An MBA case: buying Volvo money isn't the problem

Mergers and acquisitions Volvo car company and smooth operation after a year, in the automobile industry has a grass roots in the image of the entrepreneurs LiShuFu seem to have qualification panasonic breath, look at yourself in the past 20 years the achievements.

He just need a proper occasion.

October day, LiShuFu with his half Chinese international team of half the foreigner, sitting in the central television channel in the hall of the economy right tell us where fortune is, big speak international m&a and transnational enterprise management way. Faced with a little bit of fun host questions, and his ease ponderously, just like a pair of zhizhu had posture. Especially when he talked about the traditional Chinese culture, multiple values and even human common development goals, it is hard to believe that this is the once said the car is "two row sofa and four wheels". "I have a dream. I always have different dreams." Near the end of the interview he could not help but laugh, "this is the new dream. To create a global enterprise culture, global type local enterprise. Volvo is not my, LiShuFu to this thing? Volvo belongs to the whole person? Class."

All mankind will Volvo stem? The words clearly could not convince all, question will soon be here.

In this atmosphere pleasant interview after a month, cobolli gigli suddenly due to huge liabilities in was tightening the negative news usury neck-as high as 71.07 billion yuan of total liabilities, 73.5% of the asset-liability ratio. A report of the securities market weekly "say:" funds of giovanni cobolli gigli group is dense with private institutions at home and abroad, for acquisitions Volvo giovanni cobolli gigli through the Goldman sachs released to overseas high bond, it needs to whip round again debts."

LiShuFu with his executive team's mad.

They would use the enterprise and deal with the media during the most embarrassing means, to the media and the author sent lawyers letters. Assist the foreign acquisition cobolli gigli also stand up for giovanni cobolli gigli speak at Goldman sachs. The key problem is, debt and debt is not the same thing, cobolli gigli in debt is accounts payable and operation of debt, need to pay the interest of bank loans to be in reasonable proportion range. Listed in Hong Kong geely automobile would show that the company's cash conversion cycle for negative 50 days, this means that giovanni cobolli gigli rely on dealers and supplier of money can maintain operation. The securities market weekly "later had to published" reported serious inaccurate "statement of apology.

Despite cobolli gigli in this question in the storm a great victory, but LiShuFu rumours of the lack of money seems to easily be trust, because that is the impression that giovanni cobolli gigli people-a sale of 10000 cars in only after getting the car production license, the auto sector ants company. The past 20 years, LiShuFu from running a tiny rural photography studio start slowly and build up China's largest private car company, which also does print the photos of the developer from refining silver, assembly refrigerator and motorcycle, production building materials business. Lack of money, lack of technologies, the day he can't be more familiar with it.

Now geely automobile have is not what it was, is no longer at the beginning that rely on a wrench and hammer mill type of car made private enterprise. The company spent 14 years in the domestic set up six vehicle manufacturing base, an annual capacity of 600000 cars (last year sold 416000 cars). It has acquired manganese bronze car company, Australia DSI automatic transmission company and in ford under control of the declining luxury car brand Volvo. In the first half of this year giovanni cobolli gigli and Volvo turnover totaled 70 billion yuan, and profit before tax RMB nearly 2.4 billion, than last year the corresponding period there are obviously ascension.

But gigli or for a congenital deficiency and starvation is always in the company, buy three overseas companies to improve the situation also of no help, even will aggravate the speculation. By march of last year, LiShuFu success Volvo takeover in giovanni cobolli gigli has encountered this conference. At that time just fly back to Beijing from Sweden LiShuFu with a weary, a slight impatience and a little excited, to the more than one hundred reporters capital source.

No outside help giovanni cobolli gigli cannot eat is several times their size of Volvo, but also not as you imagine cobolli gigli so poor. $1.8 billion acquisition of capital and is expected to $900 million in subsequent investment, cobolli gigli from China and overseas each half to raise money, cobolli gigli herself with a about 25%, other financial backer including financial group, investment Banks, local governments and domestic sovereign bank, the money from China, the United States, Europe and Hong Kong, China.

"Buy Volvo car company is not money can buy get, also have no money or less money can't buy. So money is not important." LiShuFu at that time? Said.

Is Volvo brand let giovanni cobolli gigli capital suddenly attention, but compared to previous encounter with funds cobolli gigli, this is still far from a life and death. The actual condition with LiShuFu says is very like takeover, the Volvo is not about money, and no and no big purchase loss. In 2000, though that moment, take out 1.5 billion yuan, LiShuFu don't want to do a car.

LiShuFu is basically a hot will head plunge into the automobile industry. Want to build cars, he so little money. The government of the requested minimum investment threshold is 1.5 billion yuan. Chery production capacity of 150000 cars a total investment of 4.252 billion yuan; Shanghai gm total investment of nearly $12.6 billion. LiShuFu made money from its business of car of the building materials factory and motorcycle factory out of, the two factories going to keep running, when the outside world can take out of that giovanni cobolli gigli funds ManDaManSuan also a or so. Want to buy land and build factory building, buy production line, mould and so on, 100 million yuan to build cars it is glass of water car? Salary.

As a private enterprise founded soon after, cobolli gigli is difficult to get loans from the lenders, LiShuFu marked the wenzhou, ningbo and taizhou area of private financing. He is not simply let the private enterprise boss capital contribution, but try to the development of their and giovanni cobolli gigli bound together. LiShuFu lofty sentiments in the car factory factory leased to the boss, by their separate investment or and giovanni cobolli gigli capital venture production cars of all the essential parts factory e.g. body factory, engine, gearbox factory factory, and then combined to assembly production cars, car sales after go out again into.

This kind of practice with the clothing industry fast fashion brand ZARA is like, ZARA Inditex's parent company in early also is to let some private investors to pay the plant and spent the bottleneck. Giovanni cobolli gigli's pattern is called "boss project". Giovanni cobolli gigli through this disguised folk funding, save their investment and construction of money, easing the capital turnover and won the stability of the products. The factory is in a factory in production, foreign only lofty sentiments car company a sign the mutual benefit is factory will not happen marketing behavior, no sales tax, reduce the product into? This.

By external forces help, cobolli gigli finally produced the first batch of lofty sentiments car. Giovanni cobolli gigli come from all over the country dealer orders, but a car didn't sell. This batch of car of quality too bad: internal decoration coarse; Car body workers knock out by hand, juncture place is easy to crack; Shell paint is brushed up a few workers points, color depth not divide evenly.

Like all of organization of private enterprise, giovanni cobolli gigli was the sense that gives a person is perhaps one day the company went bankrupt.

Giovanni cobolli gigli group's former vice President WangZiLiang memories, cobolli gigli only one production line is very simple, equipment is used, or by workers begin homemade. And that made the car workers cobolli gigli is basically it motorcycle factory employees, lack of car background specialized talented person. LiShuFu starts to make the car, looking through the motorcycle factory all staff records, found that three people in hunan car manufacturers did. LiShuFu said, if there is the fourth automotive engineers word, that is what he is.

Now to the LiShuFu positioning behind the scenes for the brain. He was quite so the basketball coach, when his hand manager people to get, he let them go, can take out time to think some of their more abstract problems.

Had he attended a series of interviews with a Volvo public relations staff said, LiShuFu now the most like to talk about the topic that national studies.

Global enterprise culture and new wealth view, seem to give he opened a new way of thinking. He reduced the frequency of the interview, but as long as to speak, can be certain to these talks.

When the supreme leader can wander, the company that may not be a bad thing. LiShuFu said: "in the western that set of things that I don't know much of the experience, in this case, I presumptuous to disturb the decision, Volvo will face greater challenges. I think the ignorant is no authority feeling."

Let managers do things, it is not like this do speak out so easily. Volvo takeover talks LiShuFu a listen to hosting the world's yacht game every year to spend dozens of, build a ship to 200 million, while the Chinese it had almost anything, so don't agree with. The board of directors by five years spent $11.5 billion to research and development expenses resolution, LiShuFu or don't think the money was too much.

It's like used to tighten, look for a girlfriend can spend money, a bit not used to. LiShuFu said: "that's it!"

Lee ultimately no across the rules of the game, hard to step in. "How to manage these projects, how to promote research and development has more achievements, it is to the CEO, the management to exercise their rights. I can't participate in very specific, very details of the project, our board of directors is the task of assessment in the management of the Volvo? Layer."

But he still have kept, the board of directors were planted in a proficient in financial Chinese director, in for Volvo, chairman of the board of China ShenHui.

This LiShuFu these years thanks to a snare a batch of international background of Chinese executives. The master of Chinese financial ZhangPeng director joined in 2007 as vice President cobolli gigli group, in Britain before BP do financial and internal control senior consultant, earlier in the shell and Hong Kong south China group also had work experience. Volvo global senior vice President and chairman of China ShenHui take Canada nationality, in the university of California, Los Angeles, read the project master, in 2009 to vice President cobolli gigli identity before joining, was on fiat and multinational parts suppliers are served as China borg warner presidency.

But LiShuFu warned that, once in the specific operation stage, cobolli gigli also need to find more rich for Volvo vehicle manufacturing operations experience.

With such a promising project of Volvo, attract talents suddenly becomes much easier, ShenHui even willing to without any formal appointment in the case began to work for LiShuFu. He met with LiShuFu is years of the man, early watch to pass state say as long as have good project is over.

In LiShuFu or "the fourth engineer" years, cobolli gigli nothing can be good project. But the company still have to try their best to find experienced executives, to help the company improve research and development and production management.

A car starts to make LiShuFu idea is simple, as long as the price is higher than the product can do cobolli gigli others low, quality control is better, to be able to get the market demand. When car buyers main is a government department, market is joint venture brand monopoly, a car jetta price more than $140000, a car LiangXiang xiali sold 80000 yuan. Then do as LiShuFu expected, in a domestic car shortage era, although the improved quality of pride car just not good enough, but the price is competitive, lofty sentiments in 1999 were sold 1600 cars, 2000, lofty sentiments sold more than 10000? Cars.

But can only build cheap cars were not enough, he needs more professional people to advice. From the car companies don't dig man, and he will run to wuhan university, automobile industry of jiangsu university of science a batch the please with the automotive background of retirement experts to cobolli gigli work.

LiShuFu know yourself into a promising industry, he moment never stop expanding the idea. The lofty sentiments in quality have not been improving, 1999 with annual capacity of 50000 cars can design of Japan factory in ningbo ningbo and start, they use only nine months time to let the first new car to get offline. The lofty sentiments and factory than crude, the software and hardware of ningbo factory had many progress, but the product quality control but difficult to let the people well.

In order to see what others made the car, LiShuFu sent to South Korea AnCongHui modern car visit. After visiting the factory, the finance director of a night from the auditor didn't sleep. In the first financial weekly "memories of this experience, the current vice President cobolli gigli group of AnCongHui suddenly laughed. "A couple of us look silly eye, the difference is too big," he said, "it was put into operation, ningbo factory just what are very simple."

The car factory in South Korea by automatic robot welding body, workers in the automatic assembly line busy, and giovanni cobolli gigli on the production line by forklift, flat trolley shipping parts, still use manual way making cars, use the tools are most workers wrench, and a hammer. Sometimes parts precision not enough to complete installation in place, workers could knock in with a hammer, lead to the unqualified.

LiShuFu requirements AnCongHui took out to improve the quality of the solution. Ann thought of lean production, he retired from Toyota please technical personnel, each production links all modeled after Toyota do, including a workshop on clean degree and the behavior of the individual details requirements, but the effect is not obvious. Then again they encourage a staff found and improve the problem in production, it finally received a little effect, although also is not very big, but LiShuFu love to see this kind of enthusiasm and participation.

In 2006, LiShuFu have realized that the company the urgent need to improve product quality, improve the technology content, international brand family car market to make back, plus chery and supporters of such domestic rivals, cobolli gigli's cheap car is becoming more and more difficult to earn money. He took ten years to the ten top cobolli gigli car manufacturers in guizhou, and learned how to use of external resources to solve the company operation appears in the various problems: please professional managers to prevent family enterprise disease, please professional financial talent to solve the financing problems, he needs a key sir.

At that time, brilliance auto research in charge ZhaoFuQuan is LiShuFu eyes that can change the situation. The former is a continuous 11 times refused to goodwill invite, but he met have the courage to 12 time open the latter. One day in 2006, they were both in Hong Kong airport flight and fatal after, LiShuFu 12 time invite zhao join giovanni cobolli gigli. For several months, zhao identity into giovanni cobolli gigli group vice President and research institute President giovanni cobolli gigli.

ZhaoFuQuan was in daimlerchrysler overseas company seven years, research director for technology center. At that time, giovanni cobolli gigli group has four production base, six of the main models, the base has their own product development department, each base drawings and technical standard between are not unified, leading to the base can't generic components between, also can't universal test standard and test standards. This leads to the car or other quality cobolli gigli. Zhao's is urgent for giovanni cobolli gigli establishment unify of technology system. But gigli only 300 researchers, are college, high school. The most let ZhaoFuQuan surprise, some people even PPT not to know how to? Do.

Take time for one or two years, ZhaoFuQuan from various production base hand back research and development power, lead developers will all continue in the car, parts of the drawings converted into unified format, fill together the all products of the 2 d, 3 d graphics, compiled by the 24 this "technical manual". Next, they and compiled the parts and whole design and test standards, as the whole of the enterprise standard cobolli gigli group.

ZhaoFuQuan in his office with spare a handbook, including product each parts material request, scope, technical requirements, appearance requirements, and all of the design parameters, inspection standard and test standards. "People can find new job, vehicles aging, but these things is support for sustainable development of the enterprise weapon, the" ZhaoFuQuan told the first financial weekly ", said, "we buy foreign car companies buy is, in fact, these things."

People often say, buy to a company, so give yourself bought trouble. Especially the car industry. Ford spent 10 years and $30 billion development money also failed to save Volvo is the best example.

LiShuFu since 2002 through the purchase of foreign brands to consider for giovanni cobolli gigli changed forever. Volvo and saab, jaguar, land rover, Mazda, these all in his considered. This sounds too over-confident, but LiShuFu believe that chance will come.

But in found a suitable brand before, he has cannot help create new brands from giovanni cobolli gigli internal. LiShuFu said a sentence later not rebuilding 40000 yuan of the following car do open dry. Begin from 2008, cobolli gigli began planning, global hawk next to England and three new brand, and started in 2009 on research and development and new models on the market. LiShuFu new brand to send and hope from his willing to pay 3.6 million yuan for global hawk public solicitation vehicle-logo evidenced in.

Three brands of performance next are good, a few years ago 10 months sold more than 90000 vehicles, price from 80000 to 100000 head, but like other independent brand encountered, giovanni cobolli gigli time also difficult to break through the 100000 yuan ceiling ".

This aspect Volvo could help. Although have a confidentiality clause constraints, but can still be allowed in Volvo within the scope of the research and development level and help giovanni cobolli gigli improve technical content. Volvo design director in Britain PeterHorbury at the beginning of the year, also on the Shanghai auto show in pushing the Volvo's new car, is now the vice President cobolli gigli group design, responsible for the car creative design and cultivation of talents. Horbury from 1991 to as the design director in Volvo, which also job-hopping been to ford, involved in the land rover, jaguar and aston · Martin's design work, and two years later he returned to Volvo. His most famous work is a new generation of Volvo SUVXC90 and "heaven and earth" concept car.

LiShuFu hope Horbury leadership giovanni cobolli gigli brand design development into the future, and praised his rich experience in the industry of giovanni cobolli gigli products is critical to the success of the future. Although most of the time Horbury temporarily or work in Sweden, but LiShuFu seize all opportunities to the foreigner infusion Chinese taste. He gave Horbury listen to erhu and guzheng music, told his Chinese people like the moon, sun and sunrise and sunset.

"For art design for, these are all very important." LiShuFu explanation. "He designed the 'heaven and earth' concept car is good, reflected my thoughts, I thought, not necessarily correct needs to continue improving, since want to let the Chinese accept, also want to let the whole world accepted."

Relative to persuade Volvo CEO Stephen Jacob and the board of directors, Horbury change is just a piece of cake. Management of a multinational like with your chopsticks add tofu, LiShuFu need to grasp the dynamics. This means that he can change some, but Jacob also have to change.

The two men look the difference is too great. One is the conservative German, wearing a pair of sleek black glasses, in cologne university get a business, has long before mass effect car. The latter was born a peasant family, let myself go, very talkative.

LiShuFu now has served as chairman of more than one year Volvo, cooperation look well enough, attend public when the whole dharmadhatu, but this is all the compromise of each. In the purchase at the beginning of the negotiation, cobolli gigli an executive because of a Volvo has stormed to, and take the first flight available to return to China.

So far, one of the biggest differences is whether to statues Mercedes S series and the BMW 7 series that large luxury car. Lee and Jacob set out their own reason, lee said that the Chinese people like cart, or no, Jacob insisted that keep Volvo past genes. Both sides looks are reasonable.

The result of argument is clear, it a LiShuFu got the upper hand. More specifically, the Chinese this coveted market and the present situation of the Volvo got the upper hand. Leave the luxury car growth more than 30% of the Chinese market, Volvo completely unable to return to luxury car competition ranks. In march this year LiShuFu said in an interview, Volvo and Mr. James can take the moral high ground, adhere to the Volvo brand low-key, moderate in a traditional style, but the style in the Chinese market is no future, unless it can adjust the strategy, cater to the Chinese pursue a longer current car taste.

In other small, LiShuFu would be happy to show his inclusive side, he was on business trip to Sweden to no longer drink water; Do likewise, Jacob also began in his office bubble up a cup of green tea.

LiShuFu like to say most of a word is the Pakistani taliban, this is he of Volvo management philosophy. Ford's time to take the Volvo is paternalism, spent $6.45 billion acquisition of Volvo, ford holding everything, including the appointment, management and research direction development models. Ford of Europe headquarters in Volvo were planted in most of the department supervisor, the Volvo technology research and development direction for security, for its other brand to offer the safety technical support. Volvo research and development is confined range after against Volvo as a brand survival, and Volvo also waste so much money in the moment can't into a product projects.

In LiShuFu under the carrot and stick approach, Volvo recently will propaganda to "people honour", sounds finally like a luxury car looks like. May be a coincidence, new products, and the research and development direction in the global performance for Volvo have finally started to rise again, the first half of the global sales rose 20% to 230000 vehicles, China is more sales grew 50% to 35000 vehicles, how much this touched ford period of bad management? The light.

And China go near some looks good also many, but LiShuFu and Jacob all need to watch out for is, avoid Volvo with giovanni cobolli gigli come too close, leading to brand image problem, can no longer attracted to rich people around the world. J.D.P ower asia-pacific company China research services MeiSongLin general manager dr reminds say, Volvo need to further consolidate their global current car brand position, and to prevent its brand in Chinese style.

LiShuFu would like to very clearly: "giovanni cobolli gigli is giovanni cobolli gigli, Volvo is Volvo. Volvo from northern Europe, is rooted in Sweden and left the specific soil, Volvo will no longer be Volvo. Without the foundations of the brand, nature also lost its proper value. Volvo cars will be to preserve its own distinctive features in gothenburg, red under the management of and under the leadership of the new board of directors, continue to focus on the development of automobile industry's top luxury. Giovanni cobolli gigli doesn't production Volvo, Volvo also not production giovanni cobolli gigli."

LiShuFu and giovanni cobolli gigli, Volvo story now confirmed obviously are premature.

In the 1980 s, the graduate from high school LiShuFu not into the factory work, but ZouJieChuanHang photograph people to make money, and with him into the young people now business period has thering is no lack of business leaders, while the iron is hot, keep the lu-guanqiu quail LiuYongHao, place of the XiuXieTan NaCunHui, each a private enterprise acquiring is full of uncertainty and the twists and turns. This is the age of the opportunities and suffering given to them.

LiShuFu dream also is far to achieve. He set big goals for giovanni cobolli gigli, to 2015 years to achieve 2 million car sales, including Volvo 800000 cars. This means that giovanni cobolli gigli need growth 3 times, and Volvo need growth almost 2.5 times. It's hard to say, LiShuFu path before him and the road, which a longer.