We are exploring new directions, developing new manufacturing technology routes through technology-driven innovation, and using new production tools to reduce costs, improve efficiency, and better meet the individual needs of users. At the same time, we need to change the business model of pursuing quick results, and turn to long-term scientific and technological innovation, which takes time to hone and precipitate, and abandon the traditional development concept of short-term investment and short-term gains.

Specific to the enterprise level, we should pay attention to the three key elements of new quality productivity: production tools, labor force and production relations. Companies need to look at their own situation and assess whether they have the ability to compete in the future from these three aspects.

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While seeking new markets and growth points, China’s manufacturing industry is also facing a key question: After 30 years of rapid growth, what is the next development path?

The process of industrialization first began in Europe, then moved to the United States, and then to Japan and Korea. In each shift, established manufacturing powers need to think carefully, identifying which areas to hold on to and which to let go of. For example, after World War II, although many European brands were replaced by the United States, Europe retained critical high-end equipment manufacturing capabilities, which became an important core competence in the manufacturing value chain and ecosystem.

At present, China’s manufacturing industry is standing at a turning point similar to a crossroads. We must carefully consider, in the global competitive landscape, which traditional advantages are worth adhering to, which areas we need to be brave to give up?

03 Strategic restructuring

At present, China’s manufacturing industry is facing many problems and challenges, which not only restrict the sustainable development of the manufacturing industry, but also have a profound impact on the transformation and upgrading of China’s economic development. These problems include the lack of innovation capacity, the double constraints of resources and environment, the pressure of industrial restructuring and upgrading, the rise of labor costs, the intensification of international competition and the difficulties of digital transformation. The overall trend is to promote the coordination of the upstream and downstream of the industrial chain, and then achieve the overall adjustment of the industrial structure.

China’s production capacity has been very large, we can not find new growth points, leading to the so-called “internal volume” phenomenon in many industries, its essence is the lack of differentiation. Some of these problems can be improved through the efforts of enterprises, such as strengthening information construction and promoting digital transformation.

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Digital transformation has many definitions. Whether the enterprise is worth the effort to do this depends on whether someone “pays”, which is called the strategic restructuring of the enterprise driven by customer value in academic. For example, in the competition of new energy vehicles, who will win in the end, and who will decide? The market will decide. Who decides the market? The consumer decides. Why do users buy this model and not that model? In fact, there are many considerations, price performance and customer experience are key.

A manufacturing company that wants to win depends on manufacturing value. Enterprises upgrade the value chain through the application of digital technology and organizational culture change, improve customer experience, meet the diversified and personalized needs of customers, and ultimately create value for customers and society.

The strategic restructuring of enterprises is not only the transfer of offline business to online, but also the fundamental restructuring of the development direction and value creation ability of enterprises. Simply adding old organizational structures and information technology can lead to an even worse “old organization that is expensive and inefficient.”

Different companies have different understandings of digitalization, which is related to their market positioning. Take Huawei as an example. Since 2015, Huawei has begun to use data as a new production factor to drive decision-making, management and customer analysis, and digital technology as a new productivity tool to comprehensively reshape its business, achieve corporate transformation and upgrading with improved quality, efficiency, cost reduction and innovation, and finally implement it at the business level to achieve business restructuring. Digital transformation is a systematic project of the leader, which requires high-level leadership and comprehensive planning from the top down, and cannot be achieved overnight.