Entrepreneurship philosophy - written on the occasion of the red beans 60th birthday
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June 13, 2023
Every life has a story, every business is legendary. In 1957, when three cotton-elastic cotton farmers collaborated to set up a cotton processing factory, they could not imagine what they were now: one hundred thousand practitioners, two industrial parks, three listed companies and three well-known trademarks, and four major industries Plate; more than 50 billion marketing; sixty years of growth stop. Stick to the industry six decades, Hongdou Group not only create brilliant achievements, but also valuable business philosophy and entrepreneurial philosophy. Inheritance of philosophy: the system of performance-oriented enterprises longevity, heritage to be. Hongdou Group can have today, can not do without three generations of entrepreneurial heritage. Hongdou Group Secretary of the Party Committee and Chairman Zhou Haijiang and CEO: This is actually an entrepreneurial relay, not inheritance of property. When my father Zhou Yaoting took office in 1983, my grandfather Zhou Linsen was the founder of the Miantai Factory. In that era of public ownership, cadres were appointed by their superiors. The factory dying, my village mobilization when the village party secretary my father, can see to save the factory. My father obeyed the arrangement because of her childhood playhouse complex. This process is to obey and bear. Zhou Haijiang red beans, but also obey and play. That was 1987, when he was coached in college, his father struggled to find a college student at a township level and advised him to return home. So he resigned with pain and came to a small factory of unknown prospects. He started as a salesman, after the secretary, workshop director, director, subsidiary CEOs. With passion and knowledge of entrepreneurial talent, his performance in charge of the company has been ranked first in the various subsidiaries. Zhou Yaoting blunder, clutching the spine, bold reform, in 1993 the enterprise from the township collective to private ownership of the fundamental restructuring of government and enterprises completely decoupled, equity ownership shareholders, rights and interests returned to the enterprise, the small temple factory jumped into a modern enterprise group , He took for granted the chairman and CEO of the group. People guess: high-spirited Zhou Haijiang CEO successor will soon be. However, the desperate Zhouyou Ting has a deeper consideration: one party requires eight directions, with all directions, everyone should sit on two legs of the stool. In October 1995, he announced on behalf of the Board of Directors: million annual salary global recruitment general manager. The final selected one to increase the Chinese nationality. Three years later, the group internal competition general manager, a senior executive was elected; because of its incompetence, the post of general manager is still Zhou Yao-ting. Handprint of the post, always empty-handed to be outstanding. In September 2004, the Group once again elected president of the sea, has demonstrated its talent for 17 years, Zhou Haijiang doing my part, among the 20 candidates was elected, since the dry twelve years, the performance increased ten times. In January 2017, Zhou Haijiang again took over the chairman and CEO of the board of directors, with full control over the Hongdou Group. So far, the three generations of Zhou's ancestors and grandchildren, with their special contribution and ability, have realized the handsome inheritance under the non-family-based and modern enterprise system. Thus, also curing the employment rules of red beans: only responsible for the capital, regardless of kinship; performance-oriented, who have the ability to be the mastermind; cite not to avoid pro-crony, meritocracy is the premise. Today, red beans from the workshop director to the plant manager, subsidiary general manager, group minister, president, all open competitive posts. This mechanism, to avoid the familialization, the relationship between the use of human error caused by inheritance. The basis of system selection lies in the establishment of a modern enterprise system in an all-round way. All rely on property rights to speak and all respect the law of capital. Zhou Haijiang: not linked to the company license is the modern enterprise system. The real modern enterprise system should meet three characteristics, namely: a clear boundary of the pluralistic property rights system, the balance of efficient corporate governance system, the system of scientific management system. "Multi-property system" is the foundation of the foundation. If property rights are still dominant and can not be diversified, then the power of dialogue will be arbitrary and unable to absorb more talents and capital. Red bean employment system, based on the establishment of a diversified property rights system. Hundreds of initial shareholders to ensure that the business of the right to speak of democracy, decided the employment of enterprises, the system of selection. To sum up, the inheritance philosophy of the Hongdou Group is: system selection and performance orientation based on the modern enterprise system. Industrial philosophy: a high degree of specialization diversification of property rights, diversified industries, but also a diversity of industries, but not blindly seek more, according to the actual business, have their own homes. In the past, Hongdou had 89 major categories of industries. Later, it cut down the non-profitable and unprofessional ones and left only four major categories. It belongs to the basic needs of clothing, food, shelter and transportation and humankind. Zhou Haijiang: I tell you that as long as we insist on doing a good job in these four industries, we will never finish it. As an industry, you can neither put eggs in one basket nor too many baskets. The world's most profitable companies are highly specialized, diversified get the trap. Therefore, our strategy is: highly professional, moderate diversification. A high degree of specialization means concentrating superior forces and being highly specialized and strong, so that they can be at the forefront of their peers. A moderate diversification means that they can achieve cross-sectoral development with the support of sufficient personnel, technology, capital and markets. As the saying goes "Interlaced as a mountain"; also said "interlacing does not intercept." Although each industry has its own special laws, the basic laws of industry are interlinked; if one industry is done, it is possible to make another industry well. In Hongdou, "modest specialization" is laid out by the headquarters of the group and "highly specialized" is implemented by affiliated companies. For example, textile and garment industry, with annual sales of 120 million units, long-term national counterparts to maintain the first. Focusing on specialized division of labor, the Group has set up four subsidiary companies that produce and sell red bean men's clothing, red bean home, red bean textile and red bean children's clothing respectively. Another example, the rubber tire manufacturing industry, when the decision-making, deliberately avoided strongman Rulin car tire market, from the relatively loose competition truck tire into, aimed at replacing the marketing, quickly among the top six colleagues, as "China Mining A tire. " Say yew industry, after a series of technical difficulties to overcome, just put this endangered rare plants, successfully transplanted from high altitude slopes to low altitude plain planting, the formation of artificial nursery, potted plants, pharmaceutical industry chain, creating a "yew health industry Global leader. " Red beans real estate section, located in "responsible real estate, green real estate, caring real estate," not seeking the maximum, but for the best, with the owners to achieve long-term zero-dispute. In the meantime, efforts have been devoted to developing the "Wanhua City Complex" that meets the needs of building a new socialist countryside and has formed a unique advantage. To sum up, Hongdou Group's industrial philosophy is: in line with the actual business "highly specialized, moderate diversification." Philosophy of Development: Striving to Create "Three-Self Enterprises" Although smart, it is better to take advantage of the momentum. To seize the opportunity, we must have the ability to develop independently. Many businesses do not make money, is the lack of "three kinds of" independent ability. Zhou Haijiang: I always advocated that enterprises should pay attention to independent innovation, independent brands, independent capital, because development is the final say of innovation, the market is the final word for the brand, the element of capital is the last resort. In the context of the gradual disappearance of the labor dividend, companies with a monopoly advantage make it easy to make money. Monopoly can be a period of high profits. Industry monopoly and resource monopoly will not work, only a road of innovation monopoly. Focusing on independent innovation, Hongdou focused on building the three elements of "Talent, Platform and Investment" and implemented the "100-talent Project" and established the National-class Garment Technology Center, the Provincial Engineering Research Center for Truck Tire, and the Research Center for Integrated Utilization of Taxus Engineering Technology. Nine research and development centers, the average annual patent about 300, a national patent pilot units. Three listed companies are high-tech enterprises. At present, the entire group is rapidly entering the era of intelligence. Zhou Haijiang: Brand is the carrier of innovation is the fundamental way to maximize the value of innovation. The market has always been divided by the brand, the brand is the chain leader. Chinese enterprises must grasp the initiative of the international division of labor, they must have their own brand, otherwise it is "being the first." All things and things in the business may disappear over time, only the long-term heritage of the brand. "Red Bean" is the first national self-owned brand founded in the beginning of China's reform and opening up. The face of foreign brands encirclement and suppression, Hongdou Group did not forget the beginning, adhere to build China's first cultural brand. "Red Bean", "H0do" apparel trademark and "Maxima" tire trademark, has been identified as China's well-known trademarks, the group has also been named "national trademark strategy implementation model enterprises." Zhou Haijiang: Most of the capital of our enterprises rely on borrowing, high cost, short cycle, high debt ratio, poor autonomy. We need to change the indirect financing model, learn the direct financing model in the United States, obtain more autonomous capital faster and more through the stock market, and do the direct financing of the integrators instead of indirect financing. In order to expand the capital that can be controlled by oneself, red beans first inward financing. As early as 1993, the joint stock system was fully implemented, opening up shares to employees and villagers and raising original capital. Since then, we have worked tirelessly to make Hongdou, GM and Yew Firms listed on the SSE and the New Third Board in succession, raising billions of dollars. At the same time, we actively sought for policies, established internal financing for financial companies, set up small-loan companies and investment and financing institutions, and realized the flexible scheduling and scale expansion of self-owned capital. All in all, the philosophy of development of Hongdou Group is: Focus on creating "three self-employed" enterprises with independent innovation, independent brands and independent capital. System Philosophy: "Trinity" with Chinese Characteristics The highest state of governance is institutional governance. So, what kind of system business needs? There is no doubt that the most modern enterprise system characterized by a company system is most needed because it can stimulate the internal motivation and avoid the disadvantages of public ownership. This is also the long-term effective system of Western enterprises. However, the inherent capital-for-profit gene of this system has led to frequent fraudulent activities among global companies. This means that while the modern enterprise system has a good incentive mechanism within the enterprise and better coordinates the interests of all parties, it can not guarantee external interests such as society and the state, and does not solve the problem of the consistency of the interests both inside and outside the enterprise. Zhou Haijiang: Our solution is to embed "corporate party building" and "social responsibility" into the modern enterprise system and form a trinity modern enterprise system with Chinese characteristics. Among them, the modern enterprise system is the foundation, corporate party building is to ensure that social responsibility is the mission. For the "Party Building", there have been VOA reporters Zhou Haijiang: Western companies have no political organization, has been very good, why do you Chinese enterprises have a party? Zhou Haijiang: At that time, I said that Chinese enterprises must catch up with the West and have a better corporate system. Party building can enhance the motivation of enterprises to ensure that the direction is not excessive, to overcome the friction resistance. Since then, in his monograph entitled "Modern Enterprise System with Chinese Characteristics", Zhou Haijiang used the classical economic theories of transaction costs, institutional changes, institutional economics and political economy in the West to demonstrate the positive promotion of the party-building work on the operation of enterprises effect. On the integration of the party building work and the enterprise system, Hongdou created the experience and methods of "one core and three advantages" and "one fusion and two trainings, three leading" and was fully affirmed by the Central Government and the Central Organization Department. The party committee of the Group was rated as " National Advanced Grassroots Party Organization "; party secretary Zhou Haijiang was elected as the party's 17, 18, 19, was named" the country's outstanding party workers. " Nowadays, there are more than 20000 people every year, come to visit Hongdou come to learn. Relying on the Trinity system, Hongdou maintained a steady and rapid development and ranked 64th in the Top 500 Chinese Private Enterprises. To summarize, the system philosophy of Hongdou Group is to establish a modern enterprise system with Chinese characteristics that integrates "modern enterprise system + enterprise party building + social responsibility". Social philosophy: Active performance of the eight-way win-win "Trinity" There is a "social responsibility." However, experts and scholars generally believed in their early years: Enterprises only need to do well their internal affairs without assuming social responsibilities. Zhou Haijiang: I always think that enterprises must assume social responsibility. The reason is that enterprises occupy a large amount of social resources and should repay the society. The fulfillment of social responsibilities also accumulates social capital and optimizes the enterprise ecosystem, which is a long-term investment in return. This is also in line with the needs of the Chinese dream of red bean affection, common prosperity and realization. Enterprises should have social character. As early as in 2006, Hongdou promoted the social responsibility management system and defined the orientation of social responsibility. In recent years, it has also put forward the concept of "win-win cooperation between all eight parties" and strive to work with shareholders, employees, customers, suppliers, partners, governments, the environment and society And other stakeholders to achieve win-win situation. As a result, the Group implemented an inclusive mechanism for ensuring that employees have the right to live a safe, emotional and promising career. The neighboring village factories have been given 18 million yuan of funds for their support activities, help. In particular, with a strong sense of national responsibility, China has persisted in advocating that Chinese people own their own Valentine's Day for more than 10 years - the "Red Star Tanabata Festival". This move has been widely recognized by Chinese at home and abroad and highly appreciated by the Chinese government. In public welfare undertakings, Hongduan donated a total of more than 300 million yuan in donations, has established a 25 million yuan "Red Bean Charity Fund", 20 million yuan private equity "Yao Ting Charitable Foundation" and 20 million yuan "Care for the Old Party Members" Private Equity. The concept of win-win cooperation has been validated in the special economic zone of Sihanoukville, Cambodia, which was led by red beans. The SAR government actively carried out volunteer activities to expand employment, care for the community and protect the environment. China and Cambodia have won high recognition from both sides. President Xi Jinping praised the "booming Sihanoukville special economic zone as a model for pragmatic cooperation between China and Cambodia." To sum up, the social philosophy of the Hongdou Group is: Actively fulfill its social responsibilities and make every effort to achieve a win-win situation. Three generations of relay, sixty years legend; a successful round, how many hard glory? ! Looking back yesterday: Cultivation entity, Foundation deep roots, philosophy Chengqian Kai. Looking to the future: flying dreams, the legend will be wonderful, red beans must be even more red!