Think Tank Forum

Han Zhaodong

"Third-rate enterprises rely on products, second-rate enterprises rely on services, and first-rate enterprises rely on culture." The important role that corporate culture construction plays in a modern enterprise is obvious. For large state-owned enterprises that implement mixed ownership reform (hereinafter referred to as "mixed reform"), if they want to improve quality and efficiency, they must also pay attention to the organic integration of new and old corporate cultures, which cannot be ignored.

“Mixed-ownership reform” promotes enterprise development, and innovation highlights the effectiveness of change

Currently, the “mixed-ownership reform” of state-owned enterprises is advancing steadily and rapidly. In 2020, the number of mixed-ownership enterprises among central enterprises has exceeded 70, and the introduction of non-public capital has reached more than 1 trillion yuan. Take China National Pharmaceutical Group Co., Ltd. ("Sinopharm" for short) as an example. As early as 2014, the State-owned Assets Supervision and Administration Commission of the State Council listed the then-Sinopharm Group among the first batch of pilot enterprises to develop a mixed-ownership economy. Since then, Sinopharm Group has given full play to the advantages of mixed ownership, focused on its main business, pioneered trials, promoted changes with innovative thinking, and used state-owned capital to drive social capital, enabling the company to achieve rapid development. In 2013 during the "Twelfth Five-Year Plan" period, Sinopharm became the first Chinese pharmaceutical and health company to rank among the world's top 500, ranking 446th. Since then, it has developed rapidly and successfully entered the top 200 in 2017, ranking 199th; in 2019, it ranked 169th position, ranking 145th in 2020; in the first year of the "14th Five-Year Plan", in the 2021 Fortune 500 list announced in early August, Sinopharm rose to 109th.

As a wholly-owned subsidiary of Sinopharm Group, China Traditional Chinese Medicine Co., Ltd. is the core investment platform of the group’s traditional Chinese medicine industry sector and is also a test field for Sinopharm Group to promote “mixed ownership reform” in the field of traditional Chinese medicine in China. In accordance with the deployment of the State-owned Assets Supervision and Administration Commission of the State Council and Sinopharm Group to actively and steadily develop mixed ownership, the company successfully acquired the former Guangdong Yingtian Pharmaceutical Group Co., Ltd. (a Hong Kong listed company) and Guizhou Tongjitang Pharmaceutical Co., Ltd. in 2013, integrating "Feng Liao Xing" and "De It owns three time-honored traditional Chinese medicine brands, "Zhong" and "Tongjitang". In 2015, we continued our efforts and successfully acquired Jiangsu Tianjiang Pharmaceutical, becoming a leading company in the field of traditional Chinese medicine formula granules and achieving a historic breakthrough in corporate strategic transformation.

Capital mixing is just a sail, only enterprise integration can go a long way

Next, without exception, companies that vigorously develop "mixed ownership reform" will face the issue of how to integrate organically and must properly solve it new topic.

By actively developing mixed ownership, state-owned enterprises have an obvious role in promoting the expansion of their territory. In the context of mixed ownership reform and development, in order to enable new enterprises to maintain healthy and sustainable development, improve and strengthen corporate culture construction, the inherent corporate culture of each member enterprise must be carefully analyzed and organically integrated, and ultimately act as a positive vector to assist development. Function is a task that an enterprise must complete. As a state-owned enterprise, China Traditional Chinese Medicine Co., Ltd. should keep its mission in mind, forge ahead with determination, and create a win-win operating model for state-owned enterprises with the awareness of innovation that "the strength of state-owned enterprises and the vitality of private enterprises = the competitiveness of enterprises", and build a win-win operating model suitable for this kind of mix. The corporate culture of ownership is not only an urgent need to improve economic benefits, but also has realistic social benefits.

Why is there so much emphasis on the significance and role of corporate culture construction? The answer will be found by tracing back to the origin and role of corporate culture construction.

As a central enterprise, Sinopharm Group and its subsidiary China Traditional Chinese Medicine Co., Ltd. must be responsible for building a corporate culture system that promotes the company's long-term strategic development and is suitable for the actual situation of "mixed ownership reform", and unite all new members or newly established companies. member companies, thereby ensuring that Sinopharm, the pharmaceutical aircraft carrier, rides the wind and waves.

Analyze the difficulties, solve the pain points, and find the balance point while running

From a macro perspective, the current mixed ownership reform in state-owned enterprises is a bold exploration without precedent. There are mature experiences that can be learned from, and there is no successful model that can be copied.

The construction of corporate culture under the background of mixed ownership is also at a new starting point. It can only give full play to the subjective initiative of the enterprise in the process of moving forward in practice. Only by tentatively exploring and developing a new path can we summarize in practice. Experience, use experience to guide further practice. How to effectively integrate the inherent culture of state-owned enterprises with the inherent culture of newly added private enterprises? Only by finding the entry point for work can effective integration be promoted as soon as possible.

Analyzing the difficulties from a micro perspective is more complex and diverse. China Traditional Chinese Medicine Co., Ltd. has quickly acquired several private companies of certain scale and strength in just a few years, including the aforementioned Guangdong Yingtian Pharmaceutical, Guizhou Tongjitang Pharmaceutical and Jiangsu Tianjiang Pharmaceutical. These three companies are relatively outstanding assets in the industry. They all have excellent products and have established relatively mature cultural systems. For example, Yingtian Pharmaceutical has formulated core values, core management concepts, daily behavioral norms for employees, basic requirements for managers, basic preference lines, etc. The predecessor of China Traditional Chinese Medicine Co., Ltd. was the China National Medicinal Materials Company established in 1955. It is the founder of the production, operation, and scientific research system of traditional Chinese medicine in New China. It has long been responsible for the comprehensive balance of production, supply, and marketing of traditional Chinese medicine and industry management throughout the country. In the course of more than 60 years of development has accumulated a rich corporate culture; at the same time, the company itself is also a group enterprise, with more than ten state-owned enterprises of various sizes under its subsidiaries. How to organically integrate these new and old corporate cultures is indeed facing a severe test. Corporate culture that relies on simple preaching and is packaged and whitewashed by administrative or coercive means is obviously contrary to the spirit of advancing with the times, cannot stand the test of time, and cannot be in tune with the original intention of cultural construction.

In addition, corporate culture construction seems to be the work of managing the enterprise, but in the final analysis it is the work of being a human being. People’s minds are diverse. Therefore, corporate culture construction often “looks beautiful, sounds sweet, but is difficult to implement.” This is more common in the process of implementing new corporate culture construction in “mixed-ownership reform” companies. difficulties and pain points. Secondly, after private enterprises and state-owned enterprises are mixed together, although they are consistent in the direction of development, they may have different development demands, which will also lead to deviations in the orientation and construction methods of the corporate culture system. Thirdly, mixed-ownership enterprises tend to be relatively large in scale and volume. They are cross-regional enterprises spread across the country. Different regional cultures may affect the speed and steps of building and promoting the corporate culture system. If it is not done ideally enough, the vitality of corporate culture construction will be challenged, and the theory of corporate culture construction will be difficult to support new development. Cultural conflicts will inevitably affect the effectiveness of corporate management, consume corporate resources, and damage the mental health of employees.

Of course, the problems and difficulties faced by mixed-ownership corporate culture construction are far more than these. The reform of state-owned enterprises is recognized as one of the most difficult aspects of my country's economic reform. It involves a wide range of areas and new problems emerge one after another along with old ones.

Create a distinctive corporate culture brand to help the "mixed-ownership reform" move forward steadily

In practice, China Traditional Chinese Medicine Co., Ltd. does not regard itself as the "boss", but grasps the role of mixed-ownership enterprises We should start from the rational and scientific analysis of the development rules of "mixed-ownership reform" enterprises, and gradually achieve the ultimate understanding of corporate philosophy through in-depth grassroots research, and then organize exchanges and share cultural construction experience, and then implement and implement through effective propaganda and Through methods such as building distinctive cultural brands, all elements of corporate culture will ultimately create synergy and promote rapid improvement in the company's operating performance year by year.

Through analysis, it was found that companies that smoothly and successfully implement mixed ownership often go through four stages, namely mixing, integration, combination, and integration.

The mixing stage, that is, the capital is mixed together, just like two people coming together. This stage is only the initial stage; the integration stage can be seen as the hands of two people coming together, that is, the company begins to integrate their respective resources. Learn from each other's strengths and offset weaknesses; in the union stage, the ideas of both parties gradually converge, the cultures gradually accept each other, and the two people embrace each other, but this is not the "honeymoon" stage yet; the integration stage is the best stage of cooperation, which is like two people's hearts being intimately close. Companies that cooperate, fully invest, and contribute to this stage and level are the most ideal and successful examples of mixed ownership reform. A mixed-ownership enterprise that has developed into the fourth stage will undoubtedly be a bigger, better, and stronger enterprise. Employees love such an enterprise and are proud to work for such an enterprise. Shareholders have a sense of accomplishment for investing in such an enterprise. , such an enterprise will definitely gain a high social reputation. Such a result must also be the goal that the party and the country hope to achieve when implementing the mixed ownership reform of state-owned enterprises - to achieve "goal integration", "governance integration" and "cultural integration". Form a strong synergy for enterprise development and enhance the competitiveness of mixed-ownership enterprises.

In order to effectively find a "balance point" that all parties are willing to accept, in December 2013, China Traditional Chinese Medicine Co., Ltd. took the Sinopharm Group's corporate philosophy of "caring for life and protecting health" as the basic point and starting point to conduct in-depth At the grassroots level of new and old enterprises, we conducted in-depth and extensive discussions with middle and senior managers and ordinary employees, conducted research, and learned the essence of the culture of state-owned enterprises and private enterprises. After refining, we compiled a systematic corporate culture concept. This includes corporate vision (to be a leader in the traditional Chinese medicine industry), corporate mission (to inherit and innovate, and improve people’s health with high-quality traditional Chinese medicine products and services), core values ??(customer trust, employee pride, shareholder satisfaction, social respect), and corporate spirit (Integrity, Endeavor, Professionalism, Harmony) and specific management requirements, etc. The core contents are similar and full of positive energy, which are advocated by all parties involved in the "mixed reform".

These cultural concepts have solicited opinions from all parties and been revised repeatedly before being announced, and finally gained a consensus, and the subsequent work will focus on implementation.

First of all, in order to promote and implement the new corporate culture concept, enhance the soft power of corporate culture construction, enhance cultural exchanges among member companies, and achieve the integration and development of corporate culture, in September 2014, the company held An online video conference was held to exchange experiences on the achievements of corporate culture construction. The former state-owned enterprises Jiangyou Jiangyou, Hua Miao, and the newly merged private enterprise Yingtian Pharmaceutical were selected to speak on behalf of the new and old enterprises at the meeting. Everyone not only shared their own experiences, but also expressed their doubts and worries openly and honestly. During the free speech stage, everyone rushed to speak. The meeting brainstormed and collected many useful and constructive opinions. At the same time, it enhanced the relationship between new and old enterprises. in-depth understanding.

Secondly, in order to further deepen and improve the concept of corporate culture, in July 2015, China Traditional Chinese Medicine Co., Ltd. formulated the "Company Employee Code of Conduct", which innovatively drew on the principles of "Disciples' Regulations" and "Three Character Classic" of Chinese traditional culture. The form and rhythm should be concise and novel. The Code *** consists of 3 parts, 3 levels, and only 52 articles and 156 words. It is also combined with the company's actual situation and focuses on embodying the core socialist values, "Three Stricts and Three Realities" and other spiritual contents. For example, in the chapter "Code of Conduct for Senior Management" it is clearly stated that: large-scale structure, smooth operation and planning, practical planning, good use of people, beautiful personality, public-mindedness, strict use of power, and true integrity. Subsequently, the company used multi-media means such as its own corporate newspaper, bulletin board newspaper, company website, WeChat official account, etc. to systematically promote the company's cultural concepts, and carried out post-publicity and implementation through VIS methods that employees loved to hear and see, to promote corporate development, social progress and family happiness. The "three bodies" are harmonious and unified. It should be said that this is one of the corporate culture "products" with the distinctive characteristics of China Traditional Chinese Medicine Co., Ltd.

Again, regard corporate culture as a "corporate product". Mobilize the enthusiasm of all member companies and make every effort to build a corporate cultural activity brand.

Integration between enterprises can be achieved in a variety of ways. Among them, actively mobilizing all member enterprises to form a joint effort to jointly create corporate cultural activities with the unified title of "Colorful Traditional Chinese Medicine" is China Traditional Chinese Medicine Co., Ltd.'s initiative to explore the construction of mixed enterprises. An important way of ownership corporate culture.

"Colorful Traditional Chinese Medicine" started as "Colorful Traditional Chinese Medicine" in 2012. It is a corporate culture brand created with great concentration by the company's predecessor, China Traditional Chinese Medicine Company. After the company was renamed as China Traditional Chinese Medicine Company in 2014, "Colorful Medicinal Materials" was renamed as "Colorful Chinese Medicine". The name has multiple meanings: "Colorful" means colorful. Enterprises are built by employees, and employees' work, study and life should be colorful; in addition, Chinese medicinal materials are also colorful; furthermore, whether they are medicinal materials , or Chinese medicine, which is both the keyword of the company name and the company's main business. Therefore, it can be said that "Colorful Chinese Medicine" is the harmonious unity of "people and enterprises" and is also a corporate cultural activity brand with the company's distinctive characteristics.

The methods and approaches are simple, clear and highly operable, that is, all the activities carried out by the company are named after "Colorful Chinese Medicine". Such as the May 4th theme activity of "Colorful Chinese Medicine·Extreme Practice", the health lecture of "Colorful Chinese Medicine·Quality Fitness", the employee labor skills competition of "Colorful Chinese Medicine·Based on my position and I am the best", and the "Colorful Chinese Medicine·Sound of Philharmonic" love Performances, etc., aim to carefully create corporate product awareness and build corporate cultural brands. "Colorful Chinese medicine" has accompanied the rapid development of enterprises and virtually enhanced the soft power of enterprises.

The "Colorful Chinese Medicine" brand unified naming campaign initiative quickly received responses from new and old companies such as Tianjiang Pharmaceutical, Yifang Pharmaceutical, Zhonghua Nanyang, Chinese Medicine Huayi, Chinese Medicine Chengde and other new and old enterprises, and the brand effect gradually appear. However, the construction and development process of the brand has not been smooth sailing. There have also been problems such as "it is not necessary to have a unified naming for an event", "it is just a symbolic use once", "I don't know the meaning of publicity after naming", "how to name" "I don't know" and other 8 pain point questions. Guizhou Tongjitang Pharmaceutical named the mountainous area poverty alleviation teaching team originally organized by the company as the "Colorful Teaching Team". It did not adopt a standardized unified naming. At the same time, it proposed "Can we only use 'Colorful' as the title without embedding 'Chinese Medicine'?" problem. This shows that some companies do not understand the importance of unified naming and joint efforts to build corporate cultural brands. In response to various issues such as these, the company not only implements irregular guidance at any time, but also uses annual party building work exchange meetings, league organization work meetings, corporate publicity work meetings, and "Colorful Chinese Medicine" corporate cultural activities to focus on publicity Unify the importance of naming, and provide detailed guidance on how to name and promote it. After a series of patient and professional presentations, and as the "mixed-ownership reform" continues to deepen, new companies continue to join in the naming activities, and the brand influence gradually radiates from the company headquarters to many places across the country. Guizhou Tongjitang Pharmaceutical will soon change the name of the "Colorful Teaching Support Team" to the "Colorful Chinese Medicine Supporting Teaching Team". This poverty alleviation supporting teaching brand activity that has been persisted for many years also won the honorable title of "Outstanding Youth Commando Team" issued by the Guiyang Municipal Youth League Committee in 2020 ; The "Colorful Traditional Chinese Medicine" corporate culture brand building activity initiated by China Traditional Chinese Medicine Co., Ltd. has also been affirmed by Sinopharm Group, and construction experience has been exchanged within the group.

In the context of the mixed ownership reform pilot, China Traditional Chinese Medicine Co., Ltd. has taken an active and exploratory step in the construction of corporate culture. Newly joined companies and original company members are actively using their brains to continuously contribute to the "Colorful Traditional Chinese Medicine" ” Rich content, brand influence continues to increase. From its establishment in 2012 to 2020, the number of "Colorful Chinese Medicine" activity projects has been increasing year by year, with a total of more than 600 projects, playing a joint role in uniting all member companies and uniting to create a "Colorful Chinese Medicine Family", and this title It is unique to the enterprise and has strong charisma and vitality.

The company’s synchronized operating data shows that in 2012 (the year before the mixed-ownership reform), the operating income was 1.379 billion yuan, which increased to 2.900 billion yuan in 2013. Since then, it has grown rapidly year by year. In 2017 The company has achieved revenue of over 10 billion yuan, with operating income reaching 15.941 billion yuan in 2020, and has successfully entered the leading enterprise circle in China's traditional Chinese medicine industry. Facts have proved that vigorously developing mixed ownership has brought leapfrog development to corporate performance, and implementing the organic integration strategy of corporate culture can actively, steadily and effectively promote the in-depth and high-quality development of "mixed ownership reform".

Author unit: Sinopharm China Traditional Chinese Medicine Co., Ltd.

This article was published in the 2021 issue 15 of the magazine "China Development Observation"

"China Development Observation" was published by Supervised by the Development Research Center of the State Council, sponsored by China Development Press, and edited and published by China Development Observer Magazine, it is a comprehensive bimonthly magazine with development as the main line and economy as the focus. It covers strategy, macro, regional, world, rule of law, society, and culture. , cutting-edge, industry, think tank forum and other columns are highly forward-looking, authoritative and readable. "China Development Watch" has a broad and stable readership in academic theoretical circles, party and government agencies at all levels, and the entrepreneurial class. It is also used by important institutions such as the Chinese Academy of Social Sciences, the National Development and Reform Commission, and authoritative databases such as China National Knowledge Infrastructure and VIP Information. Listed as a core journal or source journal, it was rated as the most popular journal in economics in 2020 by the National Philosophy and Social Sciences Literature Center Journal Database.

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