According to statistics, the average life expectancy of Private Enterprises in China is only 2.9 years, and about 1 million private enterprises in China go bankrupt and go bankrupt every year. In today's global economic environment, how should SMEs survive and break the spell of an average life expectancy of 3 years?
This article takes small and medium-sized manufacturers looking for growth space as an example, hoping to give you some inspiration and thinking.
Good text 1524 words | 3 min read
The thinking space of the operator determines the growth space of the enterprise
In the process of studying many cases, we often observe that a large number of manufacturing industries, their entrepreneurs or operators, are very insensitive to markets, industries, finance, policies, business opportunities and crises, and are slow to respond to changes in the operating environment. The reason for this is poor knowledge and insufficient vision.
In a word, the thinking space of entrepreneurs or operators is too narrow. Because the operator's thinking space does not extend enough, a large number of industries and market opportunities are born and die outside their vision, and even the largest industry and market space have nothing to do with them.
This phenomenon is easily reminiscent of a statement by the management guru Peter Drucker about corporate growth: an organization can only grow within its values, and the growth of a company is limited by the values it can achieve.
To paraphrase Drucker's expression, we can make this judgment about the space for the growth of the enterprise: a company can only grow within the thinking space of its operators, and its growth is limited by the thinking space that its operators can achieve. If you want to get it, you don't have to do it, and if you can't think of it, you can't do it.
Entrepreneurs are the determinant of the rise and fall of a business
In the case of a particular company, where is its room for growth? Not in the industry and the market, but in the operator's thinking space.
The popular expression of the famous "manager cap" theorem about the growth of a business in management is that a company is as good as its manager, just as the pyramid is as high as its spire. That is to say, the thinking, knowledge and ability of entrepreneurs (managers) constitute the limits of business growth.
In general, the factors that affect business performance and growth are numerous and complex. But in the case of a particular enterprise, its rise and fall depends directly on the knowledge and ability of the entrepreneur or operator.
Because of this, people always attribute Chrysler's revival and GE's success to Iacocca and Welch, and Huawei's growth to Ren Zhengfei. The history of the rise and fall of Chinese and foreign enterprises tells people an immortal truth: entrepreneurs are the determinants of the rise and fall of enterprises.
How to broaden the growth space of the enterprise?
It is inferred from this that in order to broaden the growth space of enterprises, it is necessary to improve the thinking space of operators.
1. Improve the knowledge structure of the operator,
2. Improve the level of thinking of operators,
3. Broaden the vision and insight of operators.
If enterprises in the market economy "decide the way out of the way", then what determines the idea? It is the knowledge and vision of the entrepreneur or operator that determines the thinking of the enterprise.
Hejun Chuangye believes that after joining the WTO, the following six aspects of knowledge and ability are particularly important to Chinese business operators: (1) strategy; (2) organization; (3) Marketing; (4) Finance; (5) Mergers and acquisitions; (6) Avant-garde management theories and tools.
We once designed the management knowledge of these six aspects into 500 simple multiple choice questions of hooking and crossing, and then conducted a sample evaluation of 200 enterprise CEOs.
The results show:
Around 12% of CEOs lack basic concepts, such as not knowing the difference between merchandising and marketing, finance and accounting, not hearing about SWOT analysis and BCG matrices in strategy development, not having any concept of ERP, CRM, and organizational flattening, and so on.
More than 35% of CEOs show obvious lack of management knowledge, and their knowledge structure is obviously not up to the management requirements of modern large companies. Less than 10% of CEOs have more complete knowledge in all six areas.
The lack of knowledge of enterprise operators shows from one side that a considerable part of China's enterprises are mainly in the stage of personal authority, relying on meetings and "patting their heads" to make decisions, and scientific management is still quite far away from these enterprises.
The speech of Liu Hongsheng, a famous entrepreneur in modern China, at the 50th anniversary of St. John's University in 1929, is still applicable today:
"China has a vast land, it is not worried that it has no resources, nor can it not take out capital, but it is worried that it has resources and capital, but it cannot find a group of talents who can use resources and capital." Merely having the shrewdness of a businessman and the ability to dance with long sleeves and good social activities will not bring a long-term future to the enterprise. ”
The knowledge economy is an economy that wins by knowledge. Faced with insufficient management knowledge and narrow management thinking, it is difficult to imagine that they can lead enterprises on the road of sustainable growth in today's era of knowledge economy. To broaden the growth space of enterprises, we must first broaden the thinking space of entrepreneurs or operators.
To this end, in addition to being busy with transactions and socializing, entrepreneurs need to make time to learn and pay attention to continuously improving their knowledge structure. (End of this article)