Diversified Development Strategy Based On The Core Competitiveness Of China Guangdong Nuclear Power Group

Corporate development through diversification has always been a topic of controversy in the theoretical and corporate circles. However,it should be noted that there are no hard and fast rules regarding diversification versus specialization. Diversification and specialization are only different forms of corporate existence. The key lies in whether the corporation possesses the required core competence. Diversification comes from investment portfolio theories,and adoption of the diversification strategy is invariably the result of the strategic transformation on the part of the corporation at a certain stage of development. It constitutes the source and basis for the corporation to maintain its competitive edge,and is deeply rooted within the corporate organization. It is characterized by such features as value-superiority,emulation-proof,inseparability,and effect-flowover,dynamic development etc.Diversification is an idea and model of corporation development. Fostering core competence does not mean corporation only concentrate on operation of a special industry. Based on analysis of the relation between core competence and diversification strategy,we find that their relation is very close. Diversification is based on foster and improvement of core competence,and core competence also extends advantage through diversification.The corporation is an integration of competence,and core competence is sourced from general capabilities of the corporation but rises above them at the same time. It requires constant identification,nurturing,managing and expansion,and must be evaluated and improved upon. The present paper advocates that the evaluation system for the core competence should comprise technical innovation and economic efficiency,overall organizational capability,corporate external relations capability and corporate sustainable development capability with the overall evaluation model adopted to perform qualitative and quantitative analysis on the core competence of the corporation.Based on the above theories and methodologies,and in light of the actual situation facing China Guangdong Nuclear Power Co.ltd(CGNPC) along with the investigations and analysis carried out to date,the associated statistics have beencalculated and defined. The overall situation on the core competence of CGNPC has been confirmed with the 5 core competence constituents verified.This paper builds the relation model of core competence and pole of diversification strategy,and analysis the relation through the curves of supplies and demands of economics. And Product Portfolio Management (PPM) methodology and overall evaluation model are adopted to perform qualitative and quantitative analysis on the diversification strategy based on core competence. The perform analysis on the 8 fields where CGNPC should actively pursue or retreat. CGNPC has embarked on the path of diversification on the strength of its core competence. Such choice has been well thought out and analyzed beforehand. This paper provides a new idea and a new methodology to make choice of diversification strategy based on the core competence through above theory and methodology.