Family Business in China, Volume 2 by Ling Chen & Jian An Zhu & Hanqing Fang

Author:Ling Chen & Jian An Zhu & Hanqing Fang
Language: eng
Format: epub
ISBN: 9783030514020
Publisher: Springer International Publishing

Third-Generation Ge

For Nanyao, it is difficult to decide whether the Tianle should claim bankruptcy because doing so would impose great hardship on Tianle’s employees, customers, and suppliers. It would also damage the Ge family’s reputation. Nanyao's grandson, Fei Ge, a post-90s overseas returnee, made the final move and recommended a suspension of the business in 2018. During this turbulent period, it was Fei who actually took over the company as the acting leader. Since he had learned financial management in the United States before his return to China, he eventually lived up to his family’s expectation, though he soon recognized how challenging it was to run a business.

Most of his time was spent interacting with complaining stakeholders such as banks, government officials, and customers. On the day of the suspension, many people were thronging in the office, asking for wages and claiming compensation. He had no choice but to repeatedly explain to all parties, and he even called the police to get people out of the office. A few days after the shutdown the ripple effect started. Philips's global president arrived in Shengzhou from Belgium, asking for the restarting of Tianle’s supplies to Philips. The shutdown of Tianle had also caused a BMW production line to stop. As the shutdown continued, some other auto manufacturer’s production lines might also soon be affected. It appears that the Tianle Group had significant market power even though it was in a dilemma at that moment.

When Fei returned to Shengzhou from the United States two years ago, his family business Tianle Group with over 2,500 employees was in a state of turmoil, leaving him a total mess. The complex management, weak capital chain, and huge bank debt all were evidence of the difficulties the company was having. In addition, Fei was also faced with other problems, such as the aging of the company's management, many of whom had worked at Tianle for many years. Some were managers in his grandfather’s age and occupied important positions. At this moment, his grandfather was ill and his father (Jinming) was arrested by the police due to Linchai's claim of Jinming’s misuse of Hele’s property, leaving all the tasks for him.

Given all these events, he resolutely made the suspension decision to fight for the family’s last chance. In mid-July 2018, he submitted another restructuring report to the local government. “Now we are indeed facing a crisis, but we expect that our efforts will endow us with opportunity to get rid of all the troubles, thus to step on a new trail.” He firmly believed that the local government could deal with the relationship between Tianle and Hele in accordance with the law and justice, which meant that Tianle Group would not be defeated. The Ge family might be able to win some support from the local community because Nanyao had built schools, health centers, and other public welfare undertakings in the local area. In addition, he also built 14 factories in more than a dozen villages, which provided employment opportunities for villagers to work and make money at home.

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