Return to 88: Starting from Marrying My Sister-in-law

1994 2 Month 14 Day.

This is a memorable day, not only because it is Valentine's Day, but also because it is the day that Lianxiang was listed on the Hong Kong Stock Exchange.

It is also worth noting that it was only four days before the Lunar New Year, not before, and February 14, 1994 was also the fourth day of the Lunar New Year in 1994.

On this day, Liu Sheng, holding a gilded rose given to him by a Hong Kong businessman and wearing a borrowed suit, rang the bell representing the listing of Lianxiang amidst the collective ridicule from Hong Kong media who called him a "rustic entrepreneur."

Let's set aside the stock price performance that day for now.

Let's first see what the media at home and abroad are saying.

"Lenovo, a leading tech stock, makes its debut with a steady and pragmatic approach."

"On the other side of the planet, the tolling of the Hong Kong Stock Exchange bell at this moment reflects both the clumsiness of mainland technology and its ambition."

"This is a very memorable event; it's the first time we've measured ourselves against the standards of the capital market—"

Unfortunately, we've just realized we can't even reach the scale.

The above three titles.

The first one is an article published by a relatively neutral Hong Kong media outlet that is close to the mainland.

The second is the commentary published by the English media, which maintains constant vigilance towards our country and is associated with the arrogant Anglo-Saxon lineage.

Thirdly: This is a typical domestic media outlet that criticizes our own people, as evidenced by the newspaper headline it published.

The entire content is derogatory.

Of course, this also aligns with our own Chinese philosophy of moderation. The purpose of this article is simply to remind Lianxiang not to be too arrogant or complacent.

But has Lianxiang become complacent? Has it become arrogant?

No.

On the contrary, Lianxiang is at a critical juncture of life and death.

Although it started with Chinese character cards and also acts as a PC distributor, assembling and selling Lenovo-branded desktop computers, its main source of revenue has always been Chinese character card revenue, accounting for 40% of the HK$7.8 million annual revenue report submitted to the Hong Kong Stock Exchange.

This is extremely unhealthy.

To grow and expand, they must shift from producing individual PC components to manufacturing complete PCs, taking advantage of the current barren state of the mainland computer market to quickly seize this huge market.

This wasn't a gimmick; Liu Sheng used it to tell a story to Hong Kong businessmen, which quickly secured approval for the Hong Kong Stock Exchange IPO, allowing Lianxiang to list in Hong Kong and raise HK$200 million.

According to the prospectus, the HK$200 million raised by Lianxiang will be used for its purposes.

50%: Expand the production base in Beijing (mainly producing motherboards and PCs).

30%: Research and development of Lenovo's own brand of computers (the first Lenovo microcomputer was launched in 1990).

20%: Replenish working capital (to cope with the price war following the tariff reduction).
Did anyone understand it?

The key lies in the phrase "responding to the price war following the tariff reduction".

According to reports, just before the Spring Festival, the country introduced a new tariff policy, which reduced tariffs and eliminated the cumbersome policy of requiring import permits for computers. This means that major foreign brands such as IBM and Compaq are about to make a large-scale entry into the market.

What will Lianxiang use to support it?
How much wealth do they have to contend with these world-renowned foreign PC brands?
Its only advantage is its home base.

Therefore, on the day of the listing, Liu Sheng immediately led the company's senior management back to the mainland from Hong Kong overnight to study and deploy measures to block the invasion of these world-renowned PC computer brands.

Meanwhile, Liu Guangnan, who was absent from the IPO bell-ringing celebration, was still leading his R&D team in the company's laboratory, debugging the new generation of Lianxiang motherboards prepared for the company.

on the basis of.

Liu Guangnan was deeply worried that Lianxiang had no PC computer assembly technology of its own, because all the key components on the motherboard they were currently debugging were imported from abroad.

Then a thought came to mind: he wanted to take advantage of the success of Lianxiang's listing on the Hong Kong Stock Exchange and raise HK$200 million.

He pulled out a plan he had a long time ago.

He applied to the company for an additional 5000 million yuan in investment for the laboratory, hoping to lead the team to develop core technology chips that are crucial for PC computers.

And so, he happened to hear that Liu Sheng had led the company's senior management back from Hong Kong and was in a meeting in the conference room.

He immediately abandoned his work and, without bothering to continue debugging the motherboard, excitedly barged into the company's senior strategic meeting as the chief engineer and director.

He immediately proposed that he needed 5000 million to develop chips, a bold move he made at this high-level company meeting.

The result was far beyond his expectations.

As he expected, everyone would applaud and loudly approve of his feat, but that didn't happen.

Instead, everyone was looking at him with complicated expressions.

Liu Sheng looked at him and said, "The meeting we are having now has nothing to do with your R&D department. Engineer Liu, you are the chief engineer of the laboratory. Why don't you go out first, and I will explain to you privately later."

He ignored them and loudly questioned them: "You clearly raised 200 million, and the company is not short of money right now. I only need 50 million. I don't care about the rest. With this 50 million, I guarantee you that this money will not be wasted."

He was aware that the company was preparing a new PC assembly line factory, but surely it wouldn't cost more than HK$200 million?
Liu Sheng sighed and had no choice but to gesture for the accountant behind him to step forward.

The CFO stood up, his expression complicated, and slowly picked up a computer from the conference table. He pressed a few keys and then handed it to Liu Guangnan, saying, "Two hundred million Hong Kong dollars seems like a lot, but according to Mr. Liu's plan, this amount of money will only last us 87 days. Unfortunately, Mr. Liu, we cannot support your chip R&D plan."

"That's right, not only that, other R&D projects should also be cut."

"I think Engineer Liu should resign from his position as a company director. Given the current situation, the company really can't afford to spend too much money on endless projects in the laboratory. Reducing some investment won't affect the implementation of our upcoming PC desktop computer plan."

"Yes, they are all imported parts anyway. All we do is act as a transporter, assembling these parts together and then using our own methods to put our Lianxiang brand on them. The only thing missing is the motherboard layout."

"As far as I know, the company's laboratory has already successfully debugged the second-generation Lianxiang motherboard. In the future, we will only need to make some minor adjustments based on this, if there are any changes in the technology of the components. We will no longer need so many people. Therefore, my suggestion is that the company can consider laying off some of the laboratory staff and using our resources more effectively to increase our advantage in the upcoming price war."

"Yeah, I agree."

"I agree."

"President Liu, we all agree with your trade-industry-technology approach. After all, our goal at this stage is to survive. Only by surviving can we talk about the future. Although Chairman Liu's idea is also very good, it is too idealistic. As for independent research and development, I think we can put it on hold for now. We can't let it affect the unity of the company."

All the high-ranking officials in the conference room stood up to support Liu Sheng; not a single one stood up to support Liu Guangnan.

Of course, this is also because these people were all disciples of Yagyu, and he promoted them to support him in abandoning independent research and development and pursuing the trade-industry-technology route.

For a moment, Liu Guangnan was so angry that he almost vomited blood.

He glanced around and saw that not a single person was willing to stand up and say even a word in his defense. Although some of them were technically trained, they seemed to have forgotten their original aspirations after transitioning to management positions. They kept talking about the big picture and grand principles, as if if Liu Guangnan were to say another word, insisting on following the technology-industry-trade route and developing chips with independent intellectual property rights, then he, Liu Guangnan, would be a sinner against Lianxiang.

Moreover, for the sake of company unity, if he still has any sense of responsibility, he should voluntarily resign from his positions as a company director and chief engineer, go home to recuperate temporarily, and try to appear at the company as little as possible, so as to prevent the young, inexperienced employees from being too idealistic and, under his influence, questioning the company's commitment to the "trade-industry-technology" route.

He was furious. He argued his case and confronted these people, talking non-stop until his mouth was dry and his voice was hoarse.

In the end, however, nothing changed. A minority against the majority, his status as a company director and chief engineer was stripped away by the collective efforts of these company executives.

Even his true nemesis, Liu Sheng, didn't personally intervene. He only looked at him with pity afterward, offering hypocritical comfort, "Engineer Liu, why don't you go back and rest first? We'll keep your workstation for you, and you'll still be the chief engineer of the company's laboratory. Before that, we'll conduct a thorough investigation of the laboratory staff. After we weeding out some of the slackers, you'll still be needed to lead these researchers in developing products for the company. You can't just quit."

Listen, is this human talk?

They stripped me of my board membership, dismissed me from my post, and even wiped out all my supporters before finally offering me a meal. This meal, damn it, who could possibly eat it?

Liu Guangnan almost went against his principles on the spot and cursed the hypocrite's ancestors for eighteen generations. He was resentful and hateful. He gave the other party a "we'll see" look, then slammed the door and left.

From then on, he remained idle at home for five years. If nothing unexpected happened, he would finally be unable to bear this endless idleness in 1999 or 2000, near the end of the century. He would become a mere figurehead at Lianxiang, angrily break ties with Liu Sheng and others, and be unable to gain a foothold in Lianxiang. He was also destined to lose the struggle and be expelled from Lianxiang.

However, with Lu Yang's appearance, Liu Guangnan has a new opportunity.

The fifth day of the Lunar New Year.

This occurred the day after Liu Guangnan clashed with Liu Sheng and other high-ranking officials of Lianxiang.

Upon receiving the news, Lu Yang contacted this future "Don Quixote"-like hero, who was also a lifelong advocate for domestically produced chips and operating systems, and offered him a price that the other party could not refuse.

"Even if Lenovo agrees to your chip solution, they can only give you a maximum of 50 million, while I can give you 100 million, not in one lump sum, but by investing an additional 100 million into the company's labs every year."

"The condition is that you agree to join us with your team and temporarily give up the PC-based computer chip you want to develop. Instead, you and your people will help the company develop the MPEG standard video decoding chip required for VCD players. It requires fewer transistors than PC-based computer chips and has lower precision requirements. From a technical point of view, it will be easier to achieve results, but at the same time, it can lay a more solid foundation for your future development of PC-based computer chips."

"Promise me you'll join us. Once we develop a video decoding chip based on the MPEG standard, we'll provide manpower and funding as needed. I, Lu Yang, will absolutely support your continued research and development of PC chips. Even if you want to research computer operating systems, I'll support you nonetheless." (End of Chapter)