Which of the following is NOT a result of overdiversification?
A) Top-level managers do not have a rich understanding of all of the firm's business units.
B) Managers emphasize strategic controls rather than financial controls.
C) Firms use acquisition as a substitute for innovation.
D) Managers become short-term in their orientation.

Question

Quizplus · Accepted Answer

Overdiversification can result in the other three outcomes listed, but it is unlikely to lead managers to emphasize strategic controls over financial controls. Rather, it may cause managers to focus excessively on financial metrics and short-term financial performance at the expense of long-term strategic goals.

Which of the Following Is NOT a Result of Overdiversification