[solved] The two biggest drawbacks of pursuing unrelated diversification strategies are

(1) weak ability to capture cross-business resource fits and (2) conflicts/incompatibility among the competitive strategies of the company's different businesses.

(1) the likelihood of overspending on efforts to capture economies of scope and (2) difficulty in passing the industry attractiveness test when making new acquisitions.

(1) increased likelihood that the company's financial resources will be spread thinly over too many distinctly different lines of business and (2) the high risks of conflicts and/or incompatibility among the strategies of the businesses it has diversified into.

(1) no potential for competitive advantage beyond any benefits of corporate parenting and what each individual business can generate on its own and (2) demanding managerial requirements.

(1) demanding managerial requirements and (2) falling into the trap of diversifying into too many cash cow businesses.

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09-10-22 | 05:56:44

The two biggest drawbacks of pursuing unrelated

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