Where will the “Three Heroes of Shenzhen” go at the crossroads of global competition?

Although they started in different industries and were established at different times, they all experienced major turning points in the past one or two years, and have been competing and cooperating with each other in smart cities and technology ecosystems.

"Every time a new idea sweeps across China, whether it's a new fashion, philosophy, or lifestyle, the Chinese call it a 'fever.' In the first few years of reform and opening up, the Chinese suffered from 'western suit fever,' 'Sartre fever,' and 'private telephone fever.' It is difficult to predict when and where a certain fever will break out, and what impact it will leave afterwards," wrote Evan Osnos at the beginning of his book The Age of Ambition.

Today, China has been in reform and opening up for 40 years, the Internet era for 20 years, and mobile Internet for 10 years. The name of new ideas has changed from "hot" to "trend". And the impact of each "trend" is different. Some are fleeting, such as the unmanned shelves that were popular at the beginning of last year. Some are still influencing the future decades later, such as this trend blowing from Shenzhen.

Some people call 1979 the first year of Shenzhen. Before that, it was just a small border town at the end of a province and the corner of a country. But after "in 1979, an old man drew a circle on the South China Sea", people became infected with "Shenzhen fever", and cadres who went to work, migrant workers who made a living, and ignorant graduates from all over the country rushed to the south.

Today, Shenzhen has become the main base for China's technological development. According to statistics, Shenzhen has more than 300 of China's more than 3,000 listed companies, making it the city with the most listed companies in China.

According to the financial data of 2018, among the many private enterprises in Shenzhen, Ping An Group ranked first in terms of revenue and profit, Huawei ranked second, and Tencent ranked third, becoming the "Three Heroes of Shenzhen" without any suspense. The latest Fortune Global 500 list released in 2019 shows that in terms of revenue in the most recent year, Ping An Group ranked 29th in the world, Huawei ranked 61st, and Tencent ranked 237th.

The interesting thing is that although they started in different industries and were established at different times, they all experienced major turning points in the past one or two years, and have been competing and cooperating with each other in smart cities and technology ecosystems.

one

In Shenzhen, the most common tree is the banyan tree.

Unlike other tree species, where a single tree cannot form a forest, a banyan tree can grow into a forest ecosystem if it is given enough time. In the Acharya Jagadish Chandra Bose Botanical Garden in India, a banyan tree that has lived for more than 250 years now covers an area of ​​more than 15,000 square meters of forest.

Over the past 40 years, countless private enterprises in Shenzhen have sprouted and grown from small saplings into towering trees, and even formed their own ecosystems. Ping An, Huawei, and Tencent are among them.

In October 1987, Ren Zhengfei, who had just been demobilized, raised 21,000 yuan and founded a small company in two simple houses overgrown with weeds on the Shenzhen Bay. The company was small, but its name was big: Huawei, and it mainly acted as an agent for programmable switches.

A year later, in Shekou, Shenzhen, Ma Mingzhe founded China's first private insurance company, Ping An Group.

One was selling programmable switch agents, and the other was selling insurance. Looking into the future, no one would have expected the two companies to have any intersection. However, 10 years later, they both entered the reform period for the first time and ushered in the Internet era.

In 1998, Huawei's sales revenue reached 8.9 billion yuan. However, with the rapid expansion of its scale, organizational management problems such as internal friction and low efficiency became more and more serious. After Ren Zhengfei led his senior management team to visit giants such as Lucent and HP, he hoped to learn from IBM .

IBM offered a "sky-high" apprenticeship fee of 2 billion yuan, which was almost equivalent to Huawei's profit for more than a year at the time. But Ren Zhengfei was determined to push forward, and under his promotion, Huawei carried out an unprecedented Western-style transformation.

At this time, Ping An Group was also vigorously carrying out a corporate transformation.

Before 1997, Ping An was advancing rapidly and everyone was optimistic. But Ma Mingzhe knew that if employees had no sense of crisis and worry, it would be the biggest crisis for a company. For this reason, he introduced McKinsey and led Ping An into a three-year transformation period.

At the Ping An Group's national work conference in 1998, Ma Mingzhe delivered a keynote speech entitled "Ping An's Vision and Strategy for the Second Decade", raising four questions: "Where are we? Where are we going? Which path should we take? How do we get there?" and pointed out that Ping An should become "a world-class comprehensive financial services group."

When Huawei and Ping An were undergoing their first major transformation, the Internet era in China quietly kicked off. At this time, a young man named Ma Huateng and his classmate Zhang Zhidong founded and registered a company, "Shenzhen Tencent Computer Systems Co., Ltd." to do the "QICQ" that was already being done by other companies.

Ma Huateng didn’t think too much about it at the time, but since there were already companies working in the ICQ field, Tencent had to stop using the name QICQ and changed it to “QQ”.

By 2000, as QQ became more popular, the server could no longer meet the needs of users, which led to the team needing a lot of money and manpower to operate and invest in QQ. Tencent, which was in its early stages of entrepreneurship, almost sold QQ due to financial constraints.

Many years later, Huawei has conquered the communication and mobile terminals, and has occupied a place in the communication market, chip market, and the formulation of 5G standards. Its global smartphone shipments have also ranked second. Tencent has not only secured its position as the leader in China's social networking, but has also made efforts on the B-side. The industrial Internet represented by Digital Guangzhou is in full swing. Ping An Group has completed the transformation from comprehensive finance to technology finance, and has set "empowerment" as its vision for the next 10 years.

two

In the early morning of October 24, 2018, Ma Huateng suddenly raised two questions on Zhihu: "Which basic scientific breakthroughs will affect the Internet technology industry in the next ten years? What changes will the integration and innovation of industrial Internet and consumer Internet bring?

Not long ago, Tencent just announced the transformation direction of its third structural adjustment and strategic upgrade - "taking root in consumer Internet and embracing industrial Internet."

Today, people have reached a consensus: the next opportunity for China's Internet lies in 2B. Wang Huiwen, senior vice president of Meituan Dianping, once compiled a list to compare Chinese and American technology companies and found that in the United States, 2B companies such as Salesforce, Workday, and Oracle basically occupy half of the technology industry, but in China, 2B companies have never formed a climate.

The 2B business, mainly Tencent Cloud, is currently the most important business segment for Tencent as a whole. Tencent believes that it can do a good job in the 2B business because it has several positions, including official accounts, mini-programs, mobile payments, social advertising, enterprise WeChat, cloud computing big data and artificial intelligence, and security capabilities. In other words, it is the continuous investment in technology that enables Tencent to have the ability to change its position when the industrial Internet era arrives.

Huawei’s growth from a sales agency to a giant in the mobile communications field is inseparable from its investment in R&D capabilities.

As early as a week before Christmas in the West in 1997, Ren Zhengfei led his team to visit Hughes, IBM, Bell Labs and other companies in the United States, and told the company's employees that "only by paying attention to research and development can we guide consumption."

In Ren Zhengfei's view, "The unpredictable and rapid evolution of the information tide has caused batches of large enterprises to fall into difficulties and even die. Batches of small enterprises have grown into towering trees, but the big trees have been struck by lightning. Continuous birth and continuous death are the characteristics of the information industry." Excellent companies all attach great importance to R&D, and R&D must be responsible for marketing, technical support, cost and quality.

Over the past 20 years, Huawei has continuously increased its R&D investment. The European Commission officially released the "2018 EU Industrial R&D Investment Ranking", showing that Huawei ranked fifth in the world with 11.334 billion euros, and was the only Chinese company in the top 50. Based on this, Huawei's investment in scientific research accounted for 14.7% of the company's turnover in 2018.

III

Looking back at the growth history of Huawei and Tencent, we will find that in the process of growing from small saplings into towering trees and forming their own ecosystems, they have undergone several organizational changes and have always attached importance to investment in technological research and development.

Coincidentally, the growth path of another giant company originated in Shenzhen, Ping An Group, is not much different from Huawei and Tencent. In the words of Ping An executives, if it had not used IT technology to connect various professional companies, Ping An would still be just a company that invested in many financial institutions, rather than a comprehensive financial group.