From "Made in China" to "Created in China ", from "real economy" to "transformation of online bussiness", from "investment pull" to "consumption upgrade" ... In just a couple of decades, Chinese entrepreneurs have witnessed the wonders of business while also having experienced the cruelty of business competition.
Looking over the world, the impact of overcapacity is eating away at the confidence and determination of every entrepreneur: homogenous competition leading to a bloody battle of prices, which in turn results in a vicious circle of loss of brand value and product quality. This has already become a worldwide business conundrum.
In such an era, China's economy has risen to a new level, and a group of Chinese enterprises established their footing against the overall circumstances, gaining a good grasp of the rules and laws. A company called KMIND Consulting tried to redefine business competition and help Chinese entrepreneurs win the competition.
On December 19th, the "Chinese Consulting Global Breakthrough-News Conference on the KMIND’s Consulting Achievements in Competition Strategy" was held in Shanghai. Attending the conference was Professor Shi Yong, Academician of the World Academy of Sciences and vice dean of School of Economics and Management, University of Chinese Academy of Sciences. He said: Chinese companies must have real soft power, which lies in the presence of a large number of world-class brands that can represent China. I believe that there will be a batch of world-class brands, which can help us realize the dream of brand power, and support social and economic development.
The confusion and survival of Chinese entrepreneurs amid storm
Over the past 20 years, science and commerce have ushered in a period of rapid development and take-off. Amid the tide of the times, many entrepreneurs are not happy: The market dividend has been harvested by the frontal companies; the problem of overcapacity in the world is becoming more and more serious; homogenization competition is severe; bloody price wars occur every moment ... For Chinese entrepreneurs, good domestic brands are unsought; consumption outflows; phenomena like supply-side contradictions amplify the crisis, against such a gloomy business landscape, many entrepreneurs undergo the ups and downs of the stormy business competition, struggling to find a way out.
Take the domestic milk powder brand Feihe Dairy as an example: In 2008, the domestic milk powder industry was hit hard, for a time China's infant milk powder market was seized by foreign brands taking advantage of the situation: Feihe Dairy in spite of its excellent product quality and brand image, was also affected by the situation of the domestic milk powder, its sales being stagnated. Leng Youbin, chairman of Feihe, felt a mountain-like pressure and was almost desperate.
In 2015, Leng Youbin heard about KMIND out of the blue. He seemed to have seen a glimmer of light. Firmly seizing this opportunity, he introduced KMIND’s competitive strategy into Feihe, aiming to revive the domestic milk powder brand.
In 2016, KMIND’s competition strategy rewarded Leng Youbin with a miracle: among domestic brands, Feihe brand leaped to the first place from the previous third place. In the first half of 2017, Feihe’s high-end growth reached more than 200%.
Performance is steadily improving. While reclaiming confidence in domestic milk powder brand, Feihe has truly made the national brand a global product, with an international presence, becoming a classic case in which competition strategy showed its great charm.
Behind the counterattack of Feihe, it is the new generation of competition strategy theory initiated by KMIND: it starts from the customer's heart and mind to assist the enterprise system to create competitive advantages, i.e., the cognitive advantage (positioning) and operational advantages (components). Cognitive advantage means that the brand occupies a favorable position in the customer cognition, gives the customer the reason to choose you rather than the competitor. And the operational advantage refers to the enterprise performing better than the competitor using the cognitive advantage as the goal, in the corresponding operation actions. The two affect each other, promote each other, working together to win the customer patronage.
It can be found that the evolution of competition strategy is fundamentally in line with the development of business: Today when homogenization competition has become serious, "the establishment of competitive advantages starting from the mind and heart of the customer", just treats an enterprise separately from other brands, and operate it through differentiation, thus getting out of the Red Sea of a price war, to form a unique competitive advantage.
The Site of Release Conference
Five breakthroughs to solve the world-level competition problems
Feihe is not an individual case. At the conference, KMIND Consulting revealed the achievements obtained through competition strategies: within only two years, it helped 16 companies achieve high growth.
Looking through the global consulting industry, the competition strategy has made five major breakthroughs in theory, practice, tools, achievements, and culture, according to Xie Weishan, chairman of KMIND consulting,
KMIND Consulting Chairman, Xie Weishan
Theoretically, it achieves a breakthrough in clarifying the misunderstanding about the basics of positioning in Western strategic theory, and lack of knowledge about the operation of strategic positioning theory. It helps enterprises to use customer’s mind and heart as the origin, while creating cognitive advantages and operational advantages, to build long-term competitive advantage, and turn it into an academic discipline, which becomes a course successively at the Peking University HSBC Business School, Wharton School of Business, and Overseas College of Shanghai Jiao Tong University.
In the field of actual operation: It creates a first strategic escort service, treating practice as the only standard to test and correct the theory, forming theoretical guidance for practice, which in turn assist the systematic circulation of the theory.
For tools: KMIND developed first Competition Strategy Consulting System 1.0, and introduced 143 kinds of operational tools like the strategic implementation plan, online public relations, killer applications, broke through the predicament of difficulty in strategic planning implementation or lack of efficient implementation instrument, offering help to enterprises with efficient implementation of the strategy implementation around the strategic core.
For achievements, in just two years, KMIND helped numerous companies providing fast consumable products and durable goods, financial service, e-commerce, to achieve a rapid strategic breakthrough. Among them, two of its clients were selected for the National Brand Program, and six of its clients were selected for the new version of "winning in China."
Culturally, KMIND focuses on the spiritual level of Chinese contemporary enterprises and entrepreneurs, helps Chinese enterprises grow through its competitive strategy, to be clear about their organizational mission, to enable employees to perceive value, to break through the shallow service by traditional consulting firms that has an attachment to organizational behavior but neglect the shaping of a mission. KMIND helps enterprises to achieve spontaneous operation and efficient management.
In the face of world-level business competition challenges, competitive strategy excels through “differentiation” and “sequencing:" To help an enterprise with its strategic design is only the first step, and then successful designing of a competitive runway for the entire segmented industry, as well as other enterprises within the industry is "double insurance."
For example, KMIND developed a "high-end" awareness concept for Gani Marble Tiles, building different runways for high-end, medium-end, and low-end products for the industry, which reduces the disorderly competition between marble tile enterprises, and then lead marble tiles to grow into a single category, turning two former major categories of the industry, "tile + marble" into "tile + marble + marble tiles." This provides consumers with more choices: when the market expands, competition is reduced as a result of different tracks and roles. The brand has gained back its quality, and in the context of the healthy development of the market, the rise of national brands will be inevitable.
To help the national brand, and jointly build a "Better Life"
"KMIND aims to create 100 classic cases in 10 years. It has exclusive agreements with the companies it serves, which means that KMIND will serve China's 100 segmented businesses, continue to optimize the Chinese business environment, help more Chinese enterprises to go global, to realize the dream of brand power, and to build a better life." These are the wishes of Xie Weishan, made on site at the release conference.
At present, socialism with Chinese characteristics has entered a new era, and the main contradictions of our society have been transformed into the contradiction between the growing needs of the people for a better life and the unbalanced and inadequate development. From the perspective of the development of Chinese enterprises, the imbalance occurs because most of the markets dividends are clenched by the frontal companies, making it difficult to "share" for small and medium-sized companies. The inadequacy is because of the serious homogenization competition: most entrepreneurs care only about the "breadth" and have no time to expand the "depth."
On this basis, the national brand needs to employ the power of the competitive strategy to solve the imbalance and inadequacy issues in Chinese enterprises in their course of development from the root. Xie Weishan also predicted that China will usher in the era of 100-billion-level brands. In the course of going global and striving to enter the world's top 500 list, Chinese brands will have more opportunities to demonstrate their style.
Professor Shi Yong also said that these three major predictions of Xie Weishan "are bound to be realized".
