Study On The Relationship Between The Diversification Strategy And Firm Performance From The Respective Of Dynamic Capability

Diversification strategy is an important issue that enterprises inevitably involve in the process of business development.With the development of market economy,the trend of diversification has been greatly enhanced,and many enterprises in our country are optimistic about the adoption of diversified business.Some enterprises implemented diversification strategy,opened up the main business and captured the new market rapidly,making the value of the enterprise has been improved;while some enterprises faced financial difficulties and has never recovered.Diversification strategy has also been a lot of controversy.Agricultural enterprises in our country are still in the exploratory stage in diversified ways,if they use unrelated diversification strategy,do not pay more attention to cultivating enterprise core competitive advantages,they can not realize the goal of enterprise smoothly.Whether the diversification strategy is helpful to improve the efficiency of enterprises,there are different opinions,the academic circles have not reached the same conclusion.With the improvement of the academic level and the deepening of the research,more and more scholars believe that diversification will damage the performance of enterprises.In addition,there are studies indicating that diversification strategy influences the performance of enterprises at the same time,the degree of influence is also be affected by the enterprise integration and reconstruction of internal and external resources to create competitive advantage in order to restrict the ability to deal with the fast changing market environment,this ability is the enterprise dynamic capabilities.In this paper,the relationship between diversification strategy and enterprise performance as the research center,in the selection of an agriculture as the main mode of operation and a diversification strategy of listed companies as a case study,which influence the process of diversification strategy on business performance analysis.Through the research and analysis,we try to explain whether the diversification will result in poor performance?Whether the dynamic capabilities can adjust the negative impact of diversification on firm performance?YUAN L.P.HIGH-TECH AGRICULTURE CO.,LTD is a leader in seed companies and even agricultural listed companies.At the beginning of its establishment,they insisted on the single business model of the main business income of hybrid rice,fruits and vegetables.The company began to invest in real estate investment into the main business areas from 2005,and until 2008,they returned to a single crop seed management development model.Accordingly,this paper establishes the following objectives:summarizing the factors considered in the choice of diversification strategy by describing LONGPING HIGH-TECH diversification process;through the research on enterprise performance,Analyzing and verifying on the relationship between diversification and corporate performance.Taking the research results as reference,and providing timely and accurate operating inspiration for the enterprise development strategy,realizing the maximization of enterprise value;and to provide the reference for the choice of management strategy and enterprise performance of other agricultural science and technology enterprises.This paper mainly consists 6 parts.The first chapter is the introduction,which mainly based on the research background and the significance of the research,and points out the research content and research methods.The second chapter is the theoretical basis and literature review.Including the definition of the concept,theoretical basis,research status at home and abroad and literature review.The third chapter is LONGPING HIGH-TECH's management status analysis and describes the development of enterprises diversification and diversification of reason.The fourth chapter is the analysis of LONGPING HIGH-TECH diversified enterprise performance.The fifth chapter is to analyze the impact of LONGPING HIGH-TECH diversification on corporate performance,and to summarize the reasons of diversification discount.Finally,the paper reviews and integrates the conclusions of the previous case studies,and puts forward the limitations of this study,the implications of the conclusions and the possible place to be more perfect in the future.This paper draws the following conclusions:Diversification strategy will lead to decline in corporate performance;Dynamic capability can affect the relationship between diversification strategy and firm performance,the negative impact of the diversification of high dynamic capabilities on firm performance is stronger than that under low dynamic capability.L.P.HIGH-TECH can adjust business strategy to improve enterprise performance.On the basis of the conclusion,we get some enlightenment.In the implementation of diversification strategy,agricultural enterprises should give priority to the relevant diversification,and play the main business backbone strength at the same time.Enterprises can use the dynamic capabilities of enterprises to improve the negative impact of diversification strategy on firm performance.In addition,enterprises should always maintain awareness of risk prevention,in order to mismanagement,quickly get away.Due to the level of my research,the limitations of the data obtained,there are still needs to be improved.Based on this reason,this paper puts forward the future development direction.