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236 40 Quality Is Shanghai’s Lifeblood1 December 1, 1988 German expert Werner Gerich has offered many excellent suggestions regarding quality management in Shanghai’s factories. He’s in his 70s now and has worked in factories for decades. He is very experienced, and his suggestions are well worth paying attention to. His impression of Shanghai’s factories is that they are “dirty.” The windows in some factory shops are left open, their glass isn’t wiped, and there is dust everywhere. How can good products be made in such a dirty environment? Even the equipment is ruined. We are not rigorous in many areas of enterprise management. I think we must carefully study Mr. Gerich’s suggestions one by one and adopt forceful measures to improve our work. Our spirit should manifest itself in the details, and we should be meticulous about making products of good quality. Quality is Shanghai’s lifeblood. The insufficient supply of raw materials greatly threatens the continued growth of Shanghai’s industries. If they cannot get past this difficulty, they will shrink or even fail to survive. What should we do? On the one hand, we still hope to keep receiving support from the central government and other regions; on the other hand, we must engage in large-scale importing and exporting. If we do not do so, nobody will be able to rescue Shanghai. Given how difficult it has been to obtain raw materials for Shanghai this year, why is it that we accomplished our industrial production tasks even better than expected? The growth rate for the whole year might reach 8% because to a large extent we engaged in large-scale importing and exporting, and we imported raw materials in a timely way. But imports require us to spend forex, so we must export to earn forex—it won’t do to borrow and not repay. That’s why it will be hard for Shanghai to survive unless it works hard to export, but to earn forex through exports, products must be of high quality. 1. On December 1, 1988, Zhu Rongji invited German expert Werner Gerich to give a presentation on strengthening enterprise management and improving quality to an assembly of directors and managers from over 1,200 large and medium enterprises. These are part of the remarks he made after listening to Gerich’s presentation. Zhu_Shanghai Years_1987-1991_hc_9780815731399_i-xii_1-620.indd 236 12/26/17 12:00 PM Quality Is Shanghai’s Lifeblood 237 At present, the price of raw materials continues to rise, yet we cannot raise the price of finished products. If quality isn’t improved and we just have the same old products, how can we raise prices? When materials go up by so much, your same old products go up by a similar amount—this isn’t going to work. You must have good quality at good prices, you must develop new products and new types of products. This year, the city government has resolved to start 14 key industrial breakthrough projects that integrate sci-tech with production. The purpose is to promote the integration of sci-tech and production at thousands of enterprises. New products will offer good quality at good prices, they will be more profitable than old products, and the money they make will be enough to offset the losses from old products. After a while, the old products will be eliminated, you will only be producing higher-grade new products, and the state of your enterprise’s operations will take a turn for the better. Then you keep introducing better products, constantly upgrading and updating them. This is the sort of operational strategy we should adopt. The quality I speak of includes the product’s functions and technical level— not the quality of some second-rate substitute. Shanghai’s products must be manufactured to international standards. If we use lower standards, even if quality management is very good, the products still won’t sell. We must produce according to international standards, we must produce to export, we must produce according to the customer’s needs. If any national standards are unfavorable for exports, they should be revised according to procedure to suit the needs of exporting. We shouldn’t have two sets of standards because then it would be very hard to make strict demands of the workers. Since our goal is large-scale importing and exporting, we must first be able to export. A factory director must have an awareness of...


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