Background Note | HBS Case Collection | April 2005

Strategies of Unrelated Diversification

by Bharat N. Anand and Samhita Patwardhan Jayanti

Abstract

Conglomerates lie at the heart of debates in corporate strategy. They include, perhaps, the best known companies in history--Beatrice Corp., General Electric, ITT, Siemens, and ABB--and at various times over the last few decades have been both admired and vilified as a form of corporate organization. Regardless of the time at which these debates have occurred, they invariably focus on a few common questions, which this note addresses: Why do conglomerates exist? Do they add value to their component businesses? If so, how?

Keywords: Diversification; Business Conglomerates; Corporate Strategy; Value;

Citation:

Anand, Bharat N., and Samhita Patwardhan Jayanti. "Strategies of Unrelated Diversification." Harvard Business School Background Note 705-480, April 2005.