Steve and Hugh joined 1,000 Chinese CEOs, government figures and senior executives at the 8th China Entrepreneur Summit in Beijing over the weekend.
Steve spoke alongside CEOs like Jack Ma of Alibaba, Liu Chuanzhi, President, Legend (owners of Lenovo) and Yu Minhong, Chairman, New Oriental Education & Technology Group. Warning CEOs of Chinese units of multinational businesses that the crisis would typically make their global CEOs ration capital, rely more heavily on strong Chinese growth to hit their targets and want to install stronger process oversight of Chinese subsidiaries and JVs, Steve urged Chinese CEOs to:
- Be bolder in their targets – now is the time to go again
- Welcome the increased interest and scrutiny from their overseas HQs – but contain it appropriately and on their terms
- Take their units with them not only from the head but the heart
- If necessary adopt “guerrilla” tactics and ask forgiveness for smart commercial moves rather than fight the system to have them approved.
The China Entrepreneur Summit is The annual CEO forum in China. Hosted by China Entrepreneur Magazine, China’s answer to Fortune, it invites the most expert Asia speakers and panelists from across China, the region and the world to find the best way through the most topical challenges.
This year’s summit focused in particular on:
1. Deep concern for the environment. One senior pannellist spoke for many when he said, ““we need to change from the old focus on big and luxury…we need a simpler, less extravagant way of life”. With Beijing clouded in smog and tales of leaping increases in cancer and rivers choked by pollution, it is easy to feel the urgency with which reform is needed. With massive pollution from state owned enterprises (“SOEs”) and state-sponsored activities such as public transport policy, will the government deliver?
e.g. Some private companies are stepping in themselves – “at Alibaba, the 9 senior managers take 1 day every quarter simply about water and environmental problems” (Jack Ma)
2. Entrepreneurs’ relationship with the state. How much should entrepreneurs be expected to give back and to support civil society? In contrast to the West, Chinese CEOs spoke openly and passionately on the critical role their businesses play in society, but there was also a strong undercurrent of feeling that the government is not doing enough to support business. There was support from government ministers but they urged further action. There’s no doubt the relationship between business and the government in China remains uneasy.
– “We have to balance social obligations and entrepreneurship” Liu Chuanzhi, Chairman and President, Legend Holdings
– “People and customers are key but public welfare comes first. So, of course, pay a good salary and bonus but also you must practice people-focused management. People must be at the core.” Cheng Siwei – Former Vice Chairman of the Standing Committee of the National People’s Congress
3. The role of SOEs. Continuing the debate between business and the government, many speakers spoke passionately about the need for the role of SOEs to be restrained to vital areas of national interest such as defence and natural resources. Senior private company CEOs complained bitterly that SOEs, with implicit and explicit government support such as cheaper borrowing, skew many markets and restrain the growth of far more efficient and innovative private enterprises.
4. China’s increasing self confidence and desire to take its place as a leading power in the world. James McGregor is absolutely right that “the big change today is that the world is looking at China differently and China is looking at itself differently.” Zhang Weiying, Dean of Guanghua School of Management, Peking University, where Steve spoke in October, pointed out that: “China is 20% of the world’s population. When it is 20% of the world’s GDP, its standing will change.”
5. The need for Chinese businesses to start creating truly innovative products and, with Chinese firms starting to go out to global markets, to learn how to create global business models more quickly than the painful 20 years of Western firms gradually learning to work effectively in China.
You can read more about the conference and Steve’s role on the dedicated channel at Sina.com (in mandarin – here) and on China Entrepreneur Magazine’s website here (also in mandarin).
The conference ran from 5th-6th December at the Shangri-La China World Hotel in Beijing. You’ll find pictures and footage from the conference here as we receive them.
