In The Post Crisis Era: Tolerance Should Be Allowed To Make Mistakes By Entrepreneurs.
Li Rucheng believes that we should not be too demanding, and making mistakes is a normal thing.
Be tolerant and allow.
Entrepreneur
Those who make mistakes and do not make mistakes are unsuccessful. Only those who make mistakes can receive lessons.
In 2010,
Youngor
Li Rucheng, the founder and chairman of the group, is 59 years old, and has a year from its repeated retirement age of 60. Li Rucheng regards the present as YOUNGOR's "key turning point".
The year before was YOUNGOR's 30th anniversary.
But Li Rucheng did not carry out publicity, two did not pay the bonus, but the top management team in the Dapeng mountain closed door meeting to reflect on, sum up the lesson.
"30 years have passed, and the next 20 years will be better than before. This is my biggest concern," said Li Rucheng, who sat opposite our correspondent.
In his view, for an enterprise, 50 years is a big hole, 50 years go well, 100 years is reliable.
So he did a series of things, one of which is "successor plan". After all, it is very important for a company to be the leader.
What made him headache was YOUNGOR.
stock right
There is no absolute control of any party. Even though he is the founder, he has less than 8.5% of the shares.
"It can neither be assigned to the state like the state-owned enterprises, nor can it appoint the next generation of successor as a real private enterprise.
I hope we can get out of the new path. "
Choosing successors is still exploring the way, but in Li Rucheng's view, this is not the most important. He said that it is more important to establish a good system and control it through the system.
This is Li Rucheng's consistent style.
Any single item, in his view, can not be regarded as the ultimate and can not be ignored. The operation of various individual combinations is the most important competitiveness.
He admitted that today's YOUNGOR, some of which have played a positive role in the "tactical" has gradually weakened, and some fear that YOUNGOR will become a stumbling block.
For example, the strategy of diversifying the main business in a listed company.
YOUNGOR started with clothing, but has formed the "three carriages" mode of clothing, equity investment and real estate. The diversification of this kind of GE has been praised and imitated by domestic private enterprises.
However, in 2008, the financial crisis made YOUNGOR's "two wings" suffer great losses. Although the net profit of its textile and garment business increased by 9.61% over the same period, the annual net profit of real estate and investment business decreased by 36.05% compared to the same period last year.
In this year's earnings report, the net cash flow generated by its business activities decreased by 55.77% compared with the previous year, mainly due to the decrease in the pre purchase of the company's real estate business.
Because of its declining share price of Haitong Securities and Jinma shares, the loss of assets impairment was nearly 1 billion 320 million yuan in that year.
However, due to the loss caused by equity investment, its net profit decreased by 36.05% compared with the same period last year.
The pattern of YOUNGOR's "three carriages" has been questioned by investors, and its share price has also experienced a roller coaster, falling from more than 20 to a single digit, and has not been restored to the previous level until today.
How to adjust the strategy with the times and lay a good road for the next 20 years and even a hundred years to make YOUNGOR take a benign institutional turn is the key moment for Li Rucheng to ponder now and the critical moment to test his wisdom and strategic vision.
We are always doing business.
Twenty-first Century: in twenty-first Century, the three business structure of the company was further sharper in the 2009.
Is it the adjustment made by the financial crisis?
Li Rucheng: This is not the only idea in 2009. We have been thinking and trying to make the main business more smooth. The financial crisis has just accelerated the process.
In the past few years, YOUNGOR was more concerned with the problem of development. In the last 2 years, we have been considering a good foundation for future development, adjustment and practice.
Of course, the problem is also related to the successor plan.
A few years ago, we accepted the practice of Stan Shih and Lenovo Group Liu Chuanzhi of Taiwan Acer group.
Editor's note: at the end of 2000, Stan Shih started the Acer group's "reengineering plan", and nurtured Wang Zhentang, Li Yao Yao and Lin Xianming who supported each other in the post Stan Shih era. In the same year, Lenovo Group was split into Lenovo computer and digital China and launched Yang Yuan Qinghe Guo.
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Twenty-first Century: Yes, the three main businesses are very strong. But in a listed company, the premium capability has been swept away from each other, and investors can not give you the right valuation.
Li Rucheng: This is a problem.
For example, when the property is not good, it will have an impact on our stock price, but in fact, our clothing and investment business proceeds very well, which may not be reflected in the stock price.
The stock price is actually a comprehensive response.
Why are our stock prices relatively low? Because the plates are large and the pparency is high. It is clear that several industries do not engage in speculation.
In twenty-first Century: the SFC has begun to promote the process of splitting and listing, but it still takes time.
Looking back, will it be simpler to set up the structure at the very beginning? Will YOUNGOR estate, such as the real estate sector, be better placed outside the listed company?
Li Rucheng: it's hard to tell.
Our idea was to make the listed company bigger.
Now, it seems that because the recent real estate business does not allow financing, we have so many financial assets on hand that the financing function of listed companies is gone.
Twenty-first Century: also because of its many main businesses, the US Business Week criticized YOUNGOR for "doing nothing". What do you think of it? Will it feel bad?
Li Rucheng: they remind us to go well.
I think, first, it shows that we have attracted the attention of the US business week, which shows that YOUNGOR has arrived at such a stage and has to take care of it carefully. Second, what is called Zheng ye? I used to be a farmer, and the farmer was my real business. Afterwards, I made shirts and shirts, and then I made a suit, and my suit was also not working properly. What did you say about the business of GE? What is the main business of TOYOTA? TOYOTA's earnest business was the first to do textile.
My view is that, first of all, we must listen to what others say well, we move forward (maintain), others say wrong, we struggle (improve), do not have to worry about.
We can't learn GE.
Twenty-first Century: at the same time of business adjustment, I heard that you have also made reforms to the system of the board of directors.
Li Rucheng: we created a system of directors' regular meetings and held a regular meeting every month to let directors really participate in specific operations.
In the past, some people criticized the directors of Chinese listed companies, saying that directors were "not sensible", but we would not.
At the same time, we slowly separate the meetings of the board of directors and the executive sessions. The Board discussed the big situation and discussed the specific business at the executive level meeting.
At the very beginning, the two would always be easy and together.
Twenty-first Century: does that seem to be a group decision? What if it is wrong?
Li Rucheng: don't ask for too much. Making mistakes is normal.
It is unsuccessful to tolerate and allow entrepreneurs to make mistakes and make no mistakes. Only those who make mistakes can learn lessons.
Twenty-first Century: General Electric (GE) is a model of global diversified business management. Has it consulted GE in adjustment?
Li Rucheng: we haven't studied it. GE is too big. We should do it according to our own conditions.
It's not simply a matter of architecture. The key is teamwork.
Professors are invited to come up with the best structure, but it is useless. The key is human disposition, and the allocation of human resources is alive.
Each enterprise has the characteristics of every enterprise, its ecological environment and internal culture, and can not look at problems from outside.
We can not learn TOYOTA, we can not learn GE, others are people, YOUNGOR is YOUNGOR, not the same.
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Twenty-first Century: no adjustment like 2009?
Li Rucheng: No.
We all study by ourselves and draw conclusions from our own situation.
Now the information is very developed, from the Internet, the media, can learn from some of the outside information, which are using the external brain.
An enterprise or a person, he does not exist in his own nature, he is constantly digesting the acceptance of foreign ideas and ideas, and finally combined in the enterprise, depends on whether you will use.
Twenty-first Century: what do you think of your acceptance and assimilation of foreign ideas?
Li Rucheng: that's all right.
I still like to think about some things, but I have to combine YOUNGOR's own situation.
Successors and property rights reform
Twenty-first Century: it is said that you will retire at the age of 60, that is, next year. What are the successors' considerations?
Li Rucheng: This is what we are thinking about at the moment.
I am a rabbit and jokingly say that YOUNGOR has stocked many rabbits, "cunning rabbits, three holes", YOUNGOR has four generations of employees, and there are many ways to train successors.
But what I am most troubled about is how a company with a shareholding structure like YOUNGOR has a system of selecting successors. It can neither appoint the state as the state owned enterprise, nor appoint the next generation of successors like a real private enterprise.
I hope we can get out of the new path.
Twenty-first Century: indeed, if a successor does not have enough equity, how will he manage and lead the company?
Li Rucheng: This is going to go back to the construction of the system.
In the future, YOUNGOR must rely on institutional management and decision-making. Leaders are important and systems are important.
But in the long run, we are also considering the next step how to adjust the ownership structure.
Twenty-first Century: will successors be airborne professional managers?
Li Rucheng: the team of professional managers in China is not yet mature.
It's hard for us to find professional managers like ours.
YOUNGOR is also a small society with diverse cultures, so airborne is very difficult.
Many ways can be considered, the key is that the confirmation of a core person is very difficult.
Ma Yun said very well, in the commercial world, he must adhere to the interests of customers first, employees second, shareholders third.
We may be more responsible to shareholders in the future, and more consideration is the interests of customers and employees.
Twenty-first Century: do you have any thoughts about these? Otherwise, it's only one or two years now. It seems a bit late.
Li Rucheng: This is not to say "it's too late".
I think that if you are still moving forward, there is no such thing as being late.
YOUNGOR has been doing things for 100 years in the past 30 years. It is impossible to think too quickly and get everything done. Actually, this idea is not very realistic. It is really not very realistic.
20 years ago, I never considered the problem of changing shifts. I still worked hard.
By this time, I will think about it. By the age of 60, I feel very urgent. We must solve this problem in 5 years.
Twenty-first Century: if the shift is not as good as expected, there may be some uncontrollable problems.
How to do it?
Li Rucheng: I've thought about it. The worst thing to do is to sell YOUNGOR. It's possible.
I hope that after the handover, the enterprise can manage better than me. This is my happiest thing; if I can stay steady, I will be satisfied; if I can't support it, I will intervene, and think about it and support it. After all, I am still a shareholder.
Twenty-first Century: once again, if you choose to hold personal control, can these problems be avoided?
Li Rucheng: at that time, the practice of holding no control was right.
If you do not give equity to others, businesses will not do much.
It should be said that it is precisely because I share the stock ownership with everyone that the team is so stable that everyone's direction is more consistent, so that YOUNGOR can rise rapidly.
In my generation, the lack of centralization of ownership does not mean much, but it has an impact on the next generation.
Twenty-first Century: will you escort the new successor to "escort the horse for a while" and escort it for some time?
Li Rucheng: there is no conclusion yet. It depends on whether it is necessary.
If he wants to be escorted by others, he must escort him. He is not independent enough to escort.
Your escort is helpful to the next team, you can do it, no help, no side effects.
Distribution should be tilted to front-line employees.
Twenty-first Century: employee stock ownership, so that the old employees share the dividends of the company's development. What will happen to the new people?
Li Rucheng: This is a problem of existence. At that time, the object of encouragement should be retired now. At that time, more than 800 people, even one of our doormen, were millions of millionaires. Instead, now there are a large number of new cadres. We can not get so many shares now. Of course, there are shares, but the stock price is high, and it has gone up many times. So now we are also considering this problem.
In addition, there must be some changes in the way of distribution.
Twenty-first Century: How did it change?
Li Rucheng: we must deal with the interests of shareholders and employees in the basic distribution. We should lay stress on front-line staff in the future distribution.
In the past two years, we have set a principle that the growth rate of middle-level cadres can not exceed the growth of grass-roots staff, and the principle of higher levels will no longer increase.
With the development of YOUNGOR, our employees' income should give him a guarantee that the annual growth will reach 10%, so that we can recruit excellent staff. The middle-level cadres should not exceed 5% in principle, and the top level will not increase in principle.
Employees are the foundation of economic development.
The allocation mechanism is also very important for YOUNGOR. The original method still works, and some new things will come in.
New 5 years: talent training is the key
Twenty-first Century: what would YOUNGOR have learned in the past?
Li Rucheng: we are also summarizing.
If YOUNGOR now seems to have some regrets about the future development, I think there may be some gaps in the training of all kinds of talents.
We all know that people are more economical and reasonable to use, but they do not want to train, use more, and train less.
Therefore, we now have a sense of urgency to speed up the development of talents in the next round of development in YOUNGOR.
The enterprise has been in a critical turning point for 30 years, and the next 20 years will be faster than the 30 years before the development. This is not bottomed out in my mind. I am not sure, because we are still relatively scarce in this aspect.
But this can not be said to be wrong.
Any action, policy or behavior is able to achieve certain results under specific historical conditions.
Twenty-first Century: is it still a few years late to realize this problem?
Li Rucheng: it's hard to tell.
The development of YOUNGOR for so many years is not from the very beginning to determine what kind of enterprise it must develop into.
Like a country, it is a way to cross the river by feeling the stones. Finally, it is concluded that there is a lag stage in the final determination.
The same is true for enterprises. You can't have such a feeling without such a stage.
Twenty-first Century: enterprises are developing fast, and they also require a lot of entrepreneurs. Apart from their learning ability, they have to deal with all aspects.
Li Rucheng: in fact, it is not so complicated that everything is done well in order to coordinate things well.
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