Week 10

Eight Lecture (26th October 2013)

Time Passing So Quickly

Chapter 8: Corporate Strategy: Diversification And The Multibusiness Company

Lets prayer to the parents who doesn’t ever go pilgrimage, can go to Mecca to perform pilgrimage. All of us can go to perform pilgrimage whether when we young or on old time. My sincere wish in future my parents and I can go to perform pilgrimage at Mecca together

Strategic diversification options is sticking closely with the existing business line-up and pursuing opportunities presented by these businesses, broadening the current scope of diversification by entering additional industries. Divesting some businesses and retrenching to a narrower collection of diversified businesses with better overall performance prospects and Restructuring the entire firm by divesting some businesses and acquiring others to put a whole new face on the firm’s business line-up.

Furthermore, creating added value for shareholders via diversification requires building a multi business company where the whole is greater than the sum of its parts—an outcome known as synergy.

Better Performance through Synergy.

Approaches to Diversifying the Business Lineup

Joint venture for instance reduce cost, increase and share skills and knowledge also in the aspect of technology. For instance sime darby who has the big plantation field of kelapa sawit has do joint venture with a company at thailand to produce oil for end consumer. Moreover, air asia is company who provide airlines services has also joint venture with other company and the outcome is Tune hotel, tune talk also insurance.