Research On The Correalationship Between Diversifying,Refocusing And Firm Performance:the Perspective Of Dynamic Alignment

In the environment of the dynamic competition, business scope and species that firm choose was not static, but are changing along with the external environment (including industrial characteristics) and its resources condition, a firm will be faced with three choices:diversifying, refocusing and remains t, in the development process the corporate may experience a cycle change dynamic process from specialization to diversifying, again from diversified to refocusing. At the same time, the firm business option will also affect the firm environment and resources, may strengthen or weaken the firm core ability,.diversifying and refocusing strategy transformation is one of the important factors that forms the firm core competence. Previously related research literature use mostly the static or isolated research method for diversification (refocusing) and their value effect, research conclusion show phenomenon of coexistence " diversification discount paradox " and " refocusing premium confusion"。These static, split strategic research method have been questioned by many scholars, in fact these two strategies are connected to each other, and dynamic interaction. Base on the view of dynamic aglinment, this paper analyse the intrinsic relationship among resources-capability-environment-strategic. First, this paper review research literature on diversification and refocusing, analysising diversity and refocusing research background and research significance; Secondly, the paper describes the evolution and development of the enterprise dynamic ability theory and the strategic alignment views, analyzeing the connotation of resource, competence and dynamic capabilities, putting forward the dynamic alignment point of view; Thirdly, based on dynamic alignment point of view, the paper presents diversity and refocusing strategy analysis frame of dynamic selection model from the dynamic alignment of resource, ability, environment and strategic perspective.And then analyzeing influence on diversification and refocusing strategy choice caused by four factor of the entrepreneurial spirit, industry life cycle, core resources and the perfect degree of the market system, the research shows that the essence of diversity and refocusing dynamic turnaround is the dynamic ability of reengineering and remodeling, in the process of enterprise growth characterized by diversity and refocusing alternating cycle. Fourthly, building dynamic model on the premise of value maximization the paper analysis the inner motivation of diversity and refocusing dynamic change, specific include:(1) diversity and refocusing dynamic selection model is constructed.research shows there is critical curve in dynamic selected process between diversifying and refocusing, and critical curve will fluctuation change as technology innovation and industry competition, and due to limited rational corporate leadership, diversitying and refocusing in dynamic environment is bound to show the interaction of cyclic fluctuation state; Thus, diversity or refocusing strategy is associated with each other, interaction, this isolation and segmentation methods will generate endogenous deviation;(2) diversifying and refocusing value model is constructed, the model analysis shows that diversity or refocusing operation performance is affected by the matching quality of strategy and core resources, diversification is superior to specialization when matching the quality of medium, specialization is superior to diversification when matching the highest quality, and liquidation transformation is the best choice when matching the worst quality is the enterprise;Fifthly, on the base of the above theory and model analysis, with the data of listed companies in our country as the research sample, the paper verify empirically diversification or refocusing strategy and corporate performance correlation effect, the content is as follows:(1) calculateing growth opportunities and corporate performance indicators using principal component analysis method,the paper verify empirically the nonlinear range effect of diversification and corporate performance using panel threshold model;(2) building a simultaneous equations model (SEM), the paper test empirically correlation effect among government intervention, diversification and corporate performance appliying of three stage least square (3SLS);(3) the paper test empirically correlation effect of the refocusing and corporate performance;(4) the company characteristics, industry environment and macro environment factors as control variables, integrateing diversifying and refocusing as an unified model, the excess value improved as company’s performance level, the paper test empirically diversifying and refocusing selection influence factors and dynamic process using the multinomial logit model;, controlling simultaneous bias applying instrumental variable method, the paper test empirically correlation effect of diversifying, refocusing corporate performance.Empirical conclusions as follows:(1) diversifying and refocusing are two normalization and complement each other’s business strategy, not essentially different strategy, are the strategy of tools or strategy means winning the competitive advantage of. diversification and refocusing,(2) diversifying and refocusing all could lead to performance of increaseing or reduceing, the key is not to realize the optimization matching condition of environment-resources-strategy; Due to the environment (technology impact, industrial competition) change and leadership of the limited ability, this will lead to dynamic fluctuation process which diversifying and refocusing chang alternate conversion.(3) the relationship between diversification and corporate performance is not a simple linear, there exist significant double threshold effect, that means view of diversification discount is not always right. it is illustrated that diversified behavior in China listed companies has obvious industrial drive characteristics, industrial expansion gap is one of the main reasons for the diversified motivations and performance differences;(4) diversifying and refocusing strategy impact by enterprise characteristics, industry characteristics and the macro environment. Generally speaking, corporate profitability and growth have negative relation with diversifying, and industry profitability and growth have positive relation with diversification; industry competitive have positive relation with refocusing; Corporate governance significantly affect strategic choice, degree of marketization, the overall economic environment, such as the GDP growth rate is associated with both strategies are significant relation;(5) dynamic selection progress of diversifying and refocusing is to arm for not only firm performance, but rather grabbing future growth opportunities through business integration for enterprise, reshapeing for firm core competence, is dynamic process of the realization of dynamic core ability, the ultimate goal is to win the enterprise sustainable competitive advantage.