An Alternative to Developing Embryonic Business Units

Given the difficulties large corporations have experienced in developing embryonic industries, many have opted to monitor such industries instead. As the industry in question matures, the corporation can either take small holdings in companies, license new products or technologies, or enter into co‐operation agreements with emerging companies. During the embryonic stage, analysis usually focuses on industries in some way related to the corporation's own activities, and services three major objectives: gaining detailed knowledge of the industry's skills and technologies; evaluation of the industry's attractiveness (growth and profitability); and analysis of its success factors. Only when the industry reaches a stage when the resources of a corporation are a major competitive advantage does it consider taking complete control of a company or developing business unit.