A Research On Strategic Transition Of Biomass Power Generation Business Of Company K

Biomass energy,because of its inherent character,has become the most promising substitute for the primary energy among all forms of new energy.Our country has abundant resources of biomass,and biomass power generation industry is facing development opportunity.As the leading company in biomass power generation industry,Company K encounters the problems like shortage of cash flow and high debt ratio.Under the circumstances of de-leverage measures implemented by the country,how to lose burden,seize the opportunity and realize restructure,are urgent matters to be solved.The essay uses strategic management theory as basis,first utilizes PEST analysis and The Five-force Model to analyze biomass power generation industry and finds out the features of macro-environment and the industry and understand the possible impact on the development of biomass energy industry;secondly,the essay analyzes the internal environment of Company K,including its resources,core competence,organization and structure and enterprise culture,to have a comprehensive understanding of the company;thirdly,the essay uses SWOT tools to analyze Company K in a comprehensive way,including its advantages,disadvantages,external opportunities and threat etc,and based on the above-mentioned environment analysis to choose the direction of strategic transition of Company K;lastly,according to the direction of the strategic transition,set up appropriate strategy transition planning,determine the path forward and propose implementation advise.Based on the analysis,the following conclusion could be made: there is promising prospect of biomass power generation industry,Company K has a significant advantage and should dedicate itself in the industry,seize the opportunity and realize a new round of prosperous development.In the context of the strict implementation of de-leverage and cost reduction,enterprises of high debt and high leverage must have courage to make choices and make a prompt and resolute decision to “cut one's arm to save one's body”,by selling its non-core assets and focusing on biomass power generation business,at the same time adjusting management structure and financing model,accepting industrial integration and promoting equity restructure,to fully exploit its innovation advantage and change its business model from heavy asset to light asset.