Unit 5: 21st Century Strategy
Research in strategy really picked up steam in the 20th century. However, new research shows that there are other factors that can seriously impact strategies. For example, the use of psychology in business has moved up in the strategic planning world. Managers used to assume that all employees were the same and that all employees would do what they are told. We now know that employees are unique and motivated by different goals themselves. Understanding the culture of a firm and what motivates employees will allow strategy managers to extract more out of each individual.
Additionally, the idea of innovation as a strategy leader has complemented the competitive advantage strategy. There are issues with getting to the top of an industry by innovating and then falling behind to rising competitors. Collectively, these issues are known as the innovator's dilemma, and technology companies have been fighting tooth and nail to avoid falling victim to this problem (as have many other industries). One way to avoid this dilemma is by maintaining a high level of cash and simply acquiring the innovating companies. From 2007 through 2009, Google acquired 24 companies (that were disclosed) and Microsoft acquired 34.
Finally, as globalization makes the world a real global economy, the focus of strategy must go beyond the borders of your own country. Technology has enabled even small companies of just a few people to outsource work to the other side of the world. A global view will be essential to any 21st century strategy.
Completing this unit should take you approximately 8 hours.