NEW COMPETITION: FROM 19TH CENTURY INDUSTRIAL SOCIETIES TO THE DIGITAL AGE

Author
, professor, Kharkiv, Pushinska, 77

In heading

 Economic theory;

Signed print

 27.05.2025

Issues number

 2025 - № 2 (61)

Page

 6-24

Type of articles

 Scientific article

Code UDK

 330.342:005.332.4

ISSN print

 2411-5584

Abstract

 Problem setting. In 1990, M. H. Best published the book «The New Competition. Institutions of Industrial Restructuring». The scientist proved that competition is constantly volving, filled with new content at each stage. Thus, the competition of the mid-19th century was called by Americans «the American system of manufacturing». The competition of the second half of the 19th – early 20th century corresponded to the period of Fordism. The competition of the «post-Fordist» era realized itself in other forms and principles of organizing production and business. It was this competition that M. Best studied as The New Competition, contrasted it with Old Competition and proposed strategies for each of its directions. And what changes in competition are taking place in post-industrial societies of the 21st century?
Recent research and publication analysis. The modern business world is defined as an intellectual, networked and digital economy, the «age of innovation», the «age of reason», the «age of business ecosystems», the «new era of opportunities», the «new globalization», аnd also as a «new reality» associated with increasing uncertainty, instability and unpredictability, and the «era of anomalies». Such changes have affected the behavior of entrepreneurs and competition between them. The concepts of VUCA and BANI have gained popularity in management. The publications of R. Adner, R. Baldwin, C. M. Christensen, S. Gupta, R. Hoffman and C. Yeh, F. Janzen, M. E. Porter, A. Slywotzky, M. D. Watkins, and other authors are worthy of attention.
The purpose of the article is to study of the «new competition» of the 21st century – its essence, factors and features of management.
Paper main body. The main subject of economic activity and competition in the 21st century remains the entrepreneurial firm. However, it’s the nature, purpose, operating conditions, and competitive behavior are changing.
First, we live in an era of innovation, where the competitive advantage is given to the innovative firm. Such a firm is ahead of its competitors by offering consumers not only a new product or service, but also more efficient use of resources, an innovative business model, an innovative strategy and management innovations, which increases its revenues. Strategic innovations aimed at ensuring the company’s competitive advantages in the future are becoming particularly relevant.
Secondly, a modern firm relies on the capabilities of the intellectual economy, in which intellectual entrepreneurs win. The competition includes creators of new knowledge and information; organizations that replicate information and provide services for its discovery, selection, and definition; developers of equipment that provides scientific and informational activities. All of them participate in intellectual entrepreneurship.
Third, the modern firm uses all the possibilities of the network economy. It creates, develops and maintains the effective operation of its internal and external networks, as a result of which it becomes capable of adapting to any changes in the business environment. The firm’s network connections enable the transition to the digitalization of the economy and underlie the formation of modern business ecosystems.
Fourth, the modern firm is evolving, becoming first a digitized firm, then a partially digital firm, and finally a digital firm and digital platform. Nowadays, traditional enterprises that are gradually digitizing their business, digital and platform companies are participants in digital competition.
Fifth, the modern firm operates in the era of business ecosystems. Now competition operates at two different levels – within the ecosystem (for the consumer and for commercialization) and between the ecosystems themselves. Accordingly, the relevance of developing a play strategy against other ecosystems is increasing to ensure the entire ecosystem’s competitiveness.
Sixth, the modern firm operates in a new global reality. It can be a subject of national, multi -national and global competition. However, the governments of many countries are increasingly returning to the ideas of economic nationalism and putting the task of permanent growth of the national economy, stimulation of domestic production and protection of domestic producers.
Conclusions. The modern era is changing the principles of competition. Firms must constantly look for new business models and new approaches to competition management. The following are of particular relevance: using the potential of asymmetric business and asymmetric competition; applying blitz scaling mechanisms; developing competitive strategies and mechanisms for their implementation using predictive analytics, forecasting tools, foresight studies and scenario-based competition processes; developing strategic thinking of business leaders.
Short abstract for an article
The author of the article substantiates the changes in the nature, purpose and conditions of functioning of an entrepreneurial firm in the 21st century. The features of competition between firms in the conditions of the innovative, intellectual, network and digital economy of the 21st century are analyzed. Special attention is paid to new approaches to conducting competitive struggle in business ecosystems and the global world under growing economic nationalism.

Keywords

 competition, entrepreneurial firm, competition of innovative firms, competition of intellectual organizations, digital competition, ecosystem competition, global competition, economic nationalism.

Reviewer

External reviewer

Article in PDF

 Economic Theory and Law, 2025-2-6-24

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Code DOI

 https://doi.org/10.31359/2411-5584-2025-61-2-6

This post is also available in: Ukrainian

27.05.2025