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Chinese authorities unveiled last month a guideline to further strengthen the digital economy and nurture more independent business owners and self-employment in the latest move to boost consumption and create jobs. As people on the Internet put it: “time to hand myself an offer.”

China’s digital economy has shown its strength and energy during the covid-19 outbreak, paving way for a variety of “new professions.” Huang Tao, professor of management science and information system with Peking University’s Guanghua School of Management, shares his ideas on how newcomers should take on opportunities and challenges emerging from this trend and avoid pitfalls along the way.

CHANGES TO LABOR MARKET

While this year’s graduates are facing job-hunting difficulties due to the coronavirus and a global economic downturn, unprecedented opportunities and challenges abound in new business models from online education and the sharing economy.

In order to seize these opportunities, we need to have a clear understanding of China’s labor market. While surplus workforces from the countryside have long been taking up the country’s most menial urban jobs in the past, today’s young people would not like that,and new, fitting jobs must be created for them. How to create jobs that cater to today’s urban youngsters and urbanized migrant workers is a question we should ponder.

Not unlike consumption, labor force is also upgrading. Today’s labor force supply has undergone big changes as young job seekers’knowledge and personal demand have moved to a new level, and the labor market must adapt accordingly. With increased college enrollment,the country now has more college graduates who do not identify themselves as low-end labor forces. However, this does not necessarily mean that they are not hardworking or resilient. They are just pickier when choosing jobs. Given a flexible environment where they can pursue what they’re interested in, they will put their full potential into use.

The new guideline, jointly released by 13 central government departments,including the National Development and Reform Commission, highlighted endeavors to promote employment based on diversified channels including social media, e-commerce,short-video and live-streaming platforms. These up-to-date measures will help young people better take part in the digital economy.

NEW INDIVIDUAL BUSINESSES

While some compare this round of individually-owned businesses to the first batch of business startups during China’s reform and opening-up in the 1980s, the differences between them are huge. Businesses then were born out of and separate from the mainstream system, but now these individual business owners are still part of the mainstream economy.

As large-scale manufacturing methods and routine supplies could no longer meet people’s increasingly diversified demand,short video platforms like Kuaishou and TikTok came to pick up the slack,raising new requirements for the existing economic system and management mechanism.Thresholds for self-employment being lowered does not mean it is no longer subject to management. The goal of management is washing out the substandard, not selecting the best. The best environment for doing business is one of rule of law. As far as management is concerned, intervention should be kept to a minimum and the market economy should be allowed to achieve its full potential as long as laws and regulations are not violated. This will help businesses embrace innovative models and manufacture products more efficiently, which is beneficial for both supply and demand.

A key challenge for a young aspiring entrepreneur is that the arena nowadays is too crowded and how to find one’s own prey is a lesson for the new times. We like to tell students that whatever one likes can be turned into a business. We should encourage young people to try and tolerate their mistakes. Sometimes a casual attitude can, instead, lead to innovations and breakthroughs.

WATCH OUT FOR PITFALLS

Only a few out of the many business founders can succeed. How can young people who have just started their businesses avoid detours as best as they can?

The road of entrepreneurship is said to be full of pitfalls and many suffer bruises and cuts. It makes sense since a startup usually comes from an idea, and the idea only requires a singular-point breakthrough. For instance, a startup can be born out of a solution to gauge market demand that has yet to be fulfilled. However, corporate governance is on an entirely different level than creating a business. It requires comprehensive operations that encompass research and development, marketing, accounting and human resources, and shortcomings in any aspect can get the company in trouble. An entrepreneur will,thus, constantly encounter all sorts of problems. The road of entrepreneurship is tough because an entrepreneur has to do many things that they are not familiar with or good at in the past.

That’s why the first thing one needs is peace of mind. One should be fully aware that there will be a lot of challenges ahead and only through observing and learning meticulously can one avoid those pitfalls or quickly recover from them.

That said, difficulties are not all bad news, and they will eventually become your precious experiences. One can only be successful and versatile after navigating through those pitfalls. Young entrepreneurs might do well to ponder questions such as “what should I consider when commanding thousands of employees” and “what kinds of qualities should I possess? ” For one who has no management experiences, the challenge to supervise that many people is undoubtedly huge.

There is much to learn on the path to becoming a successful entrepreneur. Every problem solved and every pitfall skirted are an essential part of the rite of passage for an outstanding entrepreneur. Not unlike China’s grueling college entrance exam, starting a business can also be compared to crossing a single-plank bridge with many others, and every pitfall is a test. With hard work and a firm goal, one will overcome obstacles and achieve success eventually.

© 2019 Guanghua School of Management Peking University