Diversification,Competitive Advantage And Performance

Diversification strategy is a key part of enterprise management,and it is also an important development strategy that has been widely concerned by the academic community.In recent years,China's macro-economy is facing downward pressure,the task of destocking and capacity reduction is complex and urgent,many traditional manufacturing enterprises are facing development bottlenecks,and they have adopted diversified strategies to seek new performance growth points.This paper attempts to test the existence of diversification discount or premium through large sample data analysis,and take the competitive advantage as a new starting point to study the internal mechanism of the impact of diversification on performance,as well as explore the impact of agency problems and heterogeneous enterprise characteristics in this phenomenon.This paper takes A-share Manufacturing Listed Companies in China from 2014 to 2018 as the research sample,collects financial data of enterprises through the Tonghuashun database,explores the impact of diversification on performance,and probes into the intermediary role of competitive advantage in diversification and performance;after clarifying the existence of diversification discount,further introduces the agent problem factors,and studies the agent problem factors;Finally,this paper also studies the influence of Heterogeneous Firm Characteristics on diversification discount effect from four aspects.The results show that diversification discount is common in the listed manufacturing companies in China,and the higher the degree of diversification is,the worse the performance is,while the competitive advantage plays a full intermediary role in the relationship between the degree of diversification and the performance;the negative agency cost aggravates the negative impact of diversification on the performance of enterprises,and there is an intermediary adjustment test that shows that agency cost increases the negative impact of diversification on the performance of enterprises cost is to enlarge the diversification discount efffect by damaging the competitive advantage of enterprises.In terms of the characteristics of heterogeneous enterprises,this paper finds that compared with large-scale enterprises,high leverage enterprises,mature enterprises and high equity concentration enterprises,the diversification discount effect is more significant in small-scale enterprises,low leverage enterprises,young enterprises and low equity concentration enterprises.Compared with the existing literature,this paper,based on the traditional research on the relationship between diversification degree and performance,adds a new perspective of competitive advantage,and finds that the competitive advantage plays a completely intermediary role in the relationship between diversification degree and performance,that is,the essence of diversification discount effect is that the increasing diversification degree first impacts the competitive advantage,while the lower competitive advantage has a negative impact on performance.Further study on the effect of agency cost and heterogeneous enterprise characteristics will help us to further understand the diversification behavior of enterprises,and more accurately evaluate the effect of diversification on performance.