Industry as a Player in the Political and Social Arena: Defining the Competitive Environment

Changing social values, skepticism of corporate behavior, and regulation are forcing firms to recognize the impact of these issues on potential success. Political and social action can impact dramatically on individual firms and industry-wide competitiveness by changing the rules by which competition occurs. In addition, policies that restrict trade in the international arena, regulatory interventions that impose additional costs, and public interest group activities that challenge the legitimacy of the firm and industry product and service offerings also alter the rules of competition. Firms and industries that learn to play by the new rules of engagement can significantly improve their competitive positioning within the economy. There has been almost nothing written on the topic of industry political strategy. As competition moves increasingly to a global scene, the businesses will have to deal with more complex social and political interactions.

Business academicians and business managers have become more interested in the impact of social and political issues on success. Until this work, there has been a lack of models of how to deal with the general issue. In addition, formulations of strategies and tactics have been lacking before this work along with the means of their implementation.

JOHN F. MAHON is Professor of Management Policy in the School of Management at Boston University. Dr. Mahon has written many articles and three books on related subjects.

RICHARD A. McGOWAN is Visiting Professor of Economics at Boston College. Dr. McGowan is the author of two books, Business, Politics, and Cigarettes: Multiple Levels, Multiple Agendas (Quorum, 1995) and State Lotteries and Legalized Gambling: Painless Revenue or Painful Mirage (Quorum, 1994).