Diversification

Cobbler, stick to your last! The old saying contains sound advice. The fewer types of activities a business has, the easier it is to manage. Simplicity contributes to clarity and clear understanding. People clearly understand the task and can assess their contribution to the overall results of the company, which allows them to concentrate their efforts. Expectations become certain, and results are easy to evaluate. The simpler the business, the less likely it is to make a mistake. Conversely, the more complex the business, the harder it is to identify the weak link in the chain and take the necessary measures. Moreover, the more complex the business, the more levels of management, organizational formalities and procedures, meetings, and delays in implementing decisions there are. There are two ways to avoid the described shortcomings. A highly diversified enterprise can maintain the fundamental unity of activities and technologies, products, and product lines if they are united by a common market. A highly diversified enterprise can also maintain the fundamental unity of activities and technologies, products, and product lines if they are united by a common technology. TIP OF THE DAY: Analyze your company's activities. Are they focused on a narrow range of issues or a variety? In the latter case, develop a plan to achieve unity based on a common market or technology.