Tao Te Ching and Wuwei Management

Chapter 30 "Strengthening the Bone": Flexibility—Addition to Survive, Scale Up
The sixth judo volume "softness wins rigidity", the way for enterprises to break through
Dripping water can wear away rocks, and warm fire can melt ice. "Soft" emphasizes the ability of things to adapt to environmental changes through self-adjustment.Flexible management is a kind of management that can enhance the flexibility, adaptability, innovation and rapid response of the enterprise. It is more "humanized" and penetrates into the individual organizational system by forming a flexible value standard and behavior model within the enterprise. , Excellent information management, rapid response mechanism, flexible production system and market-oriented development and service.

1 "Strengthen its bones": flexibility - addition to survive and scale up
Survival and development are closely intertwined.

Empty your heart, fill your stomach, weaken your will, and strengthen your bones.

—— "Tao Te Ching" Chapter 3
A righteous person governing the world can make the people broaden their minds, live a secure life, have a flexible will, and have a strong body. "Flexibility" means softness and toughness, which is the basis for the survival and development of enterprises.An enterprise is very fragile when it first starts a business. Entrepreneurs can only increase their resistance by doing everything possible to increase profits, expand scale, "strengthen their bones" and enhance their "physique", so that the enterprise's body is flexible, tough and full of elasticity. risk capacity.

The market has its own rules of the game—the strong eat the weak, and the survival of the fittest relies on strength to speak.If any entrepreneur wants to take the initiative in this competition, he must survive by means of addition, expand the scale, practice soft skills, do everything possible to improve the strength of the enterprise, and use his strength to win his own sky.

Generally speaking, in the initial stage of entrepreneurship, the risks faced by enterprises mainly come from their own viability, such as unstable product direction and not yet gaining a firm foothold in the market; coupled with technological equipment, organizational management models, employee training, product Designing, raising working capital, preparing raw materials, etc. all require investment of time, energy and money.Various risks such as product risk, market risk, capital risk, and decision-making risk overlap together to form a huge business risk.The way to control risks is to quickly complete the primitive accumulation of wealth and experience, add desperately, do what makes money, do what has a bright future, go all out, and carry out the most basic primitive accumulation - the so-called survival first and then seeking develop.Because if you don't add, you can't survive.Even survival is a problem, and development has become an empty talk of self-deception.

At this time, there are no more than two ways for most enterprises to survive: one is to carry out low-level "labor" in small batches, multi-variety or multi-industry, and multi-headed development, so that enterprises can see if there is any profit while carrying out primitive accumulation. It is possible to make a certain business bigger and stronger to form the main business of the company; the second is to expand production capacity, increase output, expand the scale of a certain main business of the company, win by volume, and enable the company to achieve profitable growth. Step on the track of benign development.This is the basic law of business survival.

It is the general mode of enterprise development and the inevitable process of the development of things to expand the scale after seeking survival.How to realize the rapid growth of the enterprise and the rapid expansion of capital, so that the enterprise can increase the scale, level and grade in a relatively short period of time, realize scale operation, and improve scale efficiency and competitiveness are the objective requirements of enterprise management.The ultimate goal of scale operation is to minimize operating costs, maximize economic benefits, make marginal costs equal to marginal revenue, and enable enterprises to continue to develop and grow in the fierce market competition.If this cannot be done, the enterprise is like a flat boat, swaying in the wind and waves of the market, and may sink in the wind and waves at any time, not to mention the "destroyers", "battleships", "cruisers" and even those in the business war. The "aircraft carrier" contended.

Let's take a look at how Lenovo's "flexibility skills" are practiced:
When Lenovo started its business, because of lack of livelihood, it did three additions, and finally found a way out of survival.

Addition One: Selling Other People's Eggs

The main business of Liu Chuanzhi and the others in the first year was to inspect and repair computers, train personnel, and provide technical services. All of them were soldiers. Everyone wanted to go to the front line of the market and do what they wanted to make money.

This year, their operating income reached 300 million yuan, with a net profit of 70 yuan, which was Lenovo's first pot of gold.This is a huge affirmation for Lenovo.Its significance is to tell people that it is not necessary to produce their own products at the beginning, as long as they meet the market demand, they can still make money.The subtext is: as long as you can make money, you don’t have to raise your own chickens and sell eggs. Selling other people’s eggs is also possible.For an enterprise, it doesn't have to be a manufacturing industry, and trading is also acceptable.

Addition [-]: Raise your own chickens and lay eggs

In the early days of reform, approval was required for the production and import of computer products, but the profits were relatively large.In this context, there are only two choices - either give up the opportunity, or take a certain risk or take a flexible approach.It is said that in order to be able to produce machines, Liu Chuanzhi also transferred to Hong Kong, China, and established a joint venture company in Hong Kong, China, to do trade first, then production, and it took many years before he "returned" to the mainland.

Addition [-]: Cultivate talents who are good at industry operations
Around 1991, a large number of foreign brand computers entered China, causing Lenovo to be fatally impacted.Under the premise that Liu Chuanzhi was far inferior to others in terms of capital, technology, management, and talents, he gritted his teeth and raised the banner of "national industry", and pushed Yang Yuanqing, a figure who would change the fate of Lenovo Computer and the future of China's PC industry, to the top of the list. On the stage of history, he was appointed as the general manager of Lenovo Microcomputer Division.

At the same time, Liu Chuanzhi also focused on cultivating the ability and entrepreneurial spirit of Yang Yuanqing to discover and seize market opportunities, such as customer orientation and emphasis on dedication were all proposed at this time.

The principles of "only credit and not hard work" and "turning 5% of hope into 100% of reality" have also become the rules of the game that this group of intellectuals who are struggling for survival must adhere to.After this baptism, they exude a strong spirit of realism, and they hope that everything they pursue can be as reliable as the machines in front of them.This may also partly explain why they later hesitated to enter the Internet.Such an environment has cultivated the conservative side of Liu Chuanzhi and Lenovo, but it has also completed the accumulation process of Lenovo.

To run a company, we must have such ambitions, to be the best and to be the biggest.However, many bosses often fall into a daze after successfully taking the first step. They don't know how to make their company develop in a super direction, and even lose their goals in the business world. "A soldier who does not want to be a marshal is not a good soldier", and a company that does not seek development is not a good company.If you want to develop, you must first have a grand goal and the courage to persevere, and then you can talk about development.The paths of development are different.You must dare to take risks, raise funds boldly, and attack boldly; colleagues, you must be down-to-earth, steady, cautious, and do everything well on a down-to-earth basis, because the foundation for jumping is flat ground.But don't forget: "I must jump up and go to the next level"!
(End of this chapter)