It has become extremely important for corporations and managers to continuously innovate and think new ways of churning more money. If a firm or a manager fails to innovate and does not come up with new ways of profit extracting, the ideas will eventually become obsolete and the business will stop making any money at all. This is a dangerous sign, and many companies try to continuously update and innovate their business models in order to achieve success in terms of profitability and growth.
Sector analysis is one of the new innovations that are being used by corporations and managers. It is a spin-off from Financialization. Financialization can be described as a process whereby financial markets and organizations dictate the economic policy of a country. In other words, Financialization is process where financial elites dictate the business policies formulation by the government. (Froud et al. 2006)
[...] Special Issue, pp. 5- 14. Brigham, E. & Ehrhardt, M., 2010. Corporate Finance, 5th edn, South-Western College, Chicage. Brue, S. & McConnell, C., 2006. Economics, McGraw-Hills, New York. Clement, J., A'unno, T. & Poyzer, B.L., 1993. Hospital Corporate Restructuring and Financial Performance. Medical Care, vol 31, no. 3, pp. 971-990. Daft, R., 1994. Management, The Dryden Publishing, New York. Froud, J., Sukhdev, J., Leaver, A. & Williams, K., 2006. Financialization and Strategy: Narrative and Numbers, 6th edn, Routledge, New York. [...]
[...] (Froud et al. 2006) Sector matrix defines the activity horizon of a company. As a result, it is sometimes also called “activity matrix”. Sector matrix is nothing but a representation of overall finances or revenues of a company coming into the business from its various areas of operations. The matrix is based on modern business and financial thinking. The old way of thinking about the supply was to consider it the function of technology and product. The supply can only be increased if there are significant improvements in the production technology. [...]
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