Diversification is a strategy that companies use to enter new markets with new products or services. Companies may pursue a diversification strategy for reasons such as utilizing unused resources, transferring managerial skills to new markets, cross-subsidizing products, and spreading financial risk across multiple markets. However, companies also risk becoming too diversified and neglecting their core capabilities. Dell's attempts to diversify away from PCs into new areas like smartphones and data storage have faced challenges as it has struggled to keep up with competitors and transform its business model.
Diversification is a strategy that companies use to enter new markets with new products or services. Companies may pursue a diversification strategy for reasons such as utilizing unused resources, transferring managerial skills to new markets, cross-subsidizing products, and spreading financial risk across multiple markets. However, companies also risk becoming too diversified and neglecting their core capabilities. Dell's attempts to diversify away from PCs into new areas like smartphones and data storage have faced challenges as it has struggled to keep up with competitors and transform its business model.
Diversification is a strategy that companies use to enter new markets with new products or services. Companies may pursue a diversification strategy for reasons such as utilizing unused resources, transferring managerial skills to new markets, cross-subsidizing products, and spreading financial risk across multiple markets. However, companies also risk becoming too diversified and neglecting their core capabilities. Dell's attempts to diversify away from PCs into new areas like smartphones and data storage have faced challenges as it has struggled to keep up with competitors and transform its business model.
Diversification is a strategy that takes a company into new markets with new products or services. Companies may choose a diversification strategy for different reasons. Firstly, companies might wish to create and exploit economies of scope, in which the company tries to utilize its exciting resources and capabilities in other markets. This can oftentimes be the case if companies have under-utilized resources or capabilities that cannot be easily disposed or closed. Using a diversification strategy, companies may therefore be able to utilize all its capabilities or resources, and able to attract new business from market segments not catered to earlier. Secondly, managerial skills found within the company may be successfully used in other markets, where the dominant logic and managerial procedures of management can be successfully transferred to other markets. Thirdly, companies pursuing a diversification strategy may be able to cross-subsidize one product with the surplus of another. This way, companies with a very diverse portfolio of products catering to different markets may potentially grow in power, and be able to withstand a prolonged period of price competition etc. When having subsidized one product for a substantial period of time, the company might possibly be able to win a monopoly, making it the only supplier in the respective market. Fourthly, companies may also want to use a diversification strategy to spread financial risk over different markets and products, so that the entire success of the company is not reliant on one market or product only. There may however be other reasons for companies to use a diversification strategy than the four listed above, and companies may very well benefit from a diversification strategy for other reasons. However, it is important for companies to realize the possible danger of diversifying its scope of operations to much. Companies might risk neglecting its core capabilities and become too diversified, where too many different products supplied to different markets might have negative effects on products and services, where e.g. product quality or uniqueness might suffer due to the shift in focus on different products and markets. The diversification strategy can be split into two different types: 1. Related diversification 2. Unrelated diversification
Dell's Diversification Strategy: 'A Day Late and a Dollar Short?' Published: September 01, 2010 in Knowledge@Wharton
Share this Article Share on facebook Share on twitter Share on email More Sharing Services When Dell launched its first smartphone in the U.S. on August 24, early product reviews were dismal. Compared with the slew of other nifty new smartphones available today, critics groused that the only thing remarkable about the phone -- called the Aero -- was its $99 price tag. They have deemed its hardware mediocre, its operating system -- running on a 16-month-old version of Google's Android -- outdated, and the requisite smartphone bells and whistles disappointingly meager. If Dell wanted to find a bright side to the phone's debut, it was that it went largely unnoticed, for two reasons. First, in an increasingly crowded smartphone market, one more new entrant hardly causes a ripple anymore. Second, the launch was overshadowed by a bigger, more dramatic event that has been unfolding for weeks at the $53 billion, Texas-based company -- the bidding war against rival Hewlett-Packard for a small, little known developer of high-end data storage technology called 3PAR. After having initially offered to buy 3PAR for a little more than $1 billion in what looked like a sure-fire deal in mid-August, Dell found itself in a face-off with Hewlett-Packard (HP), whose second counter-offer reached $30 a share, or $2 billion. (The one- upmanship seemed likely to end in HP's favor when Knowledge@Wharton was about to publish this article on September 1). All this to own a company with just under $200 million in 2009 revenues. Both the lackluster smartphone launch and the 3PAR tug-of-war make one thing clear -- nothing about Dell's attempts to reinvent itself from a PC and server maker to an all-encompassing IT products and services company has been easy, says Daniel A. Levinthal, a Wharton professor of management. "[Dell] seems to have lost sight of what it's good at and how to find new opportunities to leverage that." This is in sharp contrast to the Dell of yesteryear, he says, which confidently won "customers who valued its tightly run business model," designed to churn out economically priced computers with a snap of the finger. "Dell hasn't become any less wonderful at doing that," he notes. "But guess what? The world has changed." The problem, according to Levinthal and other Wharton experts, is that Dell woke up too late to this changed world, even as competitors like HP snatched away its once enviable market lead by offering sharper products and services. With founder and chairman Michael Dell back in the CEO post since 2007 after a three-year break, the company has been at pains to claim a bigger stake in higher-margin corporate-focused businesses -- like the storage services that 3PAR offers -- and fast-growing consumer markets such as smartphones. But do Dell's ambitions add up? Not yet, observers say. Despite the early achievements of its groundbreaking, low-cost business model, "Dell has leadership issues, it has competitive advantage issues and it has strategy issues," suggests Saikat Chaudhuri, a Wharton management professor. "Dell sees the need for diversification, but does it see the need for transformation? There is a big difference." Forgetting the Customer In their new book, Strategy from the Outside In: Profiting from Customer Value,George S. Day, a Wharton marketing professor, and Christine Moorman of Duke University's Fuqua School of Business write that Dell's plight is typical of a company that becomes so good at what it does -- in this case, manufacturing and delivering low-cost PCs -- that it misses cues from its market that the company needs to change. Dell has succumbed to what the authors call "inside-out hubris." "To formulate an effective competitive strategy, we argue that you've got to stand from outside the firm and look at it through the respective lenses of competitors, customers, channel members and so forth," says Day, who is also co-director of Wharton's Mack Center for Technological Innovation. "That worked really well for Dell. It was a company that prospered through the 1980s and a good part of the 1990s with a really clear-cut customer value proposition. It was able to master logistics and deliver standardized hardware at prices and speeds no one else could match." However, like other successful companies, "Dell began to think, 'We know this market better than anyone else,'" Day notes. "So the focus shifted from the 'outside in' [approach of] looking at its position in the market to thinking, 'How can we maximize earnings out of our existing resources and capabilities'" at the expense of, rather than in addition to, thinking about what its customers need. Still, that low-cost model -- and what Day refers to as Dell's "monolithic focus on efficiency" -- has served it well, according to experts. "Around 1997, when Dell was the strongest, it was holding about one week of inventory. All the competitors were holding two or three months," says Serguei Netessine, professor of technology and operations management at Insead in France and co-director of the Insead-Wharton Alliance. "That created a huge difference in the cost structure -- computers lose value very quickly. Each week that a computer sits on a store shelf, it loses about 1% of its value. So Dell was winning." According to Netessine's estimates, Dell's costs were around 8% less compared with competitors at the time, like IBM or Gateway -- a difference that helped the firm become number one in the global PC market. And today? Having been usurped by HP as the top PC vendor, Dell is fighting to stay in second place. "Dell still has an efficient supply chain. It is constantly improving and taking out inefficiencies," says Netessine. Yet the 8% cost advantage has dwindled to around 2% as other companies have learned how to improve their own supply strategies. "It's hard to have any kind of meaningful advantage with 2% because Dell's products are not dramatically better or different, or more reliable, and the company doesn't offer any better service," he adds. "That's not sufficient to sustain the dramatic growth that Dell had in, say, 2000." Not that its growth today isn't enviable, especially considering the beating that many computer firms -- including Dell -- took during the recession. For the second quarter of the current fiscal year, which ended July 30, Dell reported a profit of $545 million on revenues of $15.5 billion, compared with a profit of $472 million on revenues of $12.8 billion a year ago. Meanwhile, cash and equivalents at the end of July were $13.1 billion. During the results announcement, Brian Gladden, Dell's chief financial officer, attributed much of the growth to "overdue client refresh" - - that is, large corporate customers increasing IT spending after the belt-tightening of 2008 and 2009. Sales for its servers, storage and networking products were up 43% to $4.3 billion. Services revenues increased 57% to $1.9 billion. As for computers, Dell managed to hold on to its lead over Acer, but just barely, with 10.6 million PCs shipped (up 19.1%), behind HP's 14.8 million units and slightly ahead of Acer's 10.2 million. Server shipments, too, grew in the second quarter: According to Gartner estimates, Dell was in second place, with nearly 550,000 servers shipped (up 35%), compared with HP's number one slot at 644,00 units and IBM's number three slot at 270,000. However, no company in the fast-changing hardware and software sectors can take its market share for granted. The challenge was made especially clear in the recent jostling in the notebook computer market. All the big incumbent vendors have been ceding market share to aggressive rivals over recent months -- and then came Apple's iPad in the spring. According to Deutsche Bank analyst Chris Whitmore, the new iPad helped Apple double its share of the global notebook computer market, leapfrogging Dell and other second-tier vendors like ASUS, Lenovo and Toshiba, and moving it to third place, behind HP and Acer. Being eclipsed by Apple and the new iPad goes to the heart of Dell's struggle. Dell is no Apple, says Netessine. "Dell has never invented a notable product. What it has done is deliver a basic product that someone else has invented but get it to consumers much more efficiently. To be an Apple requires a little bit more. [Apple] is structured around innovation. It has been innovating its whole life." Into the Clouds That explains why Dell wants to focus less on hardware and more on services -- or what Netessine calls "servicization." Converting products "that are commoditized into services -- which are ... harder [for consumers] to shop around for and compare with one another -- is popular among manufacturers nowadays," he notes. Dell is betting on the growing interest among its corporate customers in cloud computing services -- Internet-based computing that lets companies access resources, such as software and storage, which providers like Dell host remotely on their behalf. Dell's $1.4 billion acquisition in 2008 of EqualLogic (which posted $800 million in sales for the first six months of fiscal 2011) and a partnership with storage giant EMC have already enabled it to begin providing cloud- computing services for small- and mid-sized companies. For some companies, Netessine suggests that servicization can be a big shift. "You have to really change your focus from short-term selling of a product to thinking about five, 10, 15 years down the road and possibly bundling some kind of service agreement with customers buying those products," he states. "Thinking carefully about the life cycle of those products -- what kind of contract do corporate customers want; can you support customers with extended service agreements; can you offer some kind of multi-tiered services -- requires very different expertise, but I don't think it is as far removed from Dell's core strengths as, for example, selling smartphones." Several recent acquisitions move Dell further in the servicization direction. That includes its biggest-ever acquisition, the $3.9 billion deal last year to buy (at a 68% premium) IT management and solutions provider Perot Systems, which is currently being integrated into the Dell Services unit. "I'm wondering whether all this is too little too late," says Chaudhuri. "What I'm missing are some bold moves." Compare Dell's acquisitions with HP's, he adds. In 2008, HP expanded its services offerings by buying a frontrunner -- Electronic Data Systems -- for more than $13 billion. Shortly after, software company Oracle bought Sun Microsystems for $7.4 billion to get into the computer hardware market for the first time. What these companies want to do, according to Chaudhuri, is emulate IBM, which sold its computer manufacturing to Lenovo and shifted into services by buying PricewaterhouseCoopers Consulting in 2002 for $3.5 billion. David Hsu, a Wharton management professor, agrees that Dell has the cash and the clout to push its strategy further than it has been, despite concerns about tougher times ahead if the U.S. tumbles back into a double-dip recession. "There's a tendency to focus on profitability and operations, and not make a strategic move, but I don't think the shareholders would like it, even in an environment like ours," he says. Smaller acquisitions for a company like Dell shouldn't be overlooked, however, observes Lawrence G. Hrebiniak, a Wharton professor of management. "It doesn't matter whether an acquisition is big or small. The question is whether Dell finds something to acquire that fits logically or extends its strategy. Is Dell buying growth but destroying value?" As Hrebiniak sees it, while the 3PAR acquisition makes sense as a way for both Dell and HP to expand their services, the premium both were willing to pay does not. He adds that the bidding war has been more about HP-Dell politics than 3PAR. "There's a little ego involved," he suggests. "HP got rid of [CEO Mark Hurd in August] and it wants to prove to the world that it can still make strategic decisions without him.... And Dell still wants to beat HP badly because HP has beaten them in PCs." The 3PAR win, if successful, would be good timing for Michael Dell. In July, he agreed to pay $4 million, and the company agreed to pay $100 million, to settle a case in which the Securities and Exchange Commission (SEC) accused Dell executives of misleading investors about its profitability. A month later, at the company's annual general meeting, one-fourth of Dell's shareholders refused to vote for Michael Dell's reelection to the board as chairman. That's why "he wants to show that he's still okay -- even though a quarter of his shareholders don't think so - - that he can do a lot of good things for shareholders and they're wrong for picking on him," notes Hrebiniak. All Things to All People According to Day, Dell needs to sharpen its focus. He describes the current strategy as "a day late and a dollar short.... HP and others have been expanding into services far longer than Dell has." He suggests that part of Dell's challenge is shaking its obsession with internal efficiencies to focus outwards. For companies such as Dell, "you have to go out and live with your customers and channel members, and focus not only on what your competitors are doing in your markets but also on what they're doing elsewhere." Other experts raise concerns about Dell's inability to articulate its priorities. Is it smartphones and the like for consumers? Is it one-stop shop products and services for its corporate customers? Is it PCs and laptops for everyone? Or a little bit of everything? "I'm not sure if Dell is hedging its bets or if it is uncertain of where it wants to go, or if it wants to be an all-round big player, like an HP that straddles both worlds," says Chaudhuri. "At present, it looks like it's not sure where it can make much impact." Dell is "trying to be an 'everything' IT business, a diversified company," adds Netessine. "The problem is that it's extremely hard to do all of those things well. It's hard to see how Dell can ... compete with all those powerful companies that have been in the business longer and have much better products in many cases." It is a problem when companies like Dell "try to take an option on many, many different segments," says Hsu. "It can be very expensive as well as confusing [to send] mixed signals not only within its own organization, but also to the outside world as to what is unique about Dell." What Dell needs to remember, he adds, is that "you don't have to master the whole value chain in order to be a valuable company." Product Diversification Strategy by Ian Linton, Demand Media inShare
Share RSS Email
A product diversification strategy can help your business grow. Related Articles How Does a Multinational Company Use the Diversification Strategy in Decision Making? What Are the Benefits of Concentric Diversification? Elements of Product Strategy The Advantages of a Product Differentiation Strategy Retail Product Strategy The Purpose of Product Attribute Leadership Strategy A product diversification strategy is a form of business development. Small businesses that implement the strategy can diversify their product range by modifying existing products or adding new products to the range. The strategy provides opportunities to grow the business by increasing sales to existing customers or entering new markets. Sponsored Link The Emerging CFO Program An exclusive program at Stanford For Finance Executives. Apply Now. gsb.stanford.edu/ECFOProgram Objectives Set your objectives for product diversification. You can take a defensive approach with the objective to protect your business if, for example, demand drops for your products or you face strong competition. This might be important for news companies that have built their business on a single product. Declining market share or revenue could threaten the survival of your business. Alternatively, you can take an offensive approach where you see a strong market opportunity but cant take advantage of it with your existing products. Approach You can approach product diversification in a number of ways. You can modify your existing products so that the new version appeals to a different group of customers. If you make tools for building professionals, for example, consider developing a version that appeals to amateur users. An alternative strategy is to offer new products to your existing customers. A retailer of fruit and vegetables could introduce a range of health foods that appeal to the same customer group. Another approach is to add a new product to your range, aimed at a new group of customers. Source Product diversification can be an expensive, time-consuming task. Analyze whether you have the resources to develop new products or modify existing ones. If you dont want to develop products internally, consider other options such as distributing products from other suppliers, taking out licensing agreements to manufacture or supply products developed by other companies, or setting up alliances or partnerships with other companies to jointly develop or market products. If your company is in a strong financial position, consider acquisitions to gain access to products that align with your diversification strategy. Resources Assess the resources you need to implement your strategy. Set a budget for the diversification program to cover development and marketing costs. Consider the supply chain implications of your new products. You may have to find new suppliers and build effective working relationships with them. Review your sales and marketing resources. Does your team have the product and market knowledge to achieve your sales targets? If you plan to manufacture the product yourself, do you have the production capacity or will you need to invest in new plant or hire more staff? If your new product sells through retail outlets, can you access a suitable distribution network? Risk Product diversification is a high risk strategy, so its important to assess both the opportunity and the level of risk. Focus on product diversification that represents an attractive opportunity for your business, such as an instance where the market is growing and no other company is meeting the demand. Provided the costs of developing and marketing the new product allow you to earn a profit, this is an opportunity to pursue. Risk increases if the new product might take sales away from your existing products or if the cost of market entry is very high. In those scenarios, the benefit to your company may not offset the risk. Research Before committing resources to product diversification, carry out research to ensure that you understand the needs of the market. Use the Internet to identify potential competitors and find out more about their products and prices. Carry out a small-scale market test to evaluate the potential of your strategy. Ask for customers feedback on their experience with the product. Evaluate the results of your sales and marketing activities in the test. Analyze the cost of taking the product to market so you can prepare an accurate budget for launching the new product. Google diversification strategy? Posted on March 12, 2010 by sebastian Although the vast majority of Google is search engine market, the reality is that after 10 years the Mountain View giant has become the largest advertising agency in the world. Over the past year, Google reported total gross revenues of $ 24 billion USD. If we discount the 6 billion paid to its partners (with whom they share the advertising revenue), net revenues are in the range of $ 18 billion. If we look at the chart above, supplied by Business Insider, Is quite obvious that almost all revenue comes from ads on Googles sites. Only a small portion of revenues comes from Adsense or other services offered by the new media company (Google Apps, Youtube, Picasa, etc). Is Googles diversification strategy working? Even do Google has been one of the most prolific internet companies when launching new online and mobile services, still after ten years almost 90% of their revenues are coming from their most basic and oldest product. Why the diversification program Google launched many years back by introducing other product lines like Gmail, Youtube, Picassa, Doubleclick, AdMob, Google Energy and others does not translate into a significant level of revenues? It seems that the source of monetization that Google found on the search market, has not yet found on other business divisions. Again, the key challenge for most internet companies today is how to monetize the value created by their applications or services. Moreover if we look how much Google has invested on diversifying their portfolio; for instance Youtube was acquired in 2006 for 1,650 million USD. Anyway, Googles strategy could work in the long term. If we look closely on year 2009, revenue from ads on their sites accounted for 83% of the total. Compared to 2008, this item represented 90% of Googles total income. Nevertheless, the growth rate of these windfall is, so far, relatively modest. Is Google a facing a major risk due to their dependency in only one source of revenues? Could a loss in their share in the search market against Bing or Yahoo jeopardize Googles future? The is other angle that we are not able to assess in this graph, such as the impact of mobile internet exponential growth driven by our paranoia of real-time information and the increasing power of social networks, which inevitably will end up affecting the search industry and therefore Googles current revenues. Just as an example, online users spend more time on Facebook than in Google, Yahoo, MSN, Youtube and wikipedia together! Google is aware of this and has already begun to position themselves strategically. Its foray into the mobile world with Android OS, the recent AdMob acquisition, Twitter and Facebook included their search results and the launch of its latest social media attempt, Google Buzz, confirm that the battlefield is now for the end users mobile. Advantages & Disadvantages to Corporate Strategy Diversification By Alan Li, eHow Contributor Diversification in corporate marketing is selling new products in new markets. In a corporate marketing context, diversification is the strategy of increasing profits through selling new products in new markets. As with all strategies, it has advantages and disadvantages, and management can use these advantages and disadvantages to different ends. Other People Are Reading The Advantages and Disadvantages of Ethical Diversification Strategies Advantages & Disadvantages of Diversifying Into an Unrelated Business?
Print this article 1. Uses of Diversification o Diversification in corporate marketing can be turned to both offensive and defensive ends. On the offensive, it can be used to increase the corporation's profits through starting up enterprises in untapped markets. On the defensive, it can be used to spread the corporation's assets so as to protect against downturns in one market. Profit o The biggest potential advantage of diversification is the increase in revenue. Diversification means selling a corporation's products in a new environment that it has not attempted to tap into on prior occasions; a successful venture there can result in an entirely new stream of revenue. Better still, such enterprises do not compete with the corporation's older holdings and tend to offer higher rewards than those from the preexisting enterprises. o Sponsored Links Gap analysis tool Set up and send out gap analysis assessments in just 3 minutes www.spidergap.com Cost o One major disadvantage to diversification is the cost of starting up new businesses in new markets. It is more difficult for corporations to secure resources to start such enterprises because the element of risk is higher. Furthermore, there is no guarantee that the new enterprise will start producing in the near future, and a corporation may have to sustain a loss for consecutive periods before it has attained enough market penetration to start making a profit. Depending on when and how much profit, new enterprises may not be worth the investment. Risk o Another major disadvantage to diversification is that it is the riskiest of all possible marketing strategies. Since the corporation is selling new products in new markets, it has neither the expertise to produce and market those products nor the expertise to sell in those markets. As such, it will need to spend the money to either acquire the expertise or the information to do both, and there is a chance that its preexisting management will not be able to do so effectively, which could turn a potentially profitable project into a resource sink with no payout.
Product Diversification Strategy By Laura Acevedo, eHow Contributor Diversification Product diversification involves modifying existing products in order to expand the market potential of a product. From changes in brands to changes in a product's target market, product diversification can obtain new clients for your product by leveraging an existing product's reputation and development platform to produce and sell a modified product. Successful product diversification requires accurate targeting and product differentiation to prevent eroding your current market and increase overall sales and profits. Other People Are Reading 1. Brainstorm o Brainstorm potential markets for an existing product with slight alterations. Consider geographic differences, demographic differences such as gender and age, and features that appeal to different groups. Obtain a strong list of potential new products for diversification efforts. Market Research o Based on product brainstorming, conduct extensive market research into the viability of new products. Make sure new products align with different target markets than the customer base for your existing product to avoid eroding market share for your current product. Conduct surveys, focus groups and product trials to ensure product success prior to launching a new product. Demographic Diversification o Diversify your product base by implementing changes in your demographic targets. A good example of demographic diversification by age is "Teen People" magazine. The standard "People" targets adult readers whereas "Teen People" targets preteens and teenagers. This diversification added readership and leveraged an existing brand to diversify and increase revenue. Consider demographic diversification if there are wide differences in preferences for your product based on gender, age, location or ethnic differences. Price Diversification o Diversification can target new price points. For example, Marriott hotels targets mid- to upper-price point hotel customers. Marriott expanded into budget hotels by creating new brands---Fairfield Inn and Courtyard by Marriott hotels. Consider price diversification if there is a wide range of prices for the products or services you offer. Product Extension o Create a new product that builds off your established brand image. For example, Reebok is known for athletic footwear. Reebok extended this image and created Reebok Fitness Water to diversify its product line and build off the success of its shoe line. Consider a product extension strategy if the existing market for the type of product you offer is already saturated and there are convenient ties to other product types. This strategy also helps reduce overall business risk by offering products in a variety of customer categories. Product Modifications o Product modifications such as color or different features can help diversify your product offers. For example, Heinz expanded its ketchup offerings to include colored ketchup in purple and green. These products targeted consumers with children to capture additional market share. Consider a product modification strategy if you have budgetary constraints, or if slight modifications could lead to expanded market share or reinvigorate your existing product's image.
a dng ha qu mc: Him ha khn lng Trn th trng chng khon, chng ta lun c nghe ni n cc ch li ca vic a dng ha danh mc u t. Khng mt ai trong chng ta mun "b ht trng vo mt r" hay t a bn thn ra hng chu s ri ro bn cht ca vic ch nm gi mt loi c phiu. Th nhng, liu bn c ang i qu xa trn con ng t bo v mnh hay khng? C nhng lc a dng ha qu mc li l mt ri ro ln. Th no l a dng ha?
Khi chng ta ni n s a dng ha trong mt danh mc u t chng khon, chng ta ang ni n n lc ca nh u t trong vic gim bt ri ro thng qua vic u t vo nhiu cng ty thuc nhiu ngnh, thm ch nhiu nc khc nhau. Hu ht cc chuyn gia u t u ng rng mc d a dng ha l mt tm phiu bo hnh trc ri ro thua l, nguyn tc sng cn cho vic u t vn lun l hng ti cc mc tiu ti chnh di hn ca bn. C rt nhiu nghin cu ch ra ti sao a dng ha c tc dng. Mt cch n gin, bng cch m rng phm vi u t ca bn vo nhiu cng ty, nhiu lnh vc khng c nhiu s lin kt vi nhau, bn s th kim ch bt c s bin ng gi c vi danh mc ca mnh do thc t khng bao gi c chuyn tt c cc ngnh i ln hay i xung vi cng mt tc v trong cng mt thi k. Do , a dng ha m bo s hot ng n nh hn cho danh mc ca bn.
iu quan trng l lun nh rng cho d danh mc u t ca bn c c a dng ha n u chng na th khng bao gi nguy c ri ro v n zero. Bn c th gim thiu c nhng ri ro gn lin vi cc c phiu n l (cc nh hc thut gi l cc ri ro khng c tnh h thng), th nhng lun c nhng ri ro thuc v bn cht ca th trng (nhng ri ro h thng). Nhng ri ro ny c th nh hng n hu ht tt c cc c phiu v s a dng d mc no cng khng th ngn chn c chng.
Liu chng ta c th a dng ha chng li cc ri ro phi h thng?
V vn ny, bi vit mun nu ra mt cu hi: "Bao nhiu c phiu l cho s a dng ha nhng khng phi a dng ha qu mc?" Vic s hu ba nm c phiu thay v ch mt loi duy nht lun lun l khn ngoan, nhng n khi no th vic b sung thm c phiu vo danh mc ca bn s khng cn tc dng trong vic hn ch ri ro ca th trng?
Trc tin, chng ta cn phi bit ri ro c nh ngha nh th no. Cch thc c chp nhn rng ri trong vic o lng ri ro l theo di mc bin ng. iu c ngha l, mt c phiu hay mt danh mc u t bin ng cng mnh trong mt khong thi gian nht nh th cng c u t cng c ri ro cao. Mt khi nim trong thng k c gi l " lch chun" c s dng o mc ri ro. Trong phm vi bi vit ny, bn c th hiu lch chun l "ri ro".
Theo l thuyt hin i v danh mc u t (modern portfolio theory), bn n rt gn vi im a dng ha ti u sau khi thm vo danh mc ca mnh c phiu th 20. Trong cun sch "L thuyt hin i v danh mc u t v Phn tch u t" ca mnh, Edwin J. Elton v Martin J. Gruber kt lun rng lch chun (ri ro) trung bnh cho mt danh mc u t ch c mt c phiu l 49,2% trong khi tng s lng c phiu trong mt danh mc c cn bng tt s gip gim lch chun xung mc ti a l 19,2%. Tuy nhin, h cng nhn thy rng vi mt danh mc 20 c phiu, ri ro c gim xung cn khong 20%. V th nn, cc c phiu thm vo t th 20 cho n th 1000 s ch gim mc ri ro ca danh mc i khong 0,8% trong khi ch 20 c phiu u tin lm gim c n 29,2% (49,2% - 20%).
Nhiu nh u t c quan im sai lm rng ri ro t l nghch vi s lng c phiu thm vo cho mi danh mc u t, trong khi trn thc t iu ny khng h ng. C nhng bng chng r rng cho thy bn ch c th gim ri ro n mt im nht nh m ti vic a dng ho hn na khng em li li ch g.
a dng ha ch thc
Nhng l lun trn y khng c ngha c mua vo 20 c phiu bt k l bn gim c ri ro n mc thp nht. Lu rng ngay t u chng ti gii thch a dng ha tc l bn phi mua vo nhng c phiu hon ton khc nhau, c th l v quy m ca cng ty, ca ngnh, hay ca c mt th trng. Ni theo ngn ng ti chnh, bn mua cc c phiu khng c s lin h vi nhau - cc c phiu bin ng theo nhng chiu hng khc nhau trong nhng khong thi gian khc nhau.
ng thi, bn hy lu thm mt im na. Bi vit ny ch cp n vic a dng ha trong phm vi danh mc u t c phiu ca bn. Bn thn mt danh mc u t hon chnh ca mt c nhn cng nn c s a dng ha gia cc loi ti sn khc nhau. iu c ngha l bn phi tnh ton v c s phn b ngun vn theo t l % nht nh vo tri phiu, c phiu, bt ng sn, dng, v cc loi ti sn khc na.
Cc qu tng h
S hu mt qu tng h u t vo 100 cng ty khc nhau khng c ngha l bn ang im a dng ho ti u. Rt nhiu qu tng h ch chuyn vo mt lnh vc nht nh. Vy nn s hu mt qu u t v ngnh vin thng hay chm sc sc khe ng ngha vi vic bn ang a dng ha trong phm vi ngnh . Tuy nhin, v s bin ng gi c ca cc c phiu trong cng mt ngnh c s lin h kh mt thit vi nhau, vic u t vo mt qu tng h nh va ni s khng em li cho bn mc a dng ha nh bn c th c c khi u t cho nhiu ngnh, nhiu lnh vc khc nhau. Cc qu u t cn i c kh nng ngn nga ri ro tt hn mt qu tng h ch chuyn v mt mng nht nh bi h s hu 100 c phiu hoc hn th na ca cc cng ty trn khp th trng.
Tuy vy, hhiu nh u t ca cc qu tng h cng tng phi i mt vi hu qu ca vic a dng ha qu mc. Mt s qu, c bit l cc qu ln, c qu nhiu ti sn (v d qu nhiu tin mt cho vic u t), th nn h phi u t vo hng trm c phiu. Ni cch khc, chnh bn - nh u t vo qu tng h - ang nm gi hng trm c phiu . Trong mt vi trng hp, vic s hu qu nhiu c phiu nh th ny khin vic qu tng h i trc v thu li nhun cao hn mc trung bnh ca cc hn th biu l iu gn nh khng th. Trong khi , y li chnh l l do then cht khin bn u t vo mt tng h v chp nhn tr cho gim c qu mt khon ph qun l.
C th ly Fidelity Magellan, mt qu tng h i vo sch v vi tn tui ca mt huyn thoi trong lng u t chng khon - Peter Lynch. Trong vng t nm 1990 n 2004, ti sn ca qu ny tng ln con s 60 t . Chng ta chc chn s khng th tip tc coi Fidelity Magellan ch l mt qu ch s na. Nhng chng ta s cn phi suy ngh v bn khon rt nhiu vi cu hi ti sao mt qu u t c quy m ln n th vn c th "vt mt" ch s S&P 500 v tc sinh li.
Li kt
a dng ha ging nh mt cy kem: Hu ht tt c mi ngi u ng rng c a dng ha v kem l nhng th "tuyt vi". iu khng c ngha l bn c th tiu ha qu nhiu ci tt. n qu nhiu kem s ch khin bn au bng m thi.
kin c nht tr nhiu nht hin nay: Mt danh mc phn b cn i vi khong 20 c phiu s thc hin c mt cch hiu qu nht chc nng a dng ha, chng li ri ro. Chng ti xin c dng y vi cu ni ni ting ca Warren Buffett: "a dng ha quy m ln ch cn thit vi nhng nh u t khng hiu h ang lm ci g!"
Diversification (marketing strategy) From Wikipedia, the free encyclopedia Jump to: navigation, search
This article includes a list of references, but its sources remain unclear because it has insufficient inline citations. Please help to improve this article by introducing more precise citations. (December 2010) Diversification is a form of corporate strategy for a company. It seeks to increase profitability through greater sales volume obtained from new products and new markets. Diversification can occur either at the business unit level or at the corporate level. At the business unit level, it is most likely to expand into a new segment of an industry that the business is already in. At the corporate level, it is generally very interesting [clarification needed] entering a promising business outside of the scope of the existing business unit. Diversification is part of the four main growth strategies defined by the Product/Market Ansoff matrix [1] :
Ansoff pointed out that a diversification strategy stands apart from the other three strategies. The first three strategies are usually pursued with the same technical, financial, and merchandising resources used for the original product line, whereas diversification usually requires a company to acquire new skills, new techniques and new facilities. Note: The notion of diversification depends on the subjective interpretation of new market and new product, which should reflect the perceptions of customers rather than managers. Indeed, products tend to create or stimulate new markets; new markets promote product innovation. Contents 1 The different types of diversification strategies o 1.1 Concentric diversification o 1.2 Horizontal diversification o 1.3 When Horizontal diversification is desirable? 1.3.1 Another interpretation o 1.4 Conglomerate diversification (or lateral diversification) 2 Goal of diversification 3 Risks 4 See also 5 References The different types of diversification strategies The strategies of diversification can include internal development of new products or markets, acquisition of a firm, alliance with a complementary company, licensing of new technologies, and distributing or importing a products line manufactured by another firm. Generally, the final strategy involves a combination of these options. This combination is determined in function of available opportunities and consistency with the objectives and the resources of the company. There are three types of diversification: concentric, horizontal, and conglomerate. Concentric diversification This means that there is a technological similarity between the industries, which means that the firm is able to leverage its technical know-how to gain some advantage. For example, a company that manufactures industrial adhesives might decide to diversify into adhesives to be sold via retailers. The technology would be the same but the marketing effort would need to change. It also seems to increase its market share to launch a new product that helps the particular company to earn profit. For instance, the addition of tomato ketchup and sauce to the existing "Maggi" brand processed items of Food Specialities Ltd. is an example of technological-related concentric diversification. The company could seek new products that have technological or marketing synergies with existi ng product lines appealing to a new group of customers.This also helps the company to tap that part of the market which remains untapped, and which presents an opportunity to earn profits. Horizontal diversification The company adds new products or services that are often technologically or commercially unrelated to current products but that may appeal to current customers. In a competitive environment, this form of diversification is desirable if the present customers are loyal to the current products and if the new products have a good quality and are well promoted and priced. Moreover, the new products are marketed to the same economic environment as the existing products, which may lead to rigidity and instability. In other words, this strategy tends to increase the firm's dependence on certain market segments. For example, a company that was making notebooks earlier may also enter the pen market with its new product. When Horizontal diversification is desirable? Horizontal diversification is desirable if the present customers are loyal to the current products and if the new products have a good quality and are well promoted and priced. Moreover, the new products are marketed to the same economic environment as the existing products, which may lead to rigidity and instability. Another interpretation Horizontal integration occurs when a firm enters a new business (either related or unrelated) at the same stage of production as its current operations. For example, Avon's move to market jewelry through its door-to-door sales force involved marketing new products through existing channels of distribution. An alternative form of that Avon has also undertaken is selling its products by mail order (e.g., clothing, plastic products) and through retail stores (e.g.,Tiffany's). In both cases, Avon is still at the retail stage of the production process. Conglomerate diversification (or lateral diversification) Main article: Conglomerate (company) The company markets new products or services that have no technological or commercial synergies with current products but that may appeal to new groups of customers. The conglomerate diversification has very little relationship with the firm's current business. Therefore, the main reasons of adopting such a strategy are first to improve the profitability and the flexibility of the company, and second to get a better reception in capital markets as the company gets bigger. Even if this strategy is very risky, it could also, if successful, provide increased growth and profitability. Goal of diversification According to Calori and Harvatopoulos (1988), there are two dimensions of rationale for diversification. The first one relates to the nature of the strategic objective: Diversification may be defensive or offensive. Defensive reasons may be spreading the risk of market contraction, or being forced to diversify when current product or current market orientation seems to provide no further opportunities for growth. Offensive reasons may be conquering new positions, taking opportunities that promise greater profitability than expansion opportunities, or using retained cash that exceeds total expansion needs. The second dimension involves the expected outcomes of diversification: Management may expect great economic value (growth, profitability) or first and foremost great coherence and complementary to their current activities (exploitation of know-how, more efficient use of available resources and capacities). In addition, companies may also explore diversification just to get a valuable comparison between this strategy and expansion. Risks Diversification is the riskiest of the four strategies presented in the Ansoff matrix and requires the most careful investigation. Going into an unknown market with an unfamiliar product offering means a lack of experience in the new skills and techniques required. Therefore, the company puts itself in a great uncertainty. Moreover, diversification might necessitate significant expanding of human and financial resources, which may detract focus, commitment, and sustained investments in the core industries. Therefore, a firm should choose this option only when the current product or current market orientation does not offer further opportunities for growth. In order to measure the chances of success, different tests can be done [2] : The attractiveness test: the industry that has been chosen has to be either attractive or capable of being made attractive. The cost-of-entry test: the cost of entry must not capitalize all future profits. The better-off test: the new unit must either gain competitive advantage from its link with the corporation or vice versa. Because of the high risks explained above, many companies attempting to diversify have led to failure. However, there are a few good examples of successful diversification: Virgin Group moved from music production to travel and mobile phones Walt Disney moved from producing animated movies to theme parks and vacation properties Canon diversified from a camera-making company into producing an entirely new range of office equipment.