Fortune Makers: The Leaders Creating China’s Great Global Companies
Michael Useem, Harbir Singh, Neng Liang, and Peter Cappelli
PublicAffairs/Imprint of Perseus Books (March 2017)

How China has used capitalism to pull 600 million people out of poverty and will soon become the largest economy in the world

Michael Useem, Harbir Singh, Neng Liang, and Peter Cappelli have made an immense contribution to a long-overdue understanding and appreciation of what they characterize as “the most remarkable development of the modern era.” More specifically, those who created China’s great companies “have used capitalism to pull 600 million people out of poverty and [China] is on track to soon be the largest economy in the world. It is an astonishing turn of events.”

They go on to point out, “The growth and ascendance of Chinese companies are products of the strategies and leadership of those who created, built, and now manage those enterprises. The invisible hand of the market conditioned their goals and decisions, but their actions have constituted a strong visible hand. We want to understand that visible hand, how they direct it, what they want from it, and where it is taking their enterprises.”

What is “The China Way”?

Useem, Singh, Liang, and Cappelli focus on companies that include Alibaba Group, Geely, Haier, Huawei, Lenovo Group, Vanke Group, and Xiaomi. They examine seven distinguishing features among the leaders who have created China’s great global companies:

1. Their Own Way Forward: Without precedents. “by finding and fashioning their own way. the founders put their own unique imprints on their enterprises.”

2. The Learning Company: “Chinese executives have carried their own learning experience into the firm. They have insisted that their company be a learning organization with greater zeal than is common in the West.”

3. Strategic Agility for the Long Game: They focus on “finding new opportunities and going after them – driven by scrappy personalities and lean architectures.

4. Talent Management: “Business leaders in China have learned to grow big fast by drawing on a paternalistic leadership style and building a clan-like corporate culture.”

5. The Big Boss: “Privately owned firms are exceptionally focused on the individual at the top. While the Big Boss model has faded in the West, not so in China.” Seth Grodin uses “tribe” as a metaphor; Chinese leaders embrace it as a workplace structure and culture.

6. Growth as Gospel: ‘They place a greater premium on growth, believing that profitability is an end product of growing a business rather than the primary goal.”

7. Governance as Partnership: “When we put the above components together — lean, low-cost operating structures, highly centralized decision making with continuous learning, and a workforce that follows the boss – we get the essence of the competitiveness of Chinese business.”

As the co-authors suggest, Western business leaders need to look hard at hundreds of large private companies in China “that are increasingly coming to define not only their own way of doing business but also better ways of leading business worldwide.”

I am deeply grateful to Michael Useem, Harbir Singh, Neng Liang, and Peter Cappelli for providing an abundance of information and insights, that increased substantially my understanding and appreciation of how leaders in hundreds of private companies have “have used capitalism to pull 600 million people out of poverty and [China] is on track to soon be the largest economy in the world. It is an astonishing turn of events.”

It is indeed astonishing, especially given the fact that the Communist Party remains firmly in control – even more so now, under President Xi Jinping, than before.

Fortune Makers is a brilliant achievement. Bravo!