Modeling the Global Business Environment Based on Polycyclic Theory

Abstract

This paper develops two models - graphical and econometric - of the business environment dynamics on the global scale in the context of the polycyclic theory. Both tools can be applied to explain historical development, forecast and direct future changes in the environment to enable contemporary businesses to adapt efficiently to its uncertain rapidly varying conditions. Initially relatively stable and predictable, the external business environment has been gaining uncertainty, complexity, and the speed of change since the 1950’s. As a result, significant current and predicted future changes in the business environment necessitate efficient adaptation of a contemporary company to this variability in order to ensure high competitiveness and performance.