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[High-tech Conference] Huatian Weiye Hong Jinwen: "Heaven" has changed, SMEs breakout strategy and power supply selection
In recent years, as industrial concentration has increased and large enterprises have made significant investments, the operating space for small and medium-sized enterprises (SMEs) has been increasingly squeezed. This year, many companies have faced severe business challenges, signaling a major shift in the industry landscape.
In such a tough competitive environment, how can SMEs achieve rapid and effective breakthroughs? At the 2017 High-tech LED Annual Meeting, Hong Jinwen, General Manager of Huatian Weiye, delivered a keynote speech titled "Heaven's Power Selection," offering valuable insights on how SMEs can break through the current challenges. He discussed the evolving industrial situation and outlined strategies that SMEs can adopt to navigate this difficult period.
[Image: Hong Jinwen, General Manager of Huatian Weiye]
During his speech, Hong Jinwen highlighted six major changes shaping today’s market:
1. **Product Evolution**: The product lifecycle is becoming shorter, with new products constantly emerging. Companies must think ahead about what they will need next year.
2. **Market Dynamics**: The rate at which prices change is accelerating, making customer relationships more unpredictable. Customer resources are being reorganized and filtered continuously.
3. **Management Challenges**: Talent management has become more difficult, with employee stability declining.
4. **Cost Pressures**: Labor, housing, and tax costs are rising, and material cost fluctuations are making it harder for businesses to control their profits.
5. **Capital Market Trends**: Over the past decade, China’s capital market has been highly active. Enterprises that have accessed capital have gained advantages, leading to an imbalance where stronger firms dominate and weaker ones struggle.
6. **Corporate Social Responsibility**: Businesses now face increasing pressure from laws such as commercial regulations, tax laws, labor laws, environmental protection, and fire safety. These legal requirements are raising the bar for survival.
Hong Jinwen explained that these changes stem from several key factors:
- Under the national policy of “mass entrepreneurship and innovation,†supply capacity has expanded, but market demand hasn’t kept up, resulting in intense competition.
- The rapid development of the internet has flattened industry structures, making customer-supply chain relationships more transparent and driving faster price changes.
- With strong employment and entrepreneurial opportunities, talent is becoming more fragmented, especially in manufacturing, where it’s increasingly hard to retain skilled workers.
- As living standards have improved, corporate social responsibility has grown, and the concept of survival of the fittest is becoming more dominant.
- China’s supporting industries are well-developed, and many sectors lack technical barriers, making entry easier for new players.
Given these changing conditions, Hong Jinwen proposed three key strategies for SMEs to break through:
1. **Rebuild the Enterprise Strategy**: A successful company must consider the interests of customers, employees, suppliers, and society. In a more regulated environment, strategic clarity is essential for long-term success.
2. **Redefine Profit Models and Core Competitiveness**: Entrepreneurs must understand where their revenue comes from—whether through capital, brand, or industry influence—and build sustainable models around that.
3. **Establish a Customer-Centric Approach**: Customers are not just the market; they are individuals with specific needs. By focusing on value delivery and building meaningful relationships, SMEs can simplify the process of doing business.
In conclusion, while the market is becoming more complex and competitive, SMEs still have opportunities to thrive by adapting strategically, redefining their operations, and focusing on delivering real value to customers.