TL & Co. is following a related-linked diversification strategy, and Soar Inc. is following a related-constrained diversification strategy. How do the two firms differ from each other?
A) Soar Inc. generates 70 percent of its revenues from its primary business, while TL & Co. generates only 10 percent of its revenues from its primary business.
B) Soar Inc. pursues a backward diversification strategy, while TL & Co. pursues a forward diversification strategy.
C) TL & Co. will share fewer common competencies and resources between its various businesses when compared to Soar Inc.
D) TL & Co. pursues a differentiation strategy, and Soar Inc. pursues a cost-leadership strategy, to gain a competitive advantage.

Question

Quizplus · Accepted Answer

TL & Co. will share fewer common competencies and resources between its various businesses when compared to Soar. In related-linked diversification, only some businesses share competencies in products, services, technology, or distribution. In related-constrained diversification, all businesses share competencies in products, services, technology, or distribution.

TL & Co Is Following a Related-Linked Diversification Strategy, and Soar Inc