Wanxiang Group is regarded as one of the most successful examples in the internationalization of Chinese companies. Not long ago, the reporter flew to the United States to experience the new world opened up by Wan Xiang. Before and after this, he interviewed Lu Guanqiu, Chairman of Wanxiang Group’s Board of Directors, and asked him to explain the universal “going out†concept.
The initial universal product "going out" was forced out
Reporter: Began to go abroad from the product, and now to a series of acquisitions of international first-class auto parts companies, demonstrated the ambition of universal internationalization. What motivates Wanxiang to internationalize?
Lu Guanqiu: Initially, Wanxiang’s “Going Global†product was forced out, and there was no clear international strategy. It just wanted to find a market for the product. In the 1980s, Wanxiang proposed to base itself on domestic entrepreneurship and face international foreign exchange earnings. However, after “going out,†we realize that this is an important way to grow and grow. "Going out" turned to self-consciousness and realized that this was the inevitable path. That is "in the land of foreigners, use the resources of foreigners, when the foreigner's boss, earn money for foreigners."
Universally "going out", every step, how far we go, and whether we go faster or slower depend on the strength of Wanxiang, depending on the domestic and international situation at that time. At the beginning, our strength is small and we can only walk slowly. Explore the road first, make friends, slowly integrate into the local community, and gradually be recognized by all parties. With this foundation, with a good domestic and foreign situation, we can now make great strides toward internationalization.
How big a company can be, and optimizing the allocation of resources is a key factor
Reporter: Why are the foreign auto parts enterprises that have been acquired and why they are in the hands of Wanxiang, they can be rejuvenated and have found a new space for the universal "Made in China". Let China's cost sell U.S. prices. How does Wanxiang achieve it?
Lu Guanqiu: The key lies in Wan Xiang's ability to integrate domestic and international resources. How big a company can be, and optimizing the allocation of resources is a key factor. If only increasing export orders, "Made in China" sold only low prices. However, combining the technology and market advantages of foreign acquired companies with the cost advantages of manufacturing in China can be used to sell US prices at Chinese costs, and the value varies greatly. Wanxiang’s factories in China have made higher-value products, and Wanxiang’s acquired US plants have added cost advantages. Through the management of manufacturing in China, the use of international resources, and the use of various technologies, management, and markets for my own use, Wanxiang has created more space.
Whether or not the integration and optimization of resources is successful depends on whether a win-win situation can be achieved. Whoever has the resources available to others can use other people's resources. Many foreign companies now take the initiative to connect with our resources. After acquiring a foreign company, you can't just think of making money right away, and you can reduce the number of people at the beginning. It is for employees to benefit from the development of the enterprise and universal support for local support and resource integration.
Universal management of manufacturing in China is also based on familiarity with international rules and four conditions for the use of global resources. One is to cultivate and attract a group of talents with international acquisition experience; the other is to establish extensive and in-depth cooperation with strategic consulting agencies and intermediaries abroad, and use their strengths to find market opportunities; and third, to form a certain resource base at home and abroad. It is possible to link resources, digest resources and achieve sustainable development. Fourth, gradually form a good social reputation and win market trust. Even if there are failure cases, it will not affect the overall situation.
The chickens only see the eyes, so they can only eat rice; the eagles fly high and can eat more things.
Reporter: The development of Wanxiang has been accompanied by the continuous deepening of the internationalization process. In your opinion, what impact does "going out" have on Wanxiang?
Lu Guanqiu: On the surface, because of going out, the output of Wanxiang products has greatly increased. This is only a tangible influence. The more significant impact is the intangible influence. Going abroad has broadened the horizons, changed the concept, and caused major changes in the quality of personnel.
This kind of intangible influence can be said to be the greatest achievement of Wanxiang. In the 1980s, when I visited a large company abroad, I felt that the gap was too deep. What is a world-class level is not to make a product that looks like an international standard, but from the inside to the outside, including product life, safety, and batch production that meets various test data. Wanxiang started with grasping the most basic quality and has never relaxed for so many years.
In the past, universal orders were accepted for export, and some internal companies were reluctant to accept them, and front-line operators were unwilling to do so. Because first-class international companies have high quality requirements for orders, slow livelihoods and high risks. I asked the employees to go out in batches to see them. After they returned, they rushed to make high value-added export products, and the company developed faster. In order to adjust the product structure, in the final analysis, a group of employees who accept new concepts must be jointly implemented. The chickens only see the eyes, so they can only eat rice; the eagles fly high and can eat more foods and even eat chickens.
It can be said that without going out or going out without success, Wanxiang will not be successful today.
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