Diversification Strategies
The two general types of diversification strategies are related diversification and unrelated diversification. Businesses are said to be related when their value chains possess competitively valuable cross-business strategic fits; businesses are said to be unrelated when their value chains are so dissimilar that no competitively valuable cross-business relationships exist.11 Most companies favor related diversification strategies to capitalize on synergies as follows:
Transferring competitively valuable expertise, technological know-how, or other capabilities from one business to another
Combining the related activities of separate businesses into a single operation to achieve lower costs
Exploiting common use of a ...
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