Q:

What is diagonal integration?

A:

Quick Answer

Oxford Reference defines diagonal integration as strategic acquisitions, alliances and information partnerships between companies. The purpose of diagonal integration is to improve access to consumers and achieve economies of scale. These partnerships are characterized by tightly-related, consumer-oriented services.

Know More

Full Answer

The main goal in diagonal integration is to take advantage of possible synergies between companies, thereby increasing profitability and productivity. Companies partnering up via a diagonal integration strategy are typically from different but complementary industries. An example of this strategy is seen with travel agents who offer travel insurance, car rentals, travel planning, ticketing, add-on excursions and other services from business partners.

Learn more about Business Resources

Related Questions

  • Q:

    What is the difference between merger and acquisition?

    A:

    According to AAMS Merger, the distinction between mergers and acquisitions rests in the way the transaction is financed. A merger is characterized by two companies of comparable size deciding to become one entity. In an acquisition, one company buys another seeking a strategic advantage in the marketplace.

    Full Answer >
    Filed Under:
  • Q:

    What security services does Group 4 provide?

    A:

    Group 4's security services include corporate risk and compliance, detainee and prisoner transport, fraud and investigation, security personnel and systems integration services. The clients to which Group 4 provides security services include government agencies, energy and chemical companies, hospitals and healthcare agencies, and institutions of higher education.

    Full Answer >
    Filed Under:
  • Q:

    What are the three integrative strategies used in business?

    A:

    The three integrative strategies used in business are vertical integration, horizontal integration and functional integration. In vertical integration, a company is controlling the upstream and/or downstream elements in their supply stream. Horizontal integration involves a company expanding into or acquiring diversified product lines. Functional integration is a marketing approach in which an interconnected and expanding system of services and products increases customer entry points, participation and brand loyalty.

    Full Answer >
    Filed Under:
  • Q:

    Why do firms undertake mergers and acquisitions?

    A:

    Firms undertake mergers and acquisitions to create larger companies, maximize shareholder value and strengthen the financial position of the company, according to Investopedia. These deals also bolster the purchasing power of the acquiring company.

    Full Answer >
    Filed Under:

Explore