Chapter 40 3. Insist on innovation: continue the road of king

Fully controlling a large-scale enterprise group is beyond the capabilities of a single individual. It requires people of insight and useful talents to jointly manage the enterprise, and management is also productivity.There have been many shooting stars in China's private enterprises. Zhuhai Giant Group, Shenyang Feilong Group, and Jinan Sanzhu Group have all been as brilliant as the sun.However, their careers are not booming and declining. At most, they can only be said to be in the "early prosperity", and they have declined in an instant.Of course there are many lessons, the key is whether we can persist in independent innovation to ensure the long-term development of the enterprise.The most basic characteristic of any enterprise that can enter the world's top 500 is innovation.Without exception, these enterprises all focus on innovation, especially on their own inventions and creations, and on the protection of their own intellectual property rights. These enterprises, such as Intel, Siemens, Samsung, etc., have established complete , advanced technology innovation system, each year the company should take out about 12% of the total annual sales, as many as one billion or even billions of dollars for the research and development of the company, and at the same time, it will spend a lot of money to acquire those companies that have Emerging small companies with outstanding technical achievements in the fields they are engaged in apply for hundreds to thousands of patents worldwide every year.There is such a sentence hanging in Gree's workshop: "A company without innovation is a company without soul; a company without high-quality goods is an ugly company."

At present, the growth rate of China's manufacturing industry is only more than 20%, while that of neighboring Japan is close to 50%.There are many reasons for this phenomenon, but the key is that Chinese companies generally lack core technologies and well-known brands with independent intellectual property rights.Many enterprises and operators are full of quick success and quick profit, and are easy to be satisfied with short-term benefits, but often ignore the improvement of independent innovation capabilities.Looking back at the century-old history of air-conditioning development, most of the core technologies have been monopolized by the United States and Japan.The world's first air conditioner was invented by the United States, and then Japanese companies innovated in classification and surpassed the United States, but the United States has always had an absolute advantage in the field of central air conditioning.Zhu Jianghong has a first-hand experience of the helplessness of lack of backward technology.

At the end of 2001, Zhu Jianghong led the company's technical team to Japan for inspection. Seeing the advanced equipment and technology of Japanese companies, Zhu Jianghong proposed that as long as the Japanese side is willing to provide frequency conversion multi-connected air conditioner technology, Gree is willing to meet Japanese requirements in terms of cooperation methods and market resource allocation. Party's request, please cooperate with the enterprise.But Japanese companies ruthlessly rejected Zhu Jianghong's request.If the inverter air conditioner is the "crown" of the air conditioning industry technology, then the multi-connected central air conditioner is the "crown jewel". It took Japanese companies 16 years to develop this technology.Therefore, it is also expected that the Japanese company rejected Gree's request.Zhu Jianghong believes that if China wants to "catch up with the United States and surpass Japan", it must rely on its own strength, instead of counting on the technology handouts from the United States and Japan.From years of dealings, what they have shown is to block Chinese companies in terms of core technology, in an attempt to strangle competitors in the cradle.So Zhu Jianghong and Dong Mingzhu led the Gree people to try their best. Without any drawings and only one product instruction manual, relying on their strong technical strength, Gree only spent less than 4 million yuan in less than two years. With only about 100 million funds, the multi-connected central air-conditioning technology was successfully developed, which completely broke the monopoly of Japanese companies.Only a few years ago, the multi-connected central air-conditioning market in China was still dominated by Japanese brands, but now, key markets such as East China, North China, and South China have been "one-third of the world, and Gree has one." Not only that, in overseas markets, Japan Enterprises also feel the threat from China's Gree.In contrast, it took Japan 16 years to develop this technology. Therefore, when the news of the successful development of Gree's multi-connected central air-conditioning technology reached Japan, the entire business community was shocked.After crossing this threshold, Gree is facing new challenges. The centrifugal central air-conditioning technology has been mastered by 4 companies in the United States in the past. In order to monopolize the market, these companies only sell the whole unit and do not sell parts.It took Gree a year to break the monopoly of American companies on this technology.

In August 2005, China's first centrifugal chiller came out in Gree Electric Appliances, which filled the gap in this technical field in China's air-conditioning industry, broke the monopoly of the United States on centrifuge technology, and successively seized it from American companies. Nearly 100 large projects such as Huangshan Huizhou Hotel in Anhui, China Resources Vanguard in Zhuhai and Qufu International Trade Center in Shandong have been completed, completely ending the history of super-large central air-conditioning market dominated by American brands.Only two months later, the world's first ultra-low temperature digital multi-connected unit was successfully rolled off the assembly line at Gree Electric's central air-conditioning production base.A worldwide problem was overcome by Gree.China's air conditioners can not only bring warmth to the cold area of ​​minus 25 degrees, but also achieve efficient heating and save electricity and energy.More than 20 years of "bringing doctrine" has created the prosperity of China's air-conditioning manufacturing industry.But who dares to say that China's air-conditioning manufacturing industry has broken the technology monopoly of Japan and the United States, and has mastered the core technology in its own hands?Who dares to stand up straight and compete with international giants in the global air-conditioning industry, and hang the air-conditioners developed and produced by China on the walls of developed countries?Looking at China's air-conditioning manufacturing industry today, I am afraid that only Gree is capable of taking on this important task.Only Gree Electric has successively broken the international monopoly of core technologies such as air-conditioning compressors and multi-connected central air-conditioning, causing international competitors to lose one position after another in China's commercial air-conditioning market, and losing the price monopoly advantage brought about by technology monopoly. The reason for Gree’s success, Dong Mingzhu believes, is that Gree Electric, as a national brand in China, has the responsibility to break this monopoly when international counterparts refuse to sell technology or even use technological advantages to monopolize the market, establish a high-quality image of Chinese brands, and go The way of independent innovation.Either innovate or die. Innovation has become the most important topic of this era. Every enterprise and every organization, no matter how big or small, requires innovation, because innovation can achieve excellent quality and everlasting foundation.However, innovation is not shouted out, it must be put into action and implemented.This means that how to innovate itself is also a major issue.

Innovation is difficult, how to innovate is even more difficult, and continuous innovation is even more difficult.Just like this, many companies that are actively innovating eventually fall on the journey. The direction is wrong, the method is wrong, the method is wrong, and various factors are mixed together, which often dooms the loss and failure of innovation. If you want to innovate, you are looking for death”, that’s what I said.In order to continuously improve its independent innovation capability, Gree invests more than 3% of its sales revenue in technology research and development each year, becoming the company with the largest technology investment in China's air-conditioning industry.At present, Gree Electric has a total of more than 1,200 R&D personnel including foreign experts, of which more than 90% have a bachelor’s degree or above. Gree Electric also creates a scientific research environment that respects knowledge and talents, and has set up a scientific and technological progress award to reward scientific research. Heroes, the single award can reach up to 1 million yuan.From home use to commercial use, from window machines to split machines to one-to-one machines, Gree can produce everything that can be produced in the United States and Japan, and it has surpassed their technology.Gree has mastered the core technologies of the air-conditioning industry, such as compressors and frequency conversion control technology, coupled with its fast response to the market, greatly improving its ability to outperform its competitors.Japanese and Korean companies respond relatively slowly to product changes, and the new products they are launching now may be products that have been planned a year or even two years ago.However, China's market demand is constantly changing, and products made two years ago may not be able to keep up with the needs of current consumers. However, the R&D and design cycle of Gree's related product specifications has been shortened to 8 months or even shorter.In order to track the cutting-edge technology of the world's air-conditioning industry, Gree Electric has formed the world's largest professional air-conditioning research and development center, with more than 220 professional laboratories for heat balance, noise, reliability, etc., and it is in a leading position in the world in terms of quantity, scale and technology.In addition, a large-scale refrigeration technology research institute has been established, and more than 1,000 domestic and foreign patent technologies have been applied for. The variety and specifications of air conditioners rank first in the world.What is real independent innovation?The modern enterprise management theory holds that independent innovation means being able to base oneself upon one's own reality and to continuously develop one's own potential and create new achievements on the basis of analyzing the internal and external environment of the organization.Dong Mingzhu believes that enterprises have great responsibilities in independent innovation.On the one hand, in terms of technology research and development and independent innovation, we must be down-to-earth, do more practical things, talk less empty words, fight for a long time, and endure loneliness; Demand, take the initiative to assume social responsibility, use corporate power to promote social development, and make behaviors responsible for the future.Innovation is the source of power for an enterprise to survive. Without innovation, no matter how big an enterprise is, it can only end in death.If we analyze successful international companies, we will find that they seem to prefer to talk about strategy, culture, process reengineering, etc., but not much about innovation.If we therefore think that innovation is not important, we are very wrong.These companies do not talk about innovation, not because they think innovation is not important, on the contrary, precisely because they have a thorough understanding of the importance of innovation, innovation has become a natural way of sustainable development, so they do not need to talk about innovation.But that doesn't mean they don't need to innovate.Take McDonald's as an example. McDonald's is always a step behind KFC in local innovation. Its chain stores in the Philippines did not start to introduce Chinese flavors until they were cornered by Jollibee. McDonald's in Japan also launched after long-term research and deployment. Developed the popular rice hamburger, which is steamed in a steamer like Chinese steamed buns.

In 2003, the growth of McDonald's in the global market slowed down for the first time, and some branches even fell into operating difficulties. Based on this, McDonald's launched the brand innovation campaign of "I just like it", and hired Hong Kong's popular stars to promote it, showing its infinite vitality The new brand image of the company uses "happy elements" to attract more young customers.This example can show that if you don't innovate, you will be eliminated by the market soon, and insisting on innovation can turn the company from danger to safety.As Zhu Jianghong said: "What Gree wants to do is by no means a copy." Independent innovation is neither a simple copy model nor a follow-up strategy. It is actually a practice that surpasses the predecessors, that is, Said that it has formed a "continuous improvement, catch up" operating mechanism.

We have seen that when the United States has accelerated the pace of the information industry revolution, it has gradually and even actively ceded the automobile industry to Japan. This kind of "ceding" is not an active "handing over" but a superior independent innovation strategy.Now is no longer the era of manufacturing. If many Chinese companies cannot catch up in the third wave of the new economic wave, they will lose more market share.In fact, from Gree's development track, we can see that independent innovation is not just technological innovation.The "Gree marketing model", "off-season rebates", "year-end rebates" created by Dong Mingzhu are all part of independent innovation.All-round independent innovation is the key to Gree's success.In a sense, Gree dared to challenge big channels such as Gome and Suning because of its independent innovation in marketing.It can be said that independent innovation not only allows enterprises to gain a competitive advantage, but also takes the initiative in the competition.Dong Mingzhu said: "Self-owned brands are not only the symbols of products, but also the backbone of a country's national industry, and the carrier and reproduction of a nation's cultural heritage. When people mention Samsung, they think of South Korea, and they can't help but think of the United States. And Sony is synonymous with Japan.” Persisting in innovation and never-ending innovation is Gree people’s way of thinking in doing business.The mission of Gree Electric Appliances is to "promote the industrial spirit, pursue perfect quality, provide professional services, and create a comfortable environment." It is this high degree of industrial spirit and the pursuit of perfect quality that determine that Gree will never stop on the road of innovation. Pause, continue its kingly way.