INSTRUCTIONAL MODULE

FOR
BS HOPSPITALITY MANAGEMENT

Subject : BME 302 STRATEGIC MANAGEMENT IN TOURISM

AND HOSPITALITY

Module Title : UNIT 1. Introduction To Strategic Management

Author(s) : C. B. BABAYEN-ON, R. CESAR, R. MONSALE, P. J.

SEGURA, J.D. TULIVA
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Module Rationale/Introduction

This unit introduces strategic management and provides an overview of the

modules on Strategic management for Hospitality and Tourism. Strategy is
presented from a historical perspective from various lenses- including schools of
thought- through which strategy has been conceptualized, researched and
developed over several decades. This section discusses key definitions of the
terms used in strategic management literature, and various schools of thoughts in
the field described, and a case study of a scenario that necessitates the application
of strategic management in hospitality and tourism.

Module Outcomes:

1. Discuss the historical origin of strategic management

2. Discuss the strategic management framework and its objective
3. Compare Strategy and Policy

Historical Origins of Strategy and Strategic Management

In order to appreciate the historical origins of strategy and strategic tourism

management, it becomes essential to firstly, define strategic management.
Strategic management is a field of study that involves the process through which
firms define their missions, visions, goals, and objectives, as well as craft and
execute strategies at various levels of the firms’ hierarchies to create and sustain
a competitive advantage (Okumus, Altinay, and chathoth, 2010). In other words,
strategic management assist organization in prioritizing what is of most importance
to them and provides a holistic view of the organization. Strategic management
consists of two distinct phases that deals with formation and implementation of
strategy within an organizational setting (Okumus, Altinay, and chathoth, 2010).

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Figure 1: shows the strategic management framework/process.

Mission, Vision, Goals and

Objective

Internal Analysis (Strength & Strategic Analysis External Analysis

Weaknesses) (Opportunities & Threats)

Strategic Formation Corporate Level, Business

Level, and Functional Level Strategies

Strategy Implementation

Strategy Control

The origins of strategic management have been linked to the military. The
term strategy emanated from the word strategos, which translate to “general.”
Literally, it means “leader of the army.” Military strategy often deals with planning
and execution in a war setting, while taking into account the strategy and tactics
required to implement the plan. Defeating the enemy in a “chess-like” play situation
entails critically thought-out plan with emphasis on the plan’s execution.

Strategic management can be linked to the works of Sun Tzu that dates
back to 400 B.C. and to Carl von Clausewitz in the eighteenth century. Sun Tzu’s
reference to space, quantities, and other factors related is similar to the
characteristics of the positioning schools (Mintzberg, Ahlstrand, and Lampel,
1998). According to Sun Tzu, calculations underlie victorious situations in war.

Carl von Clausewitz’s considered strategy “a variation of themes” in war

situation (Mintzberg et al., 1998). Clausewitz notes that strategy was “open-ended
and creative” in a situation of chaos and disorganization (Mintzberg et al., 1998).
This provides avenue for a more systematic and organized approach, which is why
planning became part of the process. Strategy formation takes into consideration
the various maneuvers and the scenarios and calculations pertaining to them.
Being flexible while being proactive and deliberative, however, is essential.

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Literature since the twentieth century used these works to describe strategy in the
corporate arena.

Strategic management as a field of study has evolved in over the past fifty
years (Okumus, Altinay, and Chathoth, 2010). In the 1950s and 1960s, strategic
management was viewed from general management perspective, emphasizing the
role of the leader. Hence, the focus was on leadership, interpersonal relationships,
and the systems, processes, and structures in an organization. Firms used the top-
down approach, with the top management at the core of the decision making
process. However, the strategic management process was not formalized and
explicit during this phase; instead, it was more implicit and informal. In the 1960s,
1970s, and the early 1980s, firms adopted the strategic planning approach with an
emphasis on analysis and formalized planning, with special teams assigned to
develop plans. The typologies and concepts related to business and corporate

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strategies, with strategy formulation at the core of such conceptualizations, led to

the evolution of the domain during this period.

Strategy implementation as a process was however the emphasis of

scholars during the 1980s period. There was a shift in emphasis from the leader
to the development of organizational culture and its role in defining and
implementing strategies. In the same vein, globalization began to capture the
imagination of firms’ executives, researchers provided more insights into the
underlying concepts of globalization, including systems, processes, and structures
that enabled firms to grow into multidivisional corporation. Some scholars however
focused on firms’ competencies to explain strategy, which led to the emergence of
resource-based view of firms. In the hospitality and tourism field, strategic
management emerged as a field of study in the mid- to late 1980s that aimed at
applying the works of scholars in the strategic management domain to the
hospitality organizations. These efforts are aimed at confirming theories related to
the contingency, strategic planning, and competitive strategies.

In the 1990s, globalization led to the emergence of network strategies, and

strategic alliances became the focal point around which researchers developed
the literature. More efforts from a resource-based perspective led to the
conceptualization of characteristics related to firm’s internal competencies that
enabled them to sustain competitive advantage. The shift towards internal
competencies also saw a shift in perspective towards knowledge-based view and
learning at the core of strategic competitive advantage in the late 1990s. Progress
continues using the knowledge perspective from the 2000s, with increased
emphasis on corporate social responsibility.

In the hospitality and tourism domain, Olsen, West, and Tse (2006)
conceptually developed the co-alignment concept, which has been used as a
theoretical framework in other studies in the field. Efforts by Harrigton (2001),
Okumus (2004), and Jogaratnam and Law (2006) in the 2000s focused on
environmental scanning in the hospitality industry context, whereas Harrington and
Kendall (2006), Okums and Roper 1999, and Okumus (2002), as well as others,

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have made attempts to develop the strategy implementation framework for

hospitality and tourism firms during this period. More recent efforts in the field have
moved toward a knowledge-based view and corporate social responsibility.

Schools of thoughts on strategic management

Many schools of thought have

emerged in the strategic management
domain. Mintzberg and colleagues
(1998) described the domain as
consisting of ten schools/perspectives
that pertain to design, planning,
positioning, entrepreneurial, cognitive,
learning, power, cultural,
environmental, and configuration.
Mintzberg and his colleagues notes
that the first three school are more prescriptive, with an emphasis on strategy
formulation that developed from 1960s to 1980s. The next six schools are less
prescriptive, while emphasizing how strategies are other nine schools of thought
into an integrative whole. Brief description of each schools is given in this section.

The design school emphasis a fit between an organization’s internal

capabilities and external opportunities. This school emphasizes the importance of
a firm’s position within the context in which it operates. The environment is used
as a reference while weighing the firm’s strategies and the emphasis is on how it
develops its structure in order to support the strategy.

The second school, planning, which was developed in 1970s,

conceptualized strategy to include a structured, step-by-step approach. Mission
and vision statement were set, and goals were clearly spelled out while detailing
the objectives that would lead to the accomplishment of those goals.

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The third school is positioning, which was developed in 1980s. Although not
very different from planning and design school, it views strategy formation as
consisting of a few strategy types. This school emerged from the work of Porter
(1980), with an emphasis on strategy typologies. Strategy was still conceptualized
as a formal and controlled process, but the focus here was on competitive
strategies and industry structure.

The fourth school of thought is the entrepreneurial school, which pertain to

decision making and the process of strategy formation. Here the central role of
strategy formation lies with the leader, whose “intuition, judgment, wisdom,
experience and insight” are at the heart of decision making. Sources: Mintzberg,
H.,Ahlstrand, B., Lampel, J. (1998;p. 124). The leader’s vision and his or her
leadership style influence the organization’s strategic posture.

The cognitive school is the fifth school, and it emphasizes strategy formation
from the perspective that the decision maker’s cognition and mind drive strategy
making. The cognitive skills of managers influence their perspectives on the
environment. These perspectives in turn influence the strategy formation process.
According to Mintzberg and his colleagues, they include 2concepts, maps,
schemas, frames.”

The sixth school is learning, which supports the notion that strategy making
is based on the foundation of learning. The strategy maker is constantly learning
about process of strategy formation and its various elements in complex
environment .As a matter of fact, the firm is learning constantly as a whole, which
is incremental and continuous in a complex business environment. The knowledge
perspective is part of the learning school, and the focus here is on the on the
system as a whole rather than only a few managers at the helm of decision making.

The seventh school view strategy formation from a power perspective, with
negotiation at the crux of the process. Power and politics drive this school of
thought, with organizations vying for position in the markets and transactions.
Strategy formation is more emergent as firms engage in power plays, ploys, and
tactics to maneuver in various contexts.

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The eighth school is the cultural school, where, again, the emphasis is on
the organization as a collective whole and strategy formation as comprising social
interaction. Strategy is deliberate in that the members are engaged in the process
that involves collective action. Resources and capabilities are the sources of
competitive advantage, as firms are able to create a culture that brings forth unique
decision making with a resistance toward organizational change.

The ninth school pertains to environment while describing strategy

formation as a reactive. The firm’s external environment influences the strategy
formulation and implementation process, and firms are viewed as being part of an
environment that is simple or complex, stable or dynamic. The decision maker’s
role is one of a boundary spanner in being able to scan the environment while
identifying the macro and micro level forces that impact the firm’s position within a
business domain.

The tenth school is the configuration school, which views strategy as

transformational. Configuration refers to the structure that a firm adopts in a given
environmental context, and transformation refers to a change in configuration
based on a change in context. The life cycle of organization is essentially a pattern
that emerges from the various configurations and transformation that occur over
the various periods of change that organizations go through. The essence of
strategy formation is to ensure that firms are able to recognize the need to change
its configuration while transforming from one state to the other during its productive
life.

Aims of Strategic management: Creating a competitive advantage

A firm is in business to create value for its stakeholders. Since value is

created if firms have competitive edge over their market rivals, it is imperative that
a definitive and formalized approach that falls within the realm of strategic
management is at the core of the process. Creating a competitive advantage and
subsequently sustaining it over a period of time requires a formal approach in
terms of strategy formation and implementation. Constant evaluation of an

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organizations market position, including

benchmarking, becomes inevitable in maintaining a
competitive edge. Hilton Hotels and McDonalds are
typical examples of firms that have been through ups
and downs during the course of their organizational
histories in terms of sustaining competitive
advantage in their respective market domains.

Strategic management process can be administered at three major levels

including; corporate, business and functional levels.

1. At the corporate level, strategy entails asking questions about what

business the firm is in or would like to engage in, the firm’s potential to
create value by being in the business or expanding into a new line of
business, and the recourses and capabilities the firm already has or needs
to get to sustain/create competitive advantage in its business or businesses.

2. At the business level, firms need to ask themselves the following questions:
How can we create competitive advantage in our product-domain in each
strategic business unit (SBU)? How can we continue to be an overall cost
leader or broad differentiator, or, have a cost focus or be a focused
differentiator in our market domain? Note that SBU is defined as a unit
within a given corporate identity that is distinctly different from other units
within the corporation in terms of products and services, as well as the
markets it serves with a distinct profit-making capability of its own.

3. At the functional level, the firm’s objective is to sustain its advantage by

focusing on efficiencies related to production, operations, administration,
marketing, and other support functions. It also engages in constant
innovation to ensure new product/service development rollout, while
ensuring that the service and product qualities, as well as the customer
satisfaction related to them are at the highest level.

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The linkage among the three levels of strategy leads to the creation of sustainable
competitive advantage.

Defining key terms on strategic management

Strategy entails futuristic thinking and developing a course of action to meet

goals and objectives. The strategic management framework (Figure 1.1) captures
the process sequentially and definitively. It should be noted that although different
element of the strategic management framework is presented separately or in
linear step-by-step process, in fact they overlap and go hand in hand. The
framework includes mission and vision statements, goals, and objectives that are
linked to the mission and vision, as well as strategies and tactics to achieve the
goals and objectives. Strategic analysis provides the firm with a clear picture of its
situation, which includes internal and external analysis. Internal analysis pertains
to strengths and weakness analysis, whereas external analysis pertains to
opportunities and threats analysis, which is also referred to as SWOT analysis.
The analysis enables a firm to engage in strategic decision making. Strategic
decisions pertain to choosing an alternative among a set of alternatives that leads
to strategy-related success. These decisions have an effect on the firm’s long-term
orientation and direction.

Strategic management includes two distinct phases: the strategy formation

phase and the strategy implementation phase. Strategy formation is the process
of defining the direction of the firm’s futuristic course of action, which would enable
the firm to allocate resources in order to achieve the set goals and objectives. An
internal and external environment analysis is part of the assessment before
strategy is formulated at the corporate, business, and functional levels. On the
other hand, strategy implementation is the process of putting strategy into action,
which includes designing the organizational structure and related systems. These
process leads to effective resource allocation processes, including programs and
activities such as setting budgets, developing support systems, recruiting, hiring,

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and training, as well as designing performance evaluation and rewards systems

that lead to the attainment of set goals and objectives.

The organization must first define its mission, goals, and objectives. The
mission is a brief description of the very purpose of creating the organization. This
mission statement includes a clear purpose and states why the organization is in
existence.

To differentiate missions, goals, objectives, strategies, and tactics, let’s

consider this case: Jeflum Hotel is in the business with a mission to create value
for its stakeholders. To accomplish the mission, the firm has set goals for the
current year of increasing the business segment productivity. The objectives that
linked the goals include increasing the business segment revenues by 10 percent
and increasing repeat clientele for this business segment by 15 percent. The
strategies include marketing and operations- related plans and tactics, including
increasing sales calls in the business districts of the city, increasing promotional
campaigns for the international and domestic business markets, and creating an
amenities package for business travelers that includes free airport transfers, a free
welcome drink on arrival, free internet access in the room, and free use of business
centre secretarial services for three hours a day. Note that the goal are linked to
the mission, the objectives are linked to the goals, strategies are linked to the
objectives, and the tactics are linked to the strategies.

Characteristics of Business Strategy

A company’s strategy is the game plan business owners and management

use to position their organization in its chosen market area, to compete
successfully, satisfy customers, and achieve good business performance.
Business leaders have to pay attention to the developments in the world because
they are intertwined with market forces that affect consumers and demand. They
have to adapt their business strategy to a constantly shifting environment.

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Changes in strategy should be done when it’s clear achieving a strategic

goal is either impossible or no longer desirable, says Geoffrey James, columnist
for Inc.com. He posited that every business strategy should have the following
characteristics:

Characteristics
Strategies are Not Tactical
Strategies are Measurable
Strategies are Actionable
Strategies are Clear
Strategies Include a Business
Plan
Description
People often get a strategy mixed up with a tactic.
“Strategies define goals to be achieved while tactics define
the actions you’ll take to achieve those goals,” says James.
For example, a strategy would be to double sales in a
specific territory. A tactic would be to hire more salespeople
in that territory to achieve their goal
If your goals are vague, you won’t know if you are achieving
them. “You can’t manage what you can’t measure,” says
James. When you set goals, also set ways you will measure
them to be certain they are successful. Goals such as
achieving thought leadership won’t translate to solid
numbers. However if your goal is to double sales revenue in
a specific region, you will have data to back up whether it
was a success or a failure.
Strategic goals are achievable through tactics. They are not
dependent on forces you can’t control. James says an
actionable goal would be to double sales revenue versus
increasing your publicly held stock price by 50 percent.
Increasing your stock-price is contingent on the market.
Employees should understand exactly what their
organization’s strategy is to achieve it successfully. A
strategy requires continuous and clear communication. It
should guide their decisions and actions.
“A strategy is just hot air unless there’s a tactical plan for
achieving each strategic goal,” says James. For example, if

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Characteristics
Strategies Don’t Change Much
Description
you want to increase sales by 50 percent in a specific region,
your plan could include anything from investing in better lead
generation methods to retraining employees to hiring new
ones.
Strategies evolve as businesses evolve, but it’s important to
know what does and doesn’t work. Once you know that, you
can adjust your tactics and try new approaches. A business
strategy is an ongoing process, not something to set and
forget. Strategic planning is key to looking to the future and
creating direction to for a business to be successful. The key
is to do what works best rather than trying to do everything.

Benefits and Types of Strategies

The process of strategic management involves different kinds of strategies
to help business managers to make decisions on what to do and when to do it,
also keeping a focus on the overall trajectory of business decisions. The different
kinds of strategies are classified as:

Type of Strategy Description

Competitive Strategy
This is a primary strategy in strategic management that
refers to a plan which amalgamates the clout of the external
situation and the combinative concerns of an organization’s
personal status. Deriving a competitive advantage against
competitors in the marketplace is the heart of this strategy.
This strategy aims to create market uniqueness that can
lead to a sustainable competitive advantage. Few examples
of competitive strategies are low-cost strategy, contrast
strategy, and market-niche strategy.

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Type of Strategy Description

Corporate Strategy This encompasses the long term objectives of the
organization and typically influences all the business units of
a particular organization. This strategy is formulated at the
top echelons of the senior management in a diversified
company. Corporate strategy particularly focuses on
diversification, horizontal integration, and vertical integration
of different products, business operations, and marketing
processes of an organization. Some examples of Corporate
strategy are growth strategy, consolidation strategy, and
global strategy.
Business Strategy This type of strategy is formulated at the business-unit level.
It concentrates on increasing the competitive position of the
company’s products and services. Strategic managers use
this strategy to devise action plans and quick adaption to the
use of a company’s resources. IIM online programs in
strategic management give rich insights on the business
strategy which includes innovation, product development,
integration, and market development.
Functional Strategy This strategy adopts a technique that points to specific
functional areas of a business organization. The core mantra
of this strategy is to accomplish business objectives by
maximizing resource productivity. It can also be termed as a
short-term game plan for a vital functional area in a
company. A functional strategy facilitates coordination
between objective planning for specific functions and
resource allocation for diverse operations within the
functional domain.
Operating Strategy This strategy gives shape to the organization’s operating
units. It incorporates the whole spectrum of decisions which
gives form to the long-term operational capabilities and their

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Type of Strategy Description

contribution to the comprehensive strategy. Development of
core competencies and competitive priorities with special
reference to product and service development form the crux
of operating strategy.

Strategy vs. Policy

In learning environments, there are always debates whether various

concepts are similar, complementary, or directly mean the same thing. However,
scholars and experts emphasize that each terminologies are to be used with
caution and appropriateness since they have specific usage. Just like between
strategy and policy, many business people tend to interchange these concepts.
Yet, the two terms do not mean exactly the same but they are both needed as
inputs in the crafting of the corporate plan.

A strategy is a plan on how to gain and sustain competitive advantage. It

encompasses the company's strengths and weaknesses as well as the competitive
external business environment. In other words, a strategic plan is a framework
based on an internal analysis of the company's strength and weaknesses as well
as of the external opportunities and threats which company is facing. Corporate
strategy details a set of goal and objectives directed actions that managers intend
to take to improve or maintain overall firm performance, gain customer's trust,
attain competitive advantage and to acquire a market position.

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On the other hand, a policy is crafted by the top management and sets
general rules for the corporate strategy. It is related to the mission statement as
well as to the values and beliefs of a company. The corporate policy frames the
basic rules and principles which directs and guidelines the decisions and actions
of the organization. Policies are crafted by the top level management of the
organization. Corporate policy is rather fixed and change only under exceptional
circumstances. It is more oriented toward decisions and its limits rather than
actions. The corporate policy outlines the resources and strategy necessary for
achieving company's goals. The corporate policy derives from the past and internal
experience, thus it is made for internal (not external) environment of business.
Corporate policy outlines the roles and responsibilities of top level management,
as well critical factors determining organizational success in long-run.

Development of Strategic Competitiveness

A company achieves strategic competitiveness when it is successful in
formulating and implementing a value creation strategy. Value creation allows
companies to outperform their competitors by producing superior performance.
Companies might have a great vision and mission. They also have a good value
proposition to customers and design a strategic plan in detail. However, all of that
does not guarantee the success of value creation, for example, for reasons of weak
strategy execution.

Meanwhile, other companies outperformed their competitors. They sell

more and control the largest market share. Again, that is no guarantee of creating
value. Business performance is excellent, but their financial performance does not
reflect that. The superiority of business performance does not result in high returns

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on capital due to thin profit margins. Finally, the advantage is most likely
temporary.

The company’s primary goal is to achieve sustainable competitive

advantage. To do this, companies must have strategic competitiveness. That
requires not only design but also the implementation of a successful value creation
strategy. Value creation allows companies to make high profits. They deliver
returns that benefit investors, more than what their competitors offer. Not only that
but creating value means they are also socially responsible. They also prioritize
environmentally friendly businesses. The company achieves it all through strategy.
They design and implement strategies that create value. If successful, they have
strategic competitiveness. If not, it is just “strategic.”

To achieve a sustainable competitive advantage, companies must ensure

competitors are difficult or too expensive to duplicate their strategic
competitiveness. That often requires a combination of radical innovation, market
expertise, and courageous leadership.

Development of Strategic Competitiveness

A firm's competitive strategy concerns how to compete in the business

areas the firm operates. In other words, competitive strategy means to define how
the firm intends to create and maintain a competitive advantage with respect to
competitors. Holding a competitive advantage over competitors means to be more
profitable than competitors over the long term. A firm's competitive strategy within
a given business area is examined looking at two factors: the creation of the
competitive advantage and the protection of the competitive advantage. The
creation of the competitive advantage is described as the result of either proactive
or reactive competitive strategy.

Proactive strategies can in turn be of two different types:

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a) Improvement of performance (same game competitive strategy);

b) A change of the rules of the game (new game competitive strategy)

Finally other forms of competitive strategies are examined:

a) creation of a completely new (non-existing) business area;

b) enlarging the geographical scope of the business area (cross-market

competitive strategy);

c) enlarging the business scope (cross-business competitive strategy).

The more popular paradigm for approaching competitive strategy has been
based on the notion of strategic fit (Hayes & Pisano, 1996). Porter's (1980) book,
“Competitive Strategy” became possibly the most celebrated book in the field.
Recognizing the existence of tradeoffs, Porter argued that the goal of business
strategy is to seek sustainable competitive advantage by positioning oneself within
industries and businesses that are either structurally attractive or can be made so
through deliberate actions. According to Porter, competitive advantage is strongly
linked with the idea of good positioning. In the '90s, Prahalad and Hamel (1990)
added to this debate challenging Porter's ideas by advocating that companies
should focus on building “core competencies” that could create competitive
advantages in a variety of markets. They argue that only competencies which are
difficult to copy actually make a company sustainable competitive and therefore a
company who positions itself and then develops the needed competencies will
have their recently acquired competencies easily copied and therefore the
advantage will not be sustainable. Teece and Pisano (1994) called the attention to
the dynamic aspects of the resource-based view, arguing that not only are the
capabilities to be developed important but that the mechanisms by which new skills
and capabilities are built have an important role to play because they influence the
learning processes and knowledge base of the company and these will influence
the ability of the company to compete in the future.

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The resource-based approach is markedly different from the traditional

manufacturing strategy paradigm.

According to most of the early authors, the manufacturing strategy

development should follow a predominantly top-down approach. Skinner (1985),
Fine and Hax (1985), Gregory and Platts (1990), Slack (1991) and, to a certain
extent, Hill (1995), suggest hierarchical models in which the corporate strategy
drives the business strategy. This in turn drives the strategies of manufacturing
and other functional areas within the business unit. In fact, the manufacturing
strategy formulation process has not received as much attention as the
manufacturing strategy contents - objectives and decision areas - in the literature
(Leong et al., 1990). Among the pioneers in the field, Hill (1995) seems to have
been one of the few who actually delved into a more detailed discussion on it,
proposing a specific framework to guide the development process on a (also
predominantly top-down) step-by-step basis. Rather, the authors in the field tend
to focus their work primarily on the manufacturing strategy objectives and decision
areas. This approach, according to Leong et al. (1990), seems to consider some
sort of implicit process, which depends on breaking manufacturing down into a
number of decision areas and making the goals of manufacturing explicit in terms
of a number of performance criteria. The steps of identifying these criteria,
prioritizing them and relating the decision areas to them would form the implicit
process. Hayes and Wheelwright (1994), for instance, although describing four
stages along a “continuum”, which represents the evolution of manufacturing's
strategic role, where the key aspect of evolution is the increasing, more proactive
involvement of manufacturing in the firm's strategic needs, do not describe how a
company should go about reaching the more advanced stages.

The exclusive top-down traditional planning approach does not seem to be

adequate for the future - planning is only of use when a good level of stability is
present. Otherwise it may easily become a futile exercise. In the future the only
certainty companies will face is that changes will be larger, more sudden and

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quicker than ever before therefore requiring more agile manufacturing strategy
development and implementation processes.

Trend and Condition that Alter Competition

Understanding what drivers will contribute to growth over the next few years
will inform your business strategy. According to the World Economic Forum’s “The
Future of Jobs Report 2018,” the top 10 business trends that will impact business
growth through 2022, include:

i. Increasing Adoption Of New Technology

The top five strategic business drivers through 2022 are technology-
related. It’s no surprise that the Fourth Industrial Revolution and the new
technologies that define it will spur business growth, job creation and
demand for specialist skills.

ii. The Increasing Availability Of Big Data

According to the stated investment intentions of companies surveyed

for “The Future of Jobs Report,” 85 percent of respondents are likely to
expand their adoption of user and entity big data analytics by 2022. This will
inform decisions and make for smarter and more pointed innovations and
investments.

iii. Advances In Mobile Internet

Everywhere you look, someone’s face is buried in a smartphone. And

that’s no different all around the world. According to GSMA Intelligence’s
“Global Mobile Trends 2017,” two-thirds of the global population are mobile
subscribers. Mobile now has the greatest reach of any technology. This
connectedness leads to life-enhancing services for developing countries,
including greater access to education and health services. The opportunity
in developed nations for mobile consumerism will also play a part.

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iv. Advances In Artificial Intelligence (AI)

AI is already being used to increase efficiency, improve productivity

and better performance in manufacturing, technology, healthcare and other
industries. The MIT Sloan Management Review’s “2017 Artificial
Intelligence Global Executive Study and Research Project” found that 85
percent of executives believe AI will help their businesses obtain or sustain
competitive advantage.

v. Advances In Cloud Technology

According to the stated investment intentions of companies surveyed

for “The Future of Jobs Report 2018,” 72 percent of respondents are likely
to expand their adoption of cloud computing by 2022. This will make
businesses more agile, collaborative, efficient and scalable while reducing
costs.

vi. Shifts In National Economic Growth

Combined with technology, socio-economic trends will have an effect

on business growth through 2022. National growth trajectories will have the
greatest impact in industries like aerospace, supply chain and transport;
infrastructure; and mining and metals.

vii. Expansion Of Affluence In Developing Economies

Increasing access to technology and education will provide greater

opportunities in developing countries and therefore contribute to the
expansion of the middle class. It will have the biggest effect on the following
industries: aviation, travel and tourism; chemistry, advanced materials and
biotech; and global health and healthcare.

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viii. Expansion Of Education

The increased access to education is partly due to technology

adoption rates, as well as the expansion of the middle class. The industries
most impacted by this socio-economic trend are aviation, travel and tourism;
mining and metals; and professional services.

ix. Advances In New Energy Supplies & Technologies

Decarbonization, emerging markets and resilience are to thank for

increased demand in renewable energy. Coupled with advanced computing
power, new energy supplies and technologies will drive business
development in many industries.

x. Expansion Of The Middle Class

According to the World Economic Forum, the world has reduced the
number of people living on less than $1.25 a day by one-half and the world
is on track to meeting the Organization for Economic Co-operation and
Development’s (OECD) 2010 forecast that the global middle class could
double by 2020 and triple by 2030. It is argued this is due to urbanization,
including greater access to education, technology and opportunity.

REFERENCES

 Bertelè, U., & Chiesa, V. (2002, November 2). Competitive Strategies: Organizational. International
Encyclopedia of the Social & Behavioral Sciences. Retrieved September 12, 2021, from
https://www.sciencedirect.com/science/article/pii/B0080430767042674.
 Corrêa, H. L. (2007, September 2). Agile Manufacturing as the 21st Century Strategy for Improving
Manufacturing Competitiveness. Agile Manufacturing: The 21st Century Competitive Strategy.
Retrieved September 12, 2021, from
https://www.sciencedirect.com/science/article/pii/B9780080435671500012.
 https://www.gqrgm.com/top-10-business-trends-that-will-impact-growth-through-2022/
 https://www.nou.edu.ng/sites/default/files/2019-07/HCM441.pdf
 https://ugn.com/key-characteristics-of-an-effective-business-strategy/
 https://books.google.com.ph/books?id=JQEcwnw80P0C&printsec=frontcover&source=gbs_ge_su
mmary_r&cad=0#v=onepage&q&f=false
 https://books.google.com.ph/books?id=X0zpJ4DCyj8C&source=gbs_similarbooks
 https://talentedge.com/articles/different-kinds-strategies/

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