The Complementarity of Cluster Analysis and Network Analysis to Map the Structure of Capabilities in the Global Information Sector

This paper introduces a new methodology for measurement of the capabilities of multinational enterprises (MNEs). The analysis is based on a comprehensive database of the diversification portfolio of the largest firms in the Global Information Sector. The paper looks at the bundle of capabilities and cross-industry diversification of global firms in all sectors that contribute to information creation and dissemination, such as: telecommunications, publishing, computer software and hardware, information services and data processing, radio and television broadcasting, and motion pictures. We use US SIC codes declared by firms as evidence of the portfolio of their capabilities, and apply analytical techniques such as hierarchical cluster analysis and network analysis. We identify 23 clusters, or strategic business groups of firms with similar diversification portfolio. The links across these groups show the convergence that is taking place across industries, and the synergies that emerge from combined capabilities in multiple industries. We identify the complementarity between core and peripheral competences for each strategic business group