An Emprical Study On The Impact Of Technological Diversification, Technological Coherence On Performance Of Firms

Student Name:Jiang Ma Supervised by:Zhang Xin Submitted to:Southeast UniversityWith the deepening of economic globalization, enterprises are facing growing competition. In order to maintain a competitive edge, many companies continue to upgrade outdated technology. In this process, the degree of technological diversification would be changed, which will facilitate collision, overflow and recombining of knowledge in different technology field, and distribute enterprise’s limited resources, have an impact on the establishment and protection of technical skills in core technical field. Therefore, some scholars did research about whether technological diversification has an impact on corporate performance. However, there were some shortcomings in most domestic scholars’study:(1) Simply analyzing the relationship between technological diversification and business performance, ignoring the degree of complementarity (coherence) of the diverse technology activities is also an important part of study on technological diversification; (2) Ignoring the moderation of complementary assets between technology diversification and firm performance.Theoretical and empirical methods were used in this paper. Relying on the date (2000-2010) of 232 large-scale manufacturing enterprises, we analyzed the relationship between technological diversification, coherence and firm performance and the moderation of complementary assets to the relationship between technological diversification and firm performance empirically. Additionally, in order to obtain more detailed conclusions, we do regression using data of high-tech enterprises and traditional enterprises, state-owned enterprises and private enterprises respectively.The results showed that:(1) Technological diversification has an inverted U-shaped relationship with corporate performance. The relationship of diversification and performance of high-tech enterprises, traditional enterprises is U-shaped, but the relationship of diversification and performance between state-owned enterprises and private enterprises is different:technological diversification of state-owned enterprises has an inverted U-shaped relationship with corporate performance and technological diversification of private enterprises and enterprise performance has a positive correlation. (2) Technological coherence could not enhance performance, which is abided by all kinds of firms in the paper; (3) Complementary assets positively moderate the relationship between technological diversification and firm performance. But the regulatory effects of manufacturing capacity, market and human capital complementary assets are different between different kinds of firms in the paper. For high-tech enterprises, all complementary assets play a significant regulatory role, but for traditional enterprises, only manufacturing capacity and human capital complementary assets play a significant regulatory role. For state-owned enterprises, only manufacturing capacity and human capital complementary assets play a significant regulatory role. But for private enterprises, only the market complementary assets play a significant regulatory role.