Diversification in businesses merit powerful consideration

Question

When is Diversification in other businesses merit powerful consideration?

Answer 1

Diversification into other businesses merits powerful consideration when:

i. The organization is faced with diminishing market opportunities and stagnating sales in its main business.

ii. It can expand into industries whose products and technologies complement its current business.

iii. It can leverage existing capabilities and competencies by expanding into businesses where these same resource strengths are important competitive assets.

iv. Diversifying into intimately related businesses opens new avenues for dropping costs.

v. It has a well-known and stronger brand name that can be moved to the items of other businesses.