Jack Ma’s advice for Chinese entrepreneurs in the time of coronavirus: retool, reflect and restore work at a steady pace
- The coronavirus epidemic in China presents an opportunity for entrepreneurs to retool themselves and prepare for the growth, said Ma, who drove Alibaba to launch Taobao in 2003 during the Sars outbreak
- In his lecture at the Hupan College, Ma channelled Kazuo Inamori, the legendary founder of Kyocera Corporation
“Reflect on what you really want, what you have, and what you need to give up, or stick to,” Ma said.
Infographic: All you need to know about the coronavirus outbreak
“The outbreak of the coronavirus has added a further dent to growth prospects at a time when economic growth trajectories throughout the region were already declining,” said Deborah Tan, assistant vice-president at Moody’s Investors Service, in a research note.
“On the condition that safety and the prevention of coronavirus are ensured, companies that are approved [by authorities] should restore production quickly, or do so steadily,” Ma said.
Inamori had five strategies for companies during times of recession, according to Ma:
Strategy One: Every employees should turn to sales
Every employee should turn to sales, to arouse latent demand among clients, Ma cited Inamori in saying.
“Even in a company with tip-top technology, selling a product is still the foundation of the company’s operation,” Inamori said. “It is impossible to get orders during recessions if employees lack the spirit in making all-out efforts for clients.”
Strategy Two: Spare no effort to develop new products
A recession is a golden opportunity for companies to innovate and expand sales.
“Clients are too free during a recession. They will also propose new ideas after listening to yours. This would create orders that you never imagined before, so that you can expand your business.”
Strategy Three: Radical cost cuts
Recession is the only chance to cut costs, as every employee would strive to make it happen, Inamori said.
“You need to lower the break-even point of the whole company by making efforts to reduce production costs,” Inamori said. “If a company can maintain profitability when the turnover is halved, it would be even more profitable when sales returns to normal.”
Strategy Four: Maintain high production rate
Companies should maintain their usual high productivity rate even in times of recession, by reassigning excess labour from the production line to other tasks to maintain the cadence and vibe of the work cycle. “Once productivity drops, it would not be easy to restore,” Inamori said.
Strategy Five: Establish favourable interpersonal relations
“The most important thing for managing a company is the relationship between the manager and employees,” Inamori said, adding that employers must “love and protect” employees, while employees need to understand the manager, they need to help and support each other.
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