A framework for concentric diversification through sustainable competitive advantage

This article investigates the issue of diversification around the core business, namely concentric diversification. There have been many diversification failures reported over the last few decades. Little guidance has been available to firms who plan to diversify in order to grow. The literature relating to competitive advantage, sustainable competitive advantage, and concentric diversification is reviewed. A process is then presented to help managers make sound strategic diversification decisions, thus reducing the risk of failure.