Research On The Impact Of Shandong Hi-speed Group’s Diversification On Financial Performance

Whether a company can grow based on everlasting is closely related to the formulation and implementation of its strategy.Diversification has been an effective way for enterprises to avoid risks and leapfrog development,and is also an inevitable choice for business development and growth to some extent.Since the 1960s,a large number of western countries have begun to make their way across development through diversification,and of course some of them have been brought down by diversification.Enterprises of diversified business starts late in our country,since reform and opening up,China’s market economy and enterprises have achieved rapid development,the enterprise is in the process of development opened up a new era of diversification.With western countries,in comparison with relatively mature theory of diversification research theory of enterprise diversified construction in China are still at the stage of vigorous development.In this stage,our research on diversified business should not be able to remain in diversified business,but it is necessary to do diversified business and development,and to put that foot point in the way of diversified operation to promote the operation performance of the enterprise,and to successfully realize the experience of diversified development enterprises,and to promote the maturity and soundness of the theoretical system with practice.The author through reading a lot of information about diversity of research found that the current research about corporate diversification and enterprise performance is given priority to with the empirical study of large sample,and the empirical study of large sample is given priority to with the macro research,it is difficult to dig deeper into the concrete enterprise case the microscopic theory of value.After all,before the western countries,GE and existing Alphabet exist,there are haier and existing fosun in the country,which has realized the success of the enterprise with its own unique diversified development.Therefore,in the previous study format,it is possible to explore the relationship between diversified business and financial performance through a more in-depth discussion,and try to examine the impact of diversified operation on the financial performance of the enterprise by studying the impact of diversified operation on the financial performance of the enterprise,so it may have more practical reference for the analysis of the combination of the theory and the practice.In this paper,according to the thinking of problem,to analyze and solve problems,first of all to the definition of diversification and performance,diversified types,and diversified several types and ways of the impact of enterprise performance has carried on the review and summarize.Based on the selection of Shandong Hi-speed Group co.,LTD(hereinafter referred to as the "Shandong Hi-speed Group"),a strategic basic industry in China,as the subject enterprise for case analysis and the affirmation of its good results in diversification,analyzing the development history of the company,especially the process of its diversification to evaluate the financial performance,asset operational condition,debt paying ability and development capability in the evaluation system of state-owned capital as well as the financial performance of Shandong Hi-speed Group and exploring the impact of diversification on its financial performance It is found that SDHS has given full scope to its synergy of diversification by combining theories of resource utilization,market power,internal market and tax saving.The development of non-related diversification not only has avoided the risk,and in turn created a great synergy,thereby better promoting the development of enterprises.At the same time,due to the possible agency problems,the related diversification of Shandong Hi-speed Group exerts a negative impact on its financial performance.In general,after just 17 years of development,Shandong Hi-speed Group will become the same industry and Shandong Province,the largest assets of the enterprise,can be said that the industry a well-deserved benchmark and legend.Finally,the analysis of this paper has also come to some case inspiration for enterprises that carrying out diversification,which could provide some suggestions.First,make a clear orientation,choose a diversified model suitable for its own development;Second,find the right time,do the right thing at the right time;Third,Capital operation has developed diversification in a rapid way through mergers and acquisitions;Fourth,to strengthen integration and make full use of the synergistic effect of diversification;Fifth,adhere to the core,bigger and stronger and excellent main business;Sixth,with a proper concentration,the degree of pluralism should not be excessively enlarged;Seventh,take the initiative to prevent multiple diversification discount.