Analysis of Haier’s Chinese Management Model by Amelia Sui Yang
INTRODUCTION
Haier Group was founded in 1984, 20-year stability and development has become a high reputation at home and abroad internationalization large enterprise groups. Products from 1984 to the refrigerator with a single white appliances, black appliances, beige home, the door of 96 groups of more than 15.1 thousand standard products and exports to over 160 countries and regions of the world. 2004, Haier global turnover exceeded 100 billion Yuan. 2004,
Haier was the first Chinese most valuable brand, brand values as high as 61.6 billion Yuan. January 31, 2004, the world body to assess the value of one of the top-five brands in the laboratory preparation of the World brand “of the world’s most influential 100 brands,” the report is published, only selected Chinese Haier, ranked No. 95 spaces of the Chinese brands zero breakthrough.
Haier Group to the full implementation of international strategy has established an internationally competitive global network design, procurement networks, creating networks, marketing and service network. 10 existing industrial parks, 30 overseas factories and manufacturing bases overseas design centers 8, marketing station 58,800. In the domestic market, according to Chinese statistics ，Haier is the first Chinese brand name ， Haier in China has reached 21% share of the overall domestic market, significantly ahead of competitors;
Haier in white appliances market in a monopoly situation : Haier white home for 34% market share has been much higher than the internationally recognized line monopoly; small appliances in the market come from behind Haier , Haier small home for 14% market share, has gone beyond the traditional small appliances strong brand and ranks first. In the international market, Haier in many countries occupy one market share.
According to the authoritative consumer market research and analysis of global institutions Euro monitor latest survey, based on turnover statistics, Haier Group is white electrical manufacturers in the global ranks fourth, Haier goal is to become first of the world white household appliances manufacturers.
For 20 years, Haier sincere dedication to the community. Haier accumulated over approximately 13.6 billion totals, about 2 billion of taxes paid in 2004, and the average daily paid 5.5 million Yuan in taxes.
Haier dedication to the community Haier’s management model. The United States has a Harvard University and California, won the International Management Institute, the European Institute of Management in France; Japan Kobe University Business School has a total of seven done 16 cases involving corporate mergers, financial management, and corporate culture all quarters. Switzerland is a fairly special authority for the International Management Institute Haier does market chain in the EU case had been the case. (source: http://www.89mc.com/AN_haier_intro.aspx)
The objective of the paper understands Haier how to success? Analysis Haier’s management model. Through Haier Enterprise management culture analysis the development direction of China’s enterprise management culture direction. Haier appliances from the consumer programmed can be seen, Haier how to create a consumer health, fashion, information everywhere in the U lifestyle. Haier corporate culture from the formation process we can understand its essential character? Through Haier’s quality understand innovative management.
Review of Literature
Explaining Haier innovative management model, it is not difficult to see that Haier to bring innovation management from the ISO9000 standard certification, the National Quality Management Award in the Asia-Pacific Quality Management Award three stages of the evolution process and to bring forward the quality management philosophy.
It has been importing a large number of Chinese enterprises are in the management model, management thinking. Global economic integration, innovation management model for the entire Chinese enterprises presented great challenges.
Chinese Management and its Shortcomings.
First, the Chinese expression for the management of more personal control rather than the rule of law, the specific regulations in the implementation process often differ, resulting in lack of uniformity of business process rules, standardization lower. Secondly, the so-called egalitarian, causing people do not have a strong sense of competition, prevented the enthusiasm of the staff play. Some State enterprises often do not live in a state of immortality.
(Source:http://www.pp-cn.com/paper/guanlilunwen/renliziyuanguanli/)
Chinese enterprises how to do better, and Chinese enterprises where is the direction? We can Haier to analyze.
First, the Haier scored impressive achievements; the fundamental reason is that Haier have a good corporate culture. Secondly, Haier culture in China’s position. Haier cultural significance of the role of the enterprise must not be limited to one or only one economic sector, it should be said that the upgrading of our national culture as a whole provided a good reflection leads. Again, Haier culture is the combination of culture. Haier Group in dealing with transnational competitive relations with other transnational corporations, the emphasis is on their advantage.
Chinese enterprises should be to build a culture with Chinese characteristics based management. Chinese characteristics are reflected in the local market and local talents of a special law. The geographical environment, history and culture, and cultural implications, Chinese enterprises need to shape the management culture with Chinese characteristics.
Building management culture with Chinese characteristics
Chinese characteristics are reflected in the local market and local talents of a special law. The geographical environment, history and culture, and cultural implications, Chinese enterprises need to shape management with Chinese characteristics State enterprises should be to build a culture with Chinese characteristics based management
We can call it “home” culture, the family is broad home. This means small businesses can home, we can refer to this country. The enterprise as a home can be expressed in the enterprise more cohesive. As a “home” cultural significance, the social order is the East than the West is good, the inner motivation of the East economy than Western.
Haier this Connection do very well，Haier enterprise management culture to culture as the core。
Haier enterprise culture
Haier corporate culture is recognized by all staff business leaders’ innovative values.
Haier culture is the core of innovation. It is produced in the course of development and Haier 20 years evolved with the culture system. Haier culture to the concept of innovation in the lead, with innovative strategies for orientation and organizational innovation to protect, to technological innovation as a means to market innovation targeted accompanied by Haier nothing, from small to large, from big to strong, from China to the world, Haier culture itself is also continuous innovation and development. The staff recognized and active participation is the biggest characteristic of Haier culture. (Source:Http://7269520.bokee.com/4627924.html)
Haier has developed so fast because Haier is a whole. It has an innovative enterprise culture and a united leadership. All other enterprises will be to set a good example
Haier cultural entered Harvard forum
March 25, 1998, in the Harvard Business School, class of the Master of Business Administration students is a very warm scene, and we are extremely delighted to meet a strange teacher — from Chinese entrepreneurs Haier Group CEO Zhang Ruimin
Please come to think of it, 1984, Mr. Zhang Ruimin, facing serious challenges? “We propose a professor to another.
Many people raised their hands immediately; we would like to express their ideas. Including Latin America, the Japanese, the Americans are more.
Professor constantly ask questions, the discussion gradually in depth. “Haier has an 80% annual growth rate, a household appliance is the fastest-growing enterprise, and we believe that what is the impact Haier success? If you Mr. Cheung, how decision-making? Why is the effective management of the Haier? a ’shock fish’ Why can Haier cultural life? Why is the corporate culture research study vitality?” Is sued to the respective views of the participants.(Source: Http://7269520.bokee.com/4627924.html)
Zhang Ruimin, listen to the questions and the Master of national culture of Haier cases lively discussion of their questions are answered. An American student, said: “Mr. Cheung from the lectures, I first learned of the successful management of Chinese enterprises. (Source: Http://7269520.bokee.com/4627924.html)
Zhang Ruimin, is the first forum on the Harvard Chinese entrepreneurs to Haier’s outstanding performance and brilliant business ideas for the world’s understanding of China’s enterprises and successful Haier culture. The incident in the history of Chinese enterprise management has important historical significance; it shows that the Chinese enterprises that innovation in enterprise management also can contribute to the world. (Source: Http://7269520.bokee.com/4627924.html)
Chinese traditional culture to the impact of innovation management
China’s traditional culture and emphasizing the use of appropriate harmony of man and nature, but the traditional culture of ideological middle category, has become the enemy of enterprise innovation. Especially Chinese people on interpersonal and personal contacts, which are conducive to coordination within and outside the enterprise, harmonious interpersonal relations; On the other hand it over to the enterprise “relationship” neglect to comply with market rules, it is difficult to make management of equality, and often by different people. However, there is some traditional Chinese culture worthy of our study. For example, the most far-reaching impact on our culture Confucianism, which focused on emotional investment, moral enlightenment; Leaders stressed their work first, and so on 。Haier adhere to the study of good traditional culture, the traditional culture is up.
For example: Haier “hoist with refrigerators incident” As we all know, Zhang Ruimin, 76 Taiwan organizations would defective refrigerators smashed the stopped after he fined 100% of their wages. Haier set on the quality of a concept: “defective product is waste.” And further improve the quality management system. It should be said that this matter hoist with refrigerators, Haier to the full and produced strong shock, full of quality consciousness of the general increase. So quality of Haier is best.
Chinese enterprises management culture internationalization
With the trend of economic integration, China’s enterprises are faced with the integration of Chinese and Western management culture. Chinese characteristics do not mean absolute China, like Zhang Ruimin said, “We have to compete and the United States, we still can not say with Chinese characteristics to win, the U.S. company American characteristics, we also need American character.”
The combination of macroeconomic management and micro-management
Haier attaches great importance to macroeconomic management, as cask principles of the demonstration, the profitability of enterprises is not a dependent on the good management of enterprises, but on the integrated enterprise management capabilities of any management module gaps and loopholes will lead to loss of profits. In each of our enterprises should Haier re-look at their management, thus blocking their own cask gaps and loopholes? Of course, the macro-management of Haier in China also attaches great importance to the process of micro-management; on the one hand, the performance in the talent outlook Haier, Haier emphasized both cadres, and employees in a position to do this location. On the other hand, manifested in Haier attention to the details of the work, Zhang Ruimin once said “Haier to elaborate to the most small places, small places perfect, the perfect place naturally.”
System management and management of human
Management and practice management system implemented in conjunction with the Western “system” for the focus of the management model. More things can be found on the characteristics of a culture, Western culture excellence, the pursuit of the realization of self-worth, which is in the performance management regulation, management and regulatory management system to achieve the orderly and effective management of. And the East was imposed “conditions” for the characteristics of the management philosophy. Their internal emotional exchanges, members agree to effect high. However, this emphasis on the management of the role and value of the achievement, but ignored the effects and regulatory system, the system of laws and regulations, excessive personnel relations, the spirit of rational, it is the Chinese style management deficiencies and inadequacies. Evidently, the Chinese management model shaped, and the spirit of the guidelines should be rational, that the situation in the case, the empathy to the law in order to create “Conditions, System” integration management models.
Haier on the integration of these two aspects is very good. Haier attached to the staff demand, and gradually realizing the need for all levels of staff satisfaction, greatly aroused the enthusiasm of staff.
The key to success lies in the people, keeping talent, and how people and retain people? Also key to the enterprise’s employment mechanism and improve the incentive mechanism. In response, Haier Group made famous slopes ball theory. Haier slopes flows from the small ball very ordinary phenomena of life, immediately understood what the laws of the development of entrepreneurship development — slopes ball theory has also become Haier development philosophy. Slopes spheroid like one individual employees, representatives ball around staff development stage, the slopes and shopping malls represent the degree of competition scale enterprise development. Prompted a staff achieve its objectives and prospects two dynamics : is the inner motivation of personal qualities, this is fundamental; Spheroid external motivation is corporate incentive mechanism is the external impetus. At the same time, there are two kinds of resistance, resistance is the inherent inertia of staff, and external resistance is the development of the difficulties.
Employees display their talent on stage two aspects: spheroid radius — staff capacity; Spheroid flexibility — a degree of vitality staff. Greater scale enterprise development, the more intense commercial competition, and the greater the angle of slope, the more intense competition for qualified personnel, the quality of talent on the higher. According to staff at different levels of demand enterprises, such as adaptation to, full participation, self-realization, were given different dynamics — incentive mechanisms (such as staff promotions, there is management positions, professional positions, technical positions, skills positions, etc.).
This concept has become a driving force for the development of enterprises. Either as a business or staff only by constantly improving the quality of their own to overcome resistance and inertia can self-development, self-realization; otherwise, they can only fall and eliminated.
Haier the slope spheroid theoretical performance in the following areas: three workers to the existence of dynamic change. Three workers are outstanding workers, qualified workers, and probationary employees. Haier labor reform ideas that can become outstanding performance good workers, the poor performance can be readily converted to qualified workers or probation officers.
These approaches effectively address the issue of tenure, so that enterprises will stimulate a new dynamism. Meanwhile in post cadres control. Haier monthly appraisal of cadres, recognition and appraisal of sub-grade criticism for a one hour’s criticism minus one hour at the end of the year, reaching negative-must is eliminated. Develop systems to enable the rotation of cadres in a number of positions; its overall growth could be under rotation performance promotion decisions. Principle is, and give full play to each person’s potential for each person per day can feel from an internal pressure of competition and market, and can be converted to competitive pressures drive, which is the secret of sustainable development enterprises.
Pay is an important adjustment levers play an important guiding role. Haier pay principle is that a domestic equity, external competitive. High-quality, high-skills high-reward, the value of talent has been reflected in the allocation. Staff remuneration system is not only a simple monetary wages, including housing, and other problems hidden income. Haier attaches great importance to spiritual inspiration. Material incentive is the only means, and how not to fall into this mistake, and constantly develop staff potential, is the key to rapid development of enterprises.
Haier constantly exploring spiritual incentives, such as employee name small invention, solicitation of public relations, the establishment of honorary awards (the highest award for Haier Award, which is the authority for personnel incentives issued by the CEO), for full sexual rationalization proposals, specifically created to rationalize the proposed award, as a means to stimulate staff responsibility and creativity. Haier designed for different categories of promotion channels to enterprises on one of the employees to know which direction the development, how can we be successful. To that end, Haier create learning opportunities for their employees, a market-oriented form of training to upgrade their abilities and qualities. Manager is most needed to stimulate the most important and most challenging skills was actually adopted to meet the needs of their employees to work, the process of achieving organizational objectives.
In the organization, the goal of his efforts depends on the level of attractiveness depends on the extent to which the goals can meet staff needs. Motivate staff to enable them to meet their own needs to see the achievement of organizational objectives and the relationship between the internal pressures resulting work, hard work.
(Source: http://www.ppcn.com/paper/guanlilunwen/renliziyuanguanli/)
About incentive, the organization acts scientists presented a variety of theories can be summed up in two types: First, the need to motivate, inspire First, the process, which is required from the content of employees starting to find ways to inspire the theory, such as the level of theory stresses the need to understand the needs of existing staff levels, according to the needs of different levels give different incentives. Mainly from the theoretical incentive to stimulate the process of the process to explore the issue of how to motivate staff, such as the establishment of goals to give the staff a clear theory that a certain degree of difficulty and objectives; Strengthen theoretical enthusiasm that the staff should receive timely incentives to enhance such acts enthusiasm.
In our country, in recent years, enterprises are increasingly focusing on the issue of incentive; employees of major companies have begun to stimulate the enthusiasm and creativity as a key management task.
In practical management process, and encourage the staff should pay attention to several aspects: to understand the needs of all staff incentives premise. Different types of employees, and its dominant needs are different, at different levels, in general, high-tech talent mostly achievements and growth needs of the dominant, the different levels of needs, enterprises with different ways to meet the needs of growth and achievement dominant, from the provision of training and development opportunities by, and the need for respect, will provide recognition, appreciation and meet.
Second, for the staff to establish clear goals can be achieved, management by objectives are implemented. Staff should be clearly informed that enterprises expect of him what he would do to be successful, what kind of circumstances, he would be rewarded and what kind of circumstances, he will be subject to criticism and punishment, to what direction he should be consistent with the needs of enterprises.
Third, with the performance of wages, remuneration linked, and to ensure fair and reasonable compensation, external competitive.
Regular staff performance appraisal, the appraisal standards open to each staff know where their fortunately, where inadequate. Guide staff development to a higher level of demand, to the role of spiritual rewards, Haier Group’s experience is worth learning from.
(Source:http://www.china-sheep.com/esheep/info/Article_Print.asp?ArticleID=362)
Haier attach great importance to the management of law in the spirit of culture is the
Outer layer system Haier culture, Haier attached to standardized management, the emphasis is on a strictly business basis of standardized management enterprise employees a common values in order to achieve a standardized operation as a precondition emotional exchanges. Now Haier set of outstanding management system has been recognized many, and to other enterprises set a good example.
CONCLUSION
Objectively speaking, although some of our inherent advantages, our enterprise management culture has not formed a complete theoretical system, China must take to build enterprise culture with Chinese characteristics as the target, and sets of home long, I used to achieve a high level of the “middle way”. Despite the strengthening of economic integration and management of the world cultural integration trends are bound to appear, but at least a fairly long period of time, Chinese culture could never be westernization, should be to build our enterprise culture with Chinese characteristics as the goal.
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2 Responses to “Analysis of Haier’s Chinese Management Model by Amelia Sui Yang”
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August 29th, 2006 at 11:02 am
I am interested to communicate with the authour of this paper .. Amelia Sui Yang.
Thanks.
Cindy
September 1st, 2006 at 1:47 am
Haier’s and Zhang Ruimin’s achievement is something most Chinese companies must take a leaf from.
It started the OEC Management Model and develops its own philosophy of TOP QUALITY CHINA PRODUCTS for ALL!
Haier’s blending of the best of East and West management excellence is key to its success and the author has explained it rather well in the paper.
Overall, a fairly well-written paper for starters!