ABSTRACT
The short example of News Corporation illustrates many important principles of strategic management. First, a firm exists in a turbulent and rapidly changing context, which includes both the external world and the firm’s internal skills. As a firm in the media business, News Corporation has clearly been experiencing many changes in its external environment: the emergence of satellite TV; globalization; and more recently the digital revolution. Strategy is about understanding and capitalizing upon these changes. Context also includes the necessity for understanding the operations of financial markets. In early 1990 News Corporation had high debts and was almost brought down by a regional US bank but managed to survive. It has also weathered the 2008/2009 recession, albeit with reductions in sales volumes and significant losses. The firm has, however, been proactive in its environment, actively soliciting support from a broad range of interest groups such as politicians, governments, regulators, financial markets and allies in many countries. Context also includes development of new skills within the firm. Certainly News Corporation has had to develop new skills in TV, cable operations and international operations, among many others.
