The pattern of the old battlefield has been decided, and the curtain of the new battlefield has begun to open
Text: "Chinese Entrepreneur" reporter Liang Xiao
Edited by Mina
Header photo by Deng Pan
2023 is a year of "overjoy" for the entire home appliance industry. Although the annual report has not yet been disclosed, many domestic home appliance companies, including Midea and Gree, have eagerly announced that they have "ushered in the best performance in history".
Hisense is also one of them. At the recent Hisense 2024 Global Customer Conference, Yu Zhitao, President of Hisense Group, revealed: In 2023, Hisense Group's revenue will exceed 200 billion yuan for the first time, a year-on-year increase of 9%, and overseas revenue will be 85.8 billion yuan, a year-on-year increase of 13%.
This is the 54th year of Hisense Group's establishment. Even in the relatively traditional home appliance industry,Hisense is also an "old" enterprise。 But at every node of industrial transformation and technological evolution,Hisense is one of the first companies to respond:The earliest to start from black electricity,Slowly cover all categories such as white electricity、Kitchen appliances;While laying out the domestic market,While looking at the global territory,Successively acquired Toshiba TV、Gloni (Gorenje)、International brands such as Japan's three electric vehicles;At the same time,Starting from home appliances,Its business vines continue to climb to intelligent transportation、Optical communication、Chips、High-tech industries such as medical care,Even with the Internet、 The fields of artificial intelligence are connected.
"Many times, everyone calls home appliances a traditional industry, and I think that home appliances should be called an advantageous industry now. Jia Shaoqian, chairman of Hisense Group, pointed out that Chinese home appliance companies, including Hisense, are constantly moving towards high-end, intelligent and global. In his view, the "best performance" in 2023 is a manifestation of the overall transformation bottleneck of the home appliance industry.
To a certain extent, this also means that the old battlefield pattern of China's home appliance competition has been set, and the new battlefield has just begun. Where will the home appliance industry go in the future? How do home appliance companies prepare for a new round of competition? How do manufacturing enterprises respond to a new round of technological innovation? What is the growth point of Hisense's sustainable development? On these issues,Jia Shaoqian accepted an exclusive interview with "Chinese Entrepreneur",At the same time, he also talked about the most exciting and regretful things in 2023,This is the first year he took over as chairman of Hisense Group,Standing at the intersection of the era of kinetic energy conversion of the old and new home appliance industries,Many changes are happening,Many things also need to be rethought。
The following is a transcript of the conversation (with cuts):
"It is not a traditional industry, but an advantageous industry"
China Entrepreneur: In 2023, Chinese home appliance companies will generally reap the best performance in history, is this a coincidence, or does it represent a certain trend?
Jia Shaoqian: To be honest, everyone's expectations may not have been so high before, but after the results come out, they will feel very happy, so they really lowered their expectations and improved the happiness index.
There are several reasons behind this achievement:First,After so many years of market competition,The trend of the home appliance industry gradually concentrating on the head enterprises is still obvious,This is an industry that has gone through decades of fierce competition,The enterprises that can survive have experienced severe market tempering,Constantly adjust the structure,Constantly in the transformation and upgrading。
The second is the release of China's management dividends, we continue to promote intelligence, advanced manufacturing, digitalization, to achieve quality improvement, efficiency improvement, and finally improve quality and efficiency reflected in the business results.
There is also globalization, and now the overseas market proportion of Chinese enterprises is increasing, and the structure of overseas products is also going up, these factors are superimposed, making the overall performance of the home appliance industry very good.
China Entrepreneur: In other words, the industry as a whole has crossed a bottleneck in development.
Jia Shaoqian: That's right.
Everyone has always regarded household appliances as a traditional industry, and I think that this name is no longer very accurate, and it should be called an advantageous industry. From the perspective of the global market, 40%~50% of TVs come from Chinese companies, more than 50% of refrigerators and washing machines are produced in China, and air conditioners made in China account for 80%, so from the perspective of China going global, home appliances are already an industry with a strong foundation.
Photo: Deng Pan
In addition, although tradition does not mean backwardness, tradition always gives people the feeling of lack of innovation. But you see, how many application scenarios have been derived from today's home appliance industry - for example, TVs can be applied to medical displays, smart offices, and new technologies such as laser displays have emerged, so they cannot be described as traditional, but strong and advantageous industries.
The further upgrading and transformation of advantageous industries will definitely bring new development opportunities, so the past home appliance enterprises, in fact, have entered the new industry, new track, although many are still in the investment period, but the overall will pull the industry to move towards the high-tech field, pushing the industry upward.
"Chinese Entrepreneur": Hisense also achieved the best performance in history last year, with revenue exceeding 200 billion yuan for the first time, isn't it quite exciting?
Jia Shaoqian:Last year, Hisense's revenue increased by 9%,Profits are also good,In the big economic situation,Achieving such business results,It's a very happy thing for everyone。
But let me say that the current business performance is still so-so. I think the most exciting thing is the mechanism construction behind this achievement, which we have been doing in the past two years, and in the future, we will also make this long-term incentive mechanism more perfect within the enterprise, so that the past enterprise workers or professional managers will gradually change to the role of corporate shareholders or business partners.
China Entrepreneur: What is the most regrettable thing?
Jia Shaoqian: Some things related to future development, including the expansion of existing industries, the excavation of new industries, the construction of long-term capabilities, etc., have not yet achieved significant results, of course, it will take time to advance, but this process needs to be more firm. In the past, there were short-term and long-term games in the management focus and long-term ability training of the enterprise, and there were also a lot of regrets, so we should still firmly do the right thing and do the long-term thing.
"In the new overseas battlefield, the price war will not work"
"Chinese Entrepreneur": As the chairman of Hisense Group, what are the three most important things to do in 2024?
Jia Shaoqian: The first thing is internal reform, starting from 2022 to start the change, to this year has entered the third year, I hope that on the basis of the previous two years, this year to find out several key root problems, in corporate governance, top-level design has some more substantive actions and breakthroughs.
The second issue should be overseas development, how to adjust in the new political and economic environment, so that the pace of globalization is more steady and steady, and at the same time actively and promisingly further improved.
The third is the development of emerging industries, which should be explored and explored, looking for new opportunities, and planning and layout for the future.
In fact, these three things are not only the focus of this year, but also have a long-term impact, requiring a certain strategic choice, a certain sense of adventure, and a real dare to try.
"Chinese Entrepreneur": This year, several leading home appliance companies have said that they will strengthen their overseas layout, how do you view the competitive environment of overseas markets in the future?
Jia Shaoqian: As I mentioned earlier, China's home appliances already account for half of the world's total, and the competition in the global market in the future may also be competition between Chinese enterprises.
In fact, the home appliance industry has long been a global competition, but 30 or 40 years ago, it was a global competition in the Chinese market, and now it has changed to a new battlefield.
On the whole, I think it's a good thing that everyone is going out, because in this process, the power of Chinese manufacturing is getting stronger and stronger, and through competition to meet the consumer needs of different countries and regions, as well as the scenario-based and personalized needs, it will also further promote industrial self-adjustment and technological innovation.
Source: Interviewee
At the same time, the logic of competition will also change, where can go to sea, the future must be based on independent brands - rather than 20 years, 30 years ago OEM model, at this time if you still want to develop the market in the way of price war is not feasible, will form damage to the brand, so the future competition is out of the low-level, low price, in the high-end, brand level of competition.
"Doing things right and doing the right things are two levels"
"Chinese Entrepreneur":In the eyes of many people,The home appliance market is already a stock game market,Enterprises in it will inevitably encounter the development of the "ceiling",For Hisense,What does the new growth come from?
Jia Shaoqian:The first one comes from the white electricity market,Last year, Hisense's washing machine performed well,Air conditioning has also increased greatly-of course, because the previous base was relatively small,A little growth will be obvious,In fact, the total amount is still relatively large with its peers。 But on the other hand,Hisense's accumulation of technology,Brought about product performance、Quality improvement,Product structure is also constantly optimized,These have enhanced Hisense's brand influence in the field of white electricity。
In addition, Hisense's to B business,After so many years of foreshadowing,Accumulated some experience,Some sectors have made good progress,One of the best in the industry,Now it is necessary to continue to strengthen the technical foundation,Seize the opportunity period and window period that may appear in the future,Accelerate development。
The third is emerging industries,For example, automotive electronics,At present, from a technical point of view,Hisense from the compressor of the car、Air conditioning system,And then to the automobile mold has a layout;On the application side,The TV screen can be extended to the smart cockpit,Laser display can also be extended to the field of head-up display,There is also Hisense's smart transportation can be cut into vehicle-road collaboration、Unmanned, etc.,If you can better open up the industry,Enhance collaboration,The industrial space will be larger。
"Chinese Entrepreneur":At present,Hisense's businesses are scattered in different sectors,If you want to strengthen collaboration,Do you want to do business integration?
Jia Shaoqian: Yes, concentration is the best way to strengthen the cohesion and integration of the organization, but sometimes, more important than the organization is the mechanism, and a mechanism to strengthen synergy may be more important.
For example, last year, Hisense set up a consumer business group,The purpose is to be a collaborative platform。 Because Hisense has two to C companies——Hisense Home Appliances and Hisense Video,Most of the time,They are facing the same customers and the same users,Many supply chain links and background support can also be reused。 In the past, because they were under different legal entities, they must have been in a state of fighting in each other, but through the synergy of the virtual platform, two independent companies can be integrated: on the one hand, it can provide users with a more integrated experience, and on the other hand, it can also reduce management costs, financial costs, operating costs, and improve efficiency.
Hisense started pushing this model at the end of last year,There is no particularly mature experience yet,But on the whole, the efficiency is better than in the past。
"Chinese Entrepreneur": The net profit margin of Hisense Home Appliances and Hisense Video in the third quarter of last year has improved, and what level do you hope to achieve through change in the future?
Jia Shaoqian: We have been thinking about this matter, but it is very difficult to change, just like curing a disease, there are too many causes of the same disease, and it is difficult to find the cause.
But we are not in a hurry, because this is not a matter that requires rapid change to determine life and death, but more of a matter of seeking progress in stability, as long as the direction is good, any little change is conducive to efficiency improvement.
Moreover, the most important thing for enterprise change is ideological understanding, and the tools for change are not important, as long as the understanding is adjusted, effective solutions can always be found.
China Entrepreneur: Do you still go to the store often?
Jia Shaoqian: I used to go often, but now there are very few, and the reason is still that, I think that is doing work that I shouldn't do, which is equivalent to depriving the people below of their sense of responsibility.
I hope that in the future, Hisense will transform the management and control model into an authorization model,Continuously decentralize power,Let each business unit become a self-driven、Self-bursting vitality organization。 In the past, it was often said that doing things correctly and doing the right things are completely two levels, the former is more about implementation and focuses on the implementation of tasks, but the latter is concerned with future development and active decision-making, so in the future, we must learn to let people at all levels do the right things.
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