The influence of market situation on diversification strategy of companies‘ activity

Abstract

Companies' diversification is analyzed in various aspects. It is generally recognized, that, as adaptation to market strategy, which can be both very successful and very unsuccessful, this phenomenon is controversial. There is a practical and scientific problem - to highlight and analyze conditions for successful diversification activity. One of the condition is market situation. The economic crisis has shown that companies which did not assess eventual key changes in market, went to bankrupt, i.e. the ones, which did not provide an alternative for products which are sensitive to shrinking market. It follows, that it is reasonable to examine diversifications dependence on market situation, i.e. to examine influence of developing, shrinking and stable markets to it.