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fact that all the departments within your company were seamlessly interoperable and 
that work could flow between them was a great boost to productivity…but this could 
happen only if all your company's departments were using the same software and 
hardware systems。 More often than not; back in the 1980s and early 1990s; a company's 
sales department was running Microsoft and the inventory department was running 
Novell; and they could not communicate with each other。 So work did not flow as easily 
as it should。 
We often forget that the software industry started out like a bad fire department。 
Imagine a city where every neighborhood had a different interface for connecting the 
fire hose to the hydrant。 Everything was fine as long as your neighborhood fire 
department could handle your fire。 But when a fire became too big; and the fire engines 
from the next neighborhood had to be called in; they were useless because they could 
not connect their hoses to your hydrants。 
For the world to get flat; all your internal departments…sales; marketing; 
manufacturing; billing; and inventory…had to become interoperable; no matter what 
machines or software each of them was running。 And for the world to get really flat; 
all your systems had to be interoperable with all the systems of any other company。 
That is; your sales department had to be connected to your supplier's inventory 
department and your supplier's inventory department had to be seamlessly connected 
to its supplier's supplier; which was a factory in China。 That way; when you 

made a sale; an item was automatically shipped from your supplier's warehouse; and 
another item was automatically manufactured by your supplier's supplier; and a bill 
was generated from your billing department。 The disparate computer systems and 
software applications of three distinctly different companies had to be seamlessly 
interoperable so that work could flow between them。 
In the late 1990s; the software industry began to respond to what its consumers wanted。 
Technology companies; through much backroom wrangling and trial and error; started 
to forge more common Web…based standards; more integrated digital plumbing and 
protocols; so that anyone could fit his hose…his software applications…onto anyone 
else's hydrant。 
This was a quiet revolution。 Technically; what made it possible was the development 
of a new data description language; called XML; and its related transport protocol; 
called SOAP。 IBM; Microsoft; and a host of other companies contributed to the 
development of both XML and SOAP; and both were subsequently ratified and popularized 
as the Internet standards。 XML and SOAP created the technical foundation for software 
program…to…software program interaction; which was the foundation for Web…enabled 
work flow。 They enabled digitized data; words; music; and photos to be exchanged 
between diverse software programs so that they could be shaped; designed; manipulated; 
edited; reedited; stored; published; and transported…without any regard to where 
people are physically sitting or what computing devices they are connecting through。 


Once this technical foundation was in place; more and more people started writing 
work flow software programs for more and more different tasks。 Wild Brain wanted 
programs to make animated films with a production team spread out around the world。 
Boeing wanted them so that its airplane factories in America could constantly resupply 
different airline customers with parts; through its computer ordering systems; no 
matter what country those orders came from。 Doctors wanted them so that an X…ray taken 
in Bangor could be read in a hospital in Bangalore; without the doctor in Maine ever 
having to think about what computers that Indian hospital had。 And Mom and Dad wanted 
them because they wanted their e…banking software; e…brokerage software; office 
e…mail; and 
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spreadsheet software to all work off their home laptop and be able to interface with 
their office desktop。 And once everyone's applications started to connect to everyone 
else's applications…which took several years and lot of technology and brainpower 
to make happen…work could not only flow like never before; but it could be chopped 
up and disaggregated like never before and sent to the four corners of the world。 
This meant that work could flow anywhere。 Indeed; it was the ability to enable 
applications to speak to applications; not just people to speak to people; that would 
soon make outsourcing possible。 Thanks to different kinds of Web services…work flow; 
said Craig Mundie; Microsoft's chief technology officer; 〃the industry created a 
global platform for a global workforce of people and computers。〃 
The vast network of underground plumbing that made it possible for all this work to 
flow has become quite extensive。 It includes all the Internet protocols of the 
previous era; like TCP/IP and others; which made browsing and e…mail and Web sites 
possible。 It includes newer tools; like XML and SOAP; which enabled Web applications 
to communicate with each other more seamlessly; and it includes software agents known 
as middleware; which serves as an intermediary between wildly diverse applications。 
The nexus of these technologies has been a huge boon to innovation and a huge reducer 
of friction between companies and applications。 Instead of everyone trying to control 
the fire hydrant nozzle; they made all the nozzles and hoses the same; creating a 
much bigger market that stretched across every neighborhood of the world。 Then 
companies started to compete instead over the quality of the hose; the pump; and the 
fire truck。 That is; they competed over who could make the most useful and nifty 
applications。 Said Joel Cawley; the head of IBM's strategic planning unit; 〃Standards 
don't eliminate innovation; they just allow you to focus it。 They allow you to focus 
on where the real value lies; which is usually everything you can add above and around 
the standard。〃 
I found this out writing my last book。 Once Microsoft Word got established as the 
global standard; work could flow between people on different continents much more 
easily; because we were all writing off the same screen with the same basic toolbar。 
When I was working on my first book; From Beirut to Jerusalem; in 1988;1 spent part 
of my year's leave in 
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the Middle East and had to take notes with pen and paper; as it was the pre…laptop 


and pre…Microsoft Word era。 When I wrote my second book; The Lexus and the Olive Tree; 
in 1998; I had to do some of the last…minute editing from the computer behind the 
front desk at a Swiss hotel in Davos on a German version of Microsoft Word。 I could 
not understand a single word; a single command function; on the toolbar of the German 
version of Word。 But by 1998; I was so familiar with the Word for Windows writing 
program; and where the various on…screen icons were; that I was able to point and 
click my way through the editing on the German version and type my corrections with 
the English letters on the German keyboard。 Shared standards are a huge flattener; 
because they both force and empower more people to communicate and innovate over much 
wider platforms。 
Another of my favorite examples of this is PayPal; which enabled eBay's e…commerce 
bazaar to become what it is today。 PayPal is a money transfer system founded in 1998 
to facilitate C2C (customer…to…customer) transactions; like a buyer and seller 
brought together by eBay。 According to the Web site ecommerce…guide。com; using PayPal; 
anyone with an e…mail address can send money to anyone else with an e…mail address; 
whether the recipient has a PayPal account or not。 PayPal doesn't even care whether 
a commercial transaction is taking place。 If someone in the office is organizing a 
party for someone else and everyone needs to chip in; they can all do it using PayPal。 
In fact; the organizer can send everyone PayPal reminders by e…mail with clear 
instructions as to how to pay up。 PayPal can accept money from the purchaser in one 
of three ways; notes ecommerce…guide。com: charging the purcha

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