Asset Specificity,Financial Flexibility,and Corporate Transformation

Along the old map,there must be no new continent." As early as 2010,China's manufacturing output value far exceeded that of other countries in the world,accounting for 19.8%,and became a veritable "first manufacturing country".Even if it develops to this day,the average profit level is still difficult to predict.Chinese manufacturing companies urgently want to complete the transformation from a "manufacturing power" to a "manufacturing power",and the transformation is the soul of sustainable development and the gene of longevity,seize the current century-long change,and realize transformation,upgrading,and quality improvement.Effectiveness is the only way for enterprise development,but the road to transformation is not easy.Many enterprises are facing a dead end in the wave of transformation.Therefore,helping companies to identify the internal constraints of the transformation and find the appropriate solutions are urgent and arduous.This article focuses on the relationship between asset specificity,financial flexibility,and corporate transformation.It conducts research with a combination of empirical research and literature research,mainly exploring the internal constraints and solutions of corporate transformation.Therefore,this article takes 274 manufacturing companies of A-share listed companies in Guotai'an database from 2009 to 2018 as a sample,and obtains 2466 observations.It uses Excel to make preliminary data collation,and uses Stata for descriptive statistics,correlation analysis,and linearity.Regression analysis validated the proposed hypothesis.Based on the idea of "analyzing problems-solving problems",the core research contents of this article are mainly in three aspects: First,explore the impact of physical asset specificity,brand asset specificity,and human asset specificity on corporate transformation.Second,for the physical asset specificity and brand asset specificity that inhibits the transformation of the enterprise,starting from the internal controllable resources of the enterprise,the adjustment variable of financial elasticity is introduced in order to negatively adjust the relationship between the specificity of the asset and the transformation of the enterprise to help the enterprise Find ways to alleviate the restraint caused by asset specificity and promote the smooth progress of corporate transformation.Third,put forward corresponding policy recommendations based on the research conclusions of this article.Finally,the empirical results of this article show: first,the higher the specificity of physical assets,the assets being resettled in other areas of operation will generate varying degrees of value loss,increase transaction costs,increase the cost of corporate transformation,and have an inhibitory effect on corporate transformation;Second,the higher the specificity of brand assets,the more the managers and internal employees have a mind-set,which hinders the solution of new problems in the transition and inhibits the transformation of the enterprise.Third,the higher the specificity of human assets,it will help reduce employee turnover.Rate,increase employee loyalty,make it easier to improve processes,discover new ideas for corporate innovation,and the less resistance employees face from corporate transformation,so it promotes corporate transformation.Fourth,further,financial flexibility can reduce transformation The possibility of capital flow disruption in the process,reducing the sensitivity of investment cash flow,and alleviating the inhibitory effect of the specificity of physical assets on corporate transformation;sufficient cash flow can also help companies increase advertising investment,fight price wars,etc.,and further seize market resources and establish Brand value,consolidating the new image presented to consumers,Solutions brand asset specificity for inhibition of enterprise transformation;and the relationship between human asset specificity and business transformation no significant effect adjustment.In summary,when facing the transformation of enterprises with physical asset specificity and brand asset specificity,they should appropriately increase their financial flexibility reserves,increase their risk resistance,and provide strong financial resource support for corporate transformation.The research in this paper has important theoretical and practical significance to a certain extent: First,the impact of internal special assets on corporate transformation has not been covered by existing research.This article explores the possible impact of special assets on corporate transformation.The theory of asset specificity and the theory of corporate transformation have opened a "black box" between the two,which has not only enriched the study of internal factors affecting transformation and upgrading,but also promoted the study of financial consequences of asset specificity.Second,when looking for moderator variables,avoid the disconnection between theoretical research and management practice,and summarize the "operable" countermeasures of financial resilience,which extends the depth of financial resilience theory to a certain extent.Third,this study not only clarifies the internal constraints of transformation,but also proposes feasible countermeasures,which has a strong guiding significance for today's enterprises at the crossroads of transformation.