The main difference between the related constrained level of diversification and the related linked level of diversification is: the level of resources and activities shared among the businesses.
In tied affiliates, all component companies are related, while in linked affiliates, only one-to-one relationships are needed. In contrast, the no-alignment strategy has proven to be one of the less effective on average.
Irrelevant Diversification - Diversify into new industries, such as Amazon entering the grocery sector with its purchase of Whole Foods. One of the main benefits of related diversification is the ability to share key resources in different sectors.
A company's key resources and competencies can be used in a new area, which can give the company a competitive advantage over other companies that may not have comparable resources. equivalent.
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