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The business environment is a constantly changing environment where new business ventures erupt with new ideologies. These new businesses might either flop or remain relevant to the industry with their new ideologies and economies of scope. When these firms remain relevant to the latter, their implications to the new firms, therefore, are either to embrace the changes or fight them through the old existing strategies. Technological advancements are the most dynamic economic ventures. New businesses and business ideas are constantly developed in the industry to ensure that new inventions are made to satisfy the constant needs of the customers. However, old business ventures implemented different strategies from those strategies used in the present day. This not only poses a challenge of adoption of the new strategies of the entrants, but also makes the former firms irrelevant.
Nevertheless, there exists an interplay in the external factors such as timing of entry, pricing of the firms products, distribution of the market share, changes in organizational leadership in the determination of the success of either the old businesses or the new entrants. These factors, coupled with the economies of scope determine the diffusion of technology and the incentives of market circumstances. While considering the IBM and Microsoft cases presented in this article, it is identifiable that both companies used strategies that have been considered outdated and failed to embrace the new business economies of scope to remain relevant to business and compete with the new entrants.
Competition is a common phenomenon in the business environment. While new entrants into the market might offer competition to the old firms, determining the resultant victor ...

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...cope. Dynamism is a common phenomenon in business that might keep some firms irrelevant, especially the old incumbent firms. New entrants often offer challenges to the former, which implies that the old incumbent firms require adjustments to match the new entrants and economies of scope, necessarily shared assets also ensure that both the old incumbent firms and the new entrants in the business environment share responsibilities. Nevertheless, the old incumbent firms have an advantage over the new entrants if they use proper economies of scope coupled with their large financial base because the ideas require financial backing for proper implementation.

Works Cited:
Timothy Bresnahan, Shane Greenstein, & Rebecca Henderson. “Schumpeterian competition and diseconomies of scope; illustrations from the histories of Microsoft and IBM.” Harvard Business School. Pp. 1-69
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