Live Wire Management At Johnson ElectricPete Engardio
Like many Chinese industrialists of his age, Wang Seng Liang was a natural. After losing his textile business in Shanghai to the Communists in 1949, he quickly reestablished himself in Hong Kong. By the 1960s, he had built Johnson Electric Holdings Ltd. into a prosperous maker of tiny motors for toys. Wang, recalls his son Patrick, "made decisions with his gut and was usually right." But he also leaned toward cheap furniture and kept the factory lights dim to save on electricity.
If Wang typified the older generation, Patrick Wang Shui Chung, 44, is a manager for the next era. Each year, as managing director, he arranges "leadership training" outings at a U.S.-run Outward Bound camp in Hong Kong, so that engineers and managers from Johnson's factory in China can bond with their Hong Kong counterparts. Johnson gives employees everything from low-interest home loans to "creativity" classes for their children.
"NO KING AROUND HERE." For the younger Wang, building a solid core of loyal, motivated middle managers is critical. The company, whose motors are now used in everything from hair dryers to car windshield wipers, had 1994 sales of $250 million. Rising materials costs and heavy capital spending have kept earnings flat. But Credit Lyonnais Securities analyst Simon Lam thinks Johnson's modernization drive will pay off. "This is a well-managed company," says Lam. Indeed, if double-digit sales growth continues, Johnson could one day surpass Japan's Mabuchi Motor Co.
For that to happen, Johnson needs an organization capable not only of responding immediately to customers but also of staying on the cutting-edge of technology and market trends. Cutting through nepotism and secrecy, the younger Wang, a Purdue University graduate, is ushering in worker empowerment, shared databases, and the ideal of the "flat" organization. "There is no king around here," Wang says. "My job is basically to create the culture so that professionals can do their job."
To respond to hundreds of customers, ranging from General Motors and Black & Decker to Krupp and Mercedes-Benz, Johnson Electric strives to turn a concept design for a micromotor into a product in just a few weeks. That requires working hand in glove with customers and linking design centers in the U.S. and Europe to engineers and factories in Asia.
To make Johnson agile, Wang is dismantling big departments for design, engineering, research, and testing. Instead, workers from various disciplines are being divided into more than 30 small teams responsible for producing and selling to specific industries such as autos, power tools, or kitchen appliances.
And to encourage staff interaction, Wang redesigned the huge floor at Johnson headquarters, in Hong Kong's Tai Po Industrial Estate, where 150 engineers in white lab coats toil. The floor is now carved into work areas where small industry teams from the engineering and business sides work together. In the middle of the room, Wang has installed what he calls "interactive centers"--a set of rooms surrounded by glass walls where teams huddle for strategy sessions.
Wang has spent just as much energy trying to keep himself up-to-date. Each year, for example, he goes to Harvard business school to immerse himself in an intensive one-week program for young executives. Wang says he borrowed generously from case studies of Motorola Inc. and Procter & Gamble Co. for his approach to worker empowerment and teamwork.
Wang doesn't salivate over every Western management buzzword. He eschews draconian reengineering, for example, because it destroys morale. He's intent on preserving what he considers Asian values, such as loyalty to workers. To become a world-class player, however, it's clear he must shed the secretive, top-down, approach that served his father so well.