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  • Joana Lenkova

Global vs Local: The Future of Business and Education

Originally published on Sep 3, 2020 on https://issuu.com

Co-authored by Alexandra Whittington and Joana Lenkova


Abstract: The COVID-19 crisis has brought to light new tipping points and tensions positioned to impact global institutions over the coming years. What will business and education look like in the post-pandemic era? Will globalization persist, or will local supply chains thrive? How will companies and schools function in the context of new changes that have been adopted? What does growth and progress look like in the post-COVID world? In this feature we explore the future of global businesses and educational institutions in the aftermath of the pandemic, taking both a globalized and a localized view of the possibilities. I. Introduction After a decade of rapid growth, globalization eventually started losing its attractiveness in terms of costs and efficiency with both transport prices and environmental pressures increasing. The 2010s were characterized as an era The Economist calls “slowbalization.” The US-China trade war and rising nationalism and protectionism driving unfavorable trade policies pose an additional threat to the deteriorating global trade scene.[1]


The 2020 pandemic augmented the already existing cracks in globalization and affected global businesses in three major ways: it disrupted supply chains, posed limitations on physical interactions, leaving workforce unable to perform operations and consumers to shop in person, and demolished consumer demand for some products and services.[ii]

On our quest to achieve the highest (cost) efficiency, we have turned China into our manufacturing house. However, being overly reliant on outsourced supply-chains meant that the pandemic disrupted many industries’ ability to produce and assemble products and deliver services. The WTO forecasts 2020 global trade to shrink by a third.[iii]


With many countries going into full or partial lockdowns, businesses with a workforce unable to perform their tasks remotely were severely impacted, many of them furloughing staff and some having to shut down operations. At the same time demand for products and services became highly skewed towards basic necessities, home office equipment and infrastructure, loungewear, and forms of entertainment, offering escapism. Some businesses were simply lucky to be provided with an opportunity to grow under these severe circumstances, but the pandemic left whole industries like travel, hospitality, retail, and automotive questioning their future and mere existence.


Meanwhile, The pandemic has served to magnify vital issues affecting today’s education systems. Every student and teacher felt the impacts of sudden disruption and instant digital transformation that occurred. Though the COVID-19 event was universal, the response was anything but uniform. Education in particular exemplifies global/local tension of the pandemic in the sense that highly globalized technologies such as Zoom and Microsoft Teams usurped the normally local and personal inflection of face-to-face teaching. Furthermore, school systems in lockdown were expected to preserve continuity—such as grading and school calendars—while being forced to evolve into networked virtual communities of the future overnight.


The COVID-19 pandemic was the first event of the 21st century that shocked modern school systems on a global scale. Will it be the last? Climate change, growing economic inequality, and social unrest are valid sources of disruption that may strain education institutions again in the future. Are there hidden catalysts for new events which would jeopardize formal education again?


We are facing an unprecedented set of challenges for global businesses and education which are going to linger unsolved until we land somewhere on the spectrum of these two variables: 1. How soon will we resolve the health threat, i.e. when will we find a viable and widely available vaccine? and 2. How soon will the economy bounce back from the downturn?

What does the future of global business and education look like? Would they focus on building local infrastructure and supply chains or would they find ways to continue to benefit from global collaboration, talent, and consumers? Will schools retain regional identity and local flavor, or become more uniform in a post-pandemic world? Imagining these four potential futures can help us understand the implications.


II. Scenarios



Scenario 1: Lingering threats

Vaccine - / Economy -

Business:

If we are unable to find a cure or create a widely available vaccine, and our economies continue to deteriorate, we could face the creation of a very fragmented world where social unrest and crime increase and the polarization between “haves” and “have nots” grows.


The majority of consumers would cut their spending and focus on necessities, while the ones with more disposable income would opt for products and services helping them dive into escapism and experiences. Businesses will have to adjust to the new operating environment, repurposing production, stockpiling, and finding local alternatives to otherwise global talent, suppliers, and markets. Even though this could provide some opportunities for local businesses, bringing supply chains home and acting in silos could make the economic recovery slower. For example, the US is already urging Intel to build plants at home and curtail immigration further. Digital trade may be less impacted, but it still represents a modest 1.3% of world’s exports.[iv]


Education:

This future scenario for education has a number of distinct features that seem to already be in development. First of all, the teaching profession is in decline and it may fall even further back should this future come to fruition. We are in the midst of a global teacher shortage now, which will only get worse if there is no vaccine and a poor economic recovery.[v] Communities may experience extremes such as unemployed parents taking a greater part in their children’s education going forward, while the most marginalized families disengage from formal schooling unless there is face-to-face instruction provided.[vi]

The loss of international students in higher education will hit western economies particularly hard. The US and the UK have enjoyed a steady stream of revenues from international student enrollments the past two decades, programs which charge hefty tuition and fees. In this future, international education would experience declines that parallel the travel and tourism sectors instead. Some of the foreign student income may be recaptured with continuing education, skill training, and certification programs targeting the unemployed. However, there’s a risk of preparing people for jobs that may never come back unless universities and colleges revamp their offerings to match the imminent future. In other words, jobs that can survive automation trends.



Scenario 2: “Safe bubble” economy

Vaccine - / Economy +

Business:

Having experienced shortages during the pandemic, it is likely that businesses and governments will require additional stock, building “hybrid” supply chains, diversifying with local and global suppliers, and potentially will establish “safe corridors” with new trade agreements between friendly (and most likely geographically close) countries. New protective or distancing measures for the workforce could be implemented, allowing business continuity. An emphasis on testing and allowing those with antibodies to be actively involved in society, the workplace, and travel is possible. Global businesses would become “glocal” - giving more autonomy to local offices and priority to local talent, however continuing to benefit from global information exchange and best practice sharing. This fosters innovation and supports not only economic growth but also increases the chances of finding a solution to tackle the virus.



Education:

In a future with no vaccine but a thriving economy, important developments could happen to change learning in different ways. Firstly, a society still grappling with the virus but managing a healthy economy would certainly fund and prepare its citizens in science education. It seems likely that STEM (science, technology, engineering, math) will continue to outshine other studies while medical and epidemiology careers gain attention. Major global research zones may sprout up as universities and R&D facilities concentrate into clusters where infectious disease research can find treatments and a cure. A healthy pipeline of students to enter STEM fields would be valued in this future.


Since the absence of a vaccine might prevent face-to-face instruction, it is possible for EdTech to continue to rise in this scenario. Mixed reality, including artificial reality and virtual reality (AR and VR), may have an even greater role to play in training future nurses and first responders as the pandemic is prolonged. However, is it also possible that advances along the lines of the Finland public school model could be a natural byproduct of the need to adapt primary schools to a world with no COVID cure? The Finland curriculum starts school in later childhood with a shorter school day, less rigid academic expectations, and smaller classrooms where teachers put a priority on play and exploration.[vii] Could more nations take this approach to maintain their public school systems as the pandemic is dealt with?

Scenario 3: “No lessons learnt”

Vaccine + / Economy +

Business:

Even though this seems like the best-case scenario at a first glance, the risk of recovering too quickly is that it may force us back into the old inefficient ways of doing business with no lessons learnt. With global trade already becoming less efficient and the increasing focus on the deteriorating environment, we can’t go back to funding unsustainable ways of doing business. Globalization and collaboration should be reimagined so that businesses and people are able to benefit from the global platform and information exchange through implementing new, better practices. It could also be a good opportunity for businesses and governments to collaborate on global level to find solutions to world problems.


We risk putting all our focus on digitalization, impacted by the current pandemic, but being blindsided by another disruptive event which may hit us in a completely different way. Global supply chains will need to be reconsidered and improved, reliance on China or a single region or country could endanger businesses again.


Education:

A future where we have both the vaccine and a thriving economy could have many great rewards. The global unity experienced during the pandemic might help expand and enhance international education at all levels. More exchange programs and study abroad options could encourage youth to work cohesively to build a sustainable future. Furthermore, policy makers are certain to have a more realistic grasp on the connection between schools and the economy: when schools are not open and childcare is unavailable, parents cannot work. This basic fact of the could justify policies with stronger financial support for families in case of future lockdowns.[viii] Also, in a strong economy the global student loan debt bubble might come under better control. A vaccine could put a very optimistic charge in the air, which is exactly what is needed.


Scenario 4: “New opportunities”

Vaccine + / Economy -

Business:

This scenario provides for a quick return to health but slow economic recovery. Businesses will benefit from no restrictions on physical contact. Whole sectors, which were severely impacted would now be able to reopen, global travel will start to recover, however consumer spending will be squeezed. This would push businesses to find more cost efficient but also more resilient ways of working.


The slow rebuilding of structures and systems could provide new opportunities for creating better economies, benefiting from globalization, digitization, and interconnectedness but also ensuring local resilience, sufficient capability to produce essentials in case of an emergency, sustainable and efficient practices. A balance between incentivizing local businesses and connecting them to a global platform for information exchange could be one option for building resilience and self-reliance without working in silos.

The digital businesses that benefited during the pandemic may suffer to a certain extent, due to consumers longing to return to the “real world”.


The role of governments will be crucial. There will be companies that would need to be bailed out. These decisions should be taken with a sustainable future in mind and chance should be given to businesses with innovative, impactful, greener purpose.



Education:

In many ways this future will continue some of today’s most vital trends. If there is a vaccine, it would be good for education, since groups could again congregate and there could be a return to ‘normal.’ However, even before the pandemic there was a decline in enrollment in higher education in the US—should we be concerned?[ix] This future may hold promise for the skills and trades, as a meager economic outlook may reflect poorly on the value of a college education[x]. We may also see parents of primary and secondary students who wish to not return to the hectic ways of before the pandemic, perhaps pulling their children out of traditional schooling for something more personalized.[xi] Ultimately, this future may cast a light on formal education as unimportant, and that would be a notable shift.




III. Conclusion


Whichever version of these scenarios unfolds, we need to remember that connected countries are more likely to recover economically quicker, as well as tackle infectious diseases, mostly due to better health care systems.[xii] We should also recognize that the relationship between education and economic vitality are best approached at local and global levels alike.


Many of the outcomes will rely on policies that are created by our governments now, but businesses and educational institutions have the power to influence some of these decisions. Furthermore, the role of large businesses is extremely important in terms of impacting governmental policy, as well as supporting a faster economic recovery through levers like paying suppliers faster (Unilever) and supporting open markets (3M). 12


A fragmented world will not provide a better solution to global problems like the economy and the virus. It will only create a larger gap between poorer and richer economies and make local solutions more expensive. Instead, a hybrid between reimagined, more sustainable global practices and efficient high-quality local solutions that can be adaptable and resilient when times require seems far more useful.




[1] https://www.economist.com/leaders/2019/01/24/the-steam-has-gone-out-of-globalisation [ii] https://www.youtube.com/watch?v=ulW0LMFEcNw [iii] https://www.wto.org/english/news_e/pres20_e/pr855_e.htm [iv] https://www.economist.com/leaders/2020/05/14/has-covid-19-killed-globalisation [v] https://finance.yahoo.com/news/research-shows-teacher-shortage-growing-110510434.html [vi] https://www.houstonchronicle.com/news/education/article/arae-students-school-missing-thousands-coronavirus-15261497.php [vii] https://www.washingtonpost.com/education/2019/08/30/what-finland-is-really-doing-improve-its-acclaimed-schools/ [viii] https://www.theatlantic.com/family/archive/2020/06/working-parents-impossible/613429/ [ix] https://www.forbes.com/sites/michaeltnietzel/2020/05/26/college-enrollment-declined-again-in-the-spring-the-new-pre-pandemic-baseline-is-established/#86d16e11c8c9 [x] https://www.insidehighered.com/news/2020/06/17/pandemic-has-worsened-equity-gaps-higher-education-and-work [xi] https://www.theguardian.com/world/2020/jun/28/only-13-of-uk-working-parents-want-to-go-back-to-the-old-normal [xii] https://hbr.org/2020/05/will-covid-19-have-a-lasting-impact-on-globalization

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