A diversification strategy based on resource sharing
A) entails a company creating value by applying the distinctive competencies it developed in one line of business to another line of business.
B) requires the development of new business-level strategies.
C) can help a company to realize economies of scope.
D) is a valid way of supporting the generic business-level strategy of differentiation.
E) increases the accountability of units.

Question

Quizplus · Accepted Answer

A diversification strategy based on resource sharing allows a company to leverage its existing resources and capabilities across different business lines. This can enable the company to realize economies of scope by sharing common resources, such as technology, manufacturing facilities, or marketing channels, among its various business units. This can help to reduce costs and improve efficiency, while also enabling the company to offer a broader range of products and services to customers. Additionally, this strategy may not require the development of wholly new business-level strategies, but rather the application of existing competencies to new areas.

A Diversification Strategy Based on Resource Sharing