Another New Buzzword: Adjacencies

2 June 2006 at 11:57 am Leave a comment

| Peter Klein |

From today's WSJ feature on Time-Warner we learn that "synergies" are out. Now it's all about "adjacencies."

In deal after deal, [Time-Warner] executives promised to create a well-oiled, "vertically integrated" profit machine. Books and magazines and music would feed television and movie and Internet empires, each strengthening the others. But this vision never panned out. . . . Now divisions are encouraged to cooperate only if they can't get a better deal on the open market. The company's units are expected to be "best in class" — corporate-speak for being an industry leader — and those that fall short are threatened with being sold.

A return to the 1960s and "management by the numbers"? (We do know, for instance, that the conglomerates weren't so bad after all — see this, this, and this.)

Who will write the first RBV paper on adjacencies?

Entry filed under: - Klein -, Management Theory, Strategic Management, Theory of the Firm.

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