Research On The Relationship Between Diversification Strategy And Enterprise Performance Of Listed Companies With Small And Medium Enterprise Board

Diversification strategy is a choice for enterprises that pursue the sustainabledevelopment. With the development of economy and the continuous improvement of thesecurities market in our country,the scale of listed companies with small and medium-sizedboards are gradually expanding, more and more companies have chosen the mixedmanagement strategy that called else diversification strategy. Although China has setted offa wave of diversification strategy in the early1990s, academia still has not reach aconsensus to diversification which is the discount value to companies or premium or noimpact. In order to deepen the understanding of the industry mixed operation and its effect,promote the small and medium-sized boards of listed companies to better development,this thesis selects626listed companies which meet the requirements as the research object.First,selecting indexes and building model on the basis of previous studies.Then,puttingforward some related assumptions by combining the operation situation of small andmedium-sized boards of listed companies.Next, descriptive statistical analysis, correlationanalysis and multiple regression analysis are used to research on the relationship betweendiversification strategy and enterprise performance of listed companies with small andmedium enterprise board according to the collected data that has been processed. At last,draw some rudimentary conclusions and make relevant suggestions.The results of this empirical study in this thesis show that the effect of the industrymixed management strategy that is been used to listed companies of the small andmedium-sized boards in our country is not significant. In other words, the degree ofdiversification strategy and enterprise performance are irrelevant. From the empiricalresults, the corporate performance is mainly affected by other factors, such as asset scaleand the growing ability of enterprises. Asset scale and the financial indicators have positivecorrelation. The financial indicators are earnings per share, return on assets and return onequity. But asset scale and Tobin’s Q value that indicates the market performance havenegative correlation. The growth of enterprises have a significant effect on the promotionof enterprise performance. The result is also show that the industry mixed degree ispositively related to debt-to-assets radio. Therefore, companies should carefully analyzethe conditions that are good for adopting diversification strategy, and make a correct choicefor the way of entering the new industry. Companies should strengthen the main businessand develop their core competitiveness. Then, they may pursue appropriately economy ofscale on the basis of those conditions. It’s also important to improve enterprisemanagement level and establish the perfect system that warning the risk of companies. Socompanies don’t have to pursue diversified or specialized strategy.