Business Today

A flawed premise

Globalisation and geopolitics will intertwine and become the new global paradigm this century.

Arnab Mitra | Print Edition: June 1, 2008

The second world
Parag Khanna
Allen Lane
Pp: 466
Price: Rs 750

Think of the world’s political map at the start of the 17th century. The Ottoman Empire, which ruled massive swathes of central and southern Europe, North and East Africa and West Asia, was the world’s predominant power, while Moghul India was the world’s richest. Safavid Persia, the Holy Roman Empire, Czarist Russia and China were the other big powers of the day. Sir Thomas Roe, Queen Elizabeth I’s Ambassador to the court of Emperor Jehangir, wrote in awe in his memoirs that the power, wealth and grandeur of Hindustan’s monarch made the Virgin Queen look like a courtier to a provincial governor in comparison.

Contemporary observers could be forgiven for projecting that one or the other of these empires would go on to dominate the world. Yet, none of them did. Instead, England and France went on a political, military and social overdrive and soon emerged as the world’s pre-eminent powers. Parag Khanna’s The Second World suffers on that count—of projecting a flawed interpretation of current reality as the future. It says, quite authoritatively, that the US, the European Union and China “already possess most of the total power in the world”. He also dismisses Russia, Japan and India as middle-tier powers who “cannot assert themselves globally, militarily or otherwise; they are not superpowers but rather balancers whose support (or lack thereof) can buttress or retard the dominance of the three superpowers without preventing it outright.”

Apart from the obvious flaw of painting China, still a member of the developing world, as an incumbent superpower, the basic premise of this book flies in the face of projections made by both geopolitical and financial experts that point to the replacement, over the next few decades, of the current US-led unipolar world with a more multi-polar architecture.

Then, The Second World doesn’t really break any new ground. But it is well researched. Khanna travelled extensively across 50 countries, spending time with politicians, bureaucrats and people in authority, as well as the man on the street to get a “feel” of the land and to get under the skins of the people in each of them. His objective: to analyse the situation in each country from the point of view of its residents, and not from that of interested outsiders. The author argues that the three “superpowers” will compete for influence in the so-called Second World, which he defines as Eastern Europe, Central Asia, South America, West Asia and East Asia. His analysis of the situation prevailing in each of these regions is insightful, but, again, doesn’t break much new ground.

In sum, Khanna’s work is interesting in parts, informative in others, but as mentioned earlier, its central theme stretches credulity a fair bit. However, students of geopolitics and globalisation can, in fact, learn a lot about the political and economic imperatives that drive the new emerging regions across the world. And for that reason alone, it makes interesting reading.

The point of the deal
Danny Ertel and Mark Gordon
Harvard Business School Press
Pp: 265
$26.95 (Rs 1,078)

Think of a deal as the starting point, and not the end, of value creation. That, in sum, is the argument of this book, written by two partners at Vantage Partners, a Boston-based firm that trains executives in negotiating techniques. The problem with most deal making, the authors argue, is that managers tend to stop with the handshake, whereas the real value—the things that make or break a deal—lies in the stage after a deal has been signed. And this often turns out to be a minefield, blowing up even well thought out deals. Why do problems crop up once a deal goes into the implementation stage? “The answer is that lots of the ‘conventional wisdom’ serves them badly,” write Ertel and Gordon. Advice such as “avoid disclosing information when you don’t have to,” “keep them off balance”, “always be closing”. That works when the objective is to outmanoeuvre the other party, but when the objective is to ensure that the deal delivers its expected value, it’s best to negotiate for implementation.

The good thing about the book is that while it is descriptive, it is also prescriptive; it tells you how to improve and do deals that deliver the expected value.

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