« In China: the importance of governance, autonomy and digital discovery »
In 2016, you change countries again and go much further east, to China. What main experience do you retain?
I am indeed appointed in Beijing to the general management of DongFeng Peugeot Citroen Automotive Financial Company (DPCAFC). It is one of the three structures owned by the PSA group. China is something else again and the Russian experience helps me a lot: I would have arrived directly from Europe in China without going through a Russian decompression stop, I would probably not have seen or understood half of the situations I was confronted. The Chinese market is a little more difficult, in the sense that we are operating in close proximity with the State and the Communist Party. The slightest political misstep or even a simple request for support from the French Embassy is automatically punished by the Chinese administration and its regulators, allowing the country to leave its partners blind to the reality of bilateral relations. If in Russia we often speak of corruption, in China we must speak of collusion. I manage 300,000 customers in my portfolio, nearly 1,200 dealers with 180,000 individual contracts per year and more than 450,000 vehicles in financing with our distributors. Our company operates in a joint venture with DongFeng, in a context of fairly strong animosity between the leaders of each company, more for the issue of power and lack of understanding than anything else. In fact, it is difficult to break into the Chinese market by limiting the number of human resources to be assigned to it. Thus, the management of PSA in China depends on the way in which a small score of executives manages to set up common solutions with a public partner having divergent views dictated by national thinking, on the first automobile market in the world. Unlike our French companies who believe in the role of the providential man, Chinese companies hunt in packs to address problems or negotiations.
The experience that I retain in China is the importance of governance and the strength of the support of leaders. In a real joint-venture structure, the boards and all the management bodies really come into their own. We are living through a rather unique experience: having to defend our decision in front of our shareholders, with the organization of the partner company on one side and the administrative state and the Communist Party on the other. This type of organization is much more hostile than in other countries. It is in this sense that the weight of the highest leader, the energy he gives, the investments he accepts and the trust he gives to his teams is a facilitator.
Franck, tell us what difference you perceive between Russia and China?
In China, everything is disproportionate: I managed 350 people, I had more than 2,000 dealership agents and I managed 1,200 dealerships. It's just huge and much more than what we usually see in Europe in subsidiaries of large groups. China is therefore an experience of a large structure, rapid decision-making and strong strategic autonomy. Paris is indeed starting to be very far away, unlike Moscow where the time difference means that we have more than half a day of work together. With a 7 or 8 hour time lag, exchanges are rarer with head office and sometimes there are gaps in understanding. In the same way, the development of activity in China is very different from that found in Russia or even in Europe. Before any project, managers are asked to present successful business models before making a decision. Returns on investments are expected to correspond to the partners' appetite for risk. In China, it's another paradigm, we act without really worrying about the risk that exists and we take it into consideration only from the moment it is proven.
If in the past China was the workshop of the world, today it is considered the laboratory of the world. Are you making any discoveries there?
It was in China that I discovered digital. Unlike WhatsApp, WeChat makes it possible to create mini applications or mini sites, to make sales and to develop services because it integrates marketing and financial exchange tools. In China, even if it is protected, personal data is exploitable and it is very interesting to develop all its automation. For a financial structure, these opportunities give free rein to many possibilities. We were thus the first to set up a 100% online solution for a financial captive: a client can now obtain credit in less than two minutes, thanks to artificial intelligence tools such as facial recognition, recognition of characters, big data, matching learning and openness to external databases. Nevertheless, these technologies transform the relationship with customers and oblige, for example, companies, which in the past had the objective of reducing the processing times of their transactions, to reverse this logic in favor of the ethical level acceptable for their activity. Can we use this technology? How long is it reasonable to allow a client to make a decision? In Europe, we will no doubt catch up with Renault in particular, which is working on the subject with the digital factory and will, I am sure, provide answers to these questions. All this experience allows me to be a bit of a pioneer in my field of consumer credit.
When, in 2018, I have an opportunity at Renault, I resign from PSA and leave China for Korea, being one of the few senior executives to go the PSA Renault way and not the other way around.
