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Vertical integration: synergy or seduction?

Article Abstract:

A majority of business enterprises that acquire their suppliers or customers do not achieve positive results. Companies that have vertically integrated down or up the supply chain fail to improve their growth and control over the industry. A better alternative would be to outsource more activities, which will enable managers to improve their management techniques. Three essential conditions that business enterprises should satisfy to achieve success are presented.

Research, Planning, Strategic planning (Business), Vertical integration

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Brief case: why do companies over-diversify?

Article Abstract:

There are several causes for company over-diversification. Over-diversification by companies often results in falling corporate profits, if not bankruptcy. Managers who seek to spread risks and who believe in their companies' high growth potentials by investing in unfamiliar businesses are the most often-cited causes for over-diversification. To avoid over-diverisification, managers should instead focus on managing company decline.

Conglomerate corporations, Diversification in industry, Industrial diversification

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The new business enlightenment

Article Abstract:

The newest trend in business is spin-off or divestment by big companies to concentrate on a specific and specialized area. This 'smaller is better' syndrome is based on the need to specialize as managerial attention is best focused on resources that the company knows best. Furthermore, this system results in optimal productivity at less cost. It is foreseen that this trend will continue beyond 1998.

Corporate reorganizations, Corporate divestiture, Divestiture

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