Question

Porsche is expanding rapidly through both related and geographic diversification. Do you consider this business strategy to be successful? Why, or why not? If you consider Porsche’s diversification to be successful, what is the source of Porsche’s success? Corporate Strategy

Answer 1

Porsche is a german automobile manufacture in high performing sports cars,SUV and sedans. The headquaters of Porsche is in stuttgart and it is owned by volkswagen. For many years porsche is focused on differentiation strategy. It changes the competitive scope. While expanding both related and geographic may affect by two ways. First there may not successfull. While expanding geographically it need huge amout of money. Each country have different cost for factory installation. The firm need to invest huge amount of money. Most of the countries are in stage of developing and undeveloped. Porschae cars are high priced so the sales becomes compartively low in those places. it may affect the entire firm. They also provide sport cars, some country doesnt promote these type of cars. Countries like india have sped limit in each road. The customer will think that will purchasing these kind of cars and driving very low speed is waste of money. It will affect the market.Also it requires high market study, resources, investigating. We can think into another way that porscahe is highly capitialised company so they easily diversify in different. when they planned for diversify they can sell huge amount of cars in around the world .It will increases thier business.