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The pursuit of high returns is the true meaning of "lean production" companies

160 years ago, China is the world's manufacturing superpower; 2010, China has returned to the world's first seat. China's manufacturing output accounted for 19.8% of the world accounted for 19.4% of global manufacturing output in the United States. This year, our total economy than Japan to become the second in the world, we have reason to be proud of!
However, I think we should face the fact: more than 100 million workers, only 1,150 people. When China's GDP to overtake Japan, our population is 10 times the population of Japan. China's energy consumption per unit of GDP is seven times that of Japan, six times that of the United States, 2.8 times that of India; of labor compensation share of GDP is lower than Africa.
In the 30 years of our GDP economic habits scale rapid development and extensive development, ignoring the cost of resources and the environment. There is no brand management, lack of technical content, amateur level management, natural Chinese enterprises in the global manufacturing value chain in the end. I remember a story everyone has heard, a $ 10 Barbie 50 cents in China, labor income is only 35 cents. From developed countries through history, we see clearly that when the Lewis turning point occurs, there will be the demise of the large number of enterprises. The upgrade of the research management of industrial enterprises, people tend to see the "lean production", the focus in the pursuit of value and scale, ignoring the intrinsic quality of the enterprise, ignoring the core competitiveness of enterprises and vitality. Therefore, in the critical period of transformation and upgrading of China's industrial enterprises, research GDP economic impact on businesses, and enterprises to high-efficiency, high-return "Lean Enterprise" very important.
GDP-oriented enterprises symptoms
Troubled businesses are similar
Tolstoy said, happy families are the same, and unhappy family is unhappy in its own. In the enterprise, the words can, in turn, said: troubled businesses are similar, successful companies each have their own success.
Coca-Cola by formulations and brands eternity; McDonald's by standardization and American culture to dominate the world; Dell to create personalized assembly direct change PC manufacture and channel mode to achieve the ultimate liquidity; Toyota rely on lean manufacturing to become a global role model. Can be troubled businesses? Is nothing but a tight cash flow, high inventories, receivables, brand appetite, poor access, low efficiency of enterprises, corporate culture conservative, internal friction instability, weak human resources and the competitiveness of their products is not high, weak growth, profit margins low. This sub-health state usually have three high.
Financial point of view with DuPont table
When state and local governments to GDP-oriented, enterprise-oriented nature is sales. Business desperate pursuit of sales. One is coming from the age of extreme lack of substance, as long as we sell will be able to make more money, experience has formed. Even if later sales more and more difficult, least brainer price cuts, euphemistically called the "price war". Another toward the opposite extreme from the state-owned enterprises of the year plans to extreme market first, customers first publicity people, so that businesses without hesitation, "I would rather let your profits, do not let the market". Over the past three decades, many companies do so to triumph, to prove their straightforward extensive mode of development is perfect for that stage of development in China. I think it's not wrong. However, times are different, the start of modern scientific management in awe, copy the successful experience of the past, not only continued success may be slimmer, and is likely to accelerate the demise.
All entrepreneurs have financial value. However, many of the low management level of enterprises, their boss financial treated as accounting, not really financial. They value money more money into the water, which favors only the sales volume, the entrepreneur should be said that the level of primary classes. They are also very concerned about the specific costs incurred and cost changes, but does not completely study and understand the role of Finance in the enterprise. The intermediate class entrepreneurs will look at the financial statements of each line, staring at the lower his or her explain why a digital, is how to? Their accounting skills, a bunch of mid-level leadership to lay down the order, the matter at hand quickly first boss eyeing the issue is resolved. Unfortunately, I have not only seen such entrepreneurs do more and more poor, but also seen to do the enterprise dead. Because their financial data separated, do not see the relationship between the internal regularity of the financial statements behind the contact and financial information with other companies in decision-making and results. After all, the financial results for a variety of other business conditions and decision-making role and consequences of integrated digital performance.
So, I remind those who are still trying to bail out entrepreneurs through increased sales volume only, this figure means that if there is no differentiated products (the formation of favorable market supply and demand difference), if there is no manufacturing process to create significantly reduce the manufacturing cost (so that enterprises can to withstand lower price of supply and demand equilibrium point), to expand production and sales volume does not give business conditions brought improved, but may lead to greater management and financial challenges.
High-performance, high-return "Lean Enterprise"
I compare Les Miserables management "Made in China, these companies brand, complete marketing channels, integrated and efficient supply chain collaboration, core technology, differentiated products, good quality control reflects the specification system, a lean business model and production systems, asset-light, high ROE, return on total assets, smart and efficient market response, and so on. Such enterprises usually ten years or longer "sustainable earnings growth." "High-performance" refers to the astute ability to respond. "High-return" refers to the high rate of return, profitability.
Please note that case I'm talking about the high returns of the Lean Enterprise "is not some articles mentioned in the introduction to the concept of" lean production "extends to other aspects of the management and supply chain after the formation of the so-called" Lean Enterprise (LeanEnterprise). The, but highreturnleanbusiness. "High return Lean Enterprise" at the top of the lean production with minimal waste, in accordance with the principles of the value chain, the principle of division of labor, and return on investment theory manufacturing system-Africa part of the core competitiveness of enterprises business processes to the transfer of capital operation external to the enterprise; majority of direct sales and a considerable number of end brand promotion into distribution and other channel system; logistics and logistical outsourcing to a professional company, but will be placed under the direct control of the enterprise; implementation of strategic sourcing, support and procurement decisions are based on a global comparative advantage; Group of companies, the implementation of the financial co-ordination and tax optimization; minimize the amount of total assets, strict control of fixed assets increased to speed up the liquidity of assets, innovation and production of the human, financial strength and core business focus on the advantages of high value-added products and services.
Traditional enterprise like a rounded ball, high-performance, high-return Lean Enterprise in form like the icon under "dumbbell-shaped part, just inside the" dumbbell ", but also continue to implement lean manufacturing, product mix optimization, in-depth marketing, extension of the supply chain lean, and so on.
Transformation and upgrading to achieve sustainable earnings growth
Extended in accordance with the same or similar epitaxial large-scale development model more and more a dead end, enterprise development seems to be caught in the bottleneck. From Barbie value chains we have seen, even over-the myth of lean production, the problem to be solved is concentrated in the total value of a Barbie $ 10 worth only $ manufacturing sector. Our entrepreneurs, why not in product innovation, transport and logistics, customer service, channel management and terminal sales (compared to the foundry business), service these soft, more low-carbon environmental protection and higher value-added soft part of the upper and lower work hard? These links Barbie $ 10 value for $ 9!
Chinese entrepreneurs can be hard to transition to this direction, we not only found that we still have many years to make up endless lesson endless things, and, because these environmental protection and high value-added, we also the progressive realization of the green and sustainable earnings growth.
Matthew - fall behind
Without outside interference, the hands of the wealth will become good business people gathered. Is also true for many at a competitive enterprise in the market. "Where some, but also add to him told him to excess; has not, even what he has will be taken away from him." This is a gift from God for good business, help; beaten path, lazy enterprises, which is cruel the law of nature. Torrent enterprise development behind.
As the financial crisis has led the world additional money, superimposed on the modern macroeconomic "money" the rate of increase is higher than the speed of resource development and wealth creation, making more and more expensive raw materials; just turned the "Lewis turning point", "labor shortage "everywhere, so that the human resources are increasingly scarce and expensive, part of the increasingly high cost; and customers may buy it, the customers only recognized quality brand, innovative products and affordable. The rest of the entrepreneurs bosses transformation and upgrading what options? Effective in the past, and now need to re-examine.
Entrepreneurs wise successful transformation and upgrading of key
The challenge corporate restructuring and upgrading is the awakening of the entrepreneur. "This sentence no disrespect. An entrepreneur friend once said to me: "Made in China are in fact dominated by the middle and secondary school students of". He was referring to the twenty or thirty years ago, the special historical reasons, the first generation of entrepreneurs generally do not have much cultural foundation. I know a number of assets billion, but then increasingly slim profit margins OEM business with a worried frown entrepreneurs said the impact on his greatest book in the 1990s, he read a book Ford . Then asked, later read any similar book? The answer is no. It is not difficult to explain why many entrepreneurs in the industrial civilization has entered a new era of information technology, personalization and fragmentation ", still use Ford's economies of scale method to solve their problems.
The first generation of private entrepreneurs in the 30 years fought to establish self-confidence, success a lot of people will not listen to different opinions, especially when he thinks different views may mean to deny their own path, so the enterprise in accordance with depend on a principle very difficult for new ideas to be generated internally. External professional managers often single-handedly, but also suffered the organization "rejection" of the body, let alone solve the huge system problems faced by domestic entrepreneurs, "into a dead one. Finally, still depends on the entrepreneur's own consciousness. Wise entrepreneur before the arrival of the crisis through an open mind to learn and keep on introducing new ideas, tools and mechanisms to enhance the competitiveness of enterprises; better entrepreneurs determined to reform and improve in the face of difficulties; worst is to come to their senses, have to adhere to in the new era with the old routine management companies in the past, and their own hands to build a company a step-by-step into the quagmire.
"Lean Enterprise" is indicative of the future
China's reform and development and people's efforts to create a large number of entrepreneurs, and the achievements made in China. But when we climbed a high mountain found behind new heights. Extensive development in the past has been completely unable to adapt to the financial crisis has worsened the challenges, it is necessary to transformation and upgrading, otherwise there will be a large number of enterprises faced with the threat of life and death in the future.
High-performance, high-return Lean Enterprise use of all possible systems engineering principles, principles of economics, investment theory, the theory of operation of production, lean manufacturing practice equal to all aspects of corporate design and renovation, improving the overall performance and generate higher returns. Such enterprises should be the new era all States that have not yet reached the international advanced level of Chinese enterprises in their quest for the ideal enterprise, business transformation and upgrading of the target and the only way. And responsibility for the final decision of this effort, only the entrepreneurs themselves.


<SOURCE: Value China>
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