After reading this article you will learn about external and internal financial analysis of a firm. External Analysis: Financial analysis performed by creditors of the firm, shareholders or investment analysis is called External Analysis. It makes use of existing financial statements and involves limited access to the confidential information of the firm. Internal Analysis: Financial analysis performed by the financial [...]
In this article we will discuss about the diversification of firms. When considering 'synergy', it is important to note that businesses can be similar with respect to some resources while being different in terms of others. The key to successful diversification is to group together those businesses which, despite their differences, have at least one common resources need. Such businesses [...]
The evidence of researches so far made provides two major approaches to achieving competitive advantage:- 1. Market share approach, and 2. Synergy approach. Major sources of competitive advantage for each of these approaches are indicated in the diagrams next— Market Share Approach: Let us now briefly examine the sources and arguments concerning market share and implications for strategy: 1. Scale [...]