Technology-based strategies must keep pace with nuances in the changing global economy. The most notable paradigm shift for practitioners of ED to understand is the expanded globalization of technology, which in turn has intensiﬁed the focus on localized assets and resources. In today’s global economy knowledge, technology and innovation are ﬁrmly embedded in globally-traded products and services. Corporate production processes are captured within a global value chain, in which specialization can easily be outsourced. Firms and enterprises are more networked, more linked and more distributed than ever. The corporate world is also ﬁnding more ways to facilitate innovation internally and expand its reach in areas of research and development.
These trends have drastically changed the role of human capital in the economy. Managerial, professional and technical positions – or ‘knowledge workers’ – are now the largest occupational category. Competition has intensiﬁed for the most talented scientists and engineers at global, state and regional levels. Simultaneously, the global economy is more accessible for these very people to work as entrepreneurs and launch their own technology ventures independent of corporate structures.
Furthermore, US ﬁrms are not the only ones innovating. New waves of innovators are emerging in Europe, Japan, Korea, Australia, New Zealand and Southeast Asia. Foreign research and development investments are rapidly expanding, contributing to increased scientiﬁc output. Countries like Israel, Canada, Japan and Sweden have developed strong patent positions in key sectors like information technology and the life sciences.
The rapid development and incorporation into value chains all over the world by a cadre of foreign competitors is now challenging the USA at even greater levels than in the 1980s. Fortunately, US workers remain very productive and wages remain high. A large factor in this positioning is the US dominance in information technology and its successful and productive application throughout US industries. The continued global integration of technology will continue to challenge and potentially diminish this advantage.