Haier’s Internet Transformation： 60,000 employees are ＂starting businesses＂

On Haier’s entrepreneurial platform, more and more non-Haier employees are pouring in, and Qiu Xingyu is one of them.

Before joining Haier as a maker, Qiu Xingyu worked in a financial consulting company that had business dealings with Haier. At that time, the consulting company made a due diligence report for the World Bank’s support to China, and Qiu Xingyu’s team undertook the task of in-depth analysis of agriculture. They believe that in the future, China’s agriculture will enter a stage of rapid development, and may even usher in a blowout state like the real estate industry.

Such an experience has accumulated a lot of experience for Qiu Xingyu to later grab Haier Financial’s entrepreneurial project. In 2013, when she participated in the consulting project of Haier Finance, she learned that the other party had plans to carry out financial leasing business, specifically providing financial services for external industries. To this end, Haier also established a financial leasing company in Shanghai Free Trade Zone with Bohou Strategy Company where Qiu Xingyu is located.

The five major industrial financial projects released by Haier Financial Platform include consumer finance, food agriculture, medical care, green finance and community finance. Interested teams can participate in the competition with business plans. Haier is responsible for providing start-up funds and corresponding entrepreneurial services, while small and micro companies are responsible for specific management, and all decisions are finalized by makers themselves.

Maker and Xiaowei are one of the internal reform concepts put forward by Zhang Ruimin, Chairman and CEO of Haier Group. According to his idea, Haier is now mainly composed of three types of people. The first is the platform owner, and positions like Zhou Yunjie, the rotating president of Haier, belong to the big platform owner. The second is small and micro-owners, which refer to start-up companies established on different platforms within Haier. The third type of makers are entrepreneurs who hold certain shares in small and micro companies. They need to sign a gambling agreement with Haier, and only when they reach a certain target value can they cash in their shares. For example, Qiu Xingyu’s company belongs to micro-owners, and Qiu Xingyu himself is a maker.

Qiu Xingyu led a four-person team to win food and agriculture projects from a group of small and micro companies that grabbed orders at the same time, leading the way to do industrial finance. This is just the same as Haier’s industrial finance thinking. Previously, she had 8 years’ experience in financial leasing consulting industry. Financing lease, also known as equipment lease, refers to a lease that essentially transfers all or most of the risks and rewards related to asset ownership. The ownership of assets may or may not be transferred eventually.

In all food agriculture, Qiu Xingyu chose to start with the egg industry in the aquaculture industry. By investing in fixed assets for the upstream egg companies, laying hens were used as a kind of equipment for financing, and the related companies in the upstream industrial chain were joined together to achieve overall food quality control and ensure stable output. So far, the financial products developed by this small and micro company have been updated to the fourth generation products.

Specifically, in order to ensure the safety of food raw materials, egg companies need to fully control the purchased feed, vaccines, chickens, breeding environment and processes, and inevitably have a large amount of fixed assets investment. Qiu Xingyu’s first generation products mainly solve the problem of fixed assets investment, and lease the equipment to egg enterprises for use.

After the fixed assets are built, aquaculture still needs liquidity. This small and micro company has also developed a model of using biomass as a tool to carry out financing. Generally speaking, in the financial field, real estate and cars were usually used as collateral, but Qiu Xingyu’s team realized that domestic animals such as chickens, cows and pigs could be used as collateral. This is the second generation product.

In the third generation, it mainly solves the problem of liquidity in sales. The fourth generation is to build an ecological circle with feed suppliers, breeding equipment suppliers, leading enterprises of egg products and farmers. Feed suppliers provide feed and vaccines, guarantee companies are responsible for loans, Qiu Xingyu’s Xiaowei is responsible for providing fixed assets, farmers are responsible for breeding, and egg products companies are responsible for sales. Next, this small and micro company also wants to develop into a platform.

This model quickly gained market recognition. From May 2014 to August this year, the business volume of this small and micro company has reached 1 billion yuan, and the team members have expanded from 4 to 24, all of which are from outside Haier.

According to Qiu Xingyu’s introduction to the interface journalist, there are 9 maker teams under the entire Haier industrial financial platform, covering medical care, healthy consumption, intelligent transportation, community finance, logistics, food agriculture and other aspects. Among these maker teams, Qiu Xingyu’s small and micro companies have the highest comprehensive income and financial indicators, especially gross profit, although the business volume is not the largest. The gross profit in the first half of this year reached more than 30 million yuan. In the next three years, she hopes that the company’s business volume will reach 10 billion yuan.

From the perspective of Haier Group, Haier’s industrial finance is a big platform. Maker and Xiaowei are only part of Haier’s industrial finance, and Haier Finance itself has many investment projects. Haier Finance is also divided into two small platforms: one is called Sharing Center, which mainly provides financial and human resources services for small and micro companies on the platform; The other is called the resource center, which is mainly responsible for the consulting business of small and micro companies. There is a cooperative relationship between small and micro companies and the above platforms, and the completeness of small and micro companies determines the resources that can be obtained at the level of Haier’s big platform and the mechanism of profit distribution.

If the team maturity of small and micro companies is 80%, it means that many functions need to depend on the platform. Due to the settlement relationship with the platform, you need to pay separately for some services provided by the platform, and you need to pay part of the profits to the platform. If the functions of small and micro companies are relatively perfect, and the business, administration, finance and other work are all done by themselves, then all the profits distributed may be owned by themselves.

At the beginning of the business, Qiu Xingyu’s team started in the form of Haier Microfinance Division, and they further derived their own small and micro company Hainong Investment Co., Ltd. to match the above projects. "It is usually necessary to get a financial license to carry out financial business. If I set up a company alone, it is difficult to get this license. It is not a problem to do this on Haier’s financial platform." She said.

Haier’s financial business, together with traditional household appliances and logistics business, has become the three major components of Haier’s overall revenue. Although this large-scale company has a strong gene for home appliance manufacturing, it has been trying to transform to the Internet since 2012.

Different from many traditional manufacturing companies’ attempts to set up related departments separately for Internet, Haier’s reform wants to be more thorough, or to completely deny the current management system and subvert itself from various aspects such as organizational structure, management methods, revenue structure and profit distribution. In the past three years, small and large micro-companies have been established in Haier. Employees who join the micro-companies no longer enjoy Haier’s original fixed salary and need to advance and retreat with the micro-companies. In addition, some people choose to leave Haier.

"At the beginning of the reform, we didn’t understand why the company did it, and even many people would have resistance, which would touch some people’s interests after all ‘ Cake ’ . However, with the step-by-step advancement of maker thinking, some small and micro companies have achieved initial results, and everyone has slowly begun to accept it. More and more people are looking for entrepreneurial projects that suit them. " An employee who has worked in Haier for many years told the interface journalist.

According to the interface journalist, with the acceleration of Haier’s internal reform in the past two years, about 20 platforms and 183 small and micro companies have been formed. The entrepreneurial projects involve products such as home appliances and smart wearable devices, as well as services such as logistics, commerce and culture. There are also more and more outsiders who choose Haier platform to start their own businesses.

Before the reform, Haier had 86,000 employees, and after the reform, it was 60,000. According to the statement given by Haier, these 60,000 people belong to makers, and it can also be understood that Haier’s internal entrepreneurship is that every employee is involved. The remaining 26,000 people have been laid off by Haier.

"We encourage nearly 10,000 managers to transform, either to become entrepreneurial teams or to leave." Zhang Ruimin said earlier when attending a business forum. In this way, he hopes to speed up the efficiency of organizational communication, make the huge Haier have flexible components, and can set up or disband the team at any time as needed, and at the same time encourage each employee to become more active and work with the mentality of entrepreneurs rather than executors.

Just as many startups will face various business risks, these small and micro companies on Haier platform may declare failure at any time. After all, only a few people like Qiu Xingyu can quickly open the market, and more small and micro companies are still in the stage of arduous exploration and development.

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