Author: Xie Weishan Founder and Chairman of Junzhi Strategic Consulting
Source: Business Management Magazine
Founder and chairman of Junzhi Strategic Consulting, Xie Weishan
Introduce Chinese wisdom into strategic innovation
The sun of 2022 has woken up like a silkworm. In the face of unprecedented changes in a hundred years, in the past year, entrepreneurs from all walks of life have been like opening blind boxes every day, and the scene of running freely under the clear sky seems to be getting farther and farther away from us.
Even those industry experts who always have the courage to capture the first rays of sunshine are keenly aware of the slowing of the train of time: the new crown pneumonia epidemic has not subsided, inflation is high, the global supply chain crisis... All kinds of "black swan" events are difficult to deal with.
Under the influence of the cold current in the global market, many entrepreneurs find that the land under their feet seems to be drifting: some brands that were once in the C position are gradually forgotten by the market; the strict supervision of live streaming has made the entire industry appear in its original form; many new consumer brands have experienced a breakthrough from 0 to 1 and are trapped in the development of the lost...
Nevertheless, "plums have more flowers after snow, and grass also sprouts a few buds", even in the harsh years of difficult steps, there is also a spring in the cracks, such as the positive layout of flying cranes in the FMCG industry. In the field of infant milk powder, with the strategy of "milk powder more suitable for the physique of Chinese babies" to break through 10 billion yuan in revenue, after leading high-end sales, Feihe accelerated the layout of full-life cycle products, and launched heavy new products such as Aiben adult milk powder in 2021, conforming to the trend of diversified demand and health, creating a second growth curve.
Another example is yadi's technology leadership in the durable goods industry. In the field of two-wheeled electric vehicles to "more high-end electric vehicles" strategy to break through the industry price war, sales ranked first in the world's Yadi, in the first half of 2021 alone to achieve revenue of 12.375 billion yuan, an increase of 63.9% year-on-year, the second half of the release of a new generation of graphene batteries, with technology to lead the two-wheeled electric vehicle industry upgrade.
Another example is the technological innovation of Bosideng in the field of clothing. Under the guidance of the strategy of "focusing on the main channel and focusing on the main brand", Bosideng grasped the positive growth of the main down jacket industry, quickly broke through the 10 billion revenue mark, and the net profit in the 2020-2021 fiscal year hit a record high, once again becoming the world's largest down jacket brand. In 2021, Bosideng continued to innovate, creating the first windbreaker down jacket and launching the China's original top down jacket Dengfeng 2.0 series, etc., becoming the technology flow in China's original.
As a long-term strategic consultant of Feihe, Yadi and Bosideng, Junzhi Strategic Consulting has not only witnessed, but also experienced the rise of these excellent brands of 10 billion yuan. Their success is inseparable from the continuous improvement of national strength, the quality of enterprise leaders and the innovation and improvement of the team, of course, it is inseparable from the correct strategic guidance. Junzhi shows with the results of 10 billion yuan of cases and practical breakthroughs in the field of Consulting in China that in the face of global uncertainty, it is still possible to find a breakthrough of 10 billion yuan.
As a strategic consulting institution rooted in China and focusing on the global competitive landscape, we will share the "10 billion yuan solution" extracted from the "five hundred billion" strategic practice, that is, the Chinese wisdom of Junzhi's strategic equation and its application, to more entrepreneurs, hoping to provide a unique path for the rise of Chinese brands of 10 billion yuan.
The Chinese market is unique in complexity and diversity in the world, and it is enough to cultivate a large number of Chinese brands of 10 billion yuan. We firmly believe that as long as we seize the opportunity of the times and be down-to-earth, Chinese brands can move towards a broader future.
01. Re-understanding strategy from Chinese wisdom
In the past 20 years, through the exchange with many entrepreneurs who are deeply involved in the frontline of business warfare, we have deeply experienced that whenever faced with decision-making problems, entrepreneurs do not get answers through reasoning methods like solving mathematical problems, but more rely on adhering to the overall intuitive and free imagination of Chinese thinking to make major decisions, because strategy is difficult to be calculated through logical reasoning and experience summary.
Strategy is so important, but it's also so difficult to navigate. Sun Tzu's Art of War, which is regarded as a classic by Western military academies, was born in China more than 2,000 years ago, and there are no specific tricks in the book, but wisdom inspiration.
The wisdom of this strategy has a completely different expression and analysis from the West, and does not try to analyze and design based on rational assumptions and other methods like Western strategy.
This difference in strategic understanding also stems from the difference in the way of thinking of Eastern and Western wisdom - Western wisdom emphasizes analysis, pays attention to logic, and is good at induction and deduction, so Western natural science is developed and technology is advanced; Eastern wisdom pursues the grasp of the whole, seemingly intuitively, but it is actually a holistic, interactive, non-linear thinking, and this holistic way of thinking is often very practical in strategic decision-making.
In the "Art of War of Sun Tzu", it is said that "those who are good and surprising are as infinite as heaven and earth, and inexhaustible as rivers and seas." Therefore, in the face of various types of enterprise dilemmas, Junzhi often combines Chinese wisdom to find different solutions in strategic consulting practice to help enterprises better understand the strategy.
1. Return to the "passive view" to lock in the strategy
In the process of helping enterprises lock in the strategy, Junzhi found that returning to a state of "passive view" allows us to see the "far side of the moon" of the strategy, and the understanding of the strategy reaches a state of superiority, and the harvest brought to the enterprise is beyond imagination.
The "view of the unvoiced" rejects preconceived notions and sees things through a vision beyond the self. Buddhism believes that people are bound by the "five aggregates", that is, feelings, emotions and desires, and that only by removing various distractions through meditation such as mindfulness can they realize "emptiness", which is actually a more real way to understand things.
Mindfulness is also about looking closely at one's own feelings, not judging them, getting close without getting lost in them, and focusing on the real feelings they bring. Western evolutionary psychology validates the above view, arguing that human sensations compete into human consciousness through modular brain mechanisms, and that sensations are driven by natural selection that seeks advantage and avoids harm. People's feelings will choose their own favorable side through storytelling and other means, so the truth of things is often blinded by feelings.
Traditional Chinese wisdom also has a long-standing view of "passive view". The Tao Te Ching says, "Can you be as gentle as a baby?" It also means that if people can get rid of various prejudices in their hearts, they will return to the infant state, look at all things without emotion, break the boundaries between themselves and all things, and obtain more authentic feelings.
The Tao Te Ching also says, "For the sake of learning, for the sake of the Tao, the day of loss, the loss of the Tao, so that there is no action." "It also allows us to see that the more we learn about various disciplines, the more constrained our understanding of the outside world may be, and only by doing subtraction can we get close to the truth of things." Chinese Zen Buddhism also emphasizes removing all labels in the brain and thinking about nothing in order to get the "view of the sourceless", but the "emptiness" in Zen Buddhism is not empty, but it gives birth to many possibilities. Only by returning to the "empty" state can we help enterprises see more possibilities.
Cultivating the "passive view" mentality is very enlightening for chinese entrepreneurs today. Many entrepreneurs often have cognitive path dependence, it is easier to form a preconception, this cognitive fallacy can easily lead entrepreneurs to focus only on the internal and familiar things of the enterprise, and indifferent to customer perception and unknown matters.
2. Strategy must point directly to the "people's hearts"
The "view of the source" leads us out of the cage of cognition and to obtain true "knowledge." There are 79 "knowledges" in the less than 6,000-word text of Sun Tzu's Art of War, which shows that it is particularly important to obtain true "knowledge". Therefore, junzhi assists enterprises in formulating strategies, and complements the interpretation of strategies on the basis of Michael Porter, who is known as the father of global competitive strategy.
In the 1980s, Porter made a significant contribution to the field of business strategy: distinguishing strategy from operations, pointing out that operational benefits are not a substitute for strategy. Strategy is to form a unique set of operational activities, create differentiated positioning, and do different things; operational efficiency is to do a better job. Porter further pointed out that the core reason for the poor performance of the company is that it does not distinguish between strategy and operations.
Porter introduced rigorous industrial economics theory into the field of business strategy, making strategy a discipline with certain rigor, but Porter's set of competitive strategy theory cannot establish real and sustainable differentiation value for enterprises in business practice. Around 2000, the positioning theory advocating the occupation of consumer minds was introduced into China, opening up a new world for enterprises to achieve sustainable differentiated value.
Inspired by the "passive view", Combined with Porter's competitive strategy theory and positioning theory proposed by the father of positioning, Iris and Jack Trout, Junzhi extended Porter's strategy: true differentiation must be realized in the consumer's mind, and the strategy must be directed to the hearts of the people; the strategy is to make customers feel that your product is good, and the operation is to consider how to make the product well; in strategic practice, the corporate strategy is creatively divided into two, that is, combat readiness and campaign.
Strategy and operations are very different, "make customers think your water is good" and "get the water right", these are two completely different areas of expertise. For example, a bottle of water on the table, the strategy is how to make customers think that my bottle of water is good, the starting point, the process, the end point are mainly to occupy the consumer's mind. How to make the quality of this bottle of water better, the price cheaper, the customer experience better, etc., the whole perfect system can make this bottle of water in all aspects of continuous improvement.
Entrepreneurs must recognize the great value of leveraging consumer cognition, because the information that consumers inadvertently receive will be subtly embedded in their minds, and many of the current consumer shopping decisions are made unconsciously and by feeling.
As it is said in Sun Tzu's Art of War, "The extreme of the form of the soldier is the invisible." The invisible cannot be seen deeply, and the wise cannot conspire. Therefore, building a brand in the minds of consumers is crucial for enterprises, once the "property rights" of the brand in the minds of consumers, in order to be invisible, no desire is rigid, and the corporate strategy can be invincible.
02. The essence of junzhi's strategic equation
Junzhi has always been committed to integrating the advantages of Western logic, reasoning and analysis with the overall and intuitive characteristics of the East. Combined with the strategic practice of "five hundred billion", Junzhi summed up and condensed the formula of "Junzhi Strategic Equation", that is, strategy = combat readiness× the nth power of the campaign. But as with the definition of strategy, this formula is not an operational meaning, but a bridge to help more entrepreneurs, scholars, and managers better understand strategy.
Junzhi Strategic Equation
1. Combat readiness and campaign
Eastern wisdom is good at using the dichotomy to understand the world. In the I Ching, it is said that "one yin and one yang is the Tao", which is to grasp the law in the dynamics. After the opening chapter of "Sun Tzu's Art of War" "Five Things and Seven Plans", the analysis of many problems in the future is based on a dichotomy to view the world - virtual reality, widowhood, movement and stillness, strange and positive, and so on.
In strategic practice, Junzhi divides strategy into combat readiness and campaign, both in good harmony and in surprise. Combat readiness is the basic condition for the smooth operation of enterprises and the preparation for battle. Both in action and resources, it is the systematic bite of the internal operation of the enterprise, that is, the layout adjustment of products, communications, channels, supply chains, members and other sections needs to be directed to strategy and serve the campaign. This is not a resource accumulation in the traditional sense, but a careful construction under strategic guidance.
The battle is the key to the success of the enterprise, from the competition, but also from the changes in the market environment and customer cognition flashed in the "glimmer", is the competitors most unexpected or least want you to appear in the place "focus and explosion". Only through the grasp of the overall war situation, the insight into the subtle changes in people's minds, the grasping of fleeting fighters, and the familiarity with resource allocation can we plan a campaign of "leveling the ground and thundering".
Judging from the relations between the two sides, combat readiness and the battle community are a combination of movement and stillness, virtual and real. Combat readiness is the deployment of troops in a platoon, and the battle is won by the enemy; combat readiness pursues operational leadership, and the campaign pursues waiting for the time to be launched; combat readiness requires a steady and steady battle, and the campaign requires surprise. Combat readiness pursues "shape" victory, and campaign pursues "potential" victory.
Specific to their respective characteristics: Combat readiness is a basic and daily work, with specific standards, predictability, and processability; the campaign has flexibility and uniqueness, and requires improvisation and improvisation; combat readiness is a sub-departmental operation, and the campaign requires cross-departmental coordination; combat readiness attaches importance to a solid foundation, believes in long-term doctrine, pays attention to the merits of the day arch and the drip of water; the campaign values the power of leverage, emphasizes the dynamic grasp of the competitive pattern and the instantaneous detonation of customer cognition, mainly relying on the keen observation of the commander. Unique imagination and other soft powers.
The difference between combat readiness and combat
2. Interpretation of n
The n in the nth power of the campaign represents the campaign design ability, but also represents a kind of power and detonation. Specifically, n can be regarded as a professional index, which is the embodiment of the comprehensive ability of campaign design, which is a comprehensive judgment based on the competitive situation, customer cognition, industry trends and corporate advantages, and the ability to identify fighters, plan campaigns, and allocate resources in dynamics.
When the situation is good, the enemy's morale is thwarted through the campaign and the market position is consolidated; when a crisis occurs, the crisis is turned into an opportunity through the campaign.
The nth power also represents a power and a detonation force. A well-planned campaign can form a leading edge in multiple dimensions, help enterprises achieve multiple purposes such as deterring competitors, attracting media attention, and obtaining superior resources, and help enterprises achieve exponential growth. Detonation also means investing a lot of resources to overcome difficulties, open gaps, and achieve a leap in the hierarchy over a period of time.
03. China's superiority in unifying combat readiness and campaign
Combat readiness is like military law, battles are like military law, and the art of war is not water without a source, nor is it a wood without roots, and the existence of military law reminds us that we should not think that we can win a battle by relying only on the art of war, and that only by multiplying the two can we constitute a real strategy. Due to the heterogeneity between combat readiness and campaign, in order to achieve strategic objectives, it is necessary to have the ability to integrate combat readiness and campaign.
All along, under the influence of Western scientific rationality, Westerners have been better at combat readiness. Because most of China's Western-influenced curriculum adopts sub-subject teaching, etc., it is not inferior or even side-by-side in terms of combat readiness that Westerners are good at.
Moreover, Chinese, who have long absorbed the nourishment of Chinese culture and have been deeply influenced by the wisdom of the "I Ching", "Tao Te Ching", "Sun Tzu's Art of War" and so on, have subtly combined with the wisdom of campaign design. However, it is relatively more difficult for Westerners to learn, understand Chinese wisdom, and truly grasp the essence of the battle, mainly because of the differences in writing, thinking and core categories.
In terms of writing, the West is mostly alphabetic characters, which naturally have the convenience of symbolic expression, which is conducive to precise expression; Chinese characters are hieroglyphic ideographic scripts, with polysemanship and ambiguity, such as "Sun Tzu's Art of War" says "therefore good warriors, seek the potential", English has hundreds of translations, but even the most famous four versions do not have a version of the "potential" word meaning accurately translated.
In terms of thinking, Westerners emphasize analysis, reasoning, and logic; Chinese are good at intuitive reasoning, often understanding the world through experience, metaphor, analogy, etc.
In terms of categories, the central category of the West is "number", and from Pythagoras to the Middle Ages, mathematics has always been developing, hoping to grasp the world through abstract "numbers"; the central category of the East is "degrees", which is an interval and elastic.
Because of the above differences, Chinese wisdom such as "Sun Tzu's Art of War" is difficult to be truly understood by Westerners, and the great task of unifying combat readiness and campaigns falls on the shoulders of Chinese. Over the past few years, Junzhi has successfully assisted dozens of enterprises to find the strategic direction, optimize the combat readiness structure, and accumulate rich practical combat experience in campaign design, and we are indispensable to undertake this heavy responsibility.
Junzhi reflects greater sensitivity and flexibility in strategic interpretation. At the same time, we advocate that the strategic process must be a dual combination of rationality and sensibility, science and aesthetics, and this dual combination can eventually form a strategic aesthetic.
Western strategic theories such as Porter are supported by logic, analysis, reasoning, etc., and the strategies formulated from them are more than accurate and less flexible. For strategy to really work, it is necessary to add scientific and aesthetic factors to it, so as to unleash the extraordinary power of strategy itself. Junzhi's interpretation of strategy in practice not only pays attention to the inevitable and visible parts, but also leaves enough space for unknown, unforeseen, and accidental things to maintain greater sensitivity in thinking.
This flexibility of thinking comes from Chinese wisdom. The Tao Te Ching says that "the good is like water", and the "Art of War" of Sun Tzu says "soldier image water", both of which are used as a metaphor for tao and the use of soldiers with the gentleness and adaptability of water. The Tao Te Ching also says, "Know its males and keep their females, and be the stream of the world." "Knowing that he is strong, he remains supple, willing to be the ditch of the world, and skillfully handles the relationship between mechanical strength and elastic suppleness."
Of course, in order to achieve strategic flexibility, the combination of rationality and sensibility, science and art is very critical, and it needs to be realized through long-term actual combat. In the Tao Te Ching, it is said that the "Tao" is invisible, unheard, and untenable, and that there is a material existence in the void, "which is the formlessness, the image of nothingness, and the trance." "All this shows the subtlety and difficulty of grasping the strategic approach."
In addition, in the process of serving enterprises, we are well aware that in order to build a brand's psychological architecture in the hearts of consumers, it is necessary to point directly to the hearts of the people in the strategic design, build a steady and steady combat readiness, moisturize and silently shape people's hearts, and prepare to detonate consumer cognition and awaken users' awareness of beauty, and ultimately achieve the improvement of brand power.
Strategy = the relationship between the nth power of the battle of combat readiness and the human heart
Therefore, we also put forward higher requirements for strategic advisers, and we must grasp four balances in the design of strategy and campaign: the balance between science and art, the balance between truth and beauty, the balance between the real world and the soul, the balance of reason and feeling, and constantly improve the basic skills of theory and the basic skills of actual combat. Through the form of the Junzhi Strategic Equation, Junzhi takes this opportunity to make a commentary on the strategy and build a bridge between the application of Eastern and Western wisdom in the business field.
04, Chinese wisdom should appear
With the rapid development of China's economy, Chinese brands continue to rise, but there are still only a few internationally renowned Chinese brands. Needless to say, diligent Chinese entrepreneurs have actively introduced Western technology and learned from the excellent cases and operational tools of Western enterprises for decades, and Western management wisdom has become the basis of enterprise operations for a while. These experiences also once helped Chinese companies to reach the pinnacle of the industry.
However, the discourse power in China's business field has been dominated by the West for a long time - the field of business strategy has been a monopoly position of Western consulting companies for many years; at the level of corporate operation, the "benchmarking method" advocated by Western consulting companies is widely used by enterprises because it is easy to get started, but it also leads to mutual imitation and homogeneous competition between enterprises; the business school sub-discipline system makes enterprises pay more attention to the part and ignore the whole...
One of the deep-seated reasons for these phenomena is that the application of Chinese wisdom in enterprise management is seriously insufficient, white-edged competition forces Chinese entrepreneurs to limit their perspective to internal production and operation, and the overall concept of oriental wisdom such as yin and yang harmony and the unity of heaven and man is abandoned.
We know that no matter how colorful the clouds above our heads are, we must not forget the earth under our feet. Western wisdom makes people see the deterministic side of the world, and Eastern wisdom makes people see the uncertain side of the world. We can't perfectly predict how competitors and customers will act, and when the business society enters fierce competition and overcapacity, this huge business problem can be deconstructed by oriental wisdom.
The famous philosopher Mr. Li Zehou, in his books "The Chinese Philosophy Has Appeared" and "How Chinese Philosophy Appeared", called for Chinese philosophy to receive more attention. Junzhi uses his own practice of strategic consulting to show the society how Chinese wisdom should appear in the field of business strategy.
We believe that with the blessing of China's wisdom application, China will usher in the era of tens of billions of brands, and China will also give birth to a number of global brands. At the same time, the rise of great powers is always accompanied by the revolution of management theory and the help of the consulting industry, and China's consulting industry, which has entered a year of confusion, will also bloom with the rise of China.
Ten billion brand building needs Chinese wisdom, just as Feihe, Yadi, Bosideng, etc. bloomed with amazing vitality in the fierce competition. We hope that through our sharing, more Chinese consulting companies can exert the power of Chinese wisdom, empower more Chinese enterprises, and create business beauty together.