Saturday, May 28, 2016

Business Strategy and evolution

Really lovely post from Stumbling and Mumbling that links the mico aspect of firm strategy with the more macro elements of the business cycle.

"It’s not just change in the environment over time that can lead to maladaption, corporate death and downturns. A similar problem occurs when businessmen move from one environment to another. For example, the market in sportswear selected in favour of Mike Ashley’s ruthless cost-cutting. But that strategy when applied to Newcastle United proved less successful*. Or to take a more outlandish example, the market selects in favour of property developers who “restructure” their debts and dodge taxes. But it’s not so clear that such strategies are a good way of handling the government’s finances."
I would like to emphasis this link between some of the inefficiencies at the micro level and their implications at the marco sphere more fully, just as the new economic thinking takes issues like political power and distributions and uses them to enhance understanding of some micro interactions.

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