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Chinese Model gains traction in global manufacturing industry

Staff Writer | December 25, 2017
The New York-based Institute of Electrical and Electronics Engineers (IEEE) announced a proposal to develop an international mass customization standard led by Chinese electronics manufacturer Haier at the National Engineering and Scientific Commission (Nescom) Conference.
China manufacturing
World business   The first international standard
It is the first international standard created by IEEE based on the model and to serve as its technical framework since the organization was launched over 50 years ago.

It is also the first time the development of an international standard was led by a Chinese company. This is yet another opportunity for China to showcase the Chinese Model, a third component of the redefining of the term "Made in China", in addition to Chinese Product and Chinese Brand.

Currently, governments are focusing on and supporting the fast-growing digital-enabled industrial production and investment sectors.

The world's manufacturing industry is looking for the best path to the next stage of its transformation, with IEEE providing a universal and scalable approach for upgrading manufacturing processes worldwide. The aim is to accelerate the progress of the new industrial revolution.

Why is China being the one to provide what becomes the selected standard? When it comes to the topic of the new industrial revolution, China, Germany and the USA are the countries coming up with their ideas.

However, the ideas that end up getting the most traction, and becoming the trendsetter, these days, are practices developed in China.

Haier, an iconic Chinese company, incorporates the user of the product into the industrial system and considers him or her as the core, the major player and the driver in the industrial transformation process.

In addition, the company empowers the user to be a part of every step throughout the creation process with the aim of moving from Zero to One and transforming from mass manufacturing to mass customization.

It should be noted that the definition of mass customization is different from the concept of customization.

Mass customization does not refer to the low production efficiency at a manual workshop and goes beyond providing the end user with module options.

Instead, it allows the user to participate in the innovation process and the result of that process as well as benefit from the value generated throughout the life cycle.

In fact, the concept, originally called the Prosumer concept, originated in the USA. As early as 1970, American futurologist Alvin Toffler presented the idea of mass customization in his book Future Shock. Later, the idea took root and began to mature in China.

As for the reasons behind the trend, an industry watcher noted that "Industry 4.0 is not the reindustrialization of industry. It represents the socialization of industry and especially, the mass socialization. The trend is fully embodied in Haier's practices."

In 2005, Haier announced the rendanheyi business model, which transforms users to lifelong users and reshapes employees as creators.

In addition, the model creates a long-term cooperation, co-creation and win-win relationship among users, employees and the brand rather than the one-time buyer-seller relationship.

The management change creates an ideal structural and cultural environment for mass customization. However, it is not likely to gain acceptance in European and American companies that rely heavily on linear management.

The creation of the rendanheyi model by Haier paves the way for the development of the mass customization model, which gives users an opportunity to engage in every step of the process on Haier's platform.

Nowadays, technology reduces the distance between point A and point B anywhere on this planet. The One Belt, One Road initiative creates favorable conditions for the East to meet the West. "Made in China" is accelerating the transformation from Chinese Product, Chinese Brand to Chinese Model.