Measuring the related diversification of enterprises


Measuring of the related diversification of enterprises requires the determining of its quantitative and qualitative aspects, reflecting the related and unrelated diversification. A large number of methods for quantitative measuring of unrelated diversification, allowing us to determine its level rather accurately and objectively have been offered. This can be achieved because this measurement is based on the objectively determined quantities, including the number of the areas of activities and the variation of the production volumes among them. The situation is different with the related diversification measurement. The main problem in this area is associated with the method of determining the strength of the relationship between the new products and markets and the existing ones. The commonly used methods of measurement are too subjective and inaccurate because they are based only on the discrete-category evaluation. The concept of the suggested quantitative measure of the related diversification is based on determination of the comparability of production programme’s product-market combinations with the existing product-market combinations and their integration into one criterion.

Keyword : diversification of enterprise activities, the related diversification measurement

How to Cite
Ginevičius, R. (2012). Measuring the related diversification of enterprises. Business: Theory and Practice, 13(2), 150-159.
Published in Issue
Jun 22, 2012
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