Final answer:
The activity-based approach is more appealing in today's business environment because it allows for greater adaptability and responsiveness to rapid changes through the use of dynamic work teams, and facilitates easier access to financial capital for established firms with promising strategies.
Step-by-step explanation:
The activity-based approach in business has gained appeal in modern times primarily due to the changing dynamics in the workplace. These changes, influenced by factors such as technology advancements, globalization, competition, and shifts in workplace demographics, require organizations to adapt and respond with agility. The implementation of work teams, which pool diverse skills, experiences, and expertise, offers a flexible and dynamic way to tackle specific tasks and goals, unlike traditional structures based on individuals. Moreover, an established firm with a promising strategy is more appealing for outside investors like bondholders and shareholders, making it easier to raise financial capital.
Furthermore, firms that are well-established and show potential profitability attract financial capital more effortlessly, because the extensive availability of information about their products, revenues, costs, and profits renders personal acquaintance with individual managers unnecessary. Activity-based approaches contribute to ultimate success and sustainability of businesses. Companies adopting these approaches can be more attractive to both financial capital and top talent, positioning them for future success in a competitive market.