New Developments in Corporate Diversification Strategies

Although there are many variations in the definition of diversification, it would be only appropriate to provide some form of definition for the reader. Corporate diversification in its broadest sense can be defined simply as the entering into a new business activity by an existing business entity. This definition is expounded upon by many of the leading corporate diversification researchers to include references to the method of entering the new business (whether it be through acquisition, internal development, etc.), the driving forces behind the diversification (i.e., synergy, resource sharing, risk reduction), and the levels of relatedness between the company's present product line and market to that of the new businesses' products and markets.