Technology invades the modern world

Chapter 418: Half Agreed

Lin Ran rarely comes to Yanjing.

Although the authorities in Yanjing hoped he would come to report on his work more often.

But every time he came to Yanjing, he felt uneasy.

Perhaps the aura of the capital cities throughout history was too strong, and the political atmosphere too intense. Even though he was an indispensable part of the country, he still felt an invisible pressure when he came here.

He generally prefers to avoid coming if possible.

He will only make a trip if it's a particularly important meeting that you absolutely have to attend.

But after the meeting, he would return to Shenhai without lingering or attending any local gatherings in Yanjing. Lei Jun had privately invited Lin Ran to these gatherings many times, saying that the attendees were all top entrepreneurs and that they could get together and exchange ideas.

Because it's an important meeting, and it's not just a gathering of entrepreneurs from Beijing. Lei Jun organized it, so it must be attended by the top people in the country.

Lin Ran had never been to such a gathering before.

However, after LONGi Green Energy's production capacity was put into operation, Lin Ran made a special trip to Yanjing. The last time he made a special trip to Yanjing for something was back when he was working with America to reap the benefits of the 4V capital market.

Not long after.

In Lin Ran's view, this matter is even more important than the last one.

In an office in Yanjing, there were very few people, only a handful.

Lin Ran spoke first: "The implementation of the new generation of photovoltaic modules is a good thing and a happy event for our country, but I also have some thoughts to share with you."

Those present felt a chill run down their spines. They knew the power of Lin Ran's thinking; the Taiwan stock market had already been severely damaged by such thinking, and the dismantling of TSMC was underway.

It is no exaggeration to say that the world is influenced by Lin Ran's way of thinking.

"In the photovoltaic industry, we used to be used to the model of first getting bigger and then getting stronger, and companies spared no effort to seize the market."

what's the result?
We hold the largest global market share in photovoltaic modules, but our own companies have meager profits, and our technical staff's income cannot compare with that of their counterparts in Europe and America. The entire industry is caught in an endless cycle of competition.

Now, after more than 20 years of development, our photovoltaic modules have achieved a technological advantage for the first time.

Compared to products from European and American counterparts, its competitiveness is far superior.

In my view, without government intervention, our photovoltaic modules would again be the subject of a price war. Despite having a technological lead and product advantages, they would still be sold at ultra-low prices, resulting in companies not making money, employees not increasing their income, and the entire industry remaining in a state of infighting.

The market entered a vicious cycle of competition, and the direct beneficiaries of this revolutionary technology became consumers in Europe and America.

I hope to cooperate with relevant departments to use taxation to supervise and compel all companies using next-generation photovoltaic technology to raise wages for their employees.

This wage increase will be linked to the company's production capacity.

The people present looked at each other, wondering if this was a bit too much for a company to do.

Should we take care of it?

"President Lin, I understand what you mean. We will conduct a thorough analysis later."

Lin Ran nodded and continued, "To support the company, Apollo Technology is willing to cover half of the increased salaries."

They didn't have time to fully process what that sentence meant.

Lin Ran continued, "The responsibility here is not in the form of money, but in the form of technology licensing fees."

Lin Ran then explained the technology licensing fee model to everyone.

Then he said, "According to the charging model we agreed on with photovoltaic companies, all companies are required to pay us a tiered fixed technology fee based on their production capacity."

Apollo Technologies is willing to deduct the subsidy portion directly from the licensing fees they collect.

In other words, the funding cycle for this subsidy is as follows: companies pay licensing fees, and a portion of those fees is directly deducted from the company's payroll.

We hope that the tax authorities can supervise the entire process to ensure that every penny actually reaches the employees.

This approach avoids increasing the financial burden, protects employee interests, and forces companies to abandon the low-price competition model.

I hope that by doing this, we can change the competitive landscape for businesses to some extent: instead of competing by lowering labor costs and prices, we can force them to optimize management and increase the added value of their technologies.

The term "technology" here is used in a broad sense.

The technological and corporate management capabilities that determine production capacity, yield rate, and production efficiency can all be considered technology.

"Mr. Lin, your intentions are good, but I would like to ask two questions."

First, who defines a high salary? How much is considered high? Eight thousand or ten thousand? Will your forced intervention distort the market and create new inequalities? Isn't a company's value determined by its market performance? Your idea can be seen as using administrative means to intervene in a company's core labor costs. Won't this stifle market vitality and prevent companies from adjusting themselves?

We must not forget the lessons learned from the past's hasty and rapid development.

Once subsidies and targets are set, rent-seeking behavior will inevitably emerge.

Businesses will try every means to obtain subsidies instead of genuinely improving efficiency. We are using a complex intervention to solve a problem that should be self-regulated by the market.

Furthermore, isn't the involution you mentioned simply a process of market self-clearing? The weak are eliminated, and only the strong survive.

We're now using subsidies to protect companies that should be eliminated; isn't this creating inefficient zombies? The ultimate cost will be a decline in the competitiveness of the entire industry.

Lin Ran explained, "Director Wang, of course not. We are conducting an audit of our partners and providing them with subsidies."

This is not administrative intervention.

American giants have been doing this for a long time, with Apple being the most typical example.

Apple has always had a strict Supplier Code of Conduct, requiring its suppliers to have reasonable working hours and wages and benefits that comply with local regulations or even exceed industry standards. Apple also regularly conducts third-party audits of its global suppliers. These audits are not just routine checks, but also involve in-depth inspections of production facilities and employee dormitories, and even anonymous interviews with employees to ensure they are not forced to work, are paid in full, and that working conditions meet safety standards.

If any violations are discovered during an audit, Apple will require the supplier to rectify them immediately and set a clear deadline for rectification. For serious violations, Apple will take severe measures such as terminating cooperation.

According to you, Apple's level of interference with suppliers is much higher than my proposal.

What I hope to do is very simple: avoid involution and allow frontline employees of these photovoltaic companies to also enjoy the benefits brought by technological progress.

This is something that companies can do, and some companies with technological advantages have been doing it. I think Apollo Technology should also make some attempts.

If we do this well, I hope that in the future, leading companies in our domestic supply chain, such as mobile phone manufacturers and new energy vehicle manufacturers, will also be able to impose certain constraints on their suppliers, requiring them to improve employee benefits and introduce systems similar to Apple's supplier management guidelines.

The requirement to combat involution must be implemented at the enterprise level.

That's right, Lin Ran went to Yanjing this time for this very reason.

Some voices from Yanjing opposing involution also call on companies to avoid vicious competition, malicious price reductions, and price wars without any bottom line, but they do not mention that you should increase wages for your employees, and that you should benchmark against foreign companies in terms of welfare benefits and labor protection.

In the past, when we lacked technological advantages, this was done to protect the competitiveness of our domestic industries, protect our domestic businesses, and protect jobs. This is perfectly understandable, and all countries have done it this way.

The working conditions for workers in England during the First Industrial Revolution were worse than those of slaves.

Now that you have a technological advantage, even if everyone treats their employees equally, you can still compete with foreign companies. It would be unreasonable not to do this.

Lin Ran couldn't bring it up directly, so he could only push things forward indirectly in this way.

Having returned from the 60s, Lin Ran carries with him a somewhat idealistic mindset. Since no one else is doing it, I'll start first.

The photovoltaic industry is a very suitable entry point.

The tiered pricing system was initially designed to encourage partners to improve employee benefits in the future.

This initiative requires support from Beijing University of Science and Technology (BUST) on the one hand, and data from BUST on the other.

"Mr. Lin, I think your suggestion is very good, but I still have some doubts."

The middle-aged man sitting in the middle opposite Lin Ran spoke earnestly, his hand resting on the proposal submitted by Lin Ran.

"President Lin, you have seen the bottleneck in our current economic development model and advocate breaking through it through top-level design. Apollo Technology is at the top level, and it has an absolutely dominant position in dealing with its partners."

Director Wang, you insist on market efficiency and fiscal discipline, and are concerned about the risks brought about by policy intervention.

In principle, I agree with President Lin's idea. We have indeed reached a point where we should further enable the general public to share the fruits of our industrial development.

Therefore, what you want to do, Mr. Lin, is essentially an exploration of a new development pattern.

If you do well this time, then we can gradually promote this to both private and state-owned enterprises in the future.

We should further promote this approach.

Leading industries and leading enterprises can drive improvements in labor conditions on a larger scale.

It is neither a completely planned economy nor a disorderly market-driven laissez-faire economy.

It represents a new balance. We must maintain the market's vitality while also correcting its blind spots.

Therefore, I need to ask more questions.

How can companies ensure that they do not increase the workload of their employees?

My company used to pay its employees five million in wages, and now I want to increase it to eight million, an extra three million. If I make money by exploiting the labor intensity of my employees, then your company will be at a pure loss.

More importantly, from a higher perspective, it is actually the national level that is funding this.

Apollo Technology is mostly state-owned, and photovoltaic companies use this as a reason to raise the price of their new generation of photovoltaic modules. Currently, the largest buyer of photovoltaic modules in the market is still a state-owned enterprise.

I don't mind the government funding this, but I do mind that even after we've spent the money, we haven't achieved the desired results.

The middle-aged man waved his hand: "What I mean is, compared to your proposal..."

I think the government should set a minimum price for its advantageous industries.

Then, because state-owned enterprises are the largest single buyers of these photovoltaic modules, we set an entry threshold and a set of rules requiring them to improve employee benefits.

I think this approach will be more effective.

Mr. Lin, thank you for your reminder. This is the path we must take.

This is an exploration of the future and our economic development model.

This is something we absolutely must do at this point in time.

Lin Ran achieved half of his goal on this trip to Yanjing.

We did not agree with his approach, but the national government will promote "anti-involution" efforts at the worker level.

In the past, Xiaomi emphasized enabling everyone to enjoy the fun brought by technology.

From a consumer perspective, China has indeed achieved this over the past decade.

Almost every consumer can enjoy the same quality electronic products at the lowest prices in the world.

Now that technology is booming and Chinese people are going to the moon several times a year, China is finally going to address this issue at the labor relations level, allowing workers to begin to enjoy the benefits of technological progress.

(End of this chapter)