Chapter 63 Let culture take over

In China, "successor" is a common problem faced by Chinese private enterprises.According to public statistics, in the next 5 to 10 years, 3 million private enterprises in my country will face the problem of succession. Obviously, after nearly 30 years of Chinese private enterprises, the first generation of entrepreneurs have collectively approached the moment of withdrawing from the business stage after years of hard work. Many enterprises are entering a stage of alternation between old and new. Passing the baton to the next generation in order to maintain the sustainable development of the enterprise is an important issue faced by these enterprises.According to a survey, 90% of the family founders hope that their children will take over. In their eyes, the "world" they have worked so hard to "lay down" is not a last resort, and they must not be handed over to "outsiders".

The "richest man in China" Li Ka-shing handed over the power to his eldest son Li Zeju, Lu Guanqiu of Wanxiang Group handed over the power to his son, Xu Rongmao split the company and handed over the company to his son and daughter. The power is handed over to her daughter Yang Huiyan.But these founders are all retired, directing behind the scenes. Yin Mingshan, CEO of Chongqing Lifan Group, said: "I know that if I hand over the work to family members, our business will slowly die; if I rush to professional managers, our business will die. Will die quickly. Between dying slowly and dying quickly, I choose to die slowly."

In particular, the "Battle between Chen and Huang" that occurred after the founder of Gome Group Huang Guangyu was imprisoned made private entrepreneurs worry that such incidents would happen again to them, so they were more cautious in choosing their successors. In fact, whether in the East or the West, family businesses generally tend to let people within the family take over, which is the first choice for family businesses on the issue of successors.Take the famous Ford company in the United States as an example. When it comes to successors, the Ford family is always the first consideration. If the successor cannot be selected from the family, it is considered to choose from outside or professional managers. In order to ensure the inheritance of the family, even if outsiders are selected, the Ford family still has as high as 49% of the voting rights on the board of directors, while its shares are less than 8%.That is to say, for a family business, no matter whether it is a succession by an internal family member or an external professional manager at the helm, the family's control over the business will not be affected.

In January 2011, in an exclusive interview with China Business News, Xu Zhijun, the rotating chairman of Huawei's EMT, made it clear on behalf of Huawei's top management that "Huawei's future will not be succeeded by Mr. Ren's relatives." Xu Zhijun said in an exclusive interview with reporters: Huawei's handover is a cultural handover, a system handover, which has been going on for years and has never stopped.The speculation in the society is that it does not understand and thinks that it is passed from person to person.Why does the United States change CEOs like a revolving lantern, and it doesn’t affect the operation of many companies. Why, isn’t it just culture, systems, and processes?We have been studying for more than ten years. Isn't it the beginning of handover when we are studying?Over the years, the company has hired many people who have learned well and practiced well, and the institutionalized handover has been going on.Judging from the current situation, it is not that there are no successors for Huawei, nor are there fewer, but more.

Huawei's arrangements for the future are definitely not what you imagined. It will definitely not find a successor to take over, let alone Ren Zhengfei's relatives.Mr. Ren founded this company from the very beginning with this idea, and has always selected cadres on the basis of merit.What we have built from the beginning is a modern enterprise system, with a governance structure, a shareholder representative meeting, a board of directors, and a management team. You see, Western companies have basically gone through the successor stage smoothly, but in Chinese culture, because there was an emperor in ancient China, the concept of Chinese culture is to find an emperor and then succeed the emperor. This is a deep-rooted tradition in many Chinese people. Succession concept, but this is a false proposition for Huawei, Huawei does not have this problem.

Huawei has a board of directors, and the primary responsibility of the board of directors is to appoint and dismiss the CEO.The traditional concept in China is that the general manager is big, the board of directors is small or there is no board of directors. It is mainly a state-owned enterprise because there is no equity representative, but Huawei is not. The "Huawei Basic Law" clearly stipulates that the general manager of the company is appointed and dismissed by the board of directors. Why not exercise this power?Why do we have to have a successor?Why can't it be a collective?Why not a team?Huawei has many successors. (Quoted from "First Financial Daily" on January 28, 2011)

Ren Zhengfei's choice of "cultural succession" is very similar to Wang Shi, chairman of Vanke Group, who chooses "successors" by the system. The "successor" Wang Shi chose was Yu Liang, who is known as the first professional manager of China's real estate industry and the general manager of Vanke Group, not his own children.Wang Shi has 8 sisters in total, but there is no blood relative of Wang Shi in Vanke Group.Wang Shi said: "I don't train successors, I only build systems and cultivate teams. Who will be the squad leader in this team should be selected by the system. The inheritance of an enterprise depends on culture rather than blood. The opportunities for the first generation of bosses come from all corners of the country. , which is the second generation, is already a platform of choice for globalization and internationalization.”

In Wang Shi's view, whether China's private enterprises can become century-old enterprises and whether they can continue to develop depends largely on the moral level of professional managers.Chinese people are full of entrepreneurial sense of adventure and innovation. Therefore, there is no need to worry about the lack of entrepreneurs. What China needs to worry about is the lack of professional managers with sufficient professional ethics and professionalism. Wang Shi's idea of ​​"selecting successors by the system" has been recognized by many entrepreneurs.And now Ren Zhengfei has made the same choice as Wang Shi.Ren Zhengfei once clearly stated: "Let the mechanism produce successors."Ren Zhengfei has already reserved a group of excellent reserve talents through the establishment of the mechanism.In Ren Zhengfei's view, Huawei should be built into a modern enterprise without family blood.The existence of the family will hinder the performance of capable people, which is not conducive to the sustainable and stable development of the enterprise.He wants to create the true owner of the company through equity incentives and cultural inheritance, so that Huawei's cultural concepts and management foundation can be well passed on.