Case Study: Chengdu Bus Group
CHENGDU BUS GROUP
By Runtian Jing, University of Electronic Science and Technology of China
The Chengdu Bus Group (CBG) is a Chinese, state-owned enterprise with more than 4,000 buses and 14,000 employees. A few years ago, CBG encountered serious problems. The primary issue was the company’s management systems, but it also faced a considerable financial crisis. Complaints against CBG from its many customers were becoming increasingly common, and the operations of the company were in disarray.
At the end of a troubled year, Dr. She Chen was appointed the director (CEO) of CBG. Dr. Chen had proven himself in previous positions as a thoughtful and insightful manager. He had accumulated a wealth of experience in not only effective leadership in Chinese society but also the field of management theory. In addition, he had earned a PhD-a very rare achievement in the Chinese business community.
Due to the seriousness of CBG’s problems, the mayor of Chengdu gave Dr. Chen just three years to reform CBG-too short a time to gradually transform the organization, including the critically flawed management system and financial situation. Therefore, Dr. Chen had to implement rapid change and take risks to carry out a successful reform in the required time frame, even though he knew it would be met with great resistance from CBG’s employees and many stakeholders.
After taking up his new position, Dr. Chen conducted a careful investigation into the functioning of CBG, after which he formulated a series of reform measures. He then discussed his ideas and proposed changes with the mayor and leaders of Chengdu city, obtaining full support in both authorization and funding, before implementing the organizational changes in the company.
FAST-PACED MANAGERIAL REFORM
Because CBG is an old, state-owned enterprise, very complicated working relationships and politics existed among the 14,000 employees. Dr. Chen knew that this situation would make it very difficult to carry out
By Runtian Jing, University of Electronic Science and Technology of China
The Chengdu Bus Group (CBG) is a Chinese, state-owned enterprise with more than 4,000 buses and 14,000 employees. A few years ago, CBG encountered serious problems. The primary issue was the company’s management systems, but it also faced a considerable financial crisis. Complaints against CBG from its many customers were becoming increasingly common, and the operations of the company were in disarray.
At the end of a troubled year, Dr. She Chen was appointed the director (CEO) of CBG. Dr. Chen had proven himself in previous positions as a thoughtful and insightful manager. He had accumulated a wealth of experience in not only effective leadership in Chinese society but also the field of management theory. In addition, he had earned a PhD-a very rare achievement in the Chinese business community.
Due to the seriousness of CBG’s problems, the mayor of Chengdu gave Dr. Chen just three years to reform CBG-too short a time to gradually transform the organization, including the critically flawed management system and financial situation. Therefore, Dr. Chen had to implement rapid change and take risks to carry out a successful reform in the required time frame, even though he knew it would be met with great resistance from CBG’s employees and many stakeholders.
After taking up his new position, Dr. Chen conducted a careful investigation into the functioning of CBG, after which he formulated a series of reform measures. He then discussed his ideas and proposed changes with the mayor and leaders of Chengdu city, obtaining full support in both authorization and funding, before implementing the organizational changes in the company.
FAST-PACED MANAGERIAL REFORM
Because CBG is an old, state-owned enterprise, very complicated working relationships and politics existed among the 14,000 employees. Dr. Chen knew that this situation would make it very difficult to carry out