Mr. Cai Hongping was one of the first to introduce the concept of "Industry 4.0" into China. As the former chairman of Deutsche Bank's Asia Pacific Investment Banking Department, in February 2015, Cai Hongping resigned and created the world's first high-end investment platform connecting "Made in China 2025" and "German Industry 4.0"-Hande Industry 4.0 Promotion Fund. Mr. Cai witnessed the listing of several super-large industrial enterprises in China and has a profound insight into the manufacturing industry. The content of this article comes from an interview with Mr. Cai Hongping by the media.
I didn't expect the industry 4.0 wave to come so fast
Media: You ended your investment banking career, founded the Hande Fund, and recently participated in the acquisition of the 178-year-old German KraussMaffei Group and the world's most advanced Italian flexible robot gripper. What is the trigger of your "turn around"?
I may be the only Chinese executive in a Wall Street investment bank who has been working in Eurobank for 20 consecutive years. I am familiar with European economic and industrial conditions. Especially in the more than 5 years of Deutsche Bank, I was fortunate to listen to the conference jointly organized by the German government and scientists in 2012. At that time, the slogan "Industry 4.0" was first put forward. It made me feel very deeply and saw that the German industry was on the move. In front of the world. Intelligent production is another revolutionary wave in solving human production problems. It can realize real-time production, personalized production, and unmanned production. I didn't expect all this to come at such a fast speed, which brought me a great shock, this is a trigger point.
Secondly, I found that China has a very good market, capable entrepreneurs, and people who are willing to innovate, but it lacks systematic and good technology. As a global industrial leader, Germany has very good technology. Especially the many small and medium-sized enterprises in Germany are the real industrial engine of Germany, not necessarily Siemens and BMW. In Germany, even two generations of a family make only one product, but the growth of the German market is limited. Therefore, I felt and wondered whether at this moment when global industry 4.0 is coming, China’s outstanding industrial enterprises can be connected with advanced German small and medium-sized enterprises to help 750,000 small and medium-sized enterprises in the German-speaking area open the Chinese market and help China Achieve industrial upgrading and serve as a bridge for the technology, market, and capital integration of enterprises in the two places.
This idea of ​​mine is fortunately supported by the governments of China and Germany, and also invested and encouraged by China's sovereign fund. Due to work needs, I have to quit my job at Deutsche Bank to do this full-time, and the Hande Fund is the world's first cross-continental, industrial-focused promotion fund. At present, the chairman of my fund is unpaid, and I am willing to do it, but I must use a private equity fund to do this with market-oriented operation, which is the most efficient.
Media: What is the difference between Made in China 2025 and Industry 4.0 first proposed by Germany? What factors have pushed the world into such an era?
Cai Hongping: Made in China 2025 was independently proposed by the Chinese government. Made in China 2025, German Industry 4.0, France's "Industrial New France", and the United States "Reindustrialization" all point to the fourth industrial revolution in human history.
The advent of the global industry 4.0 era is based on two backgrounds: first, the world has basically completed automation, that is, the third industrial revolution; second, the Internet, data net, and tech net have grown vigorously in the past 20 years. This allows the Internet and automation to be combined, resulting in a new industrial revolution. It can be said that the third industrial revolution is "turning people into machines", and the fourth industrial revolution is "turning machines into people"
The difference of Chinese industrial products is 3 degrees
Media: During the promotion of China-EU cooperation, where did you see the industrial gap between China and Europe?
Cai Hongping: Chinese industrial products are poor in three "degrees"-accuracy, stability, and durability. In the final analysis, the difference lies in "attitude". If the three "degrees" cannot be improved, Chinese industrial enterprises will always only be able to make low-end products. . The reasons for the gap are: China lacks an industrial culture that pursues excellence in the "craftsman spirit", a business culture that "is always dissatisfied with products and treats customers as God", and lacks a market culture of "willing to pay high prices for good products" and lack of firmness. A team of skilled workers who are rock-like and calm-hearted.
We must not be presumptuous. We also have many very advanced technologies, such as precision measurement of gravity, genetic technology, etc., but a large part of these advanced technologies are linked to the defense industry and aerospace technology, resulting in insufficient commercialization, insufficient large-scale mass production, and international Standardization certification is not enough. A very important point is that the world's advanced industrial products and technologies have globally recognized systems, quantitative standards, grades and certification systems. If they cannot enter this global system, Chinese products and technologies cannot be used and popularized globally.
Media: Is the foundation of the rise of China's manufacturing industry large state-owned enterprises or small and medium-sized enterprises?
Cai Hongping: Both state-owned and private enterprises have opportunities, and it has nothing to do with the size of the company. After restructuring, state-owned enterprises are promising to do Industry 4.0. The Fourth Industrial Revolution and Made in China 2025 are the general direction and great opportunities for all Chinese private enterprises, giving them a once-in-a-lifetime opportunity to break through the barriers and stand out from the crowd. They stand on the same starting line as state-owned enterprises.
The nodes that state-owned enterprises need to break through are: First, they must unswervingly promote the reform of mixed ownership to stimulate the vitality of the system. A dominant state-owned enterprise cannot do the "Made in China 2025" business. Second, we must increase the efficiency of holdings on a large scale and reduce holding costs. At present, we have a big misunderstanding, that is, we believe that the shareholding ratio of state-owned enterprises must be maintained above 50%. In fact, 50% is an accounting consolidation concept (holding more than 50% of the equity can merge the financial statements into the parent company ), not a holding concept. Our current holdings in some state-owned enterprises are even as high as 88%, resulting in a lot of state-owned assets being wasted.
What private enterprises need to break through is: they must combine self-innovation with the integration of global resources. Self-innovation is definitely not about shutting the country and making cars behind closed doors. It must be open-ended, and must keep up with the global mainstream technology, mainstream products, mainstream international standards, and mainstream business circles, and integrate into the international mainstream industrial system. Not "you" or "me", but embrace the world's advanced production factors, it is "we". "The Germans said to me,'You Chinese make technology to get rich, we make technology and then get rich'"
Media: Recently, the media has frequently reported losses and layoffs of Chinese manufacturing companies. How do you view the plight of China's manufacturing industry?
Cai Hongping: This is a very strong signal. First, it heralds the arrival of a new industrial revolution. "Revolution" is the replacement of the old system and old production methods. The first industrial revolution eliminated many traditional handicraft industries. In the course of Industry 4.0, we will continue to see some companies lose money and lay off employees.
Second, it shows the inevitable result of enterprise polarization. This kind of polarized "Chuhe Hanjie" is intelligent production. Good companies that adapt to the times will get better and better, and poor companies will get worse and worse. Third, it has sounded the alarm for our enterprises: reforms must be made, breakthroughs must be made, smart production must be made, production efficiency must be improved, and there is no way out.
Media: Currently in China, the Internet industry is strongly sought after by capital. Is it a good thing for more venture capital and PE funds to enter the manufacturing industry?
Cai Hongping: Industry needs funds, and more funds must be encouraged to enter this field. However, "good steel is used on the blade", just the right financial support is possible, and excessive speculation is the destruction of industrial development. It will lead to two results: first, money may not flow to the enterprise; second, engineers and technology People's hearts will become floating. The Germans said to me, "You Chinese make technology to make a fortune. We make technology and then make a fortune." It can be seen that the initial aspirations of the two are different, and Chinese companies must have a "quiet heart" when doing industry.
Overseas acquisition, "civilized docking"
Media: Midea Group’s acquisition of German robotics giant KUKA is causing concern. Some German public opinion and officials are worried about the wave of Chinese-funded mergers and acquisitions of German companies. What do you think?
Cai Hongping: Generally speaking, the German government welcomes the acquisition of Chinese companies, which can be reflected in the results of the talks between Chancellor Merkel and Premier Li Keqiang. Not only is the prospect of Sino-German cooperation very broad, it is also very beneficial to German companies themselves.
However, there are two points in overseas acquisitions by Chinese companies that require special attention. First, the acquisition must be a "market-oriented" acquisition under a multi-party bidding model. As long as they adhere to marketization, Chinese companies' acquisitions in Germany and Europe will not cause too sensitive disputes and too much disgust. Second, post-investment management after acquisition must be strengthened. Post-investment management is a big article. This involves the impact on the future development of German companies and the German economy, and is of particular concern to German companies and governments. Overseas acquisitions by Chinese enterprises are by no means a simple purchase of money, but a process of interactive cooperation. It is the docking of production factors, the docking of technology and the market, the docking of mutual trust, and the docking of civilization. It must be based on the principle of win-win.
In the future, China-Germany and China-Europe will open a new cooperation model, from the previous "you" and "me" to "us", and jointly move towards the third-party global market. On this point, the prime ministers of the two countries have reached a consensus, and it can be foreseen that in the future, there will be more business models of Chinese and German companies jointly winning overseas markets. Chinese enterprises' overseas mergers and acquisitions and internationalization are the general trend. In art, “only the nation is the worldâ€, while China’s industrial upgrading is the opposite. “Only with a global perspective can China have opportunitiesâ€. Only by insisting on internationalization and embracing the whole world can Chinese local industrial enterprises achieve greater development. This is the basic law that enterprises must follow to survive and develop in today's era.
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