Last weekend, I attended the 10th anniversary celebration of one of our suppliers for material handling equipment. It was an invaluable opportunity to experience the amazing development of private business in China.
To start with, I could grasp the real extent of this supplier’s development. Seeing photographs from their facilities 10 years ago, I recognized a small and dark workshop like we still encounter so many today: a company that could sell into the Chinese market but certainly not to Western buyers. But the owner had a vision and worked hard toward building a leading supplier. He did not spare any effort to improve both business and product quality.
After several years, he had generated enough stable business to buy a large spot of land and build a new modern factory. Once in the new factory, he started applying good manufacturing practices (5S, detailed and efficient quality control system . . .). This is in contrast with too many Chinese companies that build great facilities but then operate in the same way as backyard workshop (see other post).
Improving quality attracted both domestic and foreign buyers, first for the Chinese market, and increasingly for the worldwide market. At the celebration, I found myself among guests from Sweden, The Netherlands, Belgium, Germany, Japan and USA.
Today, the new facility has quadrupled in size and has become an impressive industrial facility.
Still, this story is a well known one. China counts many such success stories, about driven entrepreneur with a vision and the ability to execute. What is more interesting is that this story is probably only the starting point.
Who could not understand if the owner and his team would slow down, after such successful 10 years?
But not for that company. In his celebration speech, the owner congratulated and thanked everyone for their effort and commitment over the last 10 years. But he also mentioned that he was worried because the rate of growth had slowed down.
He went on pointing out the key cause of the current growth bottleneck: the fact that the company was fully driven by himself and he was becoming the bottleneck. He pledged to foster his management team growth, as their personal growth also would lead to the further growth of the company. This is an uncommon attitude in many Chinese companies, still very hierarchical.
Morover, the owner’s acts seem in line with his words: he has already brought in new strong managers to assist him, he is asking help wherever he can to assist him change attitude and improve knowledge, he holds strategic sessions with his management to devise plan and focuses for the coming 5 years, he is challenging the current business model and considers what will work in the future.
This supplier is giving itself all it needs to truly become a leading player in the industry.