"Every diversification decision is an entry decision" - Discuss this statement in terms of its implications for the success of new business diversification.
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"Every diversification decision is an entry decision." Discuss this statement in terms of its implications for the success of new business diversification. Your answer should address issues of competitive advantage, industry analysis and industry evolution. What is the motivation for diversification? What is the process to set up the diversification venture? What are the determinant factors that make diversification successful? And what are the rules to manage diversification? Many firm in mature stage find themselves have little room to grow, difficult to capture more market share and to earn more profit. The future of the established firms could be threatened by industry disruption as innovative start-ups entering the market. Those more capable incumbents would constantly adapt to the new rules of competition through both innovation and imitation. There are several reasons that would motivate firms to consider diversification. First, the volatile business could cause firms' earnings uncertain, or the...


