Strategic management requirements and key points

Robert Reich and SUPERCAPITALISM

Background- One of the freshest, possibly most realistic views, of the modern 21st century economic systems in today's world is former Secretary of Labor and political economist Robert Reich. Currently, he is a Professor of Public Policy at the University of California, Berkeley, but was formerly associated with Harvard University. He is also a contributing editor to The New Republic, The American Prospect, Harvard Business Review, The Atlantic, The New York Times, and the Wall Street Journal. He had published 13 books and is regularly featured as a pundit on several political television shows. He is an active user of social media, and has more of a long-term balanced view of economics than many. Summing up his views he says, "I don't believe in redistribution of wealth for the sake of redistributing wealth. But I am concerned about how we can afford to pay for what we as a nation need to do" (Dubner, 2008).

Supercapitalism Overview- Capitalism, as we know, is an economic system that is simple in its definition -- but complex in its realization. Arising with the medieval practice of feudalism (lords owning land and controlling labor of the serfs), capitalism is can be simply defined as an economic system, marked by open competition in a free market. In this free market, however, the means of production and distribution are owned by individuals or groups (corporations) and only their continual growth and reinvestment (accumulation of wealth) drives the economy forward. However, for some, capitalism tends to incorporate a certain "way of thinking," driven by greed, the search for ever increasing profits, worldwide expansion, and internal development. Starting from the earliest origins of capitalism, only societies with the capabilities and the appropriate mindset could flourish amidst this period of economic, social, and religious dispersion. Modern capitalism arose and developed in Europe, largely due to the rise of technology, the Industrial revolution, and for some, the ethics of Christianity which promoted manual labor and helped provide the necessary hyper-productivity for a surplus of production (Bryer, 2004).

As economies grew, however, and particularly now in the 21st century when there are a number of mature states and an incredible number of permutations on capitalism and how wealth is generated and promulgated, the term capitalism no longer suffices -- we now live in a society based on supercapitalism. Supercapitalism is more than capitalism on steroids, it is the shifting of the power of capital resources from the large industrialists to consumer and investors who now have more choice than ever before and control great amounts of the wealth of nations (the title of Adam Smith's book, ironically). In general, as supercapitalism grew though, the disparity between economic classes grew as well and the most gains from economic growth settle in the top tear, with reduced job security, human rights abuses, and consequences that hurt the middle and lower classes increase (Reich, 2007).

Globalism -- Economy -- As the 21st century unfolds; we are told that the world is embracing globalism -- a key change in the economic, political and cultural movements that, broadly speaking, move the various countries of the world closer together. This idea refers to a number of theories that see the complexities of modern life such that events and actions are tied together, regardless of the geographic location of a specific country (political unit). The idea of globalism has become popular in economic and cultural terms with the advent of a number of macro-trade agreements combined with the ease of communication brought about with the Internet and cellular communication. The rapid growth of the global economy profoundly effects modern economic development and stability, labor, and, most especially, the environment. In combination with the Earth's natural geologic functions, the process of human globalization radically transforms local issues into national and international problems, heightening very serious challenges (Steger, 2009).

Globalism and Technology -- The modern corporate organization is far more complex that ever before; particularly the large multinational. Competitiveness is endemic and rarely do we find a product or service that does not have dozens, or more, aggressive competitors. The old paradigm about being efficient and being successful, then, really does not work in a competitive, supercapitalistic, 21st century economy. Instead, continued reinvention of both the company's product line and industry capabilities is not only necessary, but will help decide which companies succeed and which fail. Too, because the half-life of technology is so short, radical and category breaking innovation is needed not just to compete, but to provide the global environment with positive growth. The new culture of globalization -- one in which the rules of innovation and productivity have dramatically changed due to overt and covert pressures -- tends to be driven more and more by technology. This paradigm shift translates into innovation in communication, production, and the shift of some economies to a service, rather than production-based system (Hitt, et.al., 2010).