The Impact of Technological Relatedness and Customer Relatedness on Firm Performance

Relatedness -- the extent of synergy among a firm’s portfolio of business – is a key construct in strategic management. For a diversified firm, higher relatedness is theoretically predicted to create superior firm performance. Despite recognition that relatedness is a multidimensional construct, most quantitative measures capture only technological relatedness and hence ignore relatedness on the customer side of a firm’s value chain. Moreover,...