Thanks for your comments, how will you rate it?
Here is another one. This time it is analysis of an issue.
“Since no business can be all things at once, companies that specialize in one product or service are more efficient than those that offer a diverse product mix.”
From your perspective, how accurate is the above statement? Support your position with reasons and/or examples from your own experience, observations, or reading.
This issue is complex and different people may have different opinions about the same. Well, it might be particularly true for start ups to focus on a product or service rather than diverse product mix in order to be efficient it necessary need not be true for all other established companies. We need to understand that efficiency means maximum utilization of resources to achieve company's objectives. With this basic understanding, I disagree that a businesses that specialize in one product or service are more efficient than those that offer as diverse product mix since it is possible to be efficient even with diverse product mix and it also depends not the target market as well as the type of product or service that is being offered hence. A generalization such as this is not justified.
First, if we assume that efficiency in simple terms is ratio of revenue to resources, it is true that a company offers more than a product or service it may need more resources but at the same time revenue of a company will increase since it offers more than a product; therefore a company can be more efficient that the a company that offers just a service or a product. One of the best examples could be comparison between Google and Facebook
. Google offers a diverse service mix, whereas Facebook
offers just social networking service. But, it is not true that Facebook
is more efficient than Google.
Second, this issue also depends on the choice of a target market for a product or service. If a company offers more than a service for the same target market, efficient will be low since market share would be divided among those services and resources will increase. Example could be sat Facebook
starts another social networking site, I'm sure that they will not be as efficient as they are now. They will be creating competition for their own service and thereby reducing market share and eventually efficiency. But if Facebook
offers e-mail services, I am sure their efficiency will improve.
Some might agree that it will be efficient to offer a service or a product rather than a diverse product mix. It would not be true since divert product mix would definitely capture more revenue than a product ore service brings. Resources spend initially might be higher to offer a new service but they would be not be comparable to revenue it can generate.
In conclusion, I disagree that companies that specialize in one product or service are more efficient than those that offer a diverse product mix. As sighted above, the companies that offer diverse product mix are more likely to be efficient than those that offer a product or service.