Which diversification strategy is based on the idea that the company creates value by applying the distinctive competencies it developed in one line of business to another business activity?
A)A technology acquisition strategy
B)Related diversification
C)A restructuring strategy
D)Total diversification
E)A taper diversification strategy

Question

Which diversification strategy is based on the idea that the company creates value by applying the distinctive competencies it developed in one line of business to another business activity?
A)A technology acquisition strategy
B)Related diversification
C)A restructuring strategy
D)Total diversification 
E)A taper diversification strategy

Quizplus · Accepted Answer

Related diversification involves identifying synergies between the different lines of businesses and leveraging the existing capabilities and resources to create value. This strategy allows the company to exploit its core competencies and share the resources, knowledge, and technology across different business units. Therefore, related diversification strategy is based on the idea that the company creates value by applying the distinctive competencies it developed in one line of business to another business activity.

Which Diversification Strategy Is Based on the Idea That the Company