It used to be that the buzzword in business was diversifying and conglomeration. Economies of scale were thought to have been achieved with large corporations that produced anything from toothpaste to heavy machinery. Well, unless you’re in South Korea (with the giant Chaebols and all), this is no longer the wise thing to do for businesses. In fact, many companies today are closing down some operations and simply sourcing these out to cheaper countries or other firms with more expertise. Some companies are also taking another approach: spinning off some divisions or departments that they can no longer handle.
Take for instance IBM’s selling its highly-acclaimed ThinkPad brand to Chinese Lenovo, or Japanese electronics firm Sanyo’s partnering with Taiwanese Quanta for LCD TV production, these show us that companies nowadays have become so specialized that there’s no longer a point to doing everything yourself. So if you’re starting a company, better think of your forte and focus on doing what you can do best!