Rosia Bay Ltd

Diversification is about building new products, exploring new markets, and taking new risks. It can present significant opportunity to enable companies to continue to grow. For example, it can pay to broaden your company’s horizons and pursue new opportunities – no matter how confident you may be in your existing offerings. The cost of ignoring this can be severe especially for sectors where technology is driving change e.g. the demise of Thomas Cook. How can past events help us to understand if this may present an opportunity for growth? Essentially, diversification can be highly lucrative but also can be incredibly risky as can be seen by the following examples of Virgin and Tesco. To understand the way in which Richard Branson has built the Virgin empire goes at the heart of understanding diversification – and its successes and failures. Consider a thriving music industry mogul that suddenly wants to diversify into the airline business. From this base he has dabbled with forays into...