GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

History of GlobalizationUnited States

Agriculture, Mining

Activity

Year Trade as % of Output % Economic Activity % Employment

1900 17.0 20.8 40.2

1910 14.1 20.3 34.4

1920 23.8 18.5 30.4

1930 11.0 12.6 28.4

1940 9.0 12.0 19.2

1960 10.1 7.8 9.1

• Decline in globalization corresponds to decline in commodity production & rise of the complex manufacturing

• Industry composition is critical to impact of globalization

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

Trends in Employment –United States

Year Agriculture, Manufacturing Services

mining

• 1960 8.8 26.1 65.1

• 1970 5.1 24.8 70.1

• 1980 4.4 22.1 73.5

• 1990 3.3 18.0 78.7

• 1998 3.0 15.8 81.2

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

Productivity Growth In the Services(Basic Issues)

*Growth in Achieved Potential far outweighs growth in Potential as a source of

Productivity Growth*

EVIDENCE

- Large differences among units in Best vs. Average practice

- Episodic nature of productivity growth/ cost reduction (no gain -> high gain -> slippage)

- Higher vs. Lower Level gaps in Productivity growth

- Experience in manufacturing

- Special instances of potential revealed

- Case studies (no significant labor, capital, R & D inputs)

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

Managerial, Professional 1983 2001 Change

Managers, Executives 10,772 20,338 +89%

Teachers, Librarians 4,368 6,065 +39%

Nurses, Health Profiles 1,900 3,052 +61%

Scientists 820 2,685 +227%

Writers, Artists, Entertainers 1,675 2,336 +39%

Architects, Engineers 1,675 2,336 +39%

Social Worker, Soc. Sci

Works 1,092 1,903 +72%

Doctors, Dentists 735 1,090 + 48%

Lawyers 651 966 +48%

Total 23,592 41,894 +78%

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007

An Aide on that Giant Sucking Sound of Jobs Going to Mexico

Manufacturing Jobs (% of changes 1980-91)

Consumption of Manufacturing in U.S. +31%

Production of Manufactures in U.S. +25%

Lose of demand to Net Imports 6%

Production of Manufacturers in U.S. +25%

Manufacturing employment in U.S. (9%)

Loss of jobs to Productivity Growth 34%

Fraction of Jobs in Manufacturing Lost Overseas:

6% / (34% + 6%)= 15%

GLOBAL CONSULTING LEADERS SYMPOSIUM

December 5-7, 2007