Diversification

393 Telephones, hotels, insurance its all the same. If you neck the numbers inside out, you know the company inside out. â€"HAROLD SYDNEY GENEEN, CHAIRMAN OF ITT, 195978, AND INSTIGATOR OF 275 COMPANY TAKEOVERS For a company that has taken its original or main craft as far as it can go, variegation as a means of channeling surplus resources should certainly be considered. For the company that has not yet developed its main business to the plenteous potential, however, diversification is probably one of the riskiest strategic choices that can be made â€"KENICHI OHMAC, STRATEGY GURU AND occasion HEAD OF MCKINSEY & CO.S TOKYO OFFICE OUTLINE Diversification Strategy 15 l grounding and Objectives l Trends in Diversification over Time The Era of Diversification, 19501980 Refocusing, 19802006 l Motives for Diversification Growth Risk Reduction Profitability l Competitive Advantage from Diversification Economies of Scope Economies from Internalizing Transactions The Diversified loyal as an Internal securities industry l Diversification and Performance The Findings of Empirical Research The importee of Relatedness in Diversification l Summary l Self-Study Questions l Appendix: Does Diversification Confer Market Power?

l Notes CSAC15 1/13/07 9:27 Page 393 394 PART V CORPORATE STRATEGY Introduction and Objectives deciding What business are we in? is the starting point of system and the basis for defining the firms identity. In their statements of reverie and mission, some companies define their businesses broadly. Shells objectives are to reside efficiently, responsibly, and profitably in oil, oil products, gas, chemicals, and other selected businesses. Other companies define their businesses much narrowly: McDonalds vision is to be the worlds ruff quick-service restaurant chain: Caterpillar will be attraction in providing the best value in machines, engines, and support services for companies sacred to building the worlds... If you want to get a full essay, order it on our website: Orderessay

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