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Business and Diversification

Select and identify a diversified firm with which you are most familiar and discuss the drivers, synergies and strategy being employed in their diversification efforts, including their current level of success.

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Please refer to response attached, which is also presented below. Good luck with your studies and take care.

Response:

I located an excellent example on-line at http://mgtclass.mgt.unm.edu/Thomas/MGT%20498/chapter7.doc, which is an illustrative example a firm that has diversified.

Example:

Del Monte has diversified into a wide variety of activities, but they center on food production, processing, and distribution. Diversification, which is one of the most studied topics in all of strategic management, can be divided into two broad categories.16 Related diversification implies organizational involvement in activities that are somehow related to the dominant or "core" business of the organization, often through common or complementary markets or technologies. Unrelated diversification does not depend on any pattern of relatedness.

Unrelated Diversification is involvement in multiple businesses that do not share markets, functions served, technologies, or products/services. Del Monte employed mostly related diversification, with the complementary markets listed in the last section.

Driver, Synergies and Strategy

Since 1997, growth in the company's core business has been enhanced effectively by strategic acquisitions and product innovations. The Contadina brand of canned-tomato products greatly expanded the company's offerings of cut and paste-based tomato products, with a particular emphasis on the "freshest ideas in ...

Solution Summary

This solution selected and identified a diversified firm as an illustrative example, and analyzed it in terms of the drivers, synergies and strategy being employed in their diversification efforts, including their current level of success.

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