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Corporate strategy (Anand, HBR module note) (Sources of value creation…

- - - - Cited reporting errors in data reported in Compustat data
      - Selection bias also believed to exist
      - Certain studies found that diversification results when firms suffer decline in core business (i.e. already at a discount before diversify)
- - - - Cost side economies
      - Revenue side economies (e.g. one stop shopping if all bundled together
      - Can you share activities or resources?
      - How can you value relatedness
      - Identify core competencies of the business and what are distinctive about them
  - - - Absence of markets
      - Relationship specific investments
      - Coordination of efforts
      - Resolve double marginalisation
        
        Both upstream and downstream enjoys monopoly power - customers get double markup
  - - - Incentives to work together (rather than reward individual growth)
      - Do culture clashes exist?
      - How to organise - geographical vs. product