Business Restructuring of New Oriental Education Technology Group Under the Double Reduction

Abstract

Double Reduction Policy has strongly affected the education industry in China, especially to those mainly rely on the revenue coming from K-12 education. Since the policy prohibits education organizations gaining revenue from academic tutoring including K-12 education. Thus, many education giant companies bankrupted while New Oriental re-emerged through this crisis. The reason behind this phenomenon is worth exploring. Therefore, this study will investigate the case of New Oriental to analyze how they catch up the opportunity in this crisis. This article will mainly focus on two parts that the success of its business restructuring and its attempt to enter the live-streaming selling market. Specifically, Quantitative Analysis is presented to compare the financial data before and after business restructuring. EFE and IFE matrix method are adopted to analyze the external and internal environment of New Oriental. In addition, SWOT analysis is used to weigh the pros and cons of entering the live-streaming selling markets. According to the analysis, threat and opportunity coexist and New oriental make full use of its strengths to re-emerge under Double Reduction Policy. The basic strategy is following the relevant national policies. In addition, this paper also provides some investment suggestions for those are still struggling to survive from the change. These results shed light on research the impact of national policy to the educational industry.