Study On The Diversified Operations Strategy Of Wuhan Iron And Steel Corporation(WISCO)

With the integration of domestic and overseas markets,globalization of world economy is going at a faster and faster pace. Chinese enterprises have been feeling the impact from the international competition all the time. Faced with severe challenges with the ever approaching of China's entry into WTO,it has turned out to be a vital problem for the iron & steel makers in China to challenge the competition with international steel giants and strive for their survival and sustainable development.Based upon the theory of industrial cycle,this paper studies the cases of diversified operation in giant enterprises (especially steel enterprises) in the developed western countries. Following the general trend of diversified operation in modem enterprises,the paper analyses in theory and practice the possibility and inevitability of steel enterprises developing their non-steel industry,pointing out,"It's inevitable for the Chinese steel enterprises to adapt themselves to the strategic principle of developing non-steel industry by means of diversified operation so as to reduce risks and increase competitiveness.This paper emphasizes the present being,including the potential,the strength,the achievements and the existing problems of WISCO's non-steel industry. It evaluates the operation of WISCO's non-steel industry by analyzing the proportion of non-steel industry in the corporation's general income,the market share,the profit ration of capital and the profitability. Based on this,the paper explicitly puts forward a directive strategy for WISCO's diversified operations as follows:Backed up by WISCO while tackling the broadest market,through reform in managerial and operational mechanism and innovation in technology,and by means of making best use of the State's industrial policies,the capital and advanced technology at home and abroad,and WISCO's available resources,to cultivate and build up the development- and market-oriented,profit- and innovation-driven non-steel pillar industry and make the non-steel industry grow simultaneously with the steel sector,and turn the non-steel industry into new growing points for WISCO.Focusing on the general concept of diversified operation strategy and according to the general principle of diversified operation and theory of target business selection,this paper carries out a detailed description to the development strategy key point of WISCO's non-steel industry and the selection of market target,and make decisive reference suggestions to WISCO's non-steel industry through theoretical analysis,comparative analysis and qualitative analysis.