The Impact Of Diversification On Corporate Performance

Nowadays,the global economic integration is developing,the market is continuously subdivided,and the competition pressure of a single industry is increasing.In this context,in order to diversify the operational risks brought about by specialized operations in the process of rapid development,many of them are willing to choose a diversified business strategy.At the same time,this is also the way to achieve economies of scale,expand the scale of enterprises or form a closed loop of the industrial chain.Important development path.However,among the diversified enterprises,there are not many real successes in the long run.The reason is that a large part of them only blindly pursue the expansion of scale without reasonable consideration of their own situation or new competition.The analysis of the market did not make the best use of resources to avoid weaknesses and make full use of resources.Usually,most scholars use performance to evaluate the diversification of business results.In recent years,many scholars at home and abroad have begun to study the relationship between diversified operations and corporate performance,which is mainly divided into diversified discount,premium and neutral theories,and covers different characteristics of different types of enterprises.One of the innovations in this paper is to use the single case research method to study the diversification of enterprises,and to illustrate the relationship between diversification and performance.At present,the research on diversification of enterprises mainly uses empirical research,and research is conducted by a combination of qualitative and quantitative research methods.This research method is based on large samples and lacks specific conditions for specific enterprises in a specific industry.Discussion.This paper takes the diversified operation of DunAn-Group as an example to analyze the case and clarify the research object.The DunAn-Group began to explore the diversified development path from the initial stage of its establishment.This article chooses “DunAn-Group” as the research object and has strong practical significance.Analyze the influence of Dunan Group's diversified business strategy on the performance of DunAn-Group.In the process of research on the diversified development of DunAn-Group,it puts forward the problems to diversified operation,and then analyzes the causes of the problems and proposes corresponding solutions one by one.Countermeasures,I hope to have some inspiration and reference for other companies to choose a diversified business strategy.In the whole research process,the paper focuses on the case analysis method,and further demonstrates the combination of qualitative and quantitative analysis methods in the process of argumentation.Firstly,it expounds the diversified development process of DunAn-Group and analyzes the motives of diversified development.Then,using financial tools,and comparing the traditional financial indicators with the reference company SanHua Intelligent Controls and DaLeng Shares,The corporate performance of the DunAn-Group was evaluated.Combined with the evaluation results obtained,the reasons for the poor performance of the diversified business are analyzed.Finally,based on the previous analysis,the conclusions of this paper are drawn.In the diversified operation of the DunAn-Group,the performance of the company has a negative result.That is,the effect achieved by the diversified business strategy is not satisfactory.In response to the problems in its development,it puts forward suggestions and suggestions for improvement.In the quantitative analysis of DunAn-Group,based on the annual report and credit report data,the performance changes of the DunAn-Group's diversified business layout were analyzed,and the shields were analyzed from three perspectives: market performance,financial performance and diversified motivation performance.The results of the diversified operation of An Group and the introduction of peer-to-peer companies for comparison,the conclusions are as follows: After diversified operations,the performance of the company has declined,and the profitability of the company has not improved.This indicates that the DunAn-Group's diversified operations are not good.The root causes of its failure are: blind expansion of production scale,high-cost investment in new energy modules,narrow financing methods and short deadlines.Finally,this paper draws some inspirations from the failure of Diane's diversified operation: First,rational planning and diversification,focusing on core competitiveness;Second,paying attention to financial management and internal control;Third,paying close attention to national policies,put "de-leverage" into action.The main research purpose of the thesis is to provide some enlightenment and reference for the diversification of other enterprises through case studies.