Managers can create value for their firm through diversification by expanding resources and opportunities, building connections, increasing sales and revenue, and attracting more investors. However, diversification efforts often fail due to issues like cultural differences between merging companies, lack of attention to factors that could affect integration, and not considering future challenges. Strategic alliances can be successful if both companies share the same goals and culture, but challenges include differences in rules and adjustment difficulties that must be overcome for long-term compatibility. Recent large mergers like Disney/Fox and Amazon/Whole Foods were likely successful due to complementary strengths and goals, but success depends on effectively leveraging each company's advantages.

1. ANALYSIS
Activity 7
1. What are some of the reasons that many diversification efforts fail to achieve
desired outcomes?
The reasons that many diversification efforts fail to achieve desired
outcomes is because of merger incompatibility, one of the factor need to consider.
They did not give proper attention to the things that will affect the decision they’re
going to make. Whereas, the aspects why it becomes unsuccessful is because of
having the companies involve don’t share the same culture, which results to affects
the plan why did they merge. It’s quite motivating, the things that the company you
decided to merge with, will benefitted your firm and vice versa. Well at first it’s
exciting to collaborate, because the connections they have will help the company
to be known as well, shared its advantages and many more. Another reason why
it fails to achieve its desired outcomes, is because of not considering the
components that may affects the future while the process is just about to start.
Like, adjustments did not handle well, sometimes it might oversee its importance,
and how it affects the progress that they're going to put together. Knowing
everything in all sides that has the possibilities to fail, must take time to scrutinize
and analyze, before doing such things that will cause unpleasant result on the
decision the companies will going to agree on. This is very important, in a way that
it serves to be the bridge if it will be going to fail or succeed of both firm's
diversifications. Business is a risk where we should be ready before entering in
this world. The battle of chances to fail or win. It is hard, therefore before doing
things not sure of, start to collect feasible information that may help to pick the right
action to apply. In business, percentage to win matters, if it’s too low, make a way
to increase, change, improve, apply and know what is lacking of, and need to a lot
time for a better result. In addition, one of the reason to add is the barrier comes
in between, especially if the merge that will be going to perform has a different
nationality. The culture they have is different from the other firm. It might create a
misunderstanding and different perception to each company, this may start to
construct an unnecessary outcome while achieving their desired result they work
for.
2. Discuss how managers can create value for their firm through diversification
efforts.
Managers can create value for their firm, through diversification effort. They
count it as a help to give the firm a new opportunity to treasure. Where this way,

2. their resources will expand, which is very important to the firm. Diversification can
build enough connections for the organization, the advantages of this action
provided will extend and reflect to the firms’ performance. Like generating sales,
revenue and attract more investors to invest in the said business. Some of the way
to value the firm is through diversification, because it is one of the means to show
its usefulness towards the business. The firm becomes better, information/-
suggestion will broaden, potential losses might reduce, offers more option and
many more. As what in the quote says that “Two is better than one”. Merging is a
reasonable decision to enact, the ability to acquire skills would be greater,
ownership becomes transferable and liability of stockholders will be limited. One
means to value the firm is to assure and know how this will be going to work
according to what it should be. The firm becomes plain if it only has one color, but
by mixing the right color to this corporation it will show a different view to flourish.
Valuing firm through diversification is like building house, in order to have good
foundation architect and engineer must collaborate to shared their knowledge to
build the house firmly and last. Just like what business men and women does or
even managers, they manage to have a reliable investor to let them both soar high
and benefitted together by jointly allocating what the other company have which
would be a great help, if it succeeds.
3. In recent years there has been a rash of corporate downsizing and layoffs. Do
you feel that such actions raise ethical considerations? Why or why not?
For me, I think no I don't feel that such actions raise ethical considerations.
It's quite drastic to say but I guess it is reasonable because business must be taken
seriously, rash of corporate and layoffs is one of the way business experts doing
for the sake as well of the company. The reputation and performance of the
organization will be going to reflect on the employee, that's why downsizing has
been executed to take care also the image of the company. As per what the saying
says that "first impression last" if there's an instance that the employee commits
terrible mistakes, the trust as well of the corporation will be affected, they might
assume that, how can they trust the firm if the employees act like that. Employees
are part of the organization that's why they should make their job regards on what
they promise to do. But this kind of thing is normal if I'm not mistaken. In a business
industry where competition is given, of course, competitive employees as well is a
must.

3. 4. What were some of the largest mergers and acquisitions over the last two years?
What was the rationale for these actions? Do you think they will be successful?
Explain.
Disney/21st Century Fox
Disney is one of the fantastic and extraordinary international entertainment
and media enterprises where it operates. The rationale for these action as per this
decision has been made is they shared the same goal. The objective to create
larger movies, television and sports. More importantly, the merge wants to
compete with the success of Netflix and Amazon, which is known to be successful
in this age. That’s why they are continuously studying their actions and things to
do before it releases, they became more careful and focus to its upcoming projects
together. In that case, I think they will become successful, because I can feel that
both companies have a good tandem, as we all know that both companies have a
great impact into the viewers’ point of view, it can be their edge to succeed. Disney
known to be as the most successful and powerful entertainment firms nationwide.
After the acquisition with Fox, Disney became the largest media powerhouse in
the world. It’s a great start to both company, the result of their diversification looks
good in their first two consecutive years. A conclusion where I can say that it’s
going to be successful on its perfect time.
Amazon/Whole Foods Market
Amazon is known to be as the world’s largest online marketplace platform.
and biggest internet company in terms of its revenue. While Whole Foods Market
is the largest American multinational natural foods, and organic foods grocery
chain. It’s a great acquisition where both companies have a huge covered
connection that will take as an advantage to facilitate the crowd and gain more
consumers together. They’re both trusted and tested companies. It can be a great
decisionfor both side, given that amazons’ strength is online, Whole Foods Market
will expand their connections and will gain more customer online. Same goes with
Amazon where it’s going to have a section in the platform of grocery packages and
natural foods on it. I think it will be successful in time, because every company’s
advantages benefitted both party and uses those in a smart and effective way.
5. Discuss some of the challenges that managers must overcome in making
strategic alliances successful. What are some strategic alliances with which you
are familiar? Were they successful or not? Explain.
Some of the challenges that managers must overcome in making strategic
alliances successful is, it must not focus in one aspect only and its objective. When

4. deciding to make a strategic alliance all the factors must consider before, during
and after they decide to do it. Its process to deal with the other company is quite
challenging, like for instance, they do have different rules there from your
company, of course adjustment must be employ to avoid some unnecessary
happenings to happen. But if it becomes okay I can say that it is a good sign,
sometimes the reason mentioned becomes the cause why merge company fails.
One of the root of failure is it doesn’t share the same goal, it’s like they are together
but tracking separated ways. For instance, you have a business and you want to
merge with a Japanese company. Everything is great at first but when time passes
by, problems are continuously popping around until it becomes unhealthy. Getting
to know more about its possibilities to fail, misunderstood, and succeed will help
both company to work accordingly and gain enough percentage to be compatible
and last. Problems sometimes occur in the middle of the process therefore,
everything matters must consider especially culture differences between the
company, in order to keep things flow smoothly as most of them expected
The strategic alliances I am familiar with is Facebook and Instagram, the
two most influential social media platforms. Their alliance becomes successful.
People who use Facebook patronize more Instagram, because it is now
connected, where you're not going to create an account in IG because you’re just
going to connect it on Facebook, then you have it. They make the creation of
Instagram account easy and convenient. As a proof to that, when the company are
not merging yet the user of Instagram is about 30 million users. But now, it is
continuously increasing and now, there's a 1 billion active users nationwide. Same
goes with Facebook where people consider having two accounts connectedly with
the consumers desired applications.
6. Use the Internet and select a company that has recently undertaken
diversification into new product markets. What do you feel were some of the
reasons for this diversification (e.g., leveraging core competencies, sharing
infrastructures)? Explain.
“The Walt Disney Company”
The Walt Disney company expanded an international media enterprise. A
worldwide entertainment company that operates in four business segments; Media
Networks, Parks Experiences and Products, Studio Entertainment, and Direct-To-
Consumer and International. Some of the diverse products in which Disney
manages such as parks and resorts (Walt Disney World Resort, Disneyland Paris,

5. themed hotels etc.), Media Networks (cable, television and radio programs), Studio
Entertainment (motion pictures, direct-to-video content, musical recordings, and
stage plays) and Consumer Products & Interactive Media (Books, magazines,
comic books, video games, merchandise, and online video content). Through that,
market products will reach lot of viewers and increase the possibility to be known
throughout the globe. I think the reason for this diversification is it wants to give
different flavor for its upcoming projects they're going to make as one, but their
signature and essence are still present. Thus, it creates a wide variety on the
viewers’ view where they're patronizing different genres, but Disney’s' harmony is
still present. Its competency to compete with the other firm through that can serves
as a huge help to increase its revenues and generate more viewers, because of
its new and fresh theme to introduce. Having it plain, only people who like those
will like it, but if it has various spice and brands’ identity is still there, the possibility
to create leak on the projects to huge marketplace can conclude as a success.