Research On The Development Strategy Of ABC Cogeneration Company

ABC Cogeneration Company is located in the south of the Science and Technology Industrial Park of Dongguan City. It mainly runs the cogeneration power projects. ABC Cogeneration Company was established in July, 2004. It is a gas-turbine power plant built under the background of severe electricity shortage in the country by the end of 2003. The company uses LNG as the fuel. Since the fuel oil price keeps rising these years in the global market, the prices of coal and LNG increase at a large scale. This leads to a big disparity between the production cost and the electricity selling price in gas-turbine power plant. Gas-turbine power plants are facing with big pressure for survival. On the other hand, with the change of industry policy and the optimization of energy structure, there would be a huge reform in electricity industry. Thus, power companies have to work out a suitable development strategy and handle the change of market and situation, so as to keep competitive advantages and continuous development. Based on analyzing the development history of electricity industry both domestic and abroad, this paper draws some conclusions by using the methods of PEST analysis, Porter’s five forces model, SWOT analysis and strategic map. It would be helpful for guidance on the development strategies of ABC Cogeneration Company.Firstly, with the rapid development of macro-economy and the continuous improvement of electricity technology, the competition of electricity industry is fierce. And the power plants are facing with more and more pressure of environmental protection. By the analysis of PEST and Port’s five forces, ABC Cogeneration Company is suggested to develop the competitive strategy which is matching with company’s resources and capabilities, so as to gain advantages in the competition. Secondly, this paper analyzes the strengths, weaknesses, opportunities and threats of ABC Cogeneration Company. And it proposes that ABC Cogeneration Company should implement the steady development and cost-control strategy. Subsequently, on the basis of SWOT analysis, this paper puts forward the direction of development strategy for ABC Cogeneration Company. Lastly, this paper analyzes the implementation of strategic map for ABC Company basing on the theory of strategic map. This paper figures out the strategic map which drives the company to develop continuously through analyzing the four-level factors. Based on the theory of corporate value chain, the paper also suggests three steps to implement the strategic map, namely to be strong, to innovate and to take the lead.