For some time now, state-owned enterprise reformers have always been accustomed to following the trend and following the trend, mistaking means as the end, putting the cart before the horse, and daring not to boldly try to innovate. Some major initiatives such as employee shareholding and the reduction of management levels have been slow to advance.
Mr. Wang Jipeng, chairman of Renda Strategy, pointed out that "taking means as the end" has made the mistake of solaism, and it is not known that "reform is also a means" and that "first of all, we must make the end clear, and we cannot take the means as the end." ”
Employee stock ownership reform
Employee shareholding is a means to improve the corporate governance structure and enhance employee motivation and corporate cohesion, with the purpose of allowing employees to hold the company's stocks and options and obtain a long-term incentive.
The PURPOSE of the CSRC's Guiding Opinions on the Pilot Implementation of Employee Stock Ownership Plans by Listed Companies is to enable employees of listed companies and shareholders to form a community of interests and improve the cohesion and competitiveness of the company. In August 2016, the State-owned Assets Supervision and Administration Commission of the State Council issued the Opinions on the Pilot Project of Employee Shareholding in State-Controlled Mixed Ownership Enterprises, which aims to "establish a long-term incentive and constraint mechanism to stimulate the inherent vitality of state-owned enterprises".
The Opinions specify who can hold the shares? Leading personnel of state-owned enterprises appointed by the central and State Council and local party committees, governments and their departments and institutions shall not hold shares. Key positions have the opportunity to hold shares in scientific research, management and business backbones that have a direct or greater impact on the company's performance and sustainable development. Emphasizing that "employee shareholding is not a full shareholding, an average shareholding, nor a management level shareholding, but a backbone shareholding", it is necessary to prevent the transmission of benefits, and it is necessary to strictly prevent the incentive of "minority control" and "pepper noodles".
To this end, Mr. Wang Jipeng said: "The purpose of reform is to make people have a sense of gain in their hearts." ”
However, it backfired. Some employees hold shares, and they get a few senior executives or a few technical backbone personnel to hold shares. Employee shareholding has degenerated into "executive shareholding", changing its taste and deviation, deviating from the original purpose of the "Opinions", and in the end, "pie" has become a "trap", and the sense of employee acquisition has turned into a "sense of abandonment". The root cause lies in putting the cart before the horse and mistaking the means as the end.
The practice of reform tells us that development is the era of hard truth, and people are the means, but now to promote the reform of state-owned enterprises, people are the end, and development is the means. According to Mr. Wang Jipeng's assumption: the reform should be "one enterprise, one policy", each enterprise according to their own situation to formulate the "employee shareholding" plan, reported to the State-owned Assets Supervision and Administration Commission and the National People's Congress for approval, suitable for the whole people to hold shares, suitable for the whole people to hold shares, suitable for the share system to implement the shareholding system, this is called in line with the original spirit of reform.
Reform of compression hierarchies
The State Council issued the "Guiding Opinions on Promoting the Structural Adjustment and Reorganization of Central Enterprises", which aims to solve the structural problems such as the excessive distribution of central enterprises and the excessive number of enterprise levels, and the compression level is listed as one of the driving forces of the reform of central enterprises.
Five central enterprises such as the State Grid launched the reform of the compression level, and the "slimming down" subsidiary was changed into a branch, which was compressed from the current nine-level management level to 3-4 levels, and initial results were also achieved.
Mr. Wang Jipeng believes that the many levels and bloated institutions of central enterprises are freaks caused by the "monopoly of one force" of state-owned enterprises. If we do not understand the end and what means we use, we will also make the mistake of "treating the means as the end."
Renda's strategic point of view: "Strategy determines the structure, and the structure inherits the strategy." ”
In general, the compression hierarchy necessarily involves the question of how to distinguish between the legal entity level and the management level. In reality, some central enterprises such as CSSC and Baosteel have various cross-shareholdings in mixed ownership enterprises such as state-owned assets, and it is difficult for son companies and grandson companies to have clear boundaries, and there are no clear boundaries at the legal person level and management level, which is a normal market division. For example, the first-level authority can be called a management level, the general manager and deputy general manager are two layers, the department is three layers, the group company to the second-level company general manager team is four layers, and then down to the five layers, the management level authority is divided layer by layer.
From the perspective of SASAC supervision: compress the level to three or four layers, and you can see the bottom at a glance. And the central enterprise group does not want to be chaotic and retain some gray areas.
From this point of view: "compression level" is not the purpose, the purpose of the enterprise is development. The first is the strategic positioning of the group, what to do clearly, the natural business industry group will be clearly distinguished, the legal population will also be clear, the retreat should be withdrawn, the advance should be entered, and the grandson should be mentioned in the son's mention. The kind of SASAC-led, relying on administrative orders, mechanically compresses the organizational hierarchy is "mistaking the means as the end", which has no meaning or result.
Behind the reform of state-owned enterprises, the shackles of the system and the shackles of concepts are deeply rooted. Some people always want to be led by the government and the SASAC to do this thing, fundamentally leaving the market aside, and state-owned enterprises really need a management change.
Philosophically, the future result of the conceptual establishment of the object of the object must be achieved by the practical activity of the subject transforming the object, and the means are only the means or means to achieve the end.
Contemporary China is undergoing one of the most extensive and profound social changes. All idealists and subservients are always accustomed to following the trend and mistaking the means as the end, and are by no means true reformers. Only by keeping pace with the times and constantly promoting reform and management innovation can we avoid making mistakes. All ideological reformers must not fail to live up to this era and truly undertake the mission entrusted by history.
A good book recommendation every day
Excellent out-of-print book
Brief introduction:
The biggest problem facing group companies is not how to make a profit, but how to control it. Under the surging tide of state-owned enterprise reform, the supervision method of state-owned assets has changed from managing enterprises to managing capital, and the corresponding control mode has also changed. This book takes Document No. 63 of the State Council as the guiding opinion, coupled with the in-depth analysis and comparison of project cases by Renda Strategy, to disseminate to readers the new trend of state-owned enterprise reform group control under the new normal. In addition, this book also discusses the impact and changes related to the control of other groups under the reform of state-owned enterprises, which has great real-time value in the context of the current reform of state-owned enterprises.
Book Catalogue:
Chapter One: From "Mother-in-Law" to "Boss"
1.1 The day when the enterprise returns to the market, the successful reform of state-owned enterprises
1.2 Icebreakers
1.3 Where state-owned assets retreat and where they go
1.4 [Topic] The reform process of local state-owned assets and state-owned enterprises
Chapter II State-owned Capital Investment and Operation Companies
2.1 Is there a difference between investing and operating a company?
2.2 Key issues in the operation of state-owned companies
2.3 Competition and cooperation of state-owned companies
2.4 After reorganization, the strategy has changed, and how can the control model remain unchanged?
【Case】 From asset management to capital management, Yuanzhi Investment has built a national asset industry fund group
Chapter THREE: New Trends in Group Control
3.1 Strategically central organization
3.2 Value services make headquarters better
3.3 Integrated management
3.4 Party organizations and boards of directors, who are the leaders?
Chapter IV: Management and Control Models
4.1 Control Mode Selection
4.2 Decrypt Document No. 63
4.3 After classification, the operation mode of different types of state-owned asset management companies
【Case】L State-owned Company Control Model Selection
Chapter V: Head of State: Headquarters Positioning
5.1 Build a strong headquarters
5.2 Value-based headquarters service and supervision
5.3 The group is fat, and the development ability of the headquarters should also be improved
【Case】Northwest S Holding Group headquarters positioning
Chapter 6 Skeleton: Tissue Design
6.1 Strategy determines the structure
6.2 Business Portfolio
6.3 Select the organizational structure type
6.4 Innovation in the organizational structure of state-owned enterprises
【Case】HS Group's transformation and development and organizational structure adjustment
Chapter Seven: Fighting barbarians: corporate governance
7.1 Corporate governance is the key to mixed reform
7.2 Chaos in the governance of state-owned enterprise legal persons
7.3 Equity Incentives: A New Dark Passage of Control
【Topic】After merger and reorganization, how to determine the proportion of equity
Chapter Eight: Flesh and Blood: Responsibility and Power
8.1 Responsibility and authority system under different control modes
8.2 The strange phenomenon of decision-making of state-owned enterprises with imbalance of power and responsibility
8.3 The reform path of the group's responsibility system
【Case】The construction of the responsibility system under the strategic adjustment of Group D
Chapter Nine: Soul: Performance Evaluation
9.1 Classification of the performance appraisal system
9.2 Performance evaluation system of public welfare state-owned enterprises
9.3 Incentive Plan for Executives of State-Owned Enterprises
【Case】Xinxing Jihua
Chapter Ten: The New Situation: The Great Transformation
10.1 Internationalization
10.2 Transformation and development
10.3 After the ebb and flow stops
For details, please consult Renda Strategy!