Evolution of the new economy business model
Author: Lazonick, William INSEAD Area: Strategy In: Internet and digital economics - Brousseau, Eric;Curien, Nicolas - 2007 - Book Language: EnglishDescription: p. 59-113.Type of document: INSEAD ChapterNote: Please ask us for this itemAbstract: Through the New Economy boom, bust, and recovery of the past decade, the New Economy business model (NEBM) has emerged as dominant in the information and communication technology (ICT) industries of the United States. Strategy, finance, and organization are distinctive in NEBM, compared with the Old Economy business model (OEBM). In terms of strategy, the "New Economy" business model (NEBM) is much more highly focused on specific products and processes than the much more horizontally diversified and vertically integrated OEBM. In terms of finance, NEBM uses stock as a currency to acquire technology companies and to compensate a broad base of generally well-educated employees, whereas OEBM relied more on cash or debt to finance MandA activity, and paid dividends to maintain stock price. In terms of organization, a narrow and concentrated skill base within the United States is increasing globalization of not only routine production activities. In this paper, I outline the evolution of the "New Economy business model" in the United States over the past half century as a foundation for understanding the origins and implications of the globalization of ICT employment in the 2000s.| Item type | Current location | Collection | Call number | Status | Date due | Barcode | Item holds |
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Digital Library | Available | BC008141 |
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Through the New Economy boom, bust, and recovery of the past decade, the New Economy business model (NEBM) has emerged as dominant in the information and communication technology (ICT) industries of the United States. Strategy, finance, and organization are distinctive in NEBM, compared with the Old Economy business model (OEBM).
In terms of strategy, the "New Economy" business model (NEBM) is much more highly focused on specific products and processes than the much more horizontally diversified and vertically integrated OEBM. In terms of finance, NEBM uses stock as a currency to acquire technology companies and to compensate a broad base of generally well-educated employees, whereas OEBM relied more on cash or debt to finance MandA activity, and paid dividends to maintain stock price. In terms of organization, a narrow and concentrated skill base within the United States is increasing globalization of not only routine production activities. In this paper, I outline the evolution of the "New Economy business model" in the United States over the past half century as a foundation for understanding the origins and implications of the globalization of ICT employment in the 2000s.
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