DRAWBACKS OF UNRELATED DIVERSIFICATION
DRAWBACKS OF UNRELATED DIVERSIFICATION
- Places big demand on corporate management -- More diverse the businesses, harder it is to
- Oversee each subsidiary & spot problems
- Judge caliber of strategic plans of subsidiaries
- Consolidated performance of unrelated portfolio tends to be
- No better than sum of individual businesses on their own and
- It may be worse
- Promises greater sales-profit stability over business cycles, but is seldom realized