A new competitive landscape is developing largely based on the technological revolution and increasing globalization. The strategic discontinuities encountered by firms are transforming the nature of competition. To navigate effectively in this new competitive landscape, to build and maintain competitive advantage, requires a new type of organization. Success in the 21st century organization will depend first on building strategic flexibility. To develop strategic flexibility and competitive advantage, requires exercising strategic leadership, building dynamic core competences, focusing and developing human capital, effectively using new manufacturing and information technologies, employing valuable strategies (exploiting global markets and cooperative strategies) and implementing new organization structures and culture (horizontal organization, learning and innovative culture, managing firm as bundles of assets). Thus, the new competitive landscape will require new types of organization and leaders for survival and global market leadership. A new competitive landscape is taking shape. Managers and government policy makers are encountering major strategic discontinuities that are changing the nature of competition. The technological revolution and increasing globalization present major challenges to firms' ability to maintain their competitiveness. Some of the recent important strategic discontinuities encountered include the elimination of industry boundaries, fewer distinctions between industrial and service businesses, major advances in logistics, computer aided design and communication, and opening of global markets. Firms encounter these changes at the same time they are experiencing intense foreign competition in domestic markets. These changes rival those experienced with the industrial revolution and their impact is likely to rival that of the major advances of the light bulb, telephone, printing press, and the personal computer. ' The development of standard management thinking was based in a time when most firms operated on a landscape that was relatively smooth with only mildly hilly terrain. Boundaries were more easily identified and firms faced a more level playing field with their competitors. There was reasonable availability of common information, fewer variations in international operations or involvements, and similar industry-wide accounting practices. However, with the changed dynamics in the new competitive landscape, firms face multiple discontinuities that often occur simultaneously and are not easily predicted. The terrain in this new landscape changes unexpectedly and has many hills, mountains and valleys. Faced with unrelenting complexity, firms must develop new strategies and new ways of organizing to deal with this exceedingly complicated landscape. It requires that they use the latest technology, continue to develop new technology, actively participate in global markets, structure them- 22
Strategic flexibility is the ability of an organization to adapt quickly to changes and thereby be in a position of competitive advantage REF .
Navigating in the new competitive landscape: Building strategic flexibility and competitive advantage in the 21st century.
Academy of Management Perspectives
Economics