1. Mechanism and comparison of two business strategies 1. Mechanism of diversification strategy
Diversification strategy refers to the business strategy of an enterprise that operates more than two industries at the same time and provides products or services with different basic economic uses to enter different markets. It is an expansion behavior taken by an enterprise to seek long-term development when it reaches a certain stage. The advantages of diversification strategy are: it can make enterprises gain more market opportunities, make full use of various resources of enterprises to realize the integration of various businesses, enrich the series product structure or enrich the product portfolio structure; Diversification is flexible, and it can quickly withdraw from bad business, thus effectively avoiding, dispersing or reducing the risk of "over-specialization"; In addition, enterprises that implement diversification strategy can make full use of brand effect, employee potential, marketing channels, management experience and material resources to provide diversified products or services for the market. In short, diversification strategy plays a very important role in strengthening enterprise strength, dispersing business risks, exerting resource potential and establishing enterprise image. Abroad, a number of enterprises such as DuPont, General Electric, Philip Morris, Mitsubishi of Japan and LG of South Korea have achieved great business results by implementing diversification strategies. In recent years, Haier, Konka, Chunlan, Hongta and other enterprises in China have also achieved certain success in diversified operations.
The disadvantages of diversification strategy are also obvious, which mainly include the following three points: First, it is more difficult to manage, especially when an enterprise enters a new field that is not highly related to its original business, its original management concepts, models and experiences may be difficult to work together, which will increase the cost of coordinating various relationships, and may lead to unstable organizational structure and increase the risk of out-of-control operations; Second, resources are scattered, and enterprise resources and funds are allocated to multiple businesses. On the one hand, this may lead to the loss of the original core competitiveness and the difficulty in cultivating other core competitiveness. On the other hand, it may fall into a situation of resource shortage, poor turnover, and having to shrink or go bankrupt. South Korea's Daewoo, Japan's Sony, China's giant group and Chundu enterprises all have problems. Third, it affects the effective implementation of CIS strategy. Most enterprises that implement diversification are well-known enterprises with good performance in their main business. After diversification, the sharing of the original brand value of enterprises by multiple products may affect the brand foundation created by their main business. 2. the mechanism of specialized management strategy
specialized strategy refers to the continuous development of enterprises by engaging in production and operation business in a certain field that conforms to their own resource conditions and capabilities. In the early 198s, Michael E.Porter, a professor at Harvard Business School in the United States, put forward three basic competitive strategies suitable for enterprises of any nature and scale, one of which is specialization strategy. Porter's specialized competition strategy means that enterprises focus on a specific market in order to have a competitive advantage in local markets. Because the management of enterprises is inseparable from market competition, the management strategy and competition strategy are closely linked. The advantages of specialized management strategy are: enterprises can concentrate all kinds of resources on the most familiar business areas, so as to develop and cultivate competitive products; Facilitate the operation of enterprise integration strategy, realize large-scale production and gain cost advantage in the industry; It is conducive to the implementation of CIS strategy and the organic integration of corporate brands and products. From the point of view of competition, the specialization of enterprise business can serve a narrow strategic object with higher efficiency and better effect, so as to surpass the opponent in a wider competition range. Porter believes that as a result, the profit potential of enterprises can exceed the general level in the industry. There are also disadvantages in implementing the specialization strategy: because the business of the enterprise is concentrated in a certain field, it may lose some other market opportunities; The key of this strategy is to find a special target in a market segment, and occupy a place in the market by serving this special target. Due to the increasingly fierce market competition, it is difficult for many enterprises to find or create a core product that can use professional management strategy for a long time. Specialization is easy to form a high exit barrier, and enterprises fall into the crisis of "over-specialization" because it is difficult to quit when there is a business crisis; Due to the concentration of business areas, on the one hand, some technical or resource advantages of enterprises may not be fully exerted, on the other hand, it is easy for enterprises to fall into a position of complacency and passivate their response to market changes. 3. The basic principle of enterprise's choice of business strategy
At present, the word that people talk about most about e-commerce is "profit". Indeed, network enterprises are looking for their own profit model, and all e-commerce websites, large and small, are struggling for profit. An influential e-commerce website even put forward that the goal in 22 is to "make a dollar and work hard!" . People in academia and business circles have racked their brains around how to make enterprises profitable. Faced with the time-consuming market, enterprises have started concrete actions. Some enterprises, especially those powerful portals, have chosen diversified business strategies, while many others have identified professional business models. What is the effect of diversification or specialization? For most of these enterprises, we can only wait and see. For those enterprises that are undecided, we have to stop and wait and see now. The question of which is better or worse, diversification and specialization, has been debated for a long time, and there is no absolute standard yet. Under certain conditions, specialized management makes enterprises succeed; Under other conditions, diversification may achieve better business performance than specialization. In different situations, even the same choice may have different results.
in fact, what kind of business strategy an enterprise chooses depends largely on its macro environment, industry situation and its own situation. From the growth history of enterprises in Europe, America, Japan and other countries, it can be seen that the adoption of specialization or diversification strategy is closely related to the degree of market economy development in the country where an enterprise is located. Enterprises in Europe, America and Japan practiced specialized management from the end of 19th century to 195s. Since 195s, diversified business strategies have been widely adopted, and enterprises have grown rapidly. In the 198s, the competition in the international market became more and more fierce. At the same time, with the increase of diversification, the possibility of enterprises taking risks increased, and the disadvantages of diversification began to emerge, which was recognized by the majority of enterprises, and the number of enterprises implementing diversification gradually decreased. In recent years, the development of the Internet has accelerated the integration of the global economy. European and American enterprises have cleaned up their non-core businesses and re-integrated their resources through the Internet. The professional management strategy is increasingly favored by the business community. It can be said that when a country's market economy is in a period of development, enterprises often adopt specialized management strategies; When the market economy develops to a more developed level, enterprises often adopt diversified business strategies; When the market economy develops to a very advanced stage, enterprises turn to specialized management strategy. Secondly, it is related to the life cycle of the industry in which the enterprise is located. Generally speaking, enterprises in the growth period of industry life cycle should adopt professional management strategy; Enterprises in maturity can choose specialization or diversification according to specific conditions; Enterprises in recession should actively carry out diversified operations.
third, it is related to the enterprise's own situation. Enterprises usually choose their business strategy based on the following three considerations. First, the development space of the original business is getting smaller and the competition is becoming more and more fierce. At this time, new development opportunities have been found, so it is necessary to choose diversified management. Secondly, it is necessary to have certain surplus business resources to support enterprises to carry out diversified operations. On the contrary, if the business resources of enterprises are not sufficient, they should implement specialized business strategies; However, enterprises with surplus resources do not have to carry out diversified operations, but can also continue to specialize. How to choose should depend on other factors. If the enterprise's management resources are not abundant, it is best to adopt a professional management strategy. The third is that there is a high degree of original resources that can be migrated, that is, considering the degree of migration such as the cloning of management concepts, systems and mechanisms, the extension of technology, and the flow of talents. Generally, the higher the mobility, the higher the success rate of diversification; Conversely, the lower the mobility, the lower the success rate of diversification.
2. Specialization should be the basic business strategy of enterprises in the current e-commerce environment. 1. Specialized operation is the practical need of e-commerce development.
Value and transmissibility are the basic attributes of information. The value of information can only be reflected through communication and communication. The information accumulated to a certain extent can be turned into more valuable information through processing, analysis and processing, which is the self-accumulation and appreciation of information. The above process will lead to more information, and the more marginal utility people get from these increased information, which is the increasing marginal utility of information. The core of network economy is the information network represented by Internet, so information becomes the core resource of network economy, and the consumption under network economy also presents the law of increasing marginal utility, which is completely different from the law of decreasing marginal utility followed by traditional economics. E-commerce is supported by the computer and network technology platform to realize the effective transmission of information, with business flow, capital flow and logistics as the substantive operating objects, and needs the support of the corresponding security and credit system. Therefore, it has become the main mode of operation in the initial stage of e-commerce to carry out e-commerce under the condition that other conditions except information flow are not perfect, and to give full play to the increasing marginal utility of information to provide various market and transaction information. In fact, the vast number of consumers and customers also recognize this point. All kinds of survey data show that it is the main purpose of enterprises and consumers to go online to conduct market research and find all kinds of business information through the network at present. For enterprises, a correct understanding of the economic environment and the status of the industry, facing the reality, choosing a pragmatic business model, formulating practical business strategies and tactics, and persisting in doing so will certainly achieve results. Many domestic enterprises have done this and achieved certain results. Dangdang Online Bookstore, Joyo.com and other enterprises have achieved breakeven by the end of 21. Ctrip.com, which provides tourism services, and 3721, which provides domain name services, have also started to make profits around this time. Their success is not mysterious, that is, they have persisted in focusing on one field for several years since their establishment, without wavering or changing their business models. For example, the "Chinese real name" system established by the 3721 website based on the concept of "network popularization" has solved the "Internet bottleneck" of domestic netizens, and users can directly access websites on the Internet in Chinese. This service mode is the concrete embodiment of the specialization strategy. Not long ago, eBay injected $3 million into eBay and acquired a 33% stake in eBay. Although people have doubts about eBay, an American company that is not familiar with the Internet and e-commerce environment in China, and worry that eBay will fall into the "capital injection trap" that once happened in China, one thing is worthy of recognition at present. It is eBay's persistent adherence to the C2C market that has formed its own characteristics. Today, when investors have gradually become rational, eBay will invest its funds in this auction website that many people regard as "bleak in Qian Jing". What's more worth mentioning is that there are many little-known e-commerce websites active on the Internet. These websites, which are called "alternative e-commerce", can't be compared with mainstream e-commerce websites in terms of capital, scale and promotion methods, but they have a good profit model. As long as you visit a few such websites, it is not difficult to find their characteristics: unique business perspective. "Alternative" products or services are often not available in those big websites, such as antiques, jade articles, stamps, special local products, etc. These products seem to have little market, but they have a steadily growing customer base. The investment of "alternative" is not big. A considerable number of "alternative" is to set up their own stores on some well-known B2C websites. For example, there are a large number of netizens or enterprises on eBay to promote their products, and some "alternative" are specialized websites established by enterprises or individuals. The management strategy of low cost and specialization is the survival way of alternative e-commerce. In addition, looking at the development history of e-commerce in just a few years, it is not difficult to find that the scale and growth rate of B2B and B2C e-commerce markets are much larger than that of the latter; In B2B market, the development trend of vertical market is much better than that of horizontal market. This also reflects from one side that specialization is the realistic need of e-commerce development at present.
2. Disadvantages of "diversification" strategy from Enron's bankruptcy
On December 3, 21, Enron, which had 5 billion assets and ranked seventh in Fortune 5, filed for bankruptcy protection, becoming the largest bankruptcy case in the history of the United States.
it started with electricity and natural gas trading in 198s, and achieved great success in the energy market. Enron, which has been rated as "the most innovative company" by Fortune magazine for six consecutive years, can be regarded as the first batch of enterprises engaged in B2B e-commerce. In 1999, Enron established the energy e-commerce platform (Enron Online), which was the largest B2B e-commerce platform in the world at that time. Through this platform, Enron achieved great success in the energy market. In its heyday, online transactions accounted for 2/3 of the company's total business volume, and Enron suddenly changed from a "small-profit natural gas operator to a high-profit energy trader", and was regarded as a model of informationization and the most successful e-commerce application example. Harvard But then Enron's business strategy began to change. At that time, CEO Jeffrey skilling believed that with the re-integration of enterprise business, the further development of free market and the further reduction of intermediary fees, the comprehensive integration mode of traditional enterprises would be rapidly disintegrated. Therefore, Enron's future is not to continue to be a traditional energy company with huge assets, but to become a pioneer in promoting "decentralization" in various commodity markets around the world. So Enron began to expand into high-speed telecommunications networks and financial markets, and invested huge amounts of money unnecessarily. Enron's "decentralization" strategy is also reflected in its e-commerce application. The e-commerce platform of the world's largest energy trading enterprise deals in more than 1,5 kinds of products, ranging from daily necessities, users' electricity and natural gas supply to other extended equipment such as protective hoods in bad weather. Not only that, Enron even plans to launch a broadband futures market on the basis of realizing the spot market transaction of bandwidth in cooperation with Global crossing (an American bandwidth supplier). It can be said that Enron's bankruptcy is very large.