Our contributing author Bill Fischer is Professor of Innovation Management at IMD, in Lausanne, Switzerland. He is what in past times might’ve been called an “old China hand”, since he has worked various assignments in the country since 1980. His most recent book, ” Reinventing Giants” [co-authored with Umberto Lago and Fang Liu] deals with Chinese home appliances manufacturer Haier Group’s innovative approach to management.
It may well turn out to be one of the most significant books written about management in recent years. So we took this opportunity to conduct an interview with our esteemed co-author on the key factors he discusses in his new book.
Haier Group is a Chinese multinational consumer electronics and home appliances company. In 2011 the Haier brand’s market share in white goods was 7.8. percent, the largest in the world. The company’s roots reach back to a refrigerator factory founded in the 1920s. The current CEO Zhang Ruimin was appointed to run and turn around the then struggling enterprise in 1984.
I just watched a hockey game where Mother Russia was decisively defeated by the USA: 8-3. How is it possible that a team comprising of world-famous players, who rake in millions of dollars playing in the NHL, got their asses handed to them this bad? All these stars seemed incapable of playing together!I don’t know much about ice hockey, but I’ve given a lot of thought to building offensive lines in a business context. So let’s set hockey aside for the time being and start thinking about how to make better services and products, and how to generate some serious growth.
On Sunday, we started a tour that covers all of Russia. On the tour we’ll be covering entrepreneurship, start-ups, leadership and growth. I got the central institutions andministries, as well as the biggest banks on board. The lobbying process, in and of itself, would make a great short story, but that’s beside the point. To put it bluntly, we used both the carrotand the stick.
As I write this, we’ve put five cities in Tatarstan, Baskirstan and Siberia behind us. And I’veput a lot of effort into trying to understand IT startups. Funnily enough one of the biggestproblems is that Russian culture frowns upon failure of any kind. In a corporate context thismeans that an unbelievable amount of time and resources are spent on the testing, qualitycontrol and documentation of code. This is stressed in school, too. Basically, every little IT thing-a-majig is made like it’s responsible for managing the oxygen supply at the International Space Station. There is nothing wrong with this, per se, but in many projects this results in an imbalance between the code and customer-centeredness. In other words, the oxygen supply is secure,but customers have no idea which pipe it comes out of.