Research On The Impact Of Digital Transformation On Midea Group’s Value Creation

In recent years,with the continuous improvement of China’s information infrastructure,the digital economy has gradually become a new driving force for economic development.Due to the late start of industrialization in China,it is impossible to follow the development model of high energy consumption and high emissions in developed countries.We must adhere to the path of new industrialization with Chinese characteristics and innovate the development model through digital transformation.For the home appliance industry,digital transformation refers to business transformation through optimizing research,development,production,and marketing processes,and innovating and reshaping traditional management models and business models.As a giant in the home appliance industry,Midea Group realizes that it needs to open up new business growth curves if it wants to maintain sustained high growth in efficiency.Therefore,Midea Group actively seeks change and has implemented digital transformation since 2012 to explore new revenue growth points for the enterprise.Midea Group is the earliest enterprise in the home appliance industry to undergo digital transformation.This article takes it as the research object to study the impact of digital transformation on its value creation.Based on the analysis of the process and motivation of Midea Group’s digital transformation,this paper studies the three impact paths of Midea Group’s digital transformation on value creation,and evaluates the effect of Midea Group’s value creation by combining financial indicators,non-financial indicators,and EVA analysis.It is found that digital transformation can help Midea Group achieve value creation to a certain extent.Research shows that:(1)Midea Group’s digital transformation can achieve enterprise value creation through three paths: improving the value chain,building a digital ecosystem,transforming marketing models,attracting digital consumers,utilizing data production factors,and promoting enterprise innovation,to reduce enterprise operating costs,improve operational efficiency,and increase operating income.(2)Through comparison with Gree Electric and Haier Zhijia,it is found that digital transformation has a significant positive effect on Midea Group’s profitability,debt paying ability,operating ability,and growth ability.(3)Midea Group has made efforts in research and development,production,corporate culture,customers,etc.through digital transformation,and has a positive impact on non-financial indicators.(4)EVA economic value added shows a fluctuating upward trend,indicating that Midea Group has created new value for shareholders.By constructing a path of "digital transformation → operating costs,operating efficiency,operating revenue → value creation" and combining the Midea Group case study,this article concludes that digital transformation can help enterprises reduce costs and increase efficiency to a certain extent,and explore new business growth curves.Based on the above analysis,the article finally puts forward some suggestions for enterprise digital transformation as a reference.