Are You Adaptive to the Crisis

"Thousands of companies have received bankruptcy protection since the global financial crisis came; people feared that more news will be heard as financial carriers could not break away from the poor destiny. However, companies which up against the trend are not in minority. Mostly, entrepreneurs got into the muddle and didn’t know what the next step is. Then, which category are you belonging to?" This is the challenge Professor Dr. Brian To from HEC Paris declared in the forum of "NDRC-HEC EMBA-The Crisis and Leadership" in Jin Jiang Hall July 28th. "Are you adaptive to the crisis?"

Dr. Brian To illustrated some statistics Chinese entrepreneurs usually ignored:

First, CEO of the companies included in the Fortune Global 500 has been changed in an average of 5 years. Less people was voted in for a second term, which means directors and stockholders were forcing the change of the top management team in order to keep development of the company.
Secondly, it is said that a major leadership reshuffle always came 15 years a time. You can hardly find out the original framework of the company especially in the TOP 100. It is hard to maintain steady increase and the leadership in the market since the competition keeps getting worse.
Chinese entrepreneurs should be aware. They should be deep in thought whether the experience of successes can be copied in the future, in China, in global market or not, especially since the circumstance of politics, economics, culture and technology changed. How to lead the development of the company? It is a technology, a skill as much as an art.

In the process of teaching HEC EMBA China program, Dr. Brian To found that a majority of Chinese entrepreneurs are of order style –they have clear goals pushing employers to achieve. It is very suitable to the China's specific national conditions. In the period of fast development, this style has a benefit of enforcing strategic decision with high efficiency. Thus, the performance of enterprises could grow quickly. However, it would not work when the entrepreneur force this style to overseas investment. Due to the culture difference, oversea investments challenges top management, the situation is even as hard as a "nightmare".

Particularly, Chinese entrepreneurs are sensible to catch opportunities. The weaken point is suitability. E.g. Chinese entrepreneurs master manufacture. They sale directly to oversea distributors and believe that everything is settled. They seldom do surveys. They do not know the characteristic of the end-users. Many of them are still hoping to sell more goods to America, like convenience foods, etc. if they do not have the idea that the demand in the States is slowing down. However, the demands in Brazil and Russia have a strong growth. "What are you prepared to do?"

In addition, Chinese entrepreneurs are learning how to take care of global business from the leadership of the peers in Hong Kong and other areas in Asia. Usually, the big family has a shadow cabinet. The leader of this shadow cabinet may be a locally-born Chinese. In other words, this shadow can be more flexible to change the long-term leadership style. This low-profile shadow should have strong suitability to play the role of a bridge linking the different culture and background. It is likely to be served as a guidance counselor which is important to decision making. Dr. Brian To emphasized that there should have local businessmen included in the board of directors of the oversea investment. To combine the strength of different areas as much as possible is the key to the success of oversea expansion. This is also the biggest challenge Chinese entrepreneurs now facing under the current circumstances.

The forum were joined by entrepreneurs from many foreign enterprises, State-owned enterprises and private enterprises. People shared the common view that the coming of the professor from HEC Paris and the topic of management with a global horizon has special improvement to Chinese entrepreneurs. Rupert Hoogewerf, who had a fine grasp of Chinese private enterprise, the initiator of Hurun Report, also presented and facilitated discussion. He pointed out that Chinese entrepreneurs are enough sensible to catch opportunities. The development of secondary sites in China is still keeping a good pace uninfluenced by the crisis.