Research On Corporate Diversification Strategy Selection Based On Resource Endowment And Industry Prospect

In an increasingly competitive market environment,how to allow companies to maintain sustainable growth is something that every entrepreneur has been very concerned about.Due to the existence of industry cycles in each industry,companies will encounter bottlenecks during the development process.In order to allow companies to grow for the long term,many companies take the initiative or are forced to carry out strategic transformation.Diversification is one of the transformation strategies adopted.Then,when enterprises face diversification strategy choices,they are involved in new and profitable industries,or diversified and expanded in different areas of the original industry.What kind of factors determines the type of diversification strategy the company carries out.The theory of resource endowment points out that the different resources and capabilities that companies have will affect the choice of strategic diversification.In addition,the different industry prospects have a certain impact on the diversification of enterprises.Based on the literature of domestic and international resource endowment theory,industry prospect and diversified strategic choice,the article bases on resource endowment and industry prospect,divides resource endowment and industry prospect into two dimensions,strategic choice of issues a more systematic study.This article selects Erdos Group,which has successfully diversified and transformed itself,as an example.First,it builds a theoretical model based on theoretical analysis,and proposes that the industry has a good prospect.If the industry is endowed with good resources,it chooses a relevant diversification strategy;Industry resource endowment chooses the viewpoint of non-related diversification strategy.Then,on the basis of this,combined with the case analysis method to analyze the choice of the diversification strategy in the context of resource endowments and industry prospects to demonstrate the theoretical model perspective.Then analyze the diversification effect of Erdos Group and come to the conclusion that the diversification strategy chosen in the case of resource endowments and different prospects of the industry is conducive to the development of the enterprise,and once again demonstrates the viewpoint of the theoretical model with performance.Finally,combined with the previous theoretical analysis,case analysis,and performance analysis,we reached a conclusion.This article is based on the theory of resource endowment and the introduction of the industry outlook as a regulatory variable,further perfects the theoretical research model of “resources-strategy”,and more fully integrates the relationship between resource endowments,industry prospects and diversification strategy choices,and enriches resources.The theoretical study of endowments on the choice of diversification strategy has expanded the typical case studies of diversified operations,summed up and summed up experience,hoping to bring inspiration to our country's diversified enterprises of the same type and provide some reference.