Strategic management in the new economy: Modern information technologies and multichannel contact strategies

Abstract

The so-called information revolution has loosened many tongues in the academic, business and policy worlds. The communis opinio is that the diffusion of modern information technologies in the global village is about to radically change the rules of the competitive game in many, if not all, industries. What the new rules may be, nobody really knows for sure. The New Economy, being characterized by the penetration of information technologies and the dominance of network arrangements, is born. Firms face the daunting task of developing a response to this new environment. How they respond depends in part on what they learn from their contact portfolio. Which contacts they have, and what information they get out of these contacts, shapes their response to the New Economy. A case in point is the Internet. Apart from stimulating the emergence of new value-adding products and efficiency-enhancing processes, an argument is that the Internet will shake up the century-old market institution by introducing information transparancies and network economies. This chapter's objective is fivefold. First, we summarize the current state of the art in the multimarket competition literature. Second, we develop a multichannel contact framework that builds upon the established multimarket contact theory. Third, we briefly evaluate the New Economy debate. Fourth, we analyze what the emergence of this New Economy may imply for issues of competitive rivalry and strategic management in the context of multichannel contact management. Fifth, we illustrate part of the argument by briefly discussing the case of Java software.

Citation

van Wegberg, M. and van Witteloostuijn, A. (2001), "Strategic management in the new economy: Modern information technologies and multichannel contact strategies", Baum, J.A.C. and Greve, H.R. (Ed.) Multiunit Organization and Multimarket Strategy (Advances in Strategic Management, Vol. 18), Emerald Group Publishing Limited, Leeds, pp. 263-304. https://doi.org/10.1016/S0742-3322(01)18010-1