Editor's Note: This is a summary of an HBS Business Summit presentation. View a full summary and video of the event on the HBS Centennial Web site linked below.
| Date of Event: | October 13, 2008 |
| Speakers: | Niall Ferguson, HBS faculty John Quelch, HBS faculty |
After an introduction by professor John Quelch, professor Niall Ferguson offered a historian's view on globalization and the current financial crisis.
Neither globalization nor financial crises are new. What may be new is that today's highly efficient global financial system is so optimized that it appears vulnerable when unexpected events occur, which they invariably do.
While most people seem surprised when financial crises take place, they shouldn't be. Taking a long view of history—such as 100 years or more—shows that financial crises and unexpected events occur frequently. While most business leaders have not personally experienced a major financial crisis, they should consider history when developing their strategies, plans, and models, and should keep in mind that outlier events occur. When such events do occur, the consequences are often immediate and significant.
Key concepts include:
- One's perspective on globalization is based on the map that is used.
- Optimized global networks may be vulnerable to crises.
- Business and political leaders are often surprised by crises; they don't take a long enough view of history.
- Biological evolution is a metaphor for the financial system, with a few key differences.
For more coverage and video:
http://www.hbs.edu/centennial/businesssummit/globalization/globalization.html