Haier president: Innovation key to survival
- By He Shan
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E-mail China.org.cn, March 4, 2017
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Zhou Yunjie, a deputy to the National People’s Congress and president of Haier Group, handles an interview from China.org.cn on Friday in Beijing. |
"If companies want to stay alive and even thrive, they have to keep continuous evolution and innovation," according to Zhou Yunjie, a deputy to the National People's Congress and president of Haier Group, speaking in an interview with China.org.cn on Friday.
Speaking ahead of the NPC annual session to be held from this Sunday in Beijing, the NPC deputy urged Chinese manufacturers to embrace innovation to keep up with the times as China steadily loses its "demographic bonus" in the decades ahead.
China's manufacturing sector is currently under pressure as factories shift labor-intensive production to low-cost countries, including some in Southeast Asia, and developed countries are keen to upgrade their industries..
According to Zhou:"Since the reform and opening-up policy was initiated, China's manufacturing has benefited a lot from cheap labor, but the but the era of 'demographic bonus' has gone."
He warned that Chinese manufacturers could no longer pin their hopes on cheap labor, but focus heavily on innovation.
"We can no longer rely on cheap labor; innovation now comes to the fore," he reiterated.
As one of the largest manufacturers of home appliances in the world, Haier has continuously adhered to innovation.
Zhou explained that Haier had been transformed into an "internet factory" with hardly any hierarchy. Any employee in the company is empowered to float new ideas that are then put to the vote. The winner becomes the project leader who can "recruit" fellow employees for his venture.
In 2013, the group created a network for small startup companies whom Haier connects with users and investors.
Accord to industry analysts, what Haier has done is to unleash the potential, passion and entrepreneurship of employees and then enhance efficiency.
By the end of 2016, the network had nurtured more than 200 small companies and 1,333 venture operations with total capital of 12 billion yuan (about US$1.74 billion).
Last year, Haier bought GE's appliance unit for US$5.4 billion, a deal that will greatly expand its footprint in the U.S. against a backdrop of rising protectionism in that country.
Zhou noted that protectionism has raised its ugly head, and slowed the global trade momentum.
Despite the headwinds it now faces in international trade, Zhou asserted that Haier's robust globalization drive will help it buck the trend of "anti-globalization".
"The volatility in the market will continue, so we can see winter has come," he commented.
However, using an interesting metaphor, he added: "It is very difficult for us to change the chilly environment, but we can put on more clothes and do more exercise to keep alive."
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