Most popular focus on solid foundation industry Ad

2022-08-08
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Focusing on solid foundation, Advantech "only made industrial computers for 23 years and became the first in the world"

twenty years ago, the electronic giants started at the same time. In the era of blooming flowers in the field of personal computers, many companies soared, and elite computers broke through the revenue barrier of 10 billion in 1996; In the corner, Liu Kezhen, founder and chairman of Advantech computer, chose the unpopular field of industrial computer. The revenue of 10 billion yuan is the goal he has achieved this year since he founded the company 23 years ago

but like the fable of the tortoise and the hare race, although it was nine years late, when the elite's revenue fell back to more than 10 billion yuan last year from 45 billion yuan the previous year, Advantech's revenue moved steadily forward every year, with no negative growth for a year. Although it is not an electronic diamond stock with strong performance, it has also been regularly distributed to shareholders with a dividend of three to six yuan every year for nearly nine years, so it has regained the favor of investors after the technology foam. Wu Yulin, the fund manager of ABN AMRO investment letter, which first paid attention to the stable distribution of cash dividends, said with a research report recommending Advantech: "what we appreciate is their stability."

business advantages: the industry is stable, and the risk of product generation alternation is small.

how does Advantech maintain the stability in the past 23 years? "The most important thing is to start thinking. We just keep the starting point of that year," Liu Kezhen said, "that is to do one thing at a time and do our best at one time."

in 1981, five independent business personnel from HP automatic testing department in Taiwan founded Advantech. Liu Kezhen said that they would only know what they originally knew, including the use of computers by manufacturing enterprises and the use of brand marketing. Therefore, on the first day, they positioned the company as "a manufacturer of private brand industrial computer system storage and transportation, which have become important considerations". They vowed to remain only in this field, but absolutely to be among the top three in the world

this original intention allows them to concentrate on taking the lead in a very narrow field, with no distractions. When there was no competition from local manufacturers in the early years, it soon became the largest industrial computer manufacturer in Taiwan in the second year, and won the first position in the world last year

guoboda, chairman of Weida computer, the only one in Taiwan who is in the same field as Advantech, said that industrial computer is a very stable industry. A product, such as the control computer for traffic signs, will not be popular and product generations will alternate like consumer electronics. There is business today, and there may be no business tomorrow. He said that Advantech was the first manufacturer to enter this field and enjoyed the advantages of the advanced. As long as it got a project, it would have an average of three to five years of business to do

but he immediately mentioned that compared with the consumer electronics industry, including personal computers, every order of industrial computers is very small. Unlike Apple computer, an order of iPod can double the revenue of qunlian and soar its share price by hundreds of yuan. "You must be like an artist, enjoy (enjoy) small output, and can't envy others." Guo Boda pointed out the psychological difficulties in this industry

for Advantech, it is simple for leading industrial computer manufacturers to achieve stable growth and stable profits; However, in the era of personal computers, it is difficult to ignore the rapid growth of the industry and concentrate on sticking to the industry, but the high-end fine powder products below 7 microns have not increased year-on-year

Liu Kezhen said that when he saw the boss of the Douhua stall near his home, he only thought about how to improve the taste and how to make customers eat more delicious Douhua every day, so his business was very good every day. Naturally, he would not go to see what other roadside stalls nearby were selling. He believes that when all people in the company focus on the targeted customers and only do things that contribute to these customers, they naturally don't care how fast other electronics manufacturers grow, and it's naturally not easy to follow the ups and downs of the boom

but at that time, there was a constant sound inside. For example, a large passenger in Brazil should not have the scene of oil leakage (water). The customer took a fancy to Yanhua's ability to design computers and asked them to quote for a consumer device. The business representatives of high-level R & D talents and technical teams with Academician workstations and thousands of experts knew that the company only focused on industrial computers and never distracted itself from producing products directly to consumers. They originally wanted to refuse directly, but they didn't expect that the other party's one-time order volume was US $3 million (about NT $96 million), which was larger than any of Advantech's customers at that time. Technology is not a problem at all. Department heads are inevitably moved by this huge order

Liu Kezhen held a serious meeting for this purpose. He believes that for the system integrator customers of industrial computers, Advantech has not done its best, and its ability is not enough to do consumer electronics. This temptation cannot be overcome. Once distracted, the original customers will not be able to cultivate in the future. At the meeting, he only asked, "such an order can be made once. Can we continue it in the future?" In less than an hour, the meeting was over. In the future, few internal people raised objections to the business philosophy of concentrating on their own business

but external challenges will soon come. When Advantech went public in 1999, it immediately encountered the biggest technology foam in 2000. Many people noticed that venture capital of Advantech came to visit Liu Kezhen one by one to spread the necessity of growth to him. "It's too slow to grow by relying on this industry," they said, hoping that Liu Kezhen could invest abroad

after the foam, none of the investments were successful. Although the amount was small, when he took that step, Liu Kezhen deeply felt the seriousness of his original intention. "When your attention moved from the inside to the outside, your behavior was completely different, and you will start to have expectations for the growth of your industry, and your pace will be chaotic." After that time, he completely abstained from investments unrelated to his own business

the key to stability: brand strength, so that the company can tide over the downturn

in the depression after 2000, major customers took orders, and industrial computer OEM (manufacturing design OEM) manufacturers all experienced a period of struggle; However, for Advantech, which takes the retail channel, each customer does not exceed 2% of its revenue. The brand strength makes Advantech spend smoothly. Liu Kezhen still believes that this is due to the concept of focus. "What is brand management?" He said, "the most is to design a name without advertising. As long as you don't shake your business direction, over time, customers will connect industrial computers with Advantech. Focus is a brand. If there is no one, there is nothing." Therefore, in the most difficult time, he was too conservative to step into consumer electronics. "If customers find that you have shoes in front of the beef noodle stall, they won't know what you are selling."

the original goal of being the first in the world has been achieved, which may be the beginning of diversification, but Liu Kezhen stressed that in the same field, as long as the executive power is continuously improved, Advantech can still grow two to three times in the future

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