Cao Dewang: "Respecting God, loving people, and striving for perfection" is the foundation of entrepreneurship.

On November 20, 2021, the Fuzhou Municipal People's Government and the Heren Charitable Foundation signed a strategic cooperation framework agreement for the construction of Fuyao University of Science and Technology. The selected school site is on Liuzhou Island, Nanyu Town, Fuzhou High-tech Zone, covering a total area of ??about 1,286 acres, close to Fuzhou University Town and Haixi High-tech Industrial Park.

What’s next for the school? Cao Dewang said that Fuyao University of Science and Technology will adhere to the educational philosophy of high level, specialization and excellence, and internationalization; explore a new university governance model formed by four major committees, including the Board of Governors, Academic Committee, Advisory Committee and Education Committee; plan to build a university with a large The discipline system is composed of engineering group as the core, economic management discipline as the auxiliary, and other general disciplines such as humanities and social sciences as the support; the preliminary settings are materials science and engineering, electronic information and engineering, environmental science and engineering, instrument science and engineering, and the school of science. , six colleges of economics and management; cultivate high-quality applied research talents with international vision, innovative spirit and management ability, and feelings for home and country; it is planned to establish a Fuyao Scholarship and Teaching Fund to exempt poor students from tuition fees and provide scholarship support, etc.

Based on topics such as the development of Fuyao Group and the original intention of donating the university, Su Yong, a distinguished expert of "Entrepreneur" magazine, conducted an exclusive interview with Cao Dewang at the first time.

01 "Respecting God, loving people, and striving for perfection" is the foundation of entrepreneurship

Su Yong: Fuyao Glass has gradually developed from an unknown small business to a leading manufacturer of automotive glass in China. It is a leading enterprise and accounts for more than 1/4 of the global market share. What do you think is the most important factor along the way?

Cao Dewang: The most important factor is social responsibility. Fuyao has always adhered to the belief: "Respect God and love people, and strive for perfection." This is the foundation of Fuyao's entrepreneurship and the most fundamental reason why Fuyao has grown from a young age.

Su Yong: Could you please give us some examples of how Fuyao implements this concept into its daily operations and management?

Cao Dewang: Fuyao was founded in 1987. Fujian Province asked me to issue stocks in 1991. At that time, the price was 1.5 yuan per share, which was the net value (more than 60 million yuan in net assets was converted into 40 million shares). After the issuance, because it could not be listed, many people asked to return the shares. I was forced to repurchase several million shares myself. However, it was a blessing in disguise, and by the time it went public, the price per share had risen to more than 40 yuan.

Su Yong: Fuyao has had two anti-dumping lawsuits and won both times. What was the reason?

Cao Dewang: Fuyao has standardized its accounting management since 1999 and used the Oracle system. After the working group settled in Fuyao, no matter what information they asked for, we could print it out immediately, and all the data was clear and accurate. We also told him: What is the number of this wooden box, how many nails were used, and what is the length and weight of the nails. All information is clear at a glance. They didn't believe it, so they went to the site to verify it. As a result, the information provided by Fuyao was true and valid, and they were convinced. This is the behavior of "respecting God and loving people", doing everything responsibly and well.

The country also awarded me the title of "Model Taxpayer", and shareholders believed in me and banks believed in me.

Goodness is the foundation. Without goodness everything is zero.

Su Yong: Many people have watched the documentary "American Factory" (Keyword of the Year 2020 | American Factory, link to Eastern Wisdom). This documentary focuses on your journey of opening a factory in the United States, and the process of The collision and game between Chinese and American cultures experienced in China. As Chinese companies move to the center of the world stage, they will also encounter similar problems. Is there any experience that can be learned from?

Cao Dewang: Fuyao follows the principle of "respecting heaven and loving others". Wherever your company goes, that's your "heaven". When you are in a country, do as the Romans do and you must follow the rules. This is a very objective issue.

Fuyao invited local lawyers and consultants to help with planning. Therefore, all rules are in compliance with American laws, and things done are in line with local habits. The governor believed in me very much. He said he had an idea: this factory used to make cars. He used a camera to record the story of the last car coming off the assembly line. Because they were facing unemployment, the workers cried very sadly. It was a tragedy. This time I want to make a documentary about the first piece of glass that went online, and I want to make it into a comedy. But the director said that documentaries cannot be edited, and whatever is filmed will be broadcast. I said, as long as you don’t make pranks, you can film whatever I do and broadcast whatever I film. Chinese people do things above board.

So the photographer followed me throughout the whole process, whether it was daily work or business trips, meetings or negotiations, from the airport to the factory, the venue, from the United States to China, and it lasted four years. As for me, I forgot he was there.

02 Diligence, hard work, conscientiousness and responsibility are advantages

Su Yong: What do you think are the advantages of Fuyao’s development to this point? Is it technology, cost control, or uniqueness in business management?

Cao Dewang: Fuyao people are very diligent, hardworking, and conscientious in doing things. This is Fuyao’s competitive advantage and our country’s competitive advantage.

When the state of Illinois sold the PPG glass plant to me, it had been in litigation with the union for five years. PPG said: I will sell you the factory, but the union issues will be dealt with separately. During the handover, I told the workers: "I'm sorry. According to Chinese law, I should have greeted the union and asked for its opinions before the acquisition. Only when I was satisfied can I sign the contract. However, PPG told me that it does not need to be fulfilled according to federal law. This procedure. "After the purchase, the lawsuit between PPG and the union continued, and I sat down with the union to discuss the next step of cooperation.

PPG was surprised at the time. How could Cao Dewang declare his cooperation with the union? The unions couldn't believe it, and the conditions they proposed when they actually sat down to negotiate were not that sharp. I fully accepted the conditions proposed by the union at that time. I said to the workers: "I accept the conditions, but my financial strength is not enough to borrow money to pay wages. We must unite and run the factory together. Only when we make money can we increase your wages. I have only one condition: The product yield rate is close to that of Chinese companies."

At that time, the yield rate of Fuyao's Fujian production line reached about 85%, while the yield rate of the Illinois production line was only about 70%. To confirm this, they selected four worker representatives to visit and study in China.

Su Yong: What kind of inspiration do you think this can give to Chinese companies?

Cao Dewang: To have a cooperative attitude, you must respect each other. In this case, the trade union is very cooperative with us. Later, we renovated the factory in Illinois to be like that of domestic enterprises. Although the yield rate is still lower than that of domestic enterprises, it is much higher than before, and the enterprise's efficiency is also good.

03 Enthusiastic about charity, heart like Bodhi

Su Yong: The book "Heart like Bodhi (Updated Edition)" talks about how you treat your suppliers and collaborators, not only cooperation, He also took the initiative to help.

Cao Dewang: This is necessary! Business owners can’t just think about making money for themselves. “Everyone has to make money” and the distribution of interests must be balanced.

When you turn all the benefits that others deserve into your own interests, then he will know you the first time, and you will not get those benefits so easily the second time. The third time he will will kick you away.

Confucianism advocates benevolence, righteousness, propriety, wisdom and trust. The first is "benevolence", which means respecting others, achieving balance, and benefiting the people.

Su Yong: Please share with us a typical case.

Cao Dewang: In 2008, when the economy was undergoing major changes, a glass factory was in crisis, and the general manager came to me for help. I expressed my position to him that day: I am a small factory and I will not buy a lot. I only use a few thousand tons of glass a month. If you are not too little, you can install it yourself at the current market price in China. He was very moved. After a few months, the supply of glass became tight, but the price of my glass did not increase as a result. In fact, running a business is about being a good person. If you are a good person, you will have no problem doing things, and many people will help you.

But it is not easy to actually do things like this. In the 1950s and 1960s, there were also companies in Japan that sold fake medicines and made fake advertisements. It can be said that there were all kinds of deceptions and abductions, but the ones who were able to stay and become big consortiums were those who abided by the rules. Therefore, companies that truly fulfill the principle of "respecting heaven and loving people" will definitely do well.

Chairman Mao once said: "It is not difficult for a person to do a good deed. What is difficult is to do good deeds all his life." I am 75 years old this year. Looking back on the past, I have not done anything to disgrace society. Feel very proud and proud.

04 There is no savior in the world, you can only rely on yourself

Su Yong: Does Fuyao have any worries about its operations now? Some competitors are currently doing very well.

What do you think of the challenges businesses face?

Cao Dewang: I am more nervous than anyone else. Bill Gates has a saying, "Bankruptcy is always within 18 months." Because when the annual report comes out, attention must be paid to any losses. If not, If it is reversed in time, pressure from all aspects will follow, including shareholders, financial institutions, banking systems, etc. There is no savior in the world, you can only rely on yourself. Of course, there is no use just worrying, you must actually take action to change. I predicted the economic crisis in 2008 in 2006, and my prediction was very accurate. I made preparations in advance, successfully survived the crisis, and ushered in the economic recovery in 2009. However, Fuyao's debt ratio was also very high at that time. We first adjusted our liabilities and used savings to offset them. It took us nearly four years to adjust and finally we were debt-free.

The latest crisis is the supply chain "disconnection" crisis caused by the new crown epidemic, and some companies have debt crises. Isn't debt repayment equivalent to destroying the civilization of the entire society? Who can accept it? Therefore, there is no use worrying, it must be solved with knowledge and wisdom.

Those companies that borrowed heavily and expanded blindly are now encountering problems. Fuyao has been moving forward steadily and has transformed and upgraded to Industry 4.0.

05 Integration of intelligent manufacturing and intelligent management

Su Yong: Fuyao’s strategy is “technology leadership, intelligent production”. How to achieve Industry 4.0 specifically?

Cao Dewang: The unity of knowledge and action. We have put forward the concept of "there is no best, only better" and regard "transformation and upgrading" as the "aerobics" of the enterprise and practice it every day. Transformation and upgrading must be done when "the body is healthy" and requires the participation of all employees. For example, an ordinary worker in a Chongqing factory saw that 3M, the consumables used in making glass, was very expensive, costing a few cents a piece, and was thrown away after being used once. The daily use was large and it was very wasteful. He used his lunch break and time after get off work to ride his bicycle to various stores in the city to look for similar products, and he found them. After many experiments, the acceptance results were good and the cost was reduced a lot.

Su Yong: How to truly integrate informatization and intelligence?

Cao Dewang: The MES (a manufacturing execution system that can realize data statistics, analysis, evaluation, and correction) on our current production line has been in use for five years. Intelligent manufacturing and intelligent management must be integrated. together.

Recently, Fuyao established a joint R&D team with Tsinghua University’s School of Global Innovation and Peking University’s National Engineering Laboratory for Big Data Analysis and Applied Technology, with the core of intelligent manufacturing driven by both data and simulation. Its technical advantages in intelligent sensing, modern simulation, and industrial big data research promote innovative research and development of intelligent automotive glass manufacturing. Fuyao also cooperated with the Chinese Academy of Sciences to establish an Advanced Materials Application Research Center.

Informatization uses the Internet to collect information through lenses. Thousands or tens of thousands of data can be collected in one second, which is impossible to achieve using traditional methods. What's more important is to use the collected data, just like building a house starts with the foundation. This time I am planning to build a museum in the university I donated to build. I hope that through the display of cultural relics, I can tell my compatriots that we must seek truth from facts in everything we do. If you look at a car and its development history, you can see that different eras have different ways of thinking, different design concepts, and different process requirements...

06 Going out, culture Integration is the key

Su Yong: Fuyao entered the international market in the 1990s. How did you think of entering the international market at that time? Do you think it is better to make money abroad?

Cao Dewang: Doing business is to make money to support your family. I started doing business when I was a teenager, regardless of region, I would go wherever it was easy to make money.

However, it is not easy to make money abroad, and I have hit a wall. I built a factory in the United States in 1995. The glass I produced was sold to wholesalers for about 30 yuan/piece. The American wholesaler sold it twice as much when it went into the warehouse, and when it arrived in the store, it cost more than 100 yuan/piece. So, I decided to build a warehouse in the United States, but from 1995 to 1998, I suffered losses for four consecutive years.

Why do I lose when others make money? I invited Americans to investigate. In fact, Americans have known this for a long time, but they only told me the result after two months of research: you are operating a mixed business. He said there is a difference between "doing" and "selling". You can only do it, not sell it.

Wholesalers selling glass have first-level suppliers and second-level suppliers in each state. They serve stores in this region, and the stores serve insurance companies and retail investors. There are 50 states in the United States. Wholesalers have at least 200 warehouses and occupy more than 10 billion U.S. dollars. It is a bit naive for you to compete with them with 10 to 20 million U.S. dollars. The suggestion given is to stop the warehouse model, use a few salesmen, and push Fuyao directly to the third-tier suppliers-stores. Because some small stores can't get the prices and goods from second-tier wholesalers, you can make money by skipping the second-tier suppliers and selling them to stores at the middle price of more than 40 yuan per piece. So I listened to the advice and closed the warehouse in the United States, changed the distribution to direct sales, and turned a loss into a profit that year.

Su Yong: In the United States, including starting a business in other countries, what experience can you share with Chinese companies in terms of business management?

Cao Dewang: Justice and fairness. Use open and transparent means to maintain and ensure justice and fairness, withstand any test, and assume the responsibility of an entrepreneur.

07 Donate to build a school and insist on running schools in a dislocated manner

Su Yong: You are an entrepreneur with feelings for your family and country. Fuyao has donated more than 16 billion yuan in total, including a recent donation of 10 billion yuan to build a university. Why donate to build a school?

Cao Dewang: I donated the money to the Heren Charitable Foundation, and the foundation will supervise the use of the funds. Heren Charitable Foundation is the first and only national non-public foundation in the country approved by the State Council and established with financial assets (stocks).

Harvard University and Cornell University in the United States are all run by foundations. I want to run a university that is not found in existing universities. From the recruitment of students to the recruitment of teachers, it is different from other schools and insists on running a school in a dislocated manner.

Su Yong: There is a new word called "slow employment". What do you think of this issue?

Cao Dewang: Fuyao University tells students the importance of employment on the first day of school. It first talks about the content and requirements related to finding a job and employment, and then teaches you to learn knowledge and skills, and cultivate students. High level of employable talents. When recommended to companies, they sign an engineer's contract. The school trains not ordinary workers but sales engineers, product design engineers, mechanical engineers, electronic engineers, and quality engineers. If they are not competent in actual work, the school will take care of it.

Today, all industries in China are short of people, especially specialized talents with craftsman spirit, professional skills and suitable for enterprises. Fuyao's schools can train talents. The school establishes a museum to assist education and provide immersive training; the most beautiful thing about the university is the library, where professors, lecturers, and students can gather there every day...

08 ***Tongfufu, It is a concrete manifestation of social progress

Su Yong: Now that the country has proposed three distributions, what do you think of the common prosperity of the country?

Cao Dewang: This is a concrete manifestation of national progress and social progress.

Su Yong: I saw a slogan from Fuyao Group. Entrepreneurs have three responsibilities: "The country is strong because of you, the society progresses because of you, and the people are rich because of you." ."Can you explain it?

Cao Dewang: As an entrepreneur, we must do things from the perspective of the country, society, and people. This is not official talk, nor is it a lie. If you want to be an entrepreneur and a successful entrepreneur, you must follow these three things. The investment you are engaged in and the things you want to do must be what the country needs, society needs, and the people need.

Su Yong: You have been involved in manufacturing for so many years. What advice do you have for Chinese entrepreneurs?

Cao Dewang: Entrepreneurs are the elite of society, and the improvement of their own quality determines the development of enterprises. Entrepreneurs are an important force leading social progress and economic development. The more difficulties they encounter, the more calm they must be, and they must boldly step forward and take responsibility.

Article selected from Entrepreneur Magazine, November 26, 2021