Research On The Impact Of Liangmianzhen Company’s Diversification Strategy On Enterprise Performance

In an extremely competitive market environment,more and more companies are using diversification as a strategic means to expand their business scope in order to enhance their resilience to risks and consolidate and increase their market share.However,diversification strategy may bring new development opportunities for enterprises,but it may also make them fall into a quagmire and make it difficult for them to extricate themselves.Therefore,selecting specific cases to explore the impact of diversification strategy on corporate performance can deepen more companies’ understanding of diversification strategy,so that diversification strategy can play a positive role as much as possible and help companies develop better.One of the representative companies of the diversification strategy is Liang Mianzhen,a daily chemical company famous for toothpaste,which has been diversifying since its listing.Therefore,the correlation analysis method is used to study the diversification strategy of Liang Mianzhen,the enterprise performance and the correlation between these two.The company’s diversification history and the characteristics of each development stage are briefly introduced,and the degree of diversification over the years is measured using the operating unit method and the Herfindahl index method,and the internal and external motivations of the company’s diversification strategy are analyzed.Using factor analysis and Pearson’s correlation coefficient,the correlation between the degree of diversification and corporate performance of Liang Mianzhen was examined;based on the cases and related theories,the impact path of diversification on enterprise performance was analyzed and the impact path of diversification on enterprise performance of Liang Mianzhen was constructed according to the actual situation.The main findings are: the level of diversification is higher during the period of diversification strategy;the performance of the company is worse in all aspects during the period due to the influence of diversification;the level of diversification of Liang Mianzhen is negatively related to the enterprise performance during the same period;diversification affects the performance of the company through the effect of resource allocation efficiency and synergistic integration efficiency.Through the comprehensive analysis of the diversification of Liang Mianzhen Company,some insights related to the implementation of diversification and the development of the company are drawn: clarify the focus of the company’s operation and build core competitiveness;focus on the main business synergistic development and avoid excessive diversification;adapt to the objective market demand and maintain the innovation ability;Improve the internal mechanism of the enterprise and adjust the strategy in time.It can provide a reference to optimize the current business strategy of Liang Mianzhen company,and can also provide experience for the development and strategic deployment of companies with similar nature as Liang Mianzhen.