A company should pursue related diversification only to enhance the competitive position of its core business.

Question

Quizplus · Accepted Answer

Related diversification involves expanding into businesses that are related to the company's core business. The purpose of this strategy is to enhance the competitive position of the core business by leveraging existing resources, capabilities, and competencies. Therefore, a company should pursue related diversification only if it can create synergies and improve its core business competitiveness.

A Company Should Pursue Related Diversification Only to Enhance the Competitive