From a young age Zhang Ruimin showed engineering talent: he had a penchant for dismantling the family radio and reassembling it. Born in 1949, he says he always wanted to make China proud. In 1968 he joined a metal work factory but went to university in the evenings.
In 1984 he became a director at Qingdao Refrigerator. The situation did not look promising, reports Xinhua. The firm was insolvent, and workers were using the wood in the factory windows for firewood.
During a tour of the warehouse, Zhang discovered that many of the refrigerators had minor defects. The staff suggested that they should be sold at a discount to employees. But Zhang replied that if he did that, it would only motivate the workers to keep turning out shoddy product.
Instead he had them smashed to scrap with sledgehammers – employees were shocked (a fridge cost two years salary at the time). The incident has become famous in Chinese management texts. And the company – whose name was soon to be changed to Haier – would go on to earn a reputation for quality.
Need to know
By 1992 Haier was China’s number one refrigerator brand.
Zhang then diversified, first into washing machines and next into air-conditioners (cracking open the aircon market with a free installation policy).
Haier now makes its products in 30 countries – including the US – and is the world’s fourth largest white goods manufacturer.
In 2008 company sales rose 8% to $17.8 billion. According to Euromonitor, Haier has now displaced Whirlpool as the world’s leading seller of refrigerators, with a 6.3% global market share.
In his own words
“My dream is to give our motherland a world famous brand.”
And to relax
Zhang loves reading, and will get through several books on a flight. Apparently his early ideas about smashing the fridges came from Japanese ‘quality control’ management textbooks.
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