International Competition of Inland Enterprises

Neijiang in the Sichuan Basin is a quiet town. In addition to the reputation of "sweet city", which is rich in sugar products such as rock candy and candied fruit, there is not much to be admired here: resources are relatively scarce, industrial development is lagging behind, and there are hardly any well-known enterprises.

No one could have imagined that this area has the largest computer LCD monitor production base in mainland China. Two years ago, Direction Technology Group Co., Ltd. set up a production base here, and now there are world-class production lines, leading management teams, many R&D elites and first-class products. Even more surprising is that the company's exports last year were almost zero, but this year it is expected to reach 100 million US dollars. How does it do it?

Layout: Production inside, R&D outside

The production base is located in Neijiang, which saves a lot of production costs for the company. In the context of developing the west, the local government has implemented many preferential measures to attract investment. Most of the employees are locals, and there are not many choices in the mainland. Everyone attaches great importance to this job, and they are practical and hardworking, and the turnover rate of personnel is very low. Lai Wenxing, the current vice president of the liquid crystal company, has managed factories in Suzhou and Dongguan, and this experience is particularly profound: "Our welfare is quite competitive in the local area, and many outstanding talents from the mainland have volunteered to join, which is good for our management. ."

Lai Wenxing is full of confidence in mainland factories. When BenQ and Philips first entered Suzhou, they also faced the problem of supporting environment, but with the expansion of their own scale, upstream parts suppliers moved to Suzhou one after another, and the value chain was transferred as a whole, and the supporting problem was easily solved. Although the Neijiang factory is 10 years late, these successful experiences can be replicated.

On the other hand, Direction Technology has set up its R&D and export base in Shenzhen, making full use of the local advantages of rapid information exchange and convenient product export.

Li Yaping, general manager of Shenzhen Xiangfang Technology, told that there are more than 70 people in its R&D department, which is very prominent among display manufacturers in mainland China. It is estimated that there are hundreds of factories engaged in the production of liquid crystal displays in mainland China. Domestic businesses, including Great Wall, Founder and other large enterprises, do not invest much in research and development, and most of them use models such as copying, technology introduction or SKD.

The liquid crystal display is composed of several main components: panel, back panel, integrated circuit and mold case. The panel and IC are controlled by manufacturers in Taiwan, Japan, Korea, Europe and the United States. Li introduced that from the beginning of integrated circuits to industrial design, software and hardware are completely designed by themselves, and currently there is only one domestic company, Directional Technology.

Li Yaping, who used to be engaged in research and development at Great Wall Computer, believes that now that display technology is becoming more and more mature, technical barriers are no longer an obstacle. The core of the problem is that Chinese manufacturers need to decide which level of research and development to penetrate according to their actual situation. On the one hand, the large investment in this field is due to the accumulation of CRT technology in the past, and it is also due to the full confidence of the group's executives in the prospects of LCD. In fact, during the introduction period of new products, R&D will definitely lose money.

Grasping the pulse of the industry is the key to the success of Orient Technology. Li Yaping introduced that compared with Philips, Samsung and other companies, the current direction of technology is insignificant, and it is impossible to lead the industry. Just keeping up with the pace of progress means success. For example, the control panel needs to be updated every two or three months. The eliminated products are not because of backward technology, but because of low cost performance, which is unacceptable to the market. The backward manufacturers will inevitably suffer huge losses, especially for large-scale manufacturers.

In order to grasp the pulse of the industry, Direction Technology has worked closely with Genesis, which accounts for 70% of the global LCD chip supply market, so that it can grasp new products several months ahead of other competitors. In terms of 15- and 17-inch LCDs, the orientation is almost in sync with Taiwan.

The R&D strength in the direction is the basis of cooperation between the two parties. For example, Genesis will launch a new IC in June this year, and held talks with the direction company at the end of March, hoping that the latter will cooperate in research and development. That is to say, the other party informs Direction Technology 3 months in advance, and when the new IC is launched, the new product of Direction will be launched. Winning the time lag means opportunities and profits in today's IT industry, where the frequency of technological updates is accelerating.

Japanese and Korean companies lead the world in product appearance. Direction Technology outsources part of its industrial design to Korean companies to lead the design trend. In June last year, the company launched a folding style - "butterfly". At the Cebit exhibition in March this year, folding has indeed become a big selling point of new products from major manufacturers. Li Jing from the export department of the direction of science and technology revealed that four new models will be launched in the first and second half of this year.

Talents: Airborne Corps, Professional Management

Direction Technology knows that to participate in international competition, it must have a modern management system and globalized management talents. From the middle of 2002 to the beginning of 2003, 8 senior executives from Taiwan were "airborne". The company hopes to move the company's management to a higher platform with the arrival of the "Airborne Soldiers", and enhance its strength in the three links of the value chain such as R&D, manufacturing and marketing, especially to make a difference in the international market.

Yin Xinsheng, the current general manager of Neijiang Direction LCD Equipment Co., Ltd., has been struggling in the display industry for many years. After working at Chunghwa Picture Tubes and WISE in the United States, he joined Mickey Corporation. Before coming to Direction Technology, he was responsible for global quality management at Philips. When the direction invited him, it clearly told him that he would have the full authority to form the top management team of the LCD factory. As a result, a group of his former colleagues were brought over by the direction of "Lianguoduan", and Lai Wenxing, the current deputy general manager of the LCD company, was also one of them.

The trust of the top management of the group has become the key to the smooth airborne of these "outsiders". The board of directors reviews the factory's annual plan and never interferes with the company's specific affairs, giving them more room to play. Lai Wenxing said with deep feeling that such a fully free environment is impossible for Taiwanese companies to have, and he sincerely admires the courage of mainland companies. After the Taiwan team entered the direction, they proceeded to make a drastic transformation of the factory. In view of the bloated situation of the organization, a "slim down" campaign was carried out to reduce staff and increase efficiency, laying off 1/3 of the staff, and then renovated the production equipment according to international standards, and carried out systematic quality management training for staff. At the same time, pay attention to training Local middle management team.

Located in Neijiang in the hinterland of Sichuan, the disadvantage in logistics is self-evident, and the management and reform of logistics has been put on the agenda. Lai Wenxing introduced that in addition to display panels, most of the factory's raw material purchases come from Shenzhen, and products need to be exported through Shanghai and Shenzhen. Direction LCD established its own logistics fleet in early 2002. On this basis, after a year of integrating internal and external resources, Neijiang Direction Logistics Co., Ltd. was established, with more than 30 fully enclosed container freight vehicles. Currently, it only takes two days to ship from Neijiang to Shenzhen and Shanghai.

Marketing: service first, sales follow closely

Su Dingshen, the current general manager of Shenzhen Direction Technology Overseas Department, is a member of Taiwan's "Airborne Corps". Su has 20 years of sales experience in major display companies such as TPV, Meqi and Meige, and has created an annual sales record of 2 million monitors. After his arrival, he set about weaving a global marketing and service network.

Strictly speaking, it has only been a few months since the export of XiangTech LCD. Through participating in industry exhibitions and promotions by electronic means, it has cooperated with dozens of overseas customers, but a considerable number of them are still middlemen. Although middlemen can increase business, it is not conducive to manufacturers to understand end customers and control the market. After Su Dingshen joined, he began to adjust this, focusing on developing direct customers.

Su Dingshen knew that in order to increase the export volume, it would not last for a long time, and it was necessary to win OEM orders from major customers. But the threshold for cooperating with the biggest names in the industry is very high. Such customers have large shipments and require the company to have considerable comprehensive strength. In Europe, big buyers require suppliers to keep two weeks' worth of inventory at any time, something that small factories can't do. In addition, they have high requirements on the service level of the suppliers. For example, the delivery time, how many after-sales service points are established, and there are strict regulations on the feedback time and efficiency of customer service.

Su Dingshen has a good personal relationship with major buyers in the industry, but as a new company, Dingshen Su still has doubts about its product quality and service level. Therefore, the company has made great efforts in after-sales service. Most of the products exported in the direction have a 3-year warranty period. In terms of after-sales maintenance, the direction has adopted the mode of establishing maintenance points first and then developing customers. This can completely eliminate the worries of customers, and reflects the company's strength and determination to develop in the industry for a long time.

The company has established after-sales service centers in Los Angeles, Texas, New Jersey, Atlanta, and Toronto, Canada, as well as after-sales service centers in the Netherlands, Belgium, Luxembourg, Germany, France, the United Kingdom, Italy, and Spain in Europe. Direction has also established branches in the Netherlands and South Korea, a US branch is also in preparation, and a warehouse has been set up in Rotterdam. Today, Dixon in the Netherlands, AGCI in the United Kingdom, Datong UK, Hercules in France, and Eastern Digital, which is known as "Thailand Samsung", have all established stable business relationships with Direction Technology.

Li Yaping said that there is still a long way to go between the company's strength in all aspects and the requirements of major international buyers. The current overseas buyers of Direction Technology are still the "second echelon" of the industry, but this is an essential The process, from slow to fast, the company is accumulating, gradually moving closer to the industry's best benchmark. If nothing else, the direction company will start cooperation with the "first echelon" next year.

The export plan for this year is 400,000-600,000 units, worth 100 million US dollars.

"I believe that Orient Technology will definitely become a rising star in the LCD export industry." Li Yaping is confident in this.