The China-based Haier Group, the world’s largest home appliance manufacturer, has been pioneering a radical management approach over the past decade. “Rendanheyi”, as the model is called, has sparked intense interest in corporate circles, especially since Haier took over GE Appliances in 2016 and reversed its decade-long slump. The successful application of Rendanheyi in a Western company has demonstrated that it can work across cultures and ecosystems.The word “Rendanheyi” captures the crux of the approach: “Ren” refers to each employee, “Dan” refers to the needs of each user, and “Heyi” refers to the connection between each employee and the needs of each user. The idea is to shrink the distance between employees and users, creating win-win scenarios through co-creation and collaboration.Haier consists of more than 4,000 microenterprises, which act as separate and self-organised entities. Each micro-business resembles a start-up: employees have ownership and are empowered to make their own decisions. With a “zero distance” policy and a customer-paid salary, employees are accountable directly to users.With the Rendanheyi model we move away from being like an empire (with a traditional, closed pyramid) to be more like a rain forest (with an open networked platform). Every empire will eventually collapse. A rain forest, on the other hand, can be sustained.
The China-based Haier Group, the world’s largest home appliance manufacturer, has been pioneering a radical management approach over the past decade. “Rendanheyi”, as the model is called, has sparked intense interest in corporate circles, especially since Haier took over GE Appliances in 2016 and reversed its decade-long slump. The successful application of Rendanheyi in a Western company has demonstrated that it can work across cultures and ecosystems.The word “Rendanheyi” captures the crux of the approach: “Ren” refers to each employee, “Dan” refers to the needs of each user, and “Heyi” refers to the connection between each employee and the needs of each user. The idea is to shrink the distance between employees and users, creating win-win scenarios through co-creation and collaboration.Haier consists of more than 4,000 microenterprises, which act as separate and self-organised entities. Each micro-business resembles a start-up: employees have ownership and are empowered to make their own decisions. With a “zero distance” policy and a customer-paid salary, employees are accountable directly to users.With the Rendanheyi model we move away from being like an empire (with a traditional, closed pyramid) to be more like a rain forest (with an open networked platform). Every empire will eventually collapse. A rain forest, on the other hand, can be sustained.
The China-based Haier Group, the world’s largest home appliance manufacturer, has been pioneering a radical management approach over the past decade. “Rendanheyi”, as the model is called, has sparked intense interest in corporate circles, especially since Haier took over GE Appliances in 2016 and reversed its decade-long slump. The successful application of Rendanheyi in a Western company has demonstrated that it can work across cultures and ecosystems.The word “Rendanheyi” captures the crux of the approach: “Ren” refers to each employee, “Dan” refers to the needs of each user, and “Heyi” refers to the connection between each employee and the needs of each user. The idea is to shrink the distance between employees and users, creating win-win scenarios through co-creation and collaboration.Haier consists of more than 4,000 microenterprises, which act as separate and self-organised entities. Each micro-business resembles a start-up: employees have ownership and are empowered to make their own decisions. With a “zero distance” policy and a customer-paid salary, employees are accountable directly to users.With the Rendanheyi model we move away from being like an empire (with a traditional, closed pyramid) to be more like a rain forest (with an open networked platform). Every empire will eventually collapse. A rain forest, on the other hand, can be sustained.