Question

You have been made CEO of Ferrari, and your explicit objective is to grow the company through diversification (i.e., exploiting new products and markets). What options are immediately available to you? What business-wide considerations will affect your ability to execute your strategy? recoommede word count is 300-400 words

Answer 1

Options and strategy that are available to diversify as a CEO of Ferrari are as follows:

1) Backward integration: Manufacturing parts which are currently being procured from outside and try to enter into a new service line.

2) New products to increase the customer base: Ferrari is currently known for being into a sports and luxury cars. Ferrari as a brand can aim to produce the higher end regular cars (SUV's) to compete with the other brands.

Business wide consideration mentioned above will affect my abilities as follows:

1) Lack of expertise: Diversifying my business into areas where the company is not the market leader and neither have any experiences as such. This issue can be addressed by acquiring the company already into that product lines.

2) New Challenges: The business strategy currently we have for Ferrari may/ may not work for the diversified business. Every business comes with its own strengths and weakness.

3) Market share: Company will have to work harder to increase the market share of diversified businesses to make the investment worthy.