Digital diversification

Paolo Aversa; Francesca Hueller

doi:10.4337/9781800378902.00007

Digital diversification

Paolo Aversa, Francesca Hueller

Strategy, Intl Mgt & Entrepreneurship

Research output: Chapter in Book/Report/Conference proceeding › Chapter › peer-review

Abstract

In this work, we integrate the traditional literature on corporate strategy with more recent literature on digital in business and strategy research, to examine new mechanisms and drivers offered by digital diversification. This chapter thus offers various contributions: First, we advance a definition and conceptualization of digital diversification and compare it to traditional (non-digital) diversification. In doing this, we explore how digital diversification changes the traditional cost-benefit drivers in traditional diversification, and how the relationship between relatedness and performance shifts from a classic inverted U-shape curve in traditional diversification to an S-shaped curve in digital diversification, which increasingly favors less related diversification. Second, we characterize digital diversification across two key dimensions: locus (i.e., supply-side vs demand-side); and type (i.e., product vs business model), which we investigate by pointing to opportunities for firm growth. Finally, we present a series of promising yet underdeveloped areas for future investigation, and we advance an agenda to foster our understanding of digital diversification for both research and practice.

Original language	English
Title of host publication	Research Handbook on Digital Strategy
Editors	Carmelo Cennamo, Giovanni Battista Dagnino, Feng Zhu
Publisher	Edward Elgar Publishing Limited, Cheltenham
Chapter	1
Pages	18-42
ISBN (Electronic)	9781800378902
ISBN (Print)	9781800378896
DOIs	https://doi.org/10.4337/9781800378902.00007
Publication status	Published - 18 May 2023

Publication series

Name	Research Handbooks in Business and Management
Publisher	Edward Elgar Publishing

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10.4337/9781800378902.00007

Cite this

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title = "Digital diversification",

abstract = "In this work, we integrate the traditional literature on corporate strategy with more recent literature on digital in business and strategy research, to examine new mechanisms and drivers offered by digital diversification. This chapter thus offers various contributions: First, we advance a definition and conceptualization of digital diversification and compare it to traditional (non-digital) diversification. In doing this, we explore how digital diversification changes the traditional cost-benefit drivers in traditional diversification, and how the relationship between relatedness and performance shifts from a classic inverted U-shape curve in traditional diversification to an S-shaped curve in digital diversification, which increasingly favors less related diversification. Second, we characterize digital diversification across two key dimensions: locus (i.e., supply-side vs demand-side); and type (i.e., product vs business model), which we investigate by pointing to opportunities for firm growth. Finally, we present a series of promising yet underdeveloped areas for future investigation, and we advance an agenda to foster our understanding of digital diversification for both research and practice.",

author = "Paolo Aversa and Francesca Hueller",

year = "2023",

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doi = "10.4337/9781800378902.00007",

language = "English",

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series = "Research Handbooks in Business and Management",

publisher = "Edward Elgar Publishing Limited, Cheltenham",

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editor = "Carmelo Cennamo and Dagnino, {Giovanni Battista} and Feng Zhu",

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T1 - Digital diversification

AU - Aversa, Paolo

AU - Hueller, Francesca

PY - 2023/5/18

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N2 - In this work, we integrate the traditional literature on corporate strategy with more recent literature on digital in business and strategy research, to examine new mechanisms and drivers offered by digital diversification. This chapter thus offers various contributions: First, we advance a definition and conceptualization of digital diversification and compare it to traditional (non-digital) diversification. In doing this, we explore how digital diversification changes the traditional cost-benefit drivers in traditional diversification, and how the relationship between relatedness and performance shifts from a classic inverted U-shape curve in traditional diversification to an S-shaped curve in digital diversification, which increasingly favors less related diversification. Second, we characterize digital diversification across two key dimensions: locus (i.e., supply-side vs demand-side); and type (i.e., product vs business model), which we investigate by pointing to opportunities for firm growth. Finally, we present a series of promising yet underdeveloped areas for future investigation, and we advance an agenda to foster our understanding of digital diversification for both research and practice.

AB - In this work, we integrate the traditional literature on corporate strategy with more recent literature on digital in business and strategy research, to examine new mechanisms and drivers offered by digital diversification. This chapter thus offers various contributions: First, we advance a definition and conceptualization of digital diversification and compare it to traditional (non-digital) diversification. In doing this, we explore how digital diversification changes the traditional cost-benefit drivers in traditional diversification, and how the relationship between relatedness and performance shifts from a classic inverted U-shape curve in traditional diversification to an S-shaped curve in digital diversification, which increasingly favors less related diversification. Second, we characterize digital diversification across two key dimensions: locus (i.e., supply-side vs demand-side); and type (i.e., product vs business model), which we investigate by pointing to opportunities for firm growth. Finally, we present a series of promising yet underdeveloped areas for future investigation, and we advance an agenda to foster our understanding of digital diversification for both research and practice.

U2 - 10.4337/9781800378902.00007

DO - 10.4337/9781800378902.00007

M3 - Chapter

SN - 9781800378896

T3 - Research Handbooks in Business and Management

SP - 18

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BT - Research Handbook on Digital Strategy

A2 - Cennamo, Carmelo

A2 - Dagnino, Giovanni Battista

A2 - Zhu, Feng

PB - Edward Elgar Publishing Limited, Cheltenham

ER -

Digital diversification

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