The Empirical Study Of The Relationship Between Technological Diversification And Organizational Performance

Currently, innovation has become the main stream of enterprises, which could generate competitive advantage and is critical for long-term growth. Research has found that the strategic choice of diversification brings more opportunities for enterprises, and plays an important role in facilitating innovation. Technological diversification, as an important means of diversification strategy for enterprise, has gained increasing attention in the field of innovation and strategic management and lead more scholars to explore the relationship between technological diversification and organizational performance. However, from the theoretical point, current research on discussing the relationship between technological diversification and organizational performance is still controversial, and have not yet reach a consensus. From the empirical point, research mainly conducted in the relatively mature market of developed countries, seldom research focus on Chinese context, which the Chinese organizations are embed in the transition economy and the market is far from mature.To address the above theoretical and practical problems in existing literatures, this study draws the sample of 296 listed Chinese firms in growth enterprise market to empirically examine ’whether technological diversification will influence organizational performance, and how the environment characters impact on this relationship.’Our empirical result shows that technological diversification is positively related with organizational performance. Further, we selects two representative characters of environment (i.e., environmental munificence and environmental dynamics) to examine how the external environment affect this relationship. Specifically, the results show that environmental munificence strengthens the effect of technological diversification, while environmental dynamics weakens the effect of technological diversification.