Diversified Strategy Study Of WHCHEM Group

In recent years,along with economic recovery and emerging of developing regions,the conglomerates are facing strategic transforming.There are only two ways to transform,one is quit the existing industry and enter a new one,the other way is diversify the existing industry.To avoid risks,WHCHEM tried to go into coal related industry but achieved little.Then we enlarged the investment on R&D and got remarkable achievement from high value-added industries.Based on related literature,combined the theory with practice,we got the conclusion that MDI industry is transforming from tight balance(supply is a bit less than demand)to loose balance(supply is a bit more than demand)through the research on Wanhua MDI and petrochemical sections.Small application area and room for technology improvement leads to limitation for market growing.Alongside with urbanization and release of environmental policies(e.g.VOC),demand for coating,sticker,emulsion,textile and personal care productions will keeping a promising uptrend in china.This essay,assisted by analysis of inner and outer environment,industry development trend and several models like Potts,SWOT,BCG matrix,focuses on strategic developing route of WH to expand MDI overseas market,integrate ADI and special Amine,keep investing into PDH industry,proceed energy-saving sections and exit coal industry.This diversification strategy based the analysis of advantages(Domestic MDI demand is stable but oversea market is growing rapid.Products of ADI,surface material and other fined petrochemicals are demand driven products which are growing steadily.WH owns the critical technology and well-developed marketing networks)and disadvantages(Staff stimulating policies are not complete.Competition exists between different products).To make the diversification strategy get effect,this essay also gives supporting measures like rebuilt value,stimulation policies and IT networks.The potential problems shall be solved by proper combination of aforesaid measures.