It can be seen from this analysis of the classical, rational school of strategy that this approach is difficult to apply to the modern ICT sector. Both the volatility of the external environment and the development of new technologies are having a transformational effect, particularly as the data-rich Internet companies continuously innovate and create new business models. Not only do these new approaches challenge incumbent firms in old economy industries but they also bring into question the tools and techniques that are currently being used for strategic decision making. New approaches are therefore required to address the new competitive landscape identified by Hitt et al. (2003).

Although the chapter did not include more recent strategic approaches such as the resource-based view (Grant 2016), dynamic capabilities (Teece et al., 1997) and the knowledge-based view (KBV), these will be discussed in later chapters of the book. The resource-based view (RBV) and the importance of having dynamic and superior resources and capabilities to out-innovate rival firms (Ricardian rents) are very relevant to modern ICT companies that are knowledge-based. However, instead of these resources and capabilities being internal and uniquely owned by the firm, the most valuable resources are sourced externally from the business community or ecosystem (Moore 1996) which the firm has joined or where it has developed a keystone or platform leadership position (Iansiti and Levien 2004). This means that the firm’s resource configuration has been inverted or turned inside-out (Parker et al. 2016: 11).

Chapter 3 will now consider the relevance of the systems view of strategy including complexity science and chaos theory, how strategic innovation occurs on the edge ofchaos and the concept ofpoised strategy. The extent to which these theories provide alternatives to the classical, scientific model and are better suited to the analysis of the ICT sector will also be discussed in detail.

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