China: struggling for its position in the world - Tom Doctoroff

Tom Doctoroff

China gains economic and financial power, but is still struggling to find its place in the world, writes China veteran Tom Doctoroff in the Huffington Post."So China’s road to becoming a “soft” superpower will be long and rocky indeed," he says.

Tom Doctoroff:

Unlike Japan, a cocooned island, China is not apart from the world. Indeed, the country fancies itself the center of the universe, a cultural supernova that sucks in anything in its path. China - as much as civilization as a nation-state - has endured for thousands of years, a feat attributed to natural order. The “idea” of China is, in local people’s eyes, absolute truth. China analyzes, dissects and atomizes the political systems of other nations. It studies Western competitive advantages and applies them to local circumstances. But it is also a country in search of its own Copernican revolution. It remains unable to weave itself through the warp and weft of other societies. 

For example: Other than Huawei, a business-to-business telecommunications company, no Chinese corporation has achieved significant scale in any developed market - Haier’s fifteen percent share of cheap microwaves and mini fridges in the US does not count - due to, among other factors, the inability to balance marketing and sales functions; 

International cuisine is a hit in public settings where middle class Chinese bend over backwards to project an image of cosmopolitan erudition. However, even sophisticated Shanghainese rarely eat foreign foods at home. According to Treasury Wine Estates, only 5% of booming red wine consumption occurs at home; 

Chinese expatriates, particularly men, do not assimilate well. They often return home with a simplistic view that the West “looks down on” them. But reality is subtler. At business schools and in offices, clusters of Chinese retreat into self-effacing, gun-shy cliques reinforcing stereotypes of Chinese men as soft; 

Second- and third generation American Born Chinese struggle to reconcile the imperatives of Chinese heritage - obedience to parents, obsession with “face” - with US individualism. Identity confusion sometimes results in an odd hyper-Americanism; 

Oversees students, acutely aware of the deficiencies of China’s memorization-based education system, nonetheless avoid Western liberal arts like the plague. The most popular majors are still engineering, math and business; 

Starting in 2004, the government opened hundreds of Confucius Institutes to promote inter-cultural “harmony.” Due to a dearth of effective outreach ambassadors, they have ended up as language schools; 

So China’s road to becoming a “soft” superpower will be long and rocky indeed.

Much more in the Huffington Post.

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Haier's boss surprises his acquired US management - Bill Fischer

Bill Fischer

When Haier took over GE's Appliances, US management feared the future. But the Chinese takeover is very different from the American style, they discovered. Western firms are victim of their traditional viewpoints, tells IMD-professor Bill Fischer, who studied Haier's very different corporate style, to AP.

AP:

Haier has tried to speed up product development by using the internet to ask potential customers for suggestions and feedback, an approach taken by Chinese smartphone brands. The company says a new appliance can go from drawing board to market in as little as one year, down from more than three years. 

CEO's Zhang Ruimin’s management changes “are more impressive than we see anywhere,” said William A. Fischer, a professor at the IMD business school in Switzerland who has followed the company for a decade. He co-wrote the 2013 book “Reinventing Giants: How Chinese Global Competitor Haier Has Changed the Way Big Companies Transform.” 

“He trusts his employees to play more of a leadership role,” Fischer said. 

He said a group of European executives he took to Haier headquarters two years ago refused to believe its decentralized style could work. 

“I was struck by how daring Haier was in their thinking. And the people I was working with were hostages to very traditional ways of working,” said Fischer.

More at AP.

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Chinese management reform: shunned by the West - Bill Fischer

Bill Fischer

When Western companies discovered new management systems in Japan like Just-In-Time in the 1980s, they applied it fast,despite initial misgivings.But when they see now new ways of decentralizing corporate structures in Tencent and Haier, they are reluctant to take it serious, says Haier-watcher and IMD professor Bill Fischer, co-author of Reinventing Giants: How Chinese Global Competitor Haier Has Changed the Way Big Companies Transform at AP.

AP:

Haier has tried to speed up product development by using the internet to ask potential customers for suggestions and feedback, an approach taken by Chinese smartphone brands. The company says a new appliance can go from drawing board to market in as little as one year, down from more than three. 

Zhang (Ruimin)'s management changes "are more impressive than we see anywhere," said William A. Fischer, a professor at the IMD business school in Switzerland who has followed the company for a decade. He co-wrote the 2013 book, "Reinventing Giants: How Chinese Global Competitor Haier Has Changed the Way Big Companies Transform." 

"He trusts his employees to play more of a leadership role," said Fischer. 

Fischer said a group of European executives he took to Haier headquarters two years ago refused to believe its decentralized style could work. 

"I was struck by how daring Haier was in their thinking. And the people I was working with were hostages to very traditional ways of working," said Fischer. 

The strategy appears to be paying off. Last year's profit rose 12.8 percent from 2015 to 20.3 billion yuan ($2.9 billion) on revenue that increased 6. 8 percent to 201.6 billion yuan ($29.3 billion). Transaction volume on its business-to-business and consumer-oriented internet platforms rose 73 percent to 272.7 billion yuan ($39.6 billion).

More on Haier at AP.

Bill Fischer is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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Haier´s strategy to enter American homes - Bill Fischer

Bill Fischer

When China´s leading white goods producer Haier bought the appliances department of GE it caught the headlines. But the acquisition might not be as important as the underlying strategy to enter American homes, says IMD professor Bill Fischer, co-author of the book Reinventing Giants: How Chinese Global Competitor Haier Has Changed the Way Big Companies Transform to Bloomberg.

Bloomberg:

Besides the purchase, Haier forged a "long-term strategic partnership” with Fairfield, Connecticut-based GE to jointly expand in high-tech manufacturing areas such as healthcare and the industrial Internet. According to Bill Fischer, a professor of management at the Lausanne-based IMD business school, that was Haier’s biggest coup. 

“I believe that Haier sees the partnership as potentially more important than the acquisition itself,” said Fischer, who’s written a book about Haier’s transformation. 

The tie-up between Haier and GE was discussed “at the senior-most level” of both companies and potential global projects that draw on each other’s expertise have been identified, a Haier spokesman said in an e-mail. A joint working group is being put together to narrow down details, according to the spokesman.... 

Haier’s true aim is likely not in emulating the old GE, but to go for a less asset-heavy and nimbler strategy, where the company uses its assets as a “platform” to collaborate with others, much like how app programmers work with the iPhone and iPad, said IMD’s Fischer.

More in Bloomberg.

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How cheap China became a business disruptor - Bill Fischer

Bill Fischer

For long China has been displacing Western companies by cheaper products. But many have failed to see how this displacement has been overtaken by disruptive business models, writes IMD professor Bill Fischer in the Harvard Business Review.

Bill Fischer:

China has not been a huge technology innovator, despite being the world’s second-largest investor in R&D, but Chinese businesses have found ways to use innovations in processes, business models, and customer experience to their disruptive advantage. Xiaomi’s phones are not technologically disruptive in hardware terms, but they are revolutionary in customer experience terms; customers come to expect and appreciate their weekly OS updates. Technologically, Tencent’s WeChat may seem like a WhatsApp knockoff, but it allows users to do a multitude of things that other messaging apps cannot. Again, this is true disruption (although not particularly successful outside of China so far). Haier’s organizational reinventions allow it to accelerate the time to market for its Tianzun advanced household heater/air conditioner/air purifier — a potentially disruptive advantage in what is a slow-moving industry. 

We in the West have long prided ourselves on our business process acumen, strategy savvy, and customer centricity while stereotyping Chinese competition as being nothing more than low cost. As a result, we have missed China’s transition from displacer to disruptor. Today China’s businesses are becoming considerably more disruptive than we have given them credit for, making Chinese competition more formidable in the future. This is not to say the road ahead for China will be a smooth one. The major barrier the country must overcome is entrepreneurial. We spoke with several Chinese entrepreneurs in Kunshan last month — young and old, working in both the private sector and the public. They consistently characterized their peers as too short-term oriented to create truly disruptive change, and the country’s cumbersome state-owned enterprises as too slow. Entrepreneurs in Chinese industries from animated media to applied medical research said that China’s insistence on domestic standards are resulting in less-ambitious innovation and that the education system is not supporting appropriate talent development. The former country head of a major multinational pharmaceutical company (a Chinese-American one) observed that “made for China,” rather than “made for the world,” often is easier, cheaper, and more profitable than pursuing truly disruptive changes, an observation echoed by the Chinese managing director of an internationally funded pharmaceutical venture capital fund operating in the China market. This emphasis on “made for China” is also a peeve of a “returnee” chaired Beijing University professor who pointed out that some returning young Chinese scientists are avoiding new challenges, preferring instead to “continue their advisor’s work.” 

Nonetheless, there are enough suggestions of business model disruption appearing in China that it is highly conceivable that soon we might be entering a period of two-speed change. The first will be continued displacement by ever-more-competitive Chinese companies who compete on cost. The second will be disruptive business model innovation occasionally appearing in less-familiar sectors of the Chinese economy, powered by emerging entrepreneurs. 

This presents Western companies with a fresh challenge. Displacement can be combatted in a number of ways, from process improvements to government trade actions, and cost advantages tend to be temporary sources of competitiveness, but disruption presents a more profound challenge. It calls for real transformation in incumbent companies — something that is notoriously difficult to achieve.

More in the Harvard Business Review.

Bill Fischer is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers´request form.

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Rising labor costs and lower sales growth drive outbound expansion - James Roy

James Roy

Haier´s purchase of GE´s appliances and Midea´s efforts to get a bigger stake at Germany´s robotic company Kuka both reflect the challenges the giant Chinese firms face at home, says business analyst James Roy to Barron´s. Rising labor costs and slowing growth of domestic sales makes both look abroad.

Barron´s:

James Roy, an analyst at consultant China Market Research Group, says the deals represent two very different ways in tackling the challenges both face. For Midea, “labor costs are continuing to rise and the pool of available workers shrinking over time,” Roy tells Barron’s Asia. A number of Chinese provinces have lavished annual increases in minimum wages, while an ageing workforce and preference for services jobs are also draining the talent pool. A quick hunt through Midea’s annual financial reports indicates wages as a percentage of sales costs have risen exponentially over the last few years. 

That’s been eating in to Midea’s bottom line. The company’s traditionally focused on the low-to-middle end of the Chinese market for appliances like refrigerators and washing machines, which typically have lower margins. ... 

The rationale behind Haier’s purchase of GE’s appliances business looks simpler to decode. The company’s battling similar headwinds to Midea, namely sluggish domestic sales due to the Chinese economy’s slowdown. In fiscal 2015 its total revenues slumped by about 5%. A recent fightback in China’s property market hasn’t brought much reprieve either, given the rebound’s been mostly confined to top tier cities like Shanghai and Shenzhen. Haier bills itself as the world’s biggest white goods maker, with global market share of 10%, but the vast majority of this comes from China. Estimates put Haier’s U.S. sales at a tiny 1% of its overall revenue. GE “gives them access to a higher end segment than they’ve previously been able to get to through their own self-branded products,” explains China Market Research’s Roy.... 

Still, there’s more both Midea and Haier could do to clean up their act. China Market Research’s Roy reckons both have been slow to catch up with new trends in home appliances, or have made missteps here in the past. Case in point: Both Haier and Midea have been slow to the punch when it comes to new offerings like air purifiers – products with obvious captive markets given the poor air quality in Chinese cities. Additionally, dryer machines, for example, just haven’t caught on given locals’ propensity for hanging clothes out of windows to dry. Roy thinks by bringing more international expertise into the fold, the pair is more likely to avoid being taken to the cleaners in future. “There’s a growing comfort among large Chinese companies to acquire other companies and learn from their best practice,” he believes. “There’s a realization that they need to learn more international know-how.”

More at Barron´s

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The global road of China´s white goods producers - James Roy

James Roy

Washing machines might not be as sexy as real estate and IT-investments, but China´s white good producers have also embarked on a global road, says business analyst James Roy to Reuters. Haier has been investing abroad for decades, but others are following.

Reuters:

Haier is not alone. Major Chinese white goods makers such as Hisense Electric Co Ltd (600060.SS) and Midea Group Co Ltd (000333.SZ), have been on an overseas spending spree this year, as they seek to snap up foreign brands to tap faster-growing markets as growth slows at home. 

"Access to other markets helps them find new sources of growth as the domestic market slows," said James Roy, associate principal of Shanghai-based China Market Research Group. "It's also an opportunity to gain additional know-how to succeed in China, where competition is becoming fairly intense." 

For rivals such as Whirlpool Corp (WHR.N), Electrolux, LG and Samsung Electronics (005930.KS) - some of the biggest names it will come up against in the United States - one aspect of Haier's rise in Australia will give some cause for comfort. Despite integration of their sales, logistics and customer care operations, the deal has yet to lead to larger market share gains for Haier’s own brand, highlighting challenges the group faces as it seeks to build market share in the mid-tier segment of the market.

More at Reuters.

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How Tencent is erasing its middle management - William Bao Bean

William Bao Bean

Erasing the middle management and organizing competition internally: those are two features in new revolutionary corporate structures in China. Haier and Tencent have made big inroads. Innovation expert William Bao Bean discusses Tencent and how their organization works.

William Bao Bean is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers´ request form.

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What 8 innovations from China can you expect in 2016.

8 Chinese innovations that might disrupt your industry in the year of the ape

Looking back at the demand from our clients at the China Speakers Bureau over the past few years, we see a distinct development into the future, into the year of the ape.

When we started our operations, many companies and organizations were looking for solutions to enter the often murky China markets. How to deal with consumers, governments, competitors and questions related to the country's developing economy?

Many of the larger and middle-sized foreign companies now have their operations going in China, often hired and employed Chinese staff, and got a better handle on the country. And China itself has entered an area of normality that would have been unthinkable ten years ago, despite regular complaints from foreign companies. 

But the perceived challenges, are now of a different dimension. China is becoming an innovative nation, offering disruptive technologies, unsettling traditional industries. And while most disruption took place in China itself, the relatively slow economic growth is forcing Chinese companies to look to the rest of the world. That change reflects profoundly in the demands we get from our clients.

And gaining a market share in countries where established internet companies are already present might not be easy for Chinese companies. 

Here we offer you an overview of the top-8 Chinese innovations that might disrupt your industry in the years to come, and where China has already made huge advances.

1. Mobile payments, wiping credit card and banking services away; Alipay has 80% of the market, based on Alibaba's giant following. Can it be copied elsewhere?
2. Online mapping services, offering discounts, payment services and reservation models.
3. Chatting services develop into profound platforms, offering a wide range of services. WeChat is changing traditional marketing and their features are already being cloned by Facebook Messenger. 
4. The Chinese style of organizing successful companies: the end of the middle management (Haier, Tencent, Huawei) and a strong focus on consumers.
5. insurance: P2P models are taking over old-style insurance models
6. Crowdfunding: larger internet companies have taking over VC-style and traditional bank lending in China. Can this trend develop also outside China?
7. Self driving electric cars: traditional car companies are losing their competitive edge, while internet companies in both the US and China are fighting to conquer the markets first.
8. The Internet of Things: Huawei has become the fastest growing for handsets and other mobile connections, taking on now Samsung and Apple successfully.

In the coming months we will flesh out some of the subjects here, and offer suggestions for speakers who can cover these disruptive developments. Otherwise, we wish you all the best in the upcoming year of the ape.

Haier´s strategy into US homes - Bill Fischer

Bill Fischer

The purchase of the GE appliances section by Haier is part of a strategy to enter American homes, says IMD professor Bill Fischer, who studied Haier intensively, to Bloomberg. How different is Haier from GE?

Bloomberg:

Besides the purchase, Haier forged a "long-term strategic partnership” with Fairfield, Connecticut-based GE to jointly expand in high-tech manufacturing areas such as healthcare and the industrial Internet. According to Bill Fischer, a professor of management at the Lausanne-based IMD business school, that was Haier’s biggest coup. “I believe that Haier sees the partnership as potentially more important than the acquisition itself,” said Fischer, who’s written a book about Haier’s transformation. 

The tie-up between Haier and GE was discussed “at the senior-most level” of both companies and potential global projects that draw on each other’s expertise have been identified, a Haier spokesman said in an e-mail. A joint working group is being put together to narrow down details, according to the spokesman.... 

GE’s sale of its appliance unit comes as the manufacturer is itself attempting to positionas a digitally savvy industrial manufacturer, by expanding a business providing data analytics capabilities for its heavy-duty equipment. The company earlier this month announced it would move its headquarters to Boston to bolster those plans. 

Haier’s true aim is likely not in emulating the old GE, but to go for a less asset-heavy and nimbler strategy, where the company uses its assets as a “platform” to collaborate with others, much like how app programmers work with the iPhone and iPad, said IMD’s Fischer.

More at Bloomberg. 

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GE-deal upward boost for Haier brand - James Roy

James Roy

Haier might be the largest white good manufacturer, globally active, but is not yet seen as a global brand. The purchase of the appliances section of GE for US$5.4 billion might just change that perception, says James Roy, Associate Principal of the China Market Research Group (CMR) in the International Business Times.

The International Business Times:

Haier, the world's No. 1 manufacturer of white goods by volume, has little more than 1 percent of the U.S. market. It is one of the reasons why it was able to win the deal -- a previous sale of GE Appliances to Sweden’s Electrolux was opposed last year by U.S. antitrust regulators, who said the merged company's significant combined market share would lead to higher prices. 

“The GE deal would give Haier a stronger brand,” James Roy, associate principal at China Market Research Group in Shanghai, told International Business Times. “The company is a big player, but it has struggled in brand positioning, particularly in the U.S., where it’s seen as mass market.” 

Even in the Chinese market, Roy said, it's seen as a volume maker. Haier is always present, and reasonably priced, with a service infrastructure that people respect for its scale and reliability — but it's maybe not something people get excited about. "We haven’t seen them making the kind of innovative moves we’ve seen from a brand like [smartphone maker] Xiaomi , which has leapfrogged competitors by introducing its own brand air purifiers, for example," Roy added. 

Zhang Ruimin, who has spoken of his desire to turn Haier into a “great company," has long emphasized the importance of innovation, experimenting with innovative management structures in the company, and seeking to invest in smart devices, such as 3-D printed air conditioning units. 

The takeover, experts say,  aims to take Haier to the cutting edge, giving it not just GE's brand name but also its software. "GE is famous for its strong emphasis on best practice, and Haier could learn from its innovation culture, too,” Roy told IBT... 

(Haier) will require all of its flexibility to make a success of running one of the world’s oldest and most respected household appliance brands. China Market Research Group’s Roy said the example of Lenovo, which took over IBM personal computers and is now a market leader in the sector, is a promising one -- if Haier approaches its acquisition in the right way. 

“I could see it working if they don’t squander GE's brand equity," he said. "As long as they don’t look at this as a vanity acquisition, and are willing to learn from GE, they could make this work."

More in the International Business Times.

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How Haier reinvented itself four times - Bill Fischer

Bill Fischer

Haier is for years the largest white-good manufacturer, not only in China, but worldwide. IMD professor Bill Fischer explains how the first Chinese company to go global did so by unconditional focussing on their customers, in Strategy Business. How Haier reinvented itself four times in 30 years.

Bill Fischer:

Much of the credit for Haier’s success accrues directly to Zhang Ruimin, the company’s CEO since 1984. Throughout the 30 years of his tenure, his sharp focus on customer service leadership has given the company consistency even as it propels Haier through dramatic changes. Zhang was the leader who proposed that Haier should never see itself as just a manufacturer of products, but instead as a provider of solutions to its customers’ problems. In the earliest years, that meant bringing new levels of quality and reliability to Chinese products. Later, it involved increasingly sophisticated forms of customization and new types of services. Through its simplicity and continuity, this principle has given all employees a reliable compass with which to make decisions, even in the face of disruptive market challenges such as new technologies or new competitors. 

To accomplish its goal, Haier has consistently cultivated and rewarded high-quality talent; the company has been a magnet for many of China’s most capable engineers and businesspeople. This approach is especially noteworthy within China’s cultural and social context. In a country that was just beginning to emerge from a Maoist mind-set when Zhang took the helm, the idea that success depended on the entrepreneurial efforts of individuals, recognized for their differences and rewarded for their achievements, was relatively unfamiliar. Haier has thus invested a great deal, especially for a Chinese company, in training its employees and demanding innovative ideas. 

Despite the success it has achieved, and its willingness to stick to one core value proposition (and one CEO) since the 1980s, the company has never become complacent. Zhang established early on that changes would be a way of life, not soon-to-be-completed episodes that must be traversed. “The only thing that we know is that we know nothing,” he says. “If you don’t overcome yourself, you will be overcome by others.” 

Indeed, Haier has reinvented itself at least four times. The first reinvention, in the 1980s, was the decision to differentiate the company by the quality of its products. The second, in the 1990s, was the adoption of consumer-responsive innovation, starting with (but not limited to) products for particular customer needs. The third, which took place in the 2000s, was the reorganization into a bottom-up structure, in which self-managing teams led decision making. The fourth, going on today, is the reinvention of Haier as a truly Internet-based company, open to the world in a way that few other companies have attempted, let alone realized.

Much more in Strategy Business.

Bill Fischer is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers´ request form.

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Bill Fischer is also the author of Reinventing Giants: How Chinese Global Competitor Haier Has Changed the Way Big Companies Transform
 

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Chinese pick Chinese brands on Singles´Day - Shaun Rein

+Shaun Rein 

A major shift in consumers preferences in China is that from foreign brands to Chinese. Author Shaun Rein of The End of Copycat China: The Rise of Creativity, Innovation, and Individualism in Asia explains in CNBC how the top-5 brands at Singles´Day illustrates the growing China pride.

CNBC:

The top 5 brands, ranked by gross merchandise volume, were budget smartphone manufacturer Xiaomi, followed by telecommunications hardware and phone maker Huawei, consumer electronics and home appliances company Haier, furniture retailer Linshimuye and Japanese apparel retailer Uniqlo, an Alibaba spokesperson told CNBC via email on Wednesday. 

Top 5 ranking reflects "the growing pride Chinese consumers have in their homegrown brands", said Shaun Rein, founder and managing director of the China Market Research Group. "That's why they are buying brands like Xiaomi and Haier." 

"Uniqlo is one of the hottest brands in China now because they make clothing and [have a] marketing campaign that fit the aspirations of Chinese consumers unlike Louis Vuitton with their blond hair, blue eyed models," said Rein, who is also the author of 'The End of Copy Cat China: the Rise of Creativity, Innovation and Individualism in Asia.' Many Chinese consumers are unaware that the brand originates in Japan, he said. 

Alibaba on Wednesday revealed that the Singles' Day sale saw over 1.2 million large home appliances, 3 million lighting products, 200,000 bottles of laundry detergent and 50,000 new cars sold. 

"Those categories are very popular in China," said Rein. 

White goods makers tend to engage in aggressive marketing campaigns for Singles' Day, he said. Discounted laundry detergent, meanwhile, is a popular item as Chinese consumers prefer to have it delivered rather than carting it home. Finally, online car shopping is booming, he said, because consumers know what they are getting when they order one.

More at CNBC.

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The organization of disorder at Haier - Bill Fischer

+Bill Fischer 

White goods producer Haier has an amazing story of change, where its CEO Zhang Ruimin reinvented the company, three times, tells IMD-professor Bill Fischer in CKGSB Knowledge. Fischer is co-author of Reinventing Giants: How Chinese Global Competitor Haier Has Changed the Way Big Companies Transform.

CKGSB Knowledge:

Q. One of the things Zhang Ruimin did was break the company into different bureaus, effectively creating internal competition. How does that work?  

A. If you are moving from ‘responsiveness’ to ‘intimacy’, in ‘responsiveness’, you need to listen very well to the customer and respond quickly. With ‘intimacy’ you need to get so close to the customer that the slogan was ‘zero distance to the customer’. That means you need to change the way in which you go to market because you are now dealing with ideas rather than just customer responses to offerings. You need to have a factory system that is infinitely responsive because you don’t know what’s going to come out of this. You raise uncertainty multifold. You need to build an organization that’s capable of dealing with unforeseen uncertainty. 

In order to do that [Zhang Ruimin] needed to really free up the skills of his workforce because they had no idea what the customers were going to tell them. They needed to have an organization that was fluid in terms of how it moved to changes in the marketplace. He recognized that the existing departmental, functional, silo-ed organization would be too slow to do that. So he had to hire new skills, and then he had to put them into an organization that was able to move quickly and coherently the way the customer wanted. He had to take out the existing organizational units because they were historical, rather than anticipatory. What they settled on was an internal labor market where you literally auctioned off opportunities. So the slogan is “Haier doesn’t offer you a job but offers you the opportunity to create a job.” 

If you are going to do that, you need a labor market inside where people bid for work and then assemble teams to address that work. Those teams dissipate at the end, and go back into the labor market rather than remain in place because of historic success. If you do that, you need a mechanism for choosing a leader. So they use performance, they appraise business models and promises to pick leaders. But once that leader is in place and assembles a team, his or her team appraises their performance every quarter and votes [on whether] they want to keep them in position or not. Everything changes. It’s the organization of disorder that allows them to perform so well.

More (including a video interview) at CKGSB Knowledge.

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