| Abstract: | A new approach to corporate development activities in multi-divisional companies is the use of resource allocation models such as that briefly described by the authors in their introduction. The basic assumption of the model, which is the existence of a strong relationship between market share and profitability as a result of the experience effect, is still a subject of controversy.The article is therefore devoted to an analysis of this relationship which is verified for 18 different Strategic Product Centres of a multinational company operating in the field of high-precision engineering. Further investigations made on specific product lines show an exact relation allowing a quantification of the effects of strategic decisions. |
