At Cooper Industries,there are few similarities in the products it makes or the industries in which it completes.The corporate office adds value through such activities as superb human resource practices and budgeting systems.This is an example of __________________.
A) using related diversification to achieve value by leveraging core competencies to attain economies of scope
B) using related diversification to achieve value by leveraging core competencies to acquire market power
C) using unrelated diversification to achieve value through portfolio management in order to acquire financial synergies
D) using unrelated diversification to achieve value through restructuring and parenting

Question

Quizplus · Accepted Answer

In this case, the corporate office of Cooper Industries adds value to its acquired, unrelated businesses by performing such activities as auditing their manufacturing operations, improving their accounting activities, and centralizing union negotiations. The primary potential benefits of this unrelated diversification strategy are derived largely from hierarchical relationships; that is, value creation derived from the corporate office.

At Cooper Industries,there Are Few Similarities in the Products It