Zhang Ruimin: Haier's Facebook Revolution

A cup of black tea was slowly turned round by a broad palm. The master is hale and hearty, but his pouch seems to be a bit striking.

In the executive suite of Hilton Hotel, Beijing, December 16th. Haier Chairman of group board Zhang Ruimin An exclusive interview with this reporter said: "Haier's goal is to become the world's leading brand in the Internet age."

In recent years, Zhang Ruimin has been very different from before, no longer involved in contracts and orders. Instead, he traveled frequently in the world's top business schools. He met and talked with Gary Hammer, Michael Porter, business leaders and leaders of multinational corporations, and explored the changes in company strategy, management innovation and business mode.

Over the past 30 years, Haier is the most successful example of "made in China". Based on the current technological environment and industrial environment, Zhang Ruimin hopes to get the most abundant reference frame by reading and talking, so as to describe a clear future for Haier. From classic management masterpieces to the recent Facebook effect, he has dabbled in it. He said he also had a "three dimensional" conversation network, including Haier employees, partners and friends in the industry.

Zhang Ruimin said Haier is promoting a revolution embracing the Internet. The revolution is a process of reengineering, and the three networks convergence is the new starting point for Haier.

　 Enterprises need to deal with internet challenges

Twenty-first Century: what is the most important concern of you and Haier over the past few years?

Zhang Ruimin: in recent years, I have concentrated on business model innovation and failed many times, but there is no problem in direction.

The Internet brings personalized demand, personalized demand brings marketing fragmentation rather than the original marketing integration. This has brought great challenges to manufacturing enterprises, especially Chinese manufacturing enterprises, whose strength is mass production: to adapt to the change of individual needs, mass customization should be changed. All processes need to be changed, otherwise there will be no way to achieve customization.

For China's manufacturing enterprises, a product can produce 1 million units, but the market demand is not 1 million for each type, but 100 for 1 million or 1000 for 1 million. For modern enterprises, how do we know these 1000 needs? If we can not find this demand, we can not adapt to the times.

Twenty-first Century: how does Haier find these personalized needs?

Zhang Ruimin: it must be linked to the Internet. In the past, questionnaires were sent out on the street to ask users what they wanted. At that time, users did not know what they wanted. As Drucker said, demand is not existed until it has been created. Who can tell when Apple's iPad has not been developed?

As the book "Facebook effect" predicts, Facebook will surpass Google because Google is meeting demand. Facebook It is creating demand. Facebook has more than 45 million communities. People in every community are like-minded. It is personalized or relatively personalized.

User demand in the Internet age is also true. For Haier, it is to turn numerous small needs into a relatively popular order. This challenge is very big. Only by relying on the Internet can enterprises understand the personalized needs of users.

Twenty-first Century: what is the process from defining products, manufacturing, marketing, and services?

Zhang Ruimin: Haier has two nets. The virtual network is integrated with the real network. The real network is the strength of Haier. Its stores are located in every county, township and village in the whole country. With this network, many foreign brands come to China to make Haier the total generation, such as GE appliances. Behind this network includes marketing network, logistics distribution network, service network, pre-sale, sale and after-sale.

The bigger challenge is the virtual network, which we are exploring. Now China's Internet has already done a function, that is, the price advantage, compared with the traditional shopping malls, the price is low, because the cost of shopping malls is reduced. Like the long tail theory, the cost of the Internet age can be lower and lower. However, the most important function of the Internet should be, like the Facebook effect, how to become a community and aggregate the fragmented demand to form a large market.

Twenty-first Century: do you think this breakthrough is completed by Jingdong such as Internet Co or by Haier?

Zhang Ruimin: we will rely on the power of Internet Co, but creativity and advancement will definitely require us to do it ourselves. {page_break}

　 "Made in China" needs innovation

Twenty-first Century: do you have any difficulties in complying with the changes in Internet development?

Zhang Ruimin: in the past thirty years, China has accumulated the largest number of industrial workers in the world, with the ability to manage scale, but there is little precipitation in management innovation and business mode innovation. How to adapt to Internet development is a problem that the whole world is exploring. In October this year, I discussed with Michael Porter, the father of "the father of competitive strategy" and Gary Hammer, the author of "the great future". Michael Porter thinks that Chinese enterprises confuse strategy and operation effect. The operation effect is a management tool, such as six sigma, and the strategic positioning is customer positioning, and what customers are your products and services focused on. The operation effect is a necessary condition for an enterprise to succeed, but it is not a sufficient condition, and the sufficient condition is to satisfy the needs of users. Gary Hammer also said that he was interested in Haier. He wanted to come to Haier in January to explore a problem that the enterprises all over the world are exploring. That is, how to become more and more flexible and quickly understand and satisfy the personalized needs of users. However, there are few enterprises with substantial breakthroughs in this respect, especially large enterprises, because the organization is too large.

Chinese enterprises do not explore much in this respect. Michael Porter said, "I saw and understood Haier. I am not worried about Haier, but I am very concerned about Haier's success in this environment.

Twenty-first Century: why worry?

Zhang Ruimin: Potter believes that the current market environment is not conducive to enterprise innovation, which is very troublesome for us.

Twenty-first Century: is Haier, or is there any way for Chinese manufacturing to go beyond this environment?

Zhang Ruimin: sometimes in such an environment, it is hard to surpass. For example, the actual electricity consumption is 1 degrees, you mark 1 degrees, other manufacturers actually 1.2 degrees, but marked 0.9 degrees. Follow up, or do not follow? Responsible enterprises can not deceive consumers, but at the same time must bear the pressure of unfair competition in the market. Therefore, if the external environment does not improve, it will curb the innovation of Chinese enterprises.

Haier's approach is to jump out of this environment and implement internationalization. Recently, uy has released the latest data. Haier's largest retail brand is the first in the world.

After the international recognition, the domestic consumers also recognized.

Twenty-first Century: adapting to the development of Internet will involve a series of transformations. How did Haier do it, or how did it do it?

Zhang Ruimin: the core idea is to sell products to sell services. Many companies have questioned Haier's efforts to create services. Not really. Focusing on user needs and meeting users' personalized needs, this is selling services. Enterprise centered, production, inventory, sales, which is to sell products, sell products means to offer you my products from my will; service is from your desire to provide products you need. This is what Haier is trying to do now and again.

This includes a series of changes, such as zero inventory, our products are supplied immediately, without inventory, customers need products, we will supply immediately, you do not, I will not press goods. China's past model is just the opposite. It has been discussed with the channel. The problem of pressing a lot of goods is a series of disputes, for example, it can not be sold, and it needs to be cut. If you don't drop, take it back. Many brands, including large brands abroad, end up losing money, because this product is not what users want.

"Internationalization" is not "globalization"

Twenty-first Century: now there is a trend to integrate industrial resources through standard setting. What are the plans for Haier?

Zhang Ruimin: in the Internet era, this is not the way of thinking. In the age of Internet, all the resources in the world can be used as long as you want to use them.

I have a personal view that the original company needs internationalization, and now the company needs globalization. The two are very different. Internationalization is a way of breaking the international trail with the resources of the enterprise. The company is organized in many countries outside the home country, which is called transnational corporation. Globalization is not the same. Globalization is the global goal of global resources.

It is very different whether it is done with one's own strength or with the resources of the whole world. For example, IBM is the development of global resources, the best manufacturing in China, the factory in China, the best information services in India, outsourced to India, R & D is best in the United States, in the United States.

The same is true of Haier. R & D, manufacturing and marketing are all about integrating global resources and achieving a globalized brand.

Globalization resources integration must have its own logic. There are many foreigners working in Haier, perhaps the high-end R & D personnel of a very famous company, to Haier, not only to develop a product, but also to develop a market. For them, this is a very big challenge. In the past, they developed a product.

Twenty-first Century: will Haier make some breakthroughs in technological innovation and standard setting?

Zhang Ruimin: technology is very important, but users are more important! Haier is China's largest enterprise with the most international standards, but Haier still insists on user centered research and development from the needs of users.

In order to satisfy users' personalized needs, we must base on technological innovation, technological innovation is a necessary condition, and there is no technological innovation, so the personalized needs of users can not be realized. Haier is not centered on technological innovation, but centered on user needs. Instead, it makes technological innovations by users' demand.

Many enterprises say that they have many patents, but this is not important. Now many world-class companies are selling patents. Many of them are garbage patents, no market effect, and many patents have to be sold at a low rate of long-term utilization. For a general company, R & D is not linked to the market, and is developed by research and development for R & D.

Our thinking is reversed, that is, forced. This is very effective.

Twenty-first Century: in what way does Haier integrate technology resources, or how does Haier acquire the technology that it does not have?

Zhang Ruimin: if you have user resources in your hand, these resources can come in. Many foreign companies with strong technology come to China and are willing to find Haier. Why? The reason for finding Haier is to find a user and find a market to land. If there is no technology, there will be no market.

For Chinese enterprises, it is more important to identify demand and have users. It's a problem without users and technology.

This is also "forced", first find the user resources, get the demand from users, use demand integration technology, there is always the technology you need, the technology must be integrated.