Facing the past, confronting reality, and looking forward to promote the steady and healthy growth of enterprises - Work Report for 2004
Dear colleagues:
In order to better achieve our work objectives for 2004, overcome negative influences, mobilize all positive factors, and move forward swiftly with a light load, I would like to discuss before summarizing the work of 2003 and planning for 2004: "How to correctly understand the impact on the enterprise after the equity change of ** Group"; "How to face the past"; "How to confront reality" etc., so as to unify our understanding and thoughts and consistently carry out our future work.
First, correctly understand the impact on the enterprise after the equity change of ** Group. After the equity change of ** Group, our influence has been manifested in several aspects. Firstly, due to the equity change, there has been a change in shareholder rankings, losing the position of the second largest shareholder, with **** Company becoming the largest shareholder. Thus, the entire ** Group has shifted from being controlled by a collective enterprise to being controlled by a private enterprise, and the change in chairman is an inevitable result. The changes at the core level will inevitably bring changes to the group's affiliated enterprises, which is undeniable. It is not easy to quickly adapt to this change, which is one kind of impact.
Secondly, there are concerns that the existing major shareholders will directly absorb the enterprise, reform the current economic system and operating mechanism, lay off personnel, causing us to lose our survival foundation and our jobs. A large proportion of employees have such concerns. Even at various levels of management, including the headquarters leadership, there exists a waiting and observing attitude, hoping for the convening of the new board of directors and the emergence of a new chairman to avoid conflicts in guiding thoughts, approaches, and methods of work. Therefore, in the work of 2003, there was a manifestation of laxness, negativity, and lack of progressive spirit, greatly slowing down the pace of enterprise development. In this regard, we in the leadership layer bear responsibility. This is also a kind of impact.
Thirdly, due to the aforementioned reasons, there is a sense of pessimism and disappointment about the future of the enterprise and one's own prospects. If these emotions are not eliminated and allowed to spread, the consequences would be very frightening. It could lead to the loss of our goals, a decline in work enthusiasm, a loss of close organization and discipline within the employee team, and a loss of the cohesion already formed by the enterprise. Therefore, eliminating these impacts is essential for us to do well in our work for 2004.
Here, I want to say to everyone that for shareholding enterprises, the transfer of equity is common and ordinary, nothing extraordinary. However, the change in equity does indeed have some impact on us, mainly because the controlling enterprise (i.e., the major shareholder) has changed from state-owned to private. This change in nature will inevitably bring changes to how our enterprise operates. We cannot control or intervene in this matter; it is both unexpected and beyond our control. This reality must be confronted. We must acknowledge that it is the beginning of the transformation of the economic system and operating mechanism, and accepting private ownership is a choice we must make. This is the direction of the enterprise in the future.
Second, how to face **'s yesterday?
**'s yesterday was beautiful and inspiring. Especially over the past ten years from 1993 to now, due to the persistent adherence to innovation and market-oriented operations, high starting-point operations, and unconventional growth, we have embarked on a path of continuous self-surpassing and progress. Over the past decade, through steadfast efforts and relentless struggles, the enterprise has achieved five historic leaps. To date, whether in terms of industrial production materials operation or electronic and computer operations, ** City can claim to be the largest, with the most varieties, the largest market share, and the greatest external influence. Not only have we firmly established our foothold, but we have also stood at the forefront, withstood market tests, and won the market. Our enterprise has become a well-known municipal advanced unit with strong radiation capabilities and influence within the province. It has been awarded a two-star market by the Provincial Administration for Industry and Commerce, and the application process for a three-star market has been completed and passed the inspection and acceptance by the Provincial Administration for Industry and Commerce. Becoming the highest-rated market in our city is just around the corner.
To achieve these five leaps, we have put in great effort in systemic innovation, management innovation, and operational innovation, thus ensuring the smooth realization of the five leaps. The reason I review the history of growth over these ten years and reiterate these five leaps is that this glorious achievement was jointly built by all employees. In this fertile land of hope, we have invested our hard work and sweat. History cannot be forgotten. We were able to navigate from nothing to something, from small to big, over these ten stormy years. We can similarly seize opportunities and move towards the future. The purpose of facing the past is to encourage us to march resolutely towards new goals. Based on this, I think we have no reason to feel pessimistic or disappointed, no reason to be mediocre, and even less reason to stand still. The best choice: galloping ahead without dismounting, stepping forward again from the start, and walking the road ahead well.
Third, how to face ** today?
** Today is brilliant and worthy of pride. Because we are the only company in the national *** system to successfully list, and the top tax-paying entity in the commercial system of ** City. It owns the largest computer and electronics market in the province, and its annual profits account for 80% of the entire ** system in the province. One can say that in terms of our enterprise's current situation, it has reached the peak period of development.
However, in the process of economic activities, there are rules. No enterprise will forever show an upward trend in production and operations. Ups and downs are inevitable. Therefore, we must see the crises behind the apparent prosperity. To make our minds clear, face reality, find gaps and existing problems, will be greatly beneficial to maintaining the enterprise's operation at the peak state.
So, under the current circumstances, what kind of situation does our enterprise face? First, the external and internal environment for the enterprise is not good, and the situation faced is severe. From a macro perspective, since our city belongs to an old industrial city, with heavy burdens, slow transformation, and relatively underdeveloped economy, it makes it difficult for industries to thrive, lacking vitality, with many laid-off workers and low purchasing power. The lag in the primary industry causes the slow growth of commercial circulation enterprises. This is the external environment we face. From a micro perspective, the market is fiercely competitive, with many competitors. External purchases and internal sales cause capital outflows, increased costs, and sharply reduced gross profit margins. The direct result will certainly be a drop in sales, thin profits, and even debt operations or shutdowns for operators lacking operational strength. This is the internal environment we face.
Second, after experiencing two rounds of equity transfers, the loss of shareholder status, the reality of being "hired hands," and the serious and irreversible situation faced by employees. In terms of equity ranking, we have dropped from the second position to the fifth, having sold 873 million shares out of 1373 million shares, leaving the remaining 500 million shares in name only. We have become true proletarians. In administrative terms, our fate is in the hands of the board of directors. In other words, the status of ** headquarters in the entire ** Group has undergone a qualitative change. In identity, we have experienced changes from state-owned enterprise employees, shareholding enterprise employees, employees of a listed state-owned enterprise-controlled company, to ultimately employees of a privately owned enterprise-controlled "hired hand." The impacts of the changes in equity rankings and private enterprise control are significant for us.
Third, the overall quality of employees finds it hard to keep up with the rapidly developing situation. The quality of employees mainly manifests in concepts and knowledge. Conceptual issues are old problems, but these old problems remain unresolved: ideological rigidity, repeating old tunes, following routines, contentment with the status quo, and lack of progress still exist. Specifically, in recruitment, there are no strategies, and when encountering problems, there is helplessness, leading to rent reductions. Work is pushed along, with little initiative, requiring a nudge to move, indicating a lack of eyes for work and wanting money for doing any task. Employees flip through newspapers repeatedly during working hours and drink heavily.
Secondly, regarding knowledge issues, among the currently employed staff at ** headquarters, only four are graduates of regular universities with bachelor’s degrees, three obtained their bachelor’s degrees through personal efforts, and twenty-seven have college degrees or above through self-study exams or regular schools. Among the economic series, there is one senior professional, ten intermediates, and seventeen assistants or below. That is to say, those with college degrees or above account for more than 20% of the workforce, and those with intermediate or above economic titles account for less than 10% of the total. This ratio may seem acceptable in the ** system but falls far short when compared horizontally, especially with listed companies, failing to meet the rapid development needs.
Moreover, the average age of our on-duty employees remains relatively high, falling short of the requirements set by the ** Board of Directors.
Fourth, the business capabilities of operators are weak, making them vulnerable to risks, and their growth does not match the market, especially in the appliance mall. Among the thousand-plus operators in our market, if divided into good, average, and poor performance, the ratios are 15%, 40%, and 45% respectively. Divided by annual profits (in ten thousand yuan), the ratios are 9%, 3%, and negative numbers respectively. In this ratio, the operators engaged in production material and computer businesses perform relatively better, while those in electronics and home appliances fall short of the aforementioned rates. That is to say, based on these figures, only about 150 operators can sustain further growth, about 400 can maintain basic living standards in a slightly profitable non-loss state, and nearly half are struggling, barely covering costs, making it difficult to talk about profitability. Compared to the scale, reputation, and radiation capability of our market, this represents a significant disparity and reflects that the foundation on which we rely for survival is not yet stable and lacks necessary risk resistance capabilities.
Fifth, there are issues in internal enterprise management that constrain development. Management issues primarily manifest in the lagging systems, mechanisms, and management concepts, coordination between departments and sections, effective connections in work, discrepancies in contract execution, effective control of variable expenses such as hospitality fees, travel expenses, repair fees, water, and electricity, enforcement of existing regulations and systems, and the gradual weakening of corporate cohesion. Such management problems can be cited further. From the reflected situations, it shows that our management lacks horizontal coverage, vertical depth, and sufficient intensity. It also indicates that the lag in management has become a significant factor constraining and hindering enterprise development. This issue must be placed on the agenda; otherwise, talking about enterprise innovation and development becomes meaningless and merely empty words. Of course, the gaps and problems currently existing in the enterprise are not limited to these five aspects but indicate that these five aspects are relatively prominent and urgently need resolution. Solving these problems should be approached from the following aspects:
Colleagues, 2004 has begun. With the introduction and implementation of central policies supporting old industrial bases, the economic environment we face is better than in previous years. This is an opportunity and a challenge. To seize this historical opportunity well, we must focus on the following aspects to ensure the work of 2004.
Our overall work objective for 2004 is to continue consolidating the foundation of asset leasing, strengthen real estate development as the leading force, activate property management, enhance corporate culture construction, improve service levels, elevate management standards, and increase operational benefits. Create an atmosphere of small-scale management and large-scale operations. Achieve an annual rental income of 10.16 million yuan, real estate sales of 6.96 million yuan, property charges of 1.3313 million yuan, with total expenses of 13.86 million yuan, and aim to save 400,000 yuan on the basis of 2003.
To fully achieve the work objectives of the headquarters in 2004, we must focus on the following key tasks:
One, emphasize priorities and focus on cultivating and enhancing the core competencies of the enterprise. The core competency of an enterprise is the source of its competitive advantage. All enterprises with vitality and growth potential invariably rely on core competencies for support and development. Our core competitiveness lies in asset leasing. Therefore, we must enhance the management capabilities, innovation capabilities, and service levels of asset leasing operations, making asset leasing truly become the cornerstone for the survival and development of the enterprise.
First, regarding the overall mall, innovate the operating model. In the increasingly fierce market competition, how to break through traditional market operating models and take the path of innovation is a highly important issue we should pay attention to now. "Building a good market, revitalizing local enterprises, invigorating the local economy, enriching the local people" has already become our consensus. Over the past ten years, regardless of the scope of operations, categories, radiation capabilities, and transaction amounts, our market has achieved substantial growth. As the organizers of the market, we should calmly analyze the current state of our market, identify breakthrough points for market growth, and accurately define the positioning of brands in market operations, which is particularly crucial. Currently, our market is dominated by densely structured stalls, lacking excellent operating and shopping environments, unable to meet the product image display and sales needs of a large number of operators with substantial operational capabilities, thereby constraining market growth. Currently, the vast majority of our market consists of multiple economic components (not only in our main merchants but also with small vendors visible throughout the courtyard), focusing on short-term benefits, neglecting long-term growth benefits, emphasizing charging fees while neglecting management and services, leading to uneven management levels and service methods, hindering market growth and upgrading business formats. At the same time, the chaos in the types of goods operated in our unified market, unclear segmentation of consumer groups, low operator tiers, and inconsistent product quality, with numerous counterfeit and inferior products flooding the market, and individual operators lacking the quality of ethical business practices and honesty, affect the credibility of the market to varying degrees. After China's entry into the WTO, daily necessities, industrial supplies, and home appliances have already begun to flood the domestic market in large quantities. Most products will operate in international standard ways, seeking excellent distributors or establishing large supermarkets and chain operation institutions. Traditional markets will face severe challenges, accompanied by growth opportunities. Therefore, I believe that as organizers of the market, only by adjusting the market structure, building a commercial platform for the market, valuing the cultivation of a group of excellent distributors, establishing brand management institutions with good credibility, and granting the market entirely new operating concepts, will the market welcome a new day. Here, the work思路of the mall in the coming year and for some time to come should adhere to four basic guidelines: zero-distance service, zero-defect management, zero-risk shopping, and zero-complaint after-sales service. In specific work, it should highlight the specialization and segmentation of the market, establishing a completely new operating pattern. This requires accurate market positioning, fresh operating patterns, perfect service methods, and standardized management systems. It could also be said to be the overall work goal of the mall. First, formulate an accurate market positioning. On the basis of carefully analyzing the current state of the market, highlight specialized characteristics and form a consumption highlight. Strive to cultivate a batch of products with relatively large market development prospects. High-quality products should be at least provincial-level or above. Establish this operating concept, make unremitting efforts, and create significant influence among manufacturers and resident dealers. Second, create a completely new operating pattern and give full play to the multi-functional role of the market. To meet the needs of modern commerce development and satisfy a large number of merchants with business foresight and operational strength, thoroughly change the traditional market operating model, transforming the mall into a business platform integrating product display, distribution, information release, intermediary services, and logistics delivery. Third, establish a strict access system, strictly control the market entry point, and shape a new market image. Establishing a brand mall and operating concept can only be implemented if the entry of operating brands is strictly controlled, which is the fundamental principle for the stable development of the enterprise. According to the National Trademark Law, Product Quality Law, and relevant regulations, rigorously review the legality and validity of business licenses, tax registration certificates, product registered trademarks, recent product quality test reports, and general distributor authorization certificates provided by entering operators. At the same time, formulate the "Brand Goods Review, Management Implementation Measures" to effectively protect the good credit of the brand market and prevent counterfeit and inferior products from entering the mall. This is an important difference from traditional mall management methods (a pilot can be conducted). Fourth, promote honest operations and establish a pre-compensation system. To protect the good credit of the brand mall and the legitimate rights of consumers, vigorously carry out publicity and educational activities on moral business practices and honest operations among operators in the mall, continuously improving their legal and moral awareness. The mall should establish a product quality pre-compensation system, collecting a certain amount of product quality credit guarantee funds from operators. Once consumers purchase defective products, the mall will directly compensate the consumers first, preventing disputes between consumers and operators. Fifth, train a group of excellent distributors. Emphasize training operators in marketing knowledge in the mall. Under appropriate conditions, invite business school professors, trademark management experts from the industrial and commercial department, and seasoned marketing experts to give specialized lectures on marketing, laws, and regulations in the mall once or twice in 2004, with a plan in place. Conduct systematic training from theory to practice. This will play a very important role in improving the marketing management level of operators and adapting to the needs of market operations.
Second, the key work objectives of the Market Department of the mall are to focus on attracting tenants and creating a vibrant market, ensuring the preservation and appreciation of mall assets, maximizing the use of effective areas, achieving a rental rate of over 98%, and ensuring timely collection of rents. The Market Department is the core of the mall's three lines and the main link in the mall's economic growth. Therefore, the Market Department should focus its efforts in 2004 on attracting tenants and creating a vibrant market to provide security for the mall's growth. In terms of methods, first, harness the "collective" strength, forming a momentum of "recruitment, discussion, thinking, and serving merchants". Second, focus