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Poll: In a chaotic environment with high political and culture-war risk, is it better for a business to be vertically or horizontally integrated? Diversified or focused? Those who respond “it depends” will be derisively shame-QTed and blocked
  • Vertical+diversified
    20.5%
  • Horizontal+diversified
    21.1%
  • Vertical+focused
    37.3%
  • Horizontal+focused
    21.1%
512 votesFinal results
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Define "diversified" and "focused"? Chaotic envs can be good for solution provider type companies that focus on diversity of transactional vs. contractual customer relationships.
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Taleb's fragile/robust/anti-fragile framework helps here. Under high uncertainty , you want a portfolio of independent options (horizontal+diversified). Vertical+focused seems most fragile.
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it seems to me that horizontal and diversified allows for the most possible outcomes and since the environment is chaotic moving with ease across domains is better than along any given vertical stack
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My reasoning: Vertical reduces dependancies on others for your value chain. Diversified ensures all eggs aren't in the same basket. Both imp in an uncertain environment. Not horizontal as you depend on even more 3rd parties with lesser control.
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Recruitment agencies that were horizontally diversified survived better in the gfc than those that only played in one niche and had some vertical integration. In fact it's true outside of the gfc as well, as individual industries have ups and downs. Spread the risk.