Home Categories political economy Case Study (Volume 5): Difficulties in Overseas Mergers and Acquisitions of Chinese Enterprises
On June 9, 2006, I went to the Barluk Mountain in the Tacheng area of ​​Xinjiang. Although the mountain road was rugged, everyone in the company was very excited. All the way, I appreciated the precipitousness and nobility of the Tianshan Mountains and the gentleness and grace of the Altai Mountains. Unique scenery, climbing to the top of the mountain, is the mysterious resort of Tang Wanxin and Delong executives - Dulatai Farm (also known as Delong Villa). Delong Villa cost 12 million yuan and was completed in 2001. It is very spectacular: it has the majestic and majestic style of the vast grassland, and the bright and delicate colors of the Jiangnan water town.The front half is an arc-shaped building with a wide field of vision of up to 270 degrees.Up close, there are alpine pastures like the Scottish Highlands, turbulent canyon rivers, dense valley secondary forests, mountain meadows full of flowers like carpets, tall coniferous forests, dead pines and dense clusters of ferocious shrubs, etc., especially Overlooking the world's largest wild almond forest, there is a special view.Turn around and look at the "Alakuri Lake" which is equivalent to three Hong Kongs in the distance - whenever the sun goes down, the vast Alakuri Lake is connected to the sky, sparkling waves and colorful clouds, and the two islands, big and small, can be seen. Enjoy the exotic landscape.People who have been here all admire Tang Wanxin's vision and courage.

Thinking of thousands of miles away, Tang Wanxin served his sentence in Caidian Prison in Hubei Province as a punishment for his crime. The high walls around him and the abbot’s sky and earth could hardly wipe out his high-spirited and heroic spirit. There is still hope.Life is like a casino, there seem to be many people who win, but few people are satisfied, so there are many people who lose. "Zhuang" itself has the taste of walking in the rivers and lakes. This "original ecology" is actually a self-righteous "personalized" feature. The domineering "I am the only one" hanging on the front wall of the Delong Villa conference hall is Tang Wanxin. Jianghu nature" proof.This short stay made me trance between the experience of reality and the deconstruction of history!Just imagine Wan Xin coming here again in 6 years, what do you think?

In recent years, China's private enterprises have encountered huge problems in credit, finance, capital chain, and capital operation one after another. Delong is not the first or the last, but it is the most far-reaching case.Why is this so?Let's first look at the macro-environment in which the majority of private enterprises are located: first, the government is obviously unfair in ensuring the distribution of resources and adjusting the balance of interests; Consistent distribution and balance, so devious laws, resort to rent-seeking and other means of unfair competition; third, finance has become the most important resource factor hindering the development of private enterprises.Generally speaking, there is a lack of financial system and legal environment conditions for cultivating multinational companies or super-large enterprises.Look at the micro-social environment: the concept of consanguinity and family is profound, centralized and authoritarian, and the family and the country are united; politics, philosophy, literature and other aspects are all ethical and moral, and it is a society of nepotism and acquaintances; the society advocates the virtues of loyalty, filial piety, obedience, and tolerance , but the national psychology is narrow, rich-hating, naive, numb, and lacks the spirit of self-examination, rights awareness, and public awareness; it emphasizes agriculture over business, family over individuals, experience over science, kinship over rules and truth.

Undoubtedly, it is the interaction between China's special macro environment and the micro-traditional culture that has been inherited for five thousand years, which has given birth to Delong, a private enterprise with obvious characteristics of the times. We define it as a "Chinese-style private enterprise" . Over the past 18 years, I have always paid attention to Deron's growth process, but I still haven't thought more and more profoundly in the face of Deron's decline in the past two years.As a management consultant, the reason for studying the case of Delong is because Delong has concentrated but is not limited to all the problems of Chinese private enterprises. It was founded in Xinjiang, grew and declined in the course of China's reform and opening up, and can be called a Chinese-style private enterprise management. classic case.

Although I have known Tang Wanxin for twenty years, I am still willing to systematically deconstruct him and his Delong with the unique thinking and perspective of a management consultant.To this end, we focused on interviewing more than 50 executives from the Delong family, collected and systematically analyzed a large amount of data from more than 100 people and more than 200 companies involved in Delong, wrote and published the "Deconstructing Delong" first edition. Delong started his business in the border city of Urumqi, moved to Beijing, the political center, and then settled in Shanghai, the financial center.How can we not think about the lessons learned from the past.The broken capital chain is only the appearance of Delong's defeat. Through this complex capital chain, we can see the imbalance of investment diversification structure, overall strategic fantasy, Tang Wanxin's personal conflicts, absence of governance mechanism and corporate culture entropy. System disorder is the cause of failure, and Delong's warnings to Chinese private enterprises are so far-reaching in six aspects: adaptation is more important than excellence, value wins, steady operation, trade-off strategy, execution promotion, and the game between Eastern and Western management ideas and culture.

"Deconstructing Delong" is actually carried out with three lines running through Tang Wanxin as the core: one is the line of blood;These three lines also exist widely in Chinese private enterprises. The line of blood relationship and the line of friends in the rivers and lakes are the essence of Delong, while the line of equity is the idealization of Delong. This is the carrier of the operation and management of Chinese private enterprises. As for its management ideas and systems , tools are attached to these three lines.Therefore, "Deconstructing Delong" is to dissect Chinese-style private enterprises, and Delong is the epitome of Chinese-style private enterprises.

East-West (China) Economic Research Institute, as a member of China's management consulting industry, does not study the cases of Chinese companies that happened around us, but it is unrealistic to talk about the cases of foreign companies!The management problems of Chinese enterprises still need to be solved by Chinese managers. Mr. Peter Drucker, the father of modern management, knows this well!Drucker believes that a large developing country like China can introduce many things, including capital, machines, and advanced technology, but there is only one thing-"managers" that cannot be introduced.As a management consultant living in Xinjiang, I can't even analyze Delong who grew up in Xinjiang thoroughly. How can I talk about doing management consulting for other companies? In essence, the process of writing this book is also a process of learning, sorting out and summarizing.Our task is how to take into account the effective integration of human nature and rationality, harmony and principle, and create and form a management theory suitable for China's national conditions.

In the face of the strong advantages of multinational companies in technology, brand and management, the monopoly and priority of state-owned enterprises in various resources such as nature and society, and the unique macro-environment and micro-cultural traditions of China, Chinese-style private What are the genes for business success or failure?How is the performance?And where is the growth space for Chinese private enterprises in the future?We are deeply saddened by the Chinese-style private enterprises that have fallen one after another, and we are also cheering for those private enterprises that are on their way to success.What is the determining factor between failure and success?

"Getting over" the leaders of more than 200 companies is a major feature of Tang Wanxin's leadership style.The story of Tang leading his subordinates to fish in the market proves that Tang has a natural desire to command and appeal.From friend Wanxin-mysterious Wanxin-Xinjiang Wanxin-Jianghu Wanxin, more than 200 Delong enterprises constitute Tang's Jianghu, and Tang is the leader of Jianghu, as loyal as Song Jiang.Where there are people, there are rivers and lakes, there are rivers and lakes in the streets and alleys, there are rivers and lakes between gangs, there are rivers and lakes within enterprises, and rivers and lakes between enterprises.In the rivers and lakes, of course, bloody winds are inevitable.The rivers and lakes are composed of so-called morality, gangs (factions), loyalty and betrayal, good and evil.The "righteousness" between employees, the "righteousness" between managers and employees, and the "righteousness" between bosses and managers also correspond to loyalty and betrayal.Gangs in the corporate arena exist both inside and outside the enterprise. Enterprises are based on people and interests. As long as there are people and interests, there will be gangs. Classmates, friends, blood relationship, and aspirations can all form a certain A gang, if there is a gang, has a de facto leader and a group of followers.

Tang Wanxin played the role of such a Jianghu leader in Delong, who has a group of loyal followers and only obeys Tang's orders. "Old Delong people" and "new Delong people" are divided, and the title of "veteran warrior" implies the real inspiration of Jianghu Delong.Delong Department is a complex of family-type enterprises, Jianghu-type enterprises and corporate governance-type enterprises.Is Tang Wanxin exploring a new business management model for private enterprises in the Chinese environment?This is the confusion of Tang Wanxin and a group of people who do business and research business.

People who have received formal education hate "family business" in their bones, and the history of Chinese and foreign companies proves that family businesses have high efficiency, low management costs and longevity; Integrating family-type enterprises, Jianghu-type enterprises and corporate governance-type enterprises, and researching and developing enterprise management tools in line with China's actual conditions may be the entry point to decipher the growth genes of Chinese-style private enterprises. After the first edition of "Deconstructing Delong" was printed three times, we made deletions and additions to form the second edition of "Deconstructing Delong: Tang Wanxin's Apocalypse".Delong's debates in finance, securities, law, government supervision and other aspects will continue.Interpreting the truth of things is not the purpose, but more important is to inspire more people, pay attention to business management cases, and conduct continuous follow-up research, because case studies that are longer than historical experience and growth lessons are far better than scattered and hasty behind the glitz The "explosive" works of enterprise management are much more effective than blindly introducing and copying foreign management ideas and tools.China has a lot of records of journalists and professional managers, often in the "feast" of suspicion and insider reading. Although there are fresh materials and data, it is difficult to systematically and carefully sort out and think about the management cases of Chinese local enterprises.Looking back over the past few years, most of the financial books flooding the Chinese book market bear such traces. Delong has fallen, but Tang Wanxin is still there.In the course of Chinese history, it is often repeated, life is also death, and death is also rebirth. This cycle requires observation over time.Through the systematic deconstruction of Delong, can Tang Wanxin find the genes of success and failure of Chinese-style private enterprises, and inspire more people to engage in case studies of Chinese-style management, especially case studies on strengthening the management of Chinese local private enterprises, Research and develop ideas and tools of "effective management" in China, improve the management level of Chinese private enterprise groups, make them a backbone echelon of the world's top 500, and build an important foundation for the rise of China's national strategy. This is the reason why we published "Deconstructing Delong" The reason, and the long-cherished wish of cultivating the management consulting industry for more than ten years!
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