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Staying in Business With the New Economy

Organisations wanting to stay a dominant force in this new era of business need to understand the forces driving the new economy; Knowledge, change, and globalisation. Dr Alex Maritz, Director of the Australian Graduate of Entrepreneurship says a new business environment is increasingly complex as a result of the vast amount of business space created, and is fuelled by a customer-driven economy.

We asked business experts what they expect the New Year to bring SMEs, and what kind of resolutions they are making for the future.

Dr Alex Maritz Director: Master of Entrepreneurship and Innovation Australian Graduate School of Entrepreneurship
It will take entrepreneurs to accept the new era of business. In the new year we will be living in a chaotic transition period to a new age defined by global competition, rampant change, faster flow of information and communication, increasing business complexity, and pervasive globalization. The pace of change has become so rapid that it takes a different type of venture to be dominant and marked entirely new era of business.

Three forces driving the new economy:

1. Knowledge – intellectual capital as a strategic factor; a set of understandings used by entrepreneurs to make decisions or take actions that are important to the company
2. Change – continuous, rapid and complex; generates uncertainty and reduces predictability
3. Globalization – in R&D, technology, production, trade, finance, communication and information, which has resulted in opening of economies, global hypercompetition and interdependency of business.

Characteristics of the New Business Environment:

• New dimensions in business space get constantly created. Forces like technological breakthroughs, economic growth, market evolution, shifts in customer tastes, social changes, and political events can expand or shrink Australian business. Vast amounts of new Business Space created today change perspectives. This unoccupied territory represents a land of opportunity for the technological and strategic innovators who can see or create it faster than their competitors do. The opportunities are great, but so are the competition and the chance of failure.
• Increasing complexity. Business space, technologies, processes, and business models become more complex. That is because new characteristics are added frequently, but subtracted infrequently. The dimensions of Business Space keep increasing, adding complexity and furnishing attractive new opportunities for those who can successfully navigate in the new environment.
• Customer-driven economy. Customer power surged as customers have much more options today and can chose among many alternative suppliers.

This pace of rapid change is accepted by entrepreneurial and innovative leaders as opportunities; an outcome exhibited by graduates of the Master of Entrepreneurship and Innovation, at the Australian Graduate School of Entrepreneurship, Swinburne University of Technology.

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