Business Model Diversification in Multi-business Firms: Performance Implications from Business Model Diversification Scope

Multi-business firms can employ the same business models in multiple product markets. Simultaneously, they can employ multiple business models in the same product market. Yet, performance implications from this have been neglected so far. This study draws two dimensions of business model diversification in multi-business firms to examine the performance implications from employing multiple business models in multiple product markets: (1) business model-specific product market diversification scope and (2) product market-specific business model diversification scope. Taking an organizational learning perspective, we suggest that business model diversification enables multi-business firms to gain and exploit experiences across various contexts, positively moderating their business units’ performance.