Research On The Motivation Of Refocusing Strategy And Its Impact On Enterprise Performance Of Fenda Technology

Since the reform and opening up and economic globalization,in order to expand the scale and increase their power,most enterprises have chosen to operate in a diversified way.Because it is easier and faster to diversify through mergers and acquisitions,M&A is also favored by many enterprises(Yang Wei,2019).However,in this process,a large number of enterprises have problems,such as business cannot develop together,difficulties of management,resources are scattered,etc.,and crises frequently break out.In this context,enterprises that choose diversified development have begun to make strategic adjustments to refocusing.These companies are trying to reverse the crisis by selling non-core businesses and strengthening their core businesses.The country’s macro policy also calls on enterprises to focus on the main business and develop core business,and General Secretary Xi Jinping pointed out in his speech that enterprises need to specialize in the main business to achieve the top of their careers and cannot be mixed with distractions.Then,whether the refocusing strategy can improve the performance of the enterprise,and how the refocusing strategy affects the performance of the enterprise is worth studying.This paper takes Fenda Technology as an example to analyze the impact of its refocusing strategy on enterprise performance.Based on life cycle approach,resource based view and core competency theory,this paper studies the motivation,mechanism of action on enterprise performance,and impact on enterprise performance of Fenda Technology’s refocusing strategy.Firstly,through the analysis of the cases,this paper argues that the motivations for Fenda Technology’s refocusing strategy include the following aspects:the development risks of the industry are not identified in diversified M&A,which is blind;The integration of enterprise resources is unfavorable,and the management is chaotic,causing internal conflicts;The decline in performance has led to loss of profits,and the company is facing a delisting crisis.Secondly,through reading literature and theoretical analysis,this paper argues that the mechanisms of refocusing strategy on enterprise performance are as follows:identifying risks and selects strategies based on business development and industry development prospects;improving internal management,and supporting profit growth with core competitiveness;rational allocation of resources,increasing investment in R&D,and forming resource advantages;using capital markets to restore market confidence by buying back shares,and to reduce costs through internal leasing and internal guarantees.Finally,this paper summarizes the changes in the market performance and financial performance brought about by the refocusing strategy of Fenda Technology,and finds that the market response is positive and the financial indicators have also improved.This paper makes suggestions on the problems existing in the development of Fenda Technology,such as poor risk identification ability,imperfect governance system,and shareholder equity pledge.This case is a typical case of choosing the refocusing strategy after diversified premium mergers and acquisitions,and it is also a product of 5G technology upgrading and complex environments at home and abroad,this paper believes that Fenda Technology’s refocusing strategy can help enterprises adapt to changes in the internal and external environment,concentrate and rationally utilize resources,strengthen core capabilities and competitive advantages,and thus have a positive effect on the market performance and financial performance of enterprises.Especially under the impact of the epidemic on enterprises in the past three years,the development of private enterprises is particularly difficult,and the refocusing strategy provides new ideas for enterprises that blindly pursue diversified development to become bigger and stronger.At the same time,this paper summarizes the mechanisms of Fenda Technology’s refocusing strategy,hoping to give reference to other enterprises that carry out refocusing strategy.