Author: Krishna G. Palepu

Publisher:

Published: 2015-06-30

Total Pages: 78

ISBN-13: 9781330514214

Excerpt from Diversification and Profit Performance in the Food Processing Industry Diversification strategy is an important component of strategic management of a firm. Literature in management as well as industrial organization theory leads us to believe that economic performance and diversification strategy of a firm should be related. Much of the empirical evidence in the literature, however, fails to provide conclusive support to this notion. Whether or not diversified firms are better performers, it is clear that more and more firms are pursuing diversification strategies. Data provided by Rumelt (1974) shows that while in 1949 only about thirty percent of the Fortune 500 U.S. corporations were non-single businesses, in 1969 over ninety percent pursued some form of diversification. In the light of such overwhelmingly prevelant practice, the question of the relationship of diversification to economic performance is of considerable interest to students of management. The purpose of the present paper is to take a fresh look at the relationship between diversification and firm performance drawing upon empirical evidence from a sample of firms in the Food Products industry. About the Publisher Forgotten Books publishes hundreds of thousands of rare and classic books. Find more at www.forgottenbooks.com This book is a reproduction of an important historical work. Forgotten Books uses state-of-the-art technology to digitally reconstruct the work, preserving the original format whilst repairing imperfections present in the aged copy. In rare cases, an imperfection in the original, such as a blemish or missing page, may be replicated in our edition. We do, however, repair the vast majority of imperfections successfully; any imperfections that remain are intentionally left to preserve the state of such historical works.