the conference board:
Zhang (Ruimin) was only 35 when he was asked to lead the Quindao General Refrigerator Factory, where product quality was a major problem. When a user complained about a defective refrigerator, he ordered an inspection of the warehouse. In all, 76 refrigerators were found to be sub-par. Each faulty appliance was labeled with its exact defect and the name of the employee responsible. Zhang called together the entire workforce to watch as first he picked up a sledgehammer and dealt a smashing blow to one refrigerator, and then each of the implicated factory workers followed suit until the machines were destroyed.
That story captures the role of leaders in shaping their company’s culture. It also conveys corporate values that, thirty years later, are still the bedrock of Haier’s culture. “Users Are Always Right, While We Need to Improve Ourselves,” is at the top of the company’s values statement.