Competing in a knowledge economy: Thomas Friedman on Innovation -but how ?

Friedman's new book with Mandelbaum extols Americans  to innovate at every level to get back to the growth and prosperity path. The question is how?

Every one is in a "locked" in mode – locked in to the supply chain and distribution channel and of course to the production process."Lockedin"worked till about the late 1990's when the world became hyper-connected with the Internet.  Friedman makes the interesting point at another interview  that his book "The World is Flat" in 2004 did not have any mention of social media like Facebook in the index. Today if something (anything) does not have a Facebook page- it is considered pretty unusual.

Let me explain the "locked-in" problem and how debilitating it is for innovation. In the last century the modern factory was all about systems,processes,six-sigma,lean. You had to work off the same technology platform like the music casette till Steve Jobs came up with the iPod and everyone in the cassette industry got extinct. Except now the iPod or for that matter iPad is entirely manufactured in China because the factory and processes are straightforward  and documented and Chinese factories  can do it much cheaper.And the trouble is that without the factory it is hard for even the most innovative American to quickly try out the next generation iPad.

But can the inventive American get a prototype quickly made overseas and tested in another global market and/or within the US ?  Yes because ten years after the sad events of 911, the average American is far more globalized than ever before. And there is no dearth of the entrepreneural spirit.

But  the American student and entrepreneur needs to get the basic domain knowledge…for domain knowledge is the building block of innovation in the global knowledge economy.  More after  President Obama's jobs speech tomorrow.