Problems of business diversication

Abstract

This article investigates the issue of diversification as a development strategy, its’ opportunities and problems. There is described the three core business diversification forms – related, unrelated and related-linked diversification. Various methods of measuring diversification given by different authors are compared. Author of the article formulates main problems of earlier proposed diversification measuring techniques: there is no clear classifiers, which separate companies one class from another, this causes only interval, discrete, not continuous measurement; related diversification may not be combined with measures of unrelated diversification; methods of calculation does not take into account current market situation, which is, as studies proved, are closely related.