Corporate Strategy Diversification - Prof. Dr. Bernd Venohr

Levels and types of diversification: the“related ratio”
Low Levels of Diversification
Single business
Moderate to High Levels of Diversification
Related linked (mixed) < 70% of revenues from dominant
business, only limited links exist
Very High Levels of Diversification
> 95% of revenues from single
business unit
Dominant business Between 70% and 95% of
revenues from single business unit
Related constrained
Unrelated-
< 70% of revenues from dominant
business; all businesses share
activities in value chain
Business units not closely related
Source: Robert M. Grant, Contemporary Strategy Analysis: Concepts, Techniques, Applications (5th edition, Blackwell,
2004)
Diversified
© 2006 Dr. Bernd Venohr
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