Diversification Study

Learn how innovation can drive your organization’s shareholder value

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Who Should Read?

Anyone who is responsible for the long-term success of their organization should be looking for ways to increase shareholder value and gain and maintain an edge over their competition.

Many executives are concerned that they won't be around to see the benefits of any bold changes they make and end up making safe bets .

By evaluating the performance of Fortune 500 companies based on their ability to diversify their revenue streams, executives can gain insights into how they can future-proff their organizations and drive lasting innovation.

Key Insights

This seems to suggest that stock markets value ongoing innovation efforts early on rather than only valuing long-term outcomes.

Current Lack of Diversification

We found empirical evidence for the innovator’s dilemma as 68% of the companies we analysed did not diversify their revenue.

Diversification Pays Off

We found that companies that diversified their revenue segments vastly outperformed those that did not in terms of total shareholder returns.

Short-Term Impact

We found that the positive impact on stock price development from long-term revenue diversification could already be observed after 3 years.

Impact before Measurability

The impact on the stock price was seen before the impact of the diversification efforts were recorded in annual reports.
Methodologies
  • Market Research
  • Financial Analysis
  • Business Strategy Analysis
  • Data Analytics
  • Innovation Quantification
  • Shareholder Perception Evaluation
  • Competition Analysis

About the Authors

Jan Sedlacek

Founder & Managing Partner
jan@stryber.com

Julian Ritter

Associate Partner
julian@stryber.com

Julius Schöning

Lead Growth Marketer
julius@sparrow-ventures.com

About Stryber

We empower leading organisations to venture into new business and drive growth. We do so by helping them to build an ambidextrous organisation that is both successful in its well-established core and successful at driving growth in new lines of business. At Stryber our track record shows that by establishing the right governance and leveraging corporate assets with our established methods and expertise, any company can build up resilience and succeed in the long run.

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