,China

Ben Huang foresees shift to digitalisation, high-quality production for China businesses

International market expert identifies key considerations in choosing the China International Awards  winner

In his role as managing partner of International Market at Grant Thornton China, Ben Huang has rich experience in audit for listed companies, initial public offerings (IPO) audit, and international business. With nearly 30 years of audit work, he has provided services to sectors such as manufacturing, commerce, finance, real estate, chemical industry, medical industry, software, environmental protection, and tertiary industries.

He has assisted leading Chinese companies in their IPO and reverse mergers, including IPO and non-IPO audits to companies that want to break through the global market.

A certified public accountant by profession, Huang is a published author of articles and commentaries that tackle subjects such as assurance, professional standards, and business in the media of management and accounting.

He joins as a judge in the China International Awards and talks about future trends that will define Chinese businesses, digital transformation, and the key criteria in the judging process.

Can you share with us your work experience that has contributed to your expertise?

I have been engaged in auditing for nearly 30 years, with working experience in the field of audit of listed companies, IPO services, and overseas business (IFRS, USGAAP) in the service industry, like manufacturing, commerce, finance, real estate, chemical industry, medicine, software, environmental protection, service industry, and other industries.

I have completed the successful IPO and shell purchase of a number of Chinese companies in China. At the same time, I am responsible for the general audit of Chinese enterprises listed and unlisted overseas.

Which trends do you think will define Chinese businesses in the years to come?

Digitalisation:The digital trend is accelerating around the world. The pandemic has led many companies to suspend production due to supply disruptions, highlighting the vulnerability of the corporate supply chains. Enterprises that take the lead in digital transformation are much less affected by the epidemic than traditional enterprises, which also promotes the process of digitalisation in all industries. In the future, digital economy and digital application will redefine the organisational model and development model of enterprises.

Innovation:Innovation is the primary driving force for development. Enterprises need innovation to maintain vitality and create new profits. At present, China has successively introduced a number of preferential tax policies and measures for the critical links and key areas of innovation and entrepreneurship, which have become a driving force for enterprises to continuously innovate and enhance transformation and upgrading. Innovation capability is also an important factor impacting the market transformation. The improvement of enterprise innovation capabilities will also promote the transformation and upgrading of the industry and achieve high-quality development.

High-quality development:High-quality development is the main theme of China's economic and social development, and it is aligned with the overall trend of Chinese socialist modernisation. In the past few years, the scale of Chinese enterprises has grown rapidly, innovation capabilities have been continuously improved, and the business environment has gradually improved. The development of enterprises has initially moved towards high quality. In the future, enterprises, especially those state-owned, will continue to play a leading role in actively promoting high-quality development; adapting to the general trend of economic globalisation, new changes, and challenges; giving full play to the advantages of market players; actively advocating and promoting multilateral cooperation mechanisms, and winning the initiative of international competition.

How has digital transformation affected the way companies are being formed today?

Changes in corporate structure:Digital transformation enables enterprises to build an all-around customer experience that is architecture-centred. The new architecture can adapt to various dynamic changes inside and outside the enterprise, and is sufficiently open and agile to expand flexibly.

Changes in internal management and decision-making process:The decision-making process in traditional enterprises is top-down, involving a large number of approval procedures at multiple levels. Digital transformation has redefined the internal management processes and made decision-making more efficient.

Mining the value of data:Data has now become an important asset of enterprises. Through digital transformation, discovering and realising the value of data can effectively promote the growth of the company's business. The innovative application of a new generation of information technology and data assets can expand the market space and improve business performance.

Where are the opportunities in China for businesses to explore and how can they leverage these? What do you think are the advantages and disadvantages that it brings when it comes to managing and growing a business?

As the world's second largest economy, China's economic recovery after the epidemic has been fast, stable, and strengthening— the biggest highlights for China to attract foreign investment. To some extent, China has provided a safe, stable, and predictable business environment for foreign companies.

China is committed to wider and deeper opening-up so as to create a broader development platform and a better market environment for foreign-invested enterprises. Foreign companies should seize China's opening market and development opportunities, step up investment in China, and achieve more win-win results.

Advantage: China lends itself to a lot of beneficial policies for foreign companies to help them grow in the country. This year, in particular, we will draw up the 14th Five-year Plan for The Utilization of Foreign Investment, draw up a negative list for cross-border trade in services in pilot Free Trade Zones, and further remove restrictions on access to foreign investment that are not on the negative list. This will bring more convenience to foreign companies in China.

Disadvantage: Cultural incompatibility is one aspect. Western management style cannot be solely used in managing Chinese employees. But it takes a long time to form a perfect Chinese management system, making the compatibility between the two difficult. On the other hand, the management decisions of foreign companies require the approval of the headquarters. Because of time differences and other reasons, the approval cycle will be too long, so it is difficult to agilely respond to the rapidly changing market.

What key factors are you looking for when judging who should win?

Innovation: Including product innovation, marketing innovation, technology innovation, etc., innovation is the core competitiveness of an enterprise and the key to its development and market success. For example, General Mills, nominated this time, established an innovation, technology, and quality centre in Shanghai as early as 2014, committed to an in-depth understanding of consumer needs and accelerating product innovation. Their selected projects this time clearly convey the company's continuous breakthrough and innovation journey, no matter in terms of product development, creative concepts, or marketing methods.

Influence: Constantly improving the influencing power of the corporate is crucial to their future development. The promotion of brand influence will get rewarded with brand benefits, although it is often difficult to achieve. Just like Logitech's project this time, they successfully enhanced their influence in China and ranked the top of Chinese brands for the first time. I believe it will be very helpful for their business expansion in China in the future.

Dynamics: The current social environment changes rapidly. Companies can always make coping strategies to keep up with changes in line with the development of the industry or just stay behind the times—this does matter.

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