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Emerson: Technology leadership brings profit growth          阅读 PDF

An interview with Peter Yam, President of Emerson Greater China

By Qiu Jiaoning, February 23, 2007, Beijing Today《今日北京》

China is among the fastest-developing regions for Emerson’s businesses. Since fiscal year 2002, China has been the second largest market for the company next to the US, according to Peter Yam, president of Emerson Greater China.

Emerson’s presence in China began as early as the late 1970s through its first technology transfer, and in 1992 the company established its first wholly foreign owned enterprise in China. In October 1993, Emerson Electric (China) Holdings Co., Ltd was formed, and became the first US firm ever to set up an investment company in Shanghai.

Q: Emerson is recognized for its innovative and proven technology. How do you maintain your technology leadership?

A: In order to stimulate innovation, we set up a long term goal and a number of criteria for managers to follow. In other words, we reward the managers who can come up with new technologies, new products, new solutions, new platforms or something different from our past ones.

We have a 40 percent criterion, meaning that 40 percent of the sales should come from new products. It puts pressure on managers and executives to come up with new ideas, innovations and platforms to meet the criterion.  If they meet the 40 percent criterion, they are rewarded; if they fail to meet the target, their performance will be affected. 

We also continue to invest in our engineering capabilities to maintain our leadership. For example, we invested US$ 560 million to improve our engineering capability in 2006.

Innovation is not something you can dream up or make up in your office.  We hire a lot of engineers in China and let them talk with our customers to understand their needs and issues. Then our engineers come back to our company and use our technology to find the right solutions, products and platform for our customers. 

Q: What are the present and long-term goals of your company in China? What are your business and investment strategies in China?

A: We believe that China is an important market for Emerson. We want to make sure that Emerson’s products stand for technological innovation.

In terms of growth, we plan to continue our double digit growth and past performance. This is not easy because of the fast-changing market dynamics in China.

The company will continue to build up our engineering capabilities in China. We established two new centers in 2006, which will help us to better understand and respond to customers’ needs, and come out with right solutions and products for our customers.

We will continue to make investment into four key areas including manufacturing and sales, engineering and development, export procurement and human capital.  The company will continue to improve efforts in the recruitment, training and developing of new leaders.

Q: What are the challenges and difficulties your company faces in China?

A: China is also changing fast - economic environment, customers’ behavior, as well as government directions. So our challenge in China is to continue to grow despite such fast changes.

We realized that China is not a single market, not a homogeneous market.  Customers in different regions and different industries have different needs.  We need to understand our customers, adapt to the market changes, and come out with new products and solutions with our technologies to meet customers’ needs.

Emerson, ranked 372nd on the 2006 Fortune Global 500 list, is a global technology and engineering leader, developing and delivering innovative solutions for commercial, industrial and consumer markets. Emerson operates in 274 manufacturing locations worldwide and markets its products in 150 countries.