.
- 22.
Dani Rodrik, “There Is No Need to Fret about Deglobalisation,” Financial Times, October 4, 2016, https://www.ft.com/content/d9a28a08-895c-11e6-8cb7-e7ada1d123b1.
- 23.
Kim Hart, “Dave McClure’s Investment Strategy for the Trump Era,” Axios, March 16, 2017, https://www.axios.com/dave-mcclures-investment-strategy-for-the-trump-era-2316191240.html.
- 24.
Gilles Sengès, “Carlos Diaz: «Le Mur de Trump, C’est La Silicon Valley Qui L’a Construit»,” L’Opinion, November 13, 2016, http://www.lopinion.fr/edition/international/carlos-diaz-mur-trump-c-est-silicon-valley-qui-l-a-construit-114167.
- 25.
“The Steam Has Gone out of Globalisation.”
- 26.
Laura Stevens and Sarah Nassauer, “Amazon Fights Wal-Mart for Low-Income Shoppers,” Wall Street Journal, June 6, 2017, https://www.wsj.com/articles/amazon-fights-wal-mart-for-low-income-shoppers-1496732400.
- 27.
Louise Lucas, “Alibaba Kicks off Ambitious Plan for Frontier-Free Global Trade,” Financial Times, March 22, 2017, https://www.ft.com/content/590d815a-0ec6-11e7-a88c-50ba212dce4d.
- 28.
Lucas.
- 29.
Elizabeth Weise, “Alibaba Launches Program to Help 1 Million U.S. Businesses Sell to China,” USA Today, April 25, 2017, https://www.usatoday.com/story/tech/news/2017/04/25/alibaba-launches-program-help-1-million-us-businesses-sell-china/100827290/.
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Ghez, J. (2019). Case Study: Strategizing at Amazon When Globalization Comes Under Pressure. In: Architects of Change. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-20684-0_8
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