From a small factory specializing in cassette tapes to a business covering the fields of telephones, televisions, mobile phones, refrigerators, washing machines, air conditioners, small household appliances, LCD panels, etc., it has more than 80000 employees, 26 research and development institutions, 22 manufacturing bases, and more than 160 countries and regions through sales institutions in more than 80 countries and regions, TCL has been an international enterprise whose territory is comparable to that of Philips, who is nearly 130 years old. One person who has to be mentioned is Li Dongsheng. In the eyes of the outside world, Li Dongsheng, one of the founders of TCL, can almost be equated with TCL. During his 22 years at the helm of TCL, there were numerous honors and applause, but he also encountered cynicism and doubts after the defeat. Today, I will look at the story of Li Dongsheng and TCL with Sister Eight.
Li Dongsheng's indissoluble bond with TCL
He was born in July 1957 in Huiyang District, Guangdong Province (now Huizhou City). Fortunately, he became the first batch of college students after the resumption of the college entrance examination in 1978. He was successfully admitted to South China Institute of Technology (now South China University of Technology) to study radio engineering.
After graduation, Li Dongsheng was assigned to go home to Huizhou, his hometown. He gave up the iron rice bowl of the office that everyone dreamed of, and chose to go to a small factory - TTK Home Appliances (Huizhou) Co., Ltd., a small factory specializing in cassette tapes.
At first, Li Dongsheng was just a technician, but he was not satisfied with this. After entering the factory, he wanted to be the workshop director. Before long, he really realized what he wanted. Then he went into sales and trade, and later became a factory director.
In 1985, the gradually developed TTK expanded its business into the telephone field complaint The trademarks are similar, so the newly established communication company is called TCL, which is the acronym of Telephone Communication Lim ied. At this time, Li Dongsheng, only 28 years old, was already the general manager of TCL.
(Image source: TCL official website)
Later, due to lack of experience, Li Dongsheng was unable to open the sales situation for a while. In 1993, he returned to TCL as General Manager. At that time, the national color TV war was already in full swing. There were many giants in the color TV market, including Konka and Skyworth led by Li Dongsheng's college classmates Chen Weirong and Huang Hongsheng, but he did not shrink back. Li Dongsheng set the goal of TCL as "Ace big color TV", began to face off with two old classmates, and achieved good results. As soon as TCL's big screen came out, it triggered a sales frenzy and became popular.
At the end of 1996, Li Dongsheng became the chairman and president of TCL. Since then, Li Dongsheng has launched a series of actions, including the establishment of an American company, the establishment of a technology research and development center, and the acquisition and merger of several companies, leading TCL into the world. Under the leadership of Li Dongsheng, TCL has developed rapidly and steadily, growing at an average annual rate of 50% for 12 consecutive years, and is one of the fastest growing industrial manufacturing enterprises in China.
In 2001, TCL color TV rose to become the first brand of color TV in China. In the same year, the group sold 1.3 million mobile phones and its communication business revenue exceeded 3 billion.
In 2004, TCL Group was officially listed on the Shenzhen Stock Exchange.
In 2012, TCL sold 15.781 million LCD TVs annually, ranking among the top three color TVs in the world, which is also the first time that Chinese color TV enterprises have entered the first camp of global LCD color TVs.
In 2014, after Haier, Midea and Gree, TCL Group's revenue reached 100 billion yuan.
In 2016, the global shipment of TCL TV exceeded 20 million units, becoming the first Chinese enterprise to enter the 20 million unit club, which is one of the few enterprises to maintain high sales growth in adversity.
Not long ago, TCL Group released its performance report for the third quarter of 2018, which showed that the operating revenue in the first three quarters was 82.24 billion yuan, up 0.03% year on year; Net profit was 2.88 billion yuan, down 5.13% year on year; Of which, the net profit attributable to shareholders of the listed company was 2.49 billion yuan, up 30.6% year on year; Deduct 1.59 billion yuan of non net profit, up 45.6% year on year.
(Picture source: TCL Group's financial statements)
The never-ending pace of globalization
What is unique is that TCL is currently the only company in China that registers its company name and brand name only in English. With its joint venture background and unique English name, TCL seems destined to "go global", and it is also one of the first Chinese brands to launch the globalization strategy.
In fact, since Li Dongsheng took the helm of TCL in 1996, TCL's "going out" has never stopped. Since Li Dongsheng took office, he has always maintained a high degree of attention to the trend of the international market. In 1997, due to the outbreak of the financial crisis in Asia, TCL has lost a large number of export orders in the form of material processing. Li Dongsheng pushed the boat along the river and started the journey of internationalization.
In 1999, TCL established its first overseas color TV production base in Vietnam, and began its overseas layout. Then TCL entered the markets of India, the Philippines, Indonesia and Russia.
In 2001, after China's accession to the WTO, foreign enterprises rushed into the domestic market, and the national industry faced a severe situation. Li Dongsheng chose the road of overseas mergers and acquisitions.
In 2002, TCL spent 8.2 million yuan euro M&A of Schneider's optical instrument enterprise, becoming the first Chinese manufacturing enterprise to enter Germany. This acquisition made Li Dongsheng famous in China's political and economic circles and became the "economic figure of the year".
However, TCL's international pace has not always been smooth.
In 2004, Li Dongsheng merged Thomson's TV, DVD business and Alcatel's mobile phone business at one go, causing an international shock. However, due to the inadequate response to international standards and the huge changes in color TV technology in the industry at that time, the color TV industry quickly shifted from CRT TV to LCD (liquid crystal) TV. These two mergers and acquisitions suffered heavy losses. In 2005, TCL suffered its first loss in 20 years and lost nearly 2 billion yuan in two consecutive years. Li Dongsheng, who had never lost money, suddenly fell into a desperate situation, and was therefore rated as the "worst boss of China's A-share listed companies". This experience has also become the biggest challenge in Li Dongsheng's business career.
But facing the challenge, Li Dongsheng did not flinch. He tried everything to survive the crisis, but the result was not satisfactory. In 2006, TCL suffered a loss of 1.932 billion yuan. In 2007, TCL Thomson Electronics Co., Ltd. applied for bankruptcy liquidation, and TCL's stock plummeted. The whole company was in great trouble.
Later, TCL began to dormant and reorganize. In addition to Li Dongsheng, TCL's senior management team changed for several rounds, and made drastic cuts, mergers and sales in business. It was only in 2009 that TCL initially recovered.
As a trendsetter on the international journey, TCL has gradually formed its global layout and competitiveness through international mergers and acquisitions, setbacks, and rebirth, becoming one of the typical representatives of the advanced nature of Chinese manufacturing.
In 2015, TCL redrew the road map of the Group's "internationalization and starting again": based on the three major industries of "multimedia, communication and household appliances", and with the strategy of "three services linkage, brand leadership, and taking root in key market countries", TCL has laid out its global layout.
On the one hand, TCL builds a three-dimensional system of mutual support by combining its three main industries of color TV, mobile phone and home appliances; On the other hand, we will continue to improve our competitiveness, consolidate and increase the share of traditional markets (European and American markets), while focusing on emerging markets such as India and Brazil, and continue to expand the share of overseas markets.
Today, in addition to Polish factories radiating to Europe, TCL also has Vietnamese factories radiating to Southeast Asia, Mexican factories radiating to Central and North America, and Egyptian joint ventures radiating to the Middle East and Africa. In the European market, TCL TVs have been sold in more than 20 countries, ranking third in France in terms of market share, and growing steadily in Germany, Italy, Poland and other places. In North America, TCL has also been rated by American media as the fastest growing TV brand in the American market for three consecutive years.
In 2017, TCL Group's overseas revenue accounted for 49%, and its business covered more than 160 countries and regions around the world. In addition, TCL has 26 R&D institutions, more than 10 joint laboratories and 22 manufacturing and processing bases worldwide. Today, TCL has become a truly global brand!
(Image source: Internet)
Layout of industry core technology fields
Although TCL's globalization strategy is becoming increasingly successful, we have to admit that there is still a big gap between TCL and Samsung, LG, Sony and other giants in the world, especially in the mastery of some core technologies. Therefore, Li Dongsheng has always attached great importance to the investment in research and development. Even in the huge losses from 2005 to 2007, he still tried to maintain the basic research and development investment of TCL. According to Bajie's query, TCL has invested 1.9 billion yuan in R&D in the past three years RMB 。 In 2017, TCL's investment in R&D reached 4.72 billion yuan, and it mainly invested in artificial intelligence, Internet applications, semiconductor displays and materials. In 2017, TCL applied for 31012 Chinese patents, 7337 American patents and 8627 PCT patents in total, and its core technology patent capability ranked the leading level of Chinese enterprises.
(TCL patent picture source: Youling Consulting)
In fact, as early as 2009, Li Dongsheng made another more bold and risky decision than overseas mergers and acquisitions: he invested a huge amount of money to enter the LCD panel, which is recognized as the most expensive and equipment depreciation is extremely fast, that is, the CSOT project. His reason is very simple. If TCL does not lay out its panels and chips, and if it does not have the ability to control the whole industry chain, what will TCL do to compete with big companies like Samsung and LG in the global market?
(Image source: Internet)
In fact, although China is a big country in TV production and sales, it has never mastered panel technology as the core component of color TV sets. The domestic color TV industry has suffered from "lack of screen" for a long time, and can only "eat" within 20% of the cost space after deducting panel costs.
In 2009, the State Council listed the high generation LCD panel project as a strategic industry with key support and development. This strengthened Li Dongsheng's determination to lay out panels and chips. He wanted to change the pain of lack of screens for a long time, so he pushed aside all suggestions to start the CSOT project.
For new technologies, Li Dongsheng has always held a positive attitude of embracing, and has the courage to pay and take risks. Facts have proved that Li Dongsheng is right! After nearly ten years of development, CSOT has gone from zero to the top five in the global panel industry, breaking the long-term monopoly of foreign enterprises in the field of semiconductor panel manufacturing, making a major breakthrough in the pattern of China's semiconductor panel industry. In some fields, CSOT even surpassed Samsung and LG, achieving the global industry leadership.
At present, CSOT has become one of the world's leading panel enterprises in terms of technology, capacity, product line and intelligence, including five production lines in mass production and under construction. In 2017, CSOT, a panel manufacturer under TCL, set a new record in revenue and profit, with revenue up 17.6% year on year and profit up 111.1% year on year. At present, the shipment volume of CSOT LCD TV panels ranks fifth in the world, and the shipment volume of first-line brand customers still keeps growing.
Bajie believes that TCL's popularity has declined in the past 30 years. At the same time, with the weakening of the household appliance market and the strengthening of small household appliances, enterprise business optimization is also very urgent. However, it has to be mentioned that TCL is still trying to explore technology and business model innovation. At the same time, in recent years, the emphasis on patented technology has gradually been in line with global well-known enterprises. The weakness of the domestic semiconductor industry foundation also feeds back to the problem of TV LCD to a certain extent. At the recent Shanghai Expo, Sister 8 saw the display of Sony's latest high pixel display, and some people on the scene exclaimed that the effect was comparable to VR. However, Bajie believes that domestic color TV manufacturers like TCL must be more transparent about industry issues than consumers. Bajie expects that TCL can go further and better in the wind of the global industrial environment changes.
