Abstract 

On the afternoon of November 1, 2018, the fifth session of GLGA Lecture Hall was successfully held at the Innovation and Development Center, Green Legal Global Alliance. Today, we have our keynote speaker here, Mr. Zhao Min, chairman and founder of Adfaith. Mr. Zhao Min will, from China's national conditions and management laws, provide us with an exclusive interpretation concerning the "Chinese practice of enterprise management". The Secretariat of the Green Legal Global Alliance will conclude core opinions on the "Chinese practice of enterprise management" of Mr. Zhao Min. 

Being a manager in China: in-depth understanding in two respects 

Being a manager in China should have in-depth understanding in two respects, i.e., X and Y axes. The former represents a profound understanding on China's national conditions. Multiple theories in China are useless, which is quite special. The latter means that management should be deemed as a discipline, with lots of scientific laws followed. So, next, we'll focus on these two respects. 

Let's first talk about China's national conditions. We can see the future from the history. The past 40 years is of typical significance of China's reform and opening-up; the past 4,000 years witnesses the uninterrupted history as one of the four ancient civilizations. Everything we now own is the full demonstration of that in the past 4,000 years. Times are changing, while human nature remains unchanged. The development law of the Chinese society is in a repeated manner. 

Perception over the past 40 years 

More opening-up, less reform; more opening to the outside world, less to the domestic market 

The past 40 years of development saw the construction of Guangdong-Hong Kong-Macao Greater Bay Area, young and dynamic Shenzhen, and metropolitan circle in Shanghai, which are the main impetus in the course of economic development. In addition, a number of well-known large enterprises have settled in Shenzhen: Huawei, ZTE, Tencent, Vanke, China Overseas Property, BYD, EVOC, and Mindray, as well as central enterprises, China Merchants Group, China Merchants Bank, and Ping An Insurance. There are state-owned, privately-operated, and high-tech companies, real estate agencies, and financial enterprises, encouraging all organizations to gain their sustainable development. 

So let's think about it, what made China so different in the past 40 years of reform and opening-up? Typically, it is China's national conditions. What are the national conditions? Shenzhen welcomes to immigrants from other cities across the country. It can be said that all immigrant cities are usually more prosperous. 

The economic growth in e-commerce of China and other countries in the world is basically synchronized. The transaction volume of Alibaba, in the past 10 years, has increased by 50 times with the market value of RMB360 billion, and the market value of Amazon in the same period has also increased by 50 times. Amazon is not the first to earn the sales volume of one trillion dollars around the world. In the past decade, both Tencent's market value and the number of Facebook users have increased by 20 times. The year of 2018 marks the beginning of the downturn of Tencent and Facebook. During the first half of the year, the market values of Tencent and Facebook had been reduced USD100 billion.  USD100 billion is equivalent to RMB700 billion. However, it is a different matter for Facebook for several reasons. Both Tencent and Facebook had reduced their market value of USD100 billion worldwide this year, and the former, in fact, reduced its market value of one trillion yuan. 

The downturn of representative leading companies ends the era of mobile Internet. In the past 20 years, Jingdong, one of the largest companies in China, with 170,000 employees, has achieved its market value of USD30 billion. Simultaneously, the 10 years of development of Jingdong have helped make up the gap of China's economy. 

In the past 10 years, DiDi and UBER have gained rapid growth, with the market value of RMB55 billion and RMB120 billion respectively. UBER will come into the market next year. MI has a market value of USD36 billion. The present lawyers and experts who are doing businesses in the capital market should think twice since the recent technologies are poor, thus causing the late listing. The valuation on such technologies in the whole capital market is on the decline. Lei Jun has regarded Apple as a benchmark all the time. It is known that Apple is the only listed company with the sales volume of one trillion dollars around the world, going beyond the GDP and gross wealth of many countries. 

What I just mentioned is all about mobile Internet. Next, we'll move to another topic which never changes: the automobile. In the past 10 years, Geely has become the second largest shareholder of Mercedes-Benz with the share worth of RMB35 billion (the largest shareholder is Daimler AG). Last week, Tesla gave its Q3 financial report, saying that it had made up the deficits and gotten surpluses. Tesla, in the Shanghai Free Trade Zone, has signed the contract, registered the company, and finished bidding land. Almost half a year, the construction can be commenced, and now, the total amount of Tesla goes beyond that of three major automobile companies. The year of 2008 marks the beginning of great changes taken place till now. 

In the past 10 years, AI has still been in the very early stage. Iflytek was listed on the Shenzhen Stock Exchange in 2008 and has a current market value of USD7 billion, with operating revenue increased 20 times in this period; the latest news about IBM is that IBM invested USD34 billion to acquire the open-source leading enterprise the day before yesterday, for complete transformation into a hybrid cloud of cloud computing, hybrid cloud, public cloud and private cloud. 

It took 40 years to prove this in high levels. As we just mentioned that the successful enterprises have the same strategy, talent, and finance. There is one disadvantage of Chinese cultures from the perspective of management, distrust. Are the most important members of the top core team, we say five, seven, and nine members united with each other? This is a question. 

Looking back on the 40 years of reform and opening-up, numerous foreign reforms but few domestic reforms have been carried out. Therefore, we'll put reform on the top of our agenda in the next ten years, opening to the domestic market, and centering on reform of the social management system. 

Perception over the past 4,000 years 

Nowadays, the management is the most stable and least changeable in all walks of life. 

Following the rules of "one central task, two basic points", specialization is of great importance in the management. All the processes of historical development are for specialization, with the most typical characteristics of division of labor based on specialization in universities, turning the university into different faculties and departments. 

Each university has its corresponding industry in our society today. For China's management history, the four great inventions, gunpowder, papermaking, printing, and compass, we are proud of, must be mentioned.  In terms of enterprise management, the four great inventions are independent of the industrial and scale management. Therefore, from the perspective of economic, enterprise and industrial development, the ultimate management scale for the four inventions has not been formed. However, logistics, trade, Silk Road and the "Belt and Road" are of a certain scale. 

Correspondingly, three world-class patent products and the greatest top industries of human society in the era of agricultural civilization, i.e., silk, tea and ceramics, are the most framed and greatest in China. 

How does trade surplus take shape? What about the era of agricultural civilization? As for trade surplus, it has nothing to do with the four great inventions since they are lack of vitality. The three world-class patent products are consumables, and there are natural top products by soil, plant and animal under fierce market competition as well as different brands and origins. Such products can be exchanged for gold and silver, to cement the historical role of No.1 world economy of the Chinese civilization for years. 

However, we should be keenly aware that all is regional in the trend of globalization. Strictly speaking, prior to reform and opening-up, China had no experience at all. Therefore, it is quite natural against the "Belt and Road" issues. So it is common to meet with setbacks during the long journey. In return, they may bring prosperity for a nation and country, based on which, great dreams can be realized. 

Management from the perspective of university 

University = Brand + professor + Principal 

Let's change another way. From the perspective of management, there are many fundamental laws in Chinese society and human society. 

What is a university? How to view university education and reform? A university is composed of brand, professor, and principal. Cai Yuanpei and Ma Yinchu, great principals of Peking University are now highly recognized by the public. We have the Imperial College and Imperial University of Peking at the primary stage of Peking University. So who have changed it? It is Cai Yuanpei who laid a solid foundation for all-inclusive core values and cultures of Peking University. Beijing Spirits cover patriotism, innovation, inclusiveness, and great virtue, in which, inclusiveness is the symbolic spirit of Peking University. Is Cai Yuanpei an academician or departmental member?  No, he is a revolutionist and principal. A principal may not be an academician but a social activist who have the ability to strive for social resources. Therefore, being an academician doesn't have the say about a good principal. 

Principal Mei Yiqi founded two campuses of Tsinghua University in the 1950s when the major of Nuclear Physics was created. What was the most advanced discipline at that time? It is Nuclear Physics. Mei Yiqi was neither an academician, nor a departmental member. But he was a great principal, so being a principal is a profession, a position, and a line of business. 

Management from the perspective of army 

Army administration is the best practice of organizational management in human history 

When we come to management, the efficiency plays a decisive role, so the army obtains the greatest and most efficient practice in human history. Therefore, the army has the best practice of organization and management of human history. 100,000-odd Mongolian army led by Genghis Khan swept over Eurasia. Unity can put things right. Husband/wife, father/child, and brothers can work together to minimize the trust crisis. At present, the minimum trust is quite another thing in terms of anti-terrorist. On the premise of high technologies covering satellite, missile, helicopter, fighter, and UAV, the fighting strength of three people was equivalent to that of 12 people at the time. So there are logistics resources to develop combat-management systems in army administration. 

Let's talk about the difference between Chinese, foreign, and international enterprise, between Chinese and international law firms, between Chines and international consulting firms. This is a combat-management system of special troops. What is the main difference? It differs in the institutionalized and systematic system, including brand, case, personnel training, information system, and internal management efficiency. This is why China Internet can catch up with the development of foreign countries. In the era of mobile Internet, all information system infrastructure remains synchronous development with international enterprises. On this front, there is a huge developmental difference in the traditional manufacturing industry, enterprise and service industry between Chinese and international enterprises. 

Management principles, powers and solutions can be found fundamentally towards any problem at all levels. Practice has proved that this is the most successful, dynamic, lasting, and fundamental management principle in human society. 

Strategy-based organization 

Our view is determined by the concept, followed by mechanism and strategy. 

It is often said that the organization is highly relies on the strategy involving process. China has implemented several national strategic plans, such as the 13th Five-Year Plan, the 14th Five-Year Plan, the 12th Five-Year Plan and the 11th Five-Year Plan. Establishing an organization has several determining factors, such as strategy, mechanism, concept, and view. Strategy is the core of management since all companies who come into the market will follow relevant strategies for IPO. The strategy for the next five years rests with the vision, concept and mechanism, so the development bottleneck lies in these three aspects. 

Through this lecture, I hope all of you can gain a better understanding in law, and have control over the law. Thank you!