Innovation and Development of China Machine Press in the New Century

Abstract

On September 15, 2012, China Machine Press (hereinafter referred to as CMP) held its 60th anniversary ceremony in Jingxi Hotel in Beijing. The president of CMP, Mr. Wang Wenbin, delivered a warm speech: “After 60 years of development, China Machine Press has become one of the largest technical information service institutions in the field of Chinese industries, and become the publisher owning the largest share of China's book retail market. In 2012, CMP's annual book sales reached 35 million copies, issued periodicals hit 7 million copies, sales revenues exceeded 950 million Yuan, and tangible assets topped 1.3 billion Yuan. CMP has become a service entity of information collection, value-added information processing, and communication services. Our main business covers books, periodicals, consultancy, and distribution. Our product portfolio includes books, periodicals, online media, exhibitions, research reports, data products, audio and video products, and electronic publications. We integrate print media, audio-visual media, and network media together and become a specialized information provider as well as a large comprehensive S & T (science and technology) publishing house.…” As President Wang Wenbin reviewed CMP's journey over the past 60 years with a smile, he also focused on CMP's future development. Now China's book publishing industry system transformation has been basically completed and the number of listed publishing firms has increased. Publishing house began to shift from decentralized development to grouping or clustering development. Since 2008, the tendency appears that the growth rate of Chinese publishing market slows down, while the market develops increasingly maturely. With the improvement of science and technology and the rise of digital publishing, the traditional publishing industry is facing tough challenges. Facing these transformations of the macro markets, where's the path for the development of CMP in the future? Will CMP strive for development unceasingly with accumulated valuable experience for many years and its own technical resources and capabilities? Facing the future, President Wang Wenbin appears to have his new strategic plan…

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Resources

Appendix I: The Gross Scale of Books' Publishing in China

Year

2000

2008

2009

2010

2011

2012

The Total Number of Titles Published

143,376

275,668

301,719

328,387

370,000

414,005

The Number of Titles Revised or Reprinted

59,141

125,680

133,423

139,092

162,017

172,019

The Total Number of Impression (in million copies)

6,274

6,936

7,037

7,171

7,710

7,925

The Total Units for Printing Paper (in million sheets)

37,621

56,073

56,550

60,633

63,450

66,699

The Total Amount of List Prices (in million RMB)

43,000

79,143

84,804

93,601

106,310

118,300

The Business Income of Books' Publication (in million RMB)

37,600

46,280

53,790

66,440

72,350

Total Profit (in million RMB)

5,270

7,480

7,720

9,420

11,520

Note: Information extracted from National News Publication Statistics Website (http://www.ppsc.gov.cn/tjsj/). The data was as of December 31, 2012.

Appendix II: The Total Amount of Copyright Trade in China

Year

2004

2008

2009

2010

2011

2012

The Total Number of Imported Copyright of Publications

11,746

16,969

13,793

16,602

15,592

17,589

The Number of Imported Copyright of Books

10,040

15,776

12,914

13,724

14,708

16,115

The Total Number of Exported Copyright of Publications

1,362

2,455

4,205

5,691

7,783

9,365

The Number of Exported Copyright of Books

1,314

2,440

3,103

3,880

5,922

7,568

Note: Information extracted from National News Publication Statistics Website (http://www.ppsc.gov.cn/tjsj/). The data was as of December 31, 2012.

Appendix III: The Chart of CMP's Revenues & Assets

Figure 1. CMP's Annual Revenue (2000–2012)

Figure 1

Figure 2. Growth in CMP's Total Asset (2000–2012)

Figure 2

Appendix IV: Organizational Structure of CMP

Figure

Appendix V: Industry Structure of CMP

Figure 3. The Revenues and Percentage of Each Business Segment in CMP in 2012

(in 100 million RMB)

Figure 3

Appendix VI: Development of Consulting Business

Information Consulting Industry

Machinery Information Consulting Industry is one of four main businesses of CMP. Currently in this segment there are branches of the Information Research Institute, Strategy planning and Planning Research Strategy Institute, and Technology Management Research Institute. In this area, CMP mainly provides decision consultancy and inquiry services to the government, industries and enterprises.

Business Scale

Since the beginning of the 11th “Five-Year Plan”, the business scale of the information consulting industry has been expanding continuously. In 2012, the sector achieved revenues of RMB 54 million in total, with 7.1% increase comparing with 2011.

Major Scope of Business

From 2000 to 2012, CMP's Consulting Industry completed 200+ issues on information research, compiled research reports totaling 30 million words, and delivered 100,000+ source articles. In addition, we served nearly 70,000 readers, provided more than 4,500+ times on retrieval service, and organized 100+ various exhibitions and activities and 100+ conferences and forums.

The Information Research Institute's current major responsibilities include the construction of national technology literature, informationization projects for the government, and information research. CMP's Literature Resources Center is a member of the National Science and Technology Library, and the No. 1 branch of the National Engineering Technology Library. It is responsible for constructing overseas technology literature systems and ensuring the availability of such services in 14 areas, including national machinery engineering, automobile engineering, power engineering, and instrumentation. Taking advantages on its resources and undertaking the projects construction (such as the website of China Trade Remedy Information trusted by the Ministry of Commerce of PRC), CMP's Literature Resources Center has become the authoritative public information platform on trade relief and industry safety after 10 years' development. Basing on the mechanical engineering and electrical & electronic engineering, the project of “Electrical Machinery Export Guide System of China” integrates the industry, trade, and market together and provides trade information and relevant consultations to China's enterprises concerning mechanical or electrical products' manufacturing and exporting.

The Strategy Planning and Planning Research Strategy Institute has been continuously expanding its business fields, upgrading its research capabilities, and conducting beneficial explorations in research methods and tools, fundamental data construction, and service models. So far, the institute has established a new business structure that is orientated to the equipment manufacturing industry, characterized by the main intellectual property rights, and improved by major technology projects. Over the past 10 years, the institute has undertaken more than 100 major-issue research projects for national ministries, and completed planning projects for different levels of governments and businesses. It has also participated in planning supportive measures for National Mid- and Long-term Technology Plans, and drafting National Industry Technology Policies, as well as the 12th “Five-Year Plans” for Upscale Equipment Manufacturing Industry. The institute has repeatedly obtained recognition and praise from different levels of government leaders, as well as awards from provincial authorities. Qiushi magazine has twice published the institute's research.

The Technology Management Research Institute devotes itself to deeply exploring and utilizing technological information resources, forming characteristic services and competitive advantages in the fields of novelty search, technology filing, scientific achievement transfer, technical evaluation, science and technology award, science and technology secrecy, Engineering Index, etc., providing consultations and services of policies, industries and products to the government and enterprises. The institute has become a powerful consulting organization serving the machinery industry, and national administrative departments, playing an important role in the acceleration of scientific achievement transfer and application. Every year, the institute completes over 600 topics of novelty searching, accepts more than 700 items of award application, processes over 50,000 entries for EI database, and accomplishes a series of national research projects.

Appendix VII: Key Products of Books and Periodicals

Currently, CMP's book business segment consists of the technology, education, and popular book publishing divisions. A large number of quality books are published in CMP's strong fields such as engineering tool books, practical engineering books, high school, college, and university teaching materials, worker training books, computer and business operation books, and technology periodicals.

In the technology book field, a large number of authoritative, highly technical, and popular specialized books are published. They include Mechanical Engineering Handbook, Machine Design Handbook, The Electrical Engineering Handbook, Electrical Engineers Handbook, Vieweg Handbuch Kraftfahrzeugtechnik (German version of Automobile Engineering), Architecture Structure and Design Series, Complete Analysis of Linux Kernel: Based on 0.12 Kernel, and China Machinery Industry Development History - Centennial Review and Outlook. In the teaching and supplementary materials field, a large number of books have been selected by the authorities during the 10th and 11th Five-Year Plan periods as recommended ones. The quality materials were selected for general higher education, senior vocational training, and undergraduate and postgraduate, and as the specified materials for national middle-level vocational education and skills-training education. These books included Theory of Machines and Mechanisms, Power Electronics, Automatic Measurement and Transfer Technology, Tolerances and Measurement, Mechanical Drawing, Machinery Worker Cutting Handbook. Furthermore, CMP promoted a number of teaching and supplementary materials, such as the Riddle Solved Series and Every Day Exercise Series. In 2008, the publisher's Children's Q Bookshelf Series and Love Putting Together 3D Puzzles Series shot into the top places in the handicraft book industry chart shortly after being launched. In the popular book area, CMP has published a multitude of highly reputable classic bestsellers. These include The Effective Executive, Positioning, Execution, Who Are You Working For?, Lead the Team, The Truth of European Debt Crisis, and Industrial Spirit and Chinese Modernization.

List of the Public Periodicals Edited and Published by CMP Media

No.

Title

Publishing Division

Frequency of Publication

1

Metal Working (Metal Cutting)

Metal Working Magazine Agency

semi-monthly

2

Metal Working (Metal Forming)

semi-monthly

3

China General Machinery Industry Yearbook

monthly

4

Modern Components

monthly

5

Electric Age

Electric Magazine Agency

monthly

6

Electro-technical Application

semi-monthly

7

Electrical Manufacturing

monthly

8

Transactions of China Electro-technical Society

monthly

9

China Machinery Industry Yearbook

CMIP. Industry & Market Institute Industry & Market Research Institute

yearly

10

China Agricultural Machinery Industry Yearbook China Machinery Industry Yearbook

yearly

11

Journal of Mechanical Engineering

Information Research Institute of First Ministry of Machine-Building of the PRC

semi-monthly

12

Chinese Journal of Mechanical Engineering

bi-monthly

13

Popular Financing

Popular Financing Magazine Agency

monthly

14

Imp-Exp Executive

monthly

15

Project Management Technology

monthly

16

Digital Manufacturing Industry

Digital Manufacturing Industry Magazine Agency

monthly

17

Machine Market

Maschinen Markt magazine Magazine Agency

weekly

18

Automobile Industries

semi-monthly

19

PROCESS

semi-monthly

20

Plastics Technology

monthly

21

Car

Car's Editorial Department

monthly

Appendix VIII: Establishment of Beijing Baiwanzhuang Book Building Co., Ltd.

During the development of CMP, an iconic event was the establishment of the Beijing Baiwanzhuang Book Building Co., Ltd. (hereinafter referred to as “Baiwanzhuang”). On September 26, 2006, Baiwanzhuang, the first bookstore founded by a publisher in China, officially opened. This large bookstore was founded and invested by China Machine Press. It is situated in Baiwanzhuang Street in Xicheng District, where government authorities, scientific research institutions, higher education institutions, and well-educated residents are concentrated. Baiwanzhuang has a total of 8,000 sq. meters of operating area and displays more than 200,000 books.

Why did the publisher open such a sizable retail bookstore? As a publishing company, CMP is constantly focusing on the bookstore market. It has a dynamic distribution market and hopes to make the distribution market layout more reasonable through its new investment: Baiwanzhuang. President Wang Wenbin remarked that there were greater risks in the publishing sector than in book retail. By investing in bookstores, CMP could extend its industry chain presence, strengthen its comprehensive competitiveness, and reduce its publication risks. Through practice in bookstores, editorial staff could enhance their awareness and adapt to market needs. In addition, conducting research in bookstores would allow them to better understand the market needs and interests, and apply it to topic selection.

To prepare for this bookstore building project, CMP had much earlier introduced an operational model of “three integrated into one with multi-position management”. This would simultaneously achieve bookstore, online, and direct sales by using the bookstore's logistics platform. Likewise, multi-position management requires that units target different regions and subjects in different businesses.

The design of Baiwanzhuang highlights a modern, simple, elegant, and stylish ambience. The bookstore building divided its business by four floors. The underground floor sells electronic audio and video publications. The first floor mainly displays books of social sciences, cultural, business operations, law, and everyday life. The second floor displays books of education, examination and children's. The third floor sells technical and other specialized books.

President Wang Wenbin stressed that the bookstore building conducts only retail, not wholesale business, and treats all publishers equally in terms of discount and credit terms, including CMP. Baiwanzhuang is positioned as a bookstore with cultural taste and operates independently with any publishers.

Baiwanzhuang's business revenues grew from RMB 62.94 million in 2006 to RMB 129 million in 2012, with the annual growth rate steadily above 12%. As of 2012, Baiwanzhuang's membership has reached 150,000 people, online-membership 600,000 people, and 230+ university library clients. 1

Reference

1. Source: China Machine Press. (2011). Innovation Development for 60 Years.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

2024 Sage Publications, Inc. All Rights Reserved

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