Research On The Causes And Effects Of Geely's Strategic Transformation

After China's accession to WTO on December 11,2001,auto market was gradually opened up.Due to the lack of brand awareness,R & D technology and management experience,Chinese auto companies lag behind developed countries in terms of industrial R & D,scale,structural adjustment,and market expansion.In order to improve their competitiveness,China's auto companies have to start to seek new development paths.As a private automobile company in China,Geely Group initially relied on low-cost strategy to occupy a place in the automobile consumer market.However,with the vigorous development of the globalized economy and the increasingly fierce market competition,its cost advantage has gradually begun to lose.Therefore,in order to achieve sustainable development,Geely Group decided to embark on the path of strategic transformation.This article selects Zhejiang Geely Holding Group as the research object,analyzes the motivation of its strategic transformation and the process and path of its realization,and then sorts and analyzes its financial data from 2004 to 2018 to evaluate the effect of Geely Group's strategic transformation.The article first introduces the connotation,motivation and performance evaluation methods of enterprise strategictransformation;secondly,it briefly introduces the internal situation of Geely Group and briefly reviews the implementation process of its strategic transformation,that is,several consecutive large-scale transnational M & A;Then the article analyzes the motivation of Geely Group's strategic transformation,and believes that Geely Group's strategic transformation is mainly the result of the internal and external environment.Finally,the company's financial data is used to analyze the effectiveness of its strategic transformation with EVA indicators and Harvard analysis framework.It is hoped that the analysis can provide experience reference for other enterprises with strategic transformation.The following conclusions are drawn through the case study: First,Geely 's strategic transformation is mainly due to the impact of external factors such as the global financial crisis and China ' s economic development,as well as the lack of technology and brand image within Geely.Internal factors such as poor,loss of cost advantage and decline in market share.Second,Geely ' s strategic transformation through cross-border mergers and acquisitions has led to the continuous expansion of its scale.While assets are rapidly increasing and independent research and development capabilities are constantly rising,there is also the danger of excessive financial pressure and increased financial risks.Third,Geely Group's strategic transformation through cross-border mergers and acquisitions is a successful road,and mergersand acquisitions have brought obvious synergies.Multinational mergers and acquisitions have enabled Geely Group to have an excellent management team and advanced technical support.