SALAM,,,everyone , how your day recently, I guess all of you
must be happy since there no lecture and tutor for this subject. But, we still
have a lot of assignment that must be submit early of December. Tired already, but still we need to finish
it. It okay’s. We can do it.
For today, I would like to share my information that I get
from my reading in this chapter. Firstly,what is the purpose of diversification
? .Diversification may builds shareholder value. But, the company must entry
into new business that pass the attractiveness test, the cost- of – entry test
and better –off test. Besides, entry into the new business there are three
forms which are acquisition, internal start-up, and joint venture.
It is important for the business to have corporate parent
which it helps providing high level oversight and making available other
corporate resources, allocating financial resources across the business
portfolio and restructuring underperforming acquisitions.
There are six steps to analysis the company diversification:
1) Evaluate the long term
attractiveness of the industries into which the firm has diversified which is
include the attractiveness in its own, for others and as a group.
2) Evaluate the competitive
strength of each of the company’s business units.
3) Check for cross strategies
fit
4) Check whether the firm’s
resources fit the resources requirement of its present business lineup.
5) Rank the performance
prospect of the business from the best to the worst and determine what the
corporate parent’s priority should be in allocating resources to its various
businesses.
6) Crafting new strategies
move to improve overall corporate performance.
I think that all for this part, have a nice day everyone.
May Allah bless all of you today. Jazakallah (^_^).
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