Singbee: Towards a Sustainable Business Model

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Overview >
About the Company >
Next Generation Singbee >
Building the Next Generation Singbee >
The Maturing of the Next Generation Singbee >
Prognosis: The Future is Bright >


Overview

Business Background

Founded in the 1990s, Singbee was originally a manufacturer of decorative crystal glass in China. Since 2004, Singbee has transitioned into manufacturing and developing LED lighting. Singbee is a second-generation family business founded by YuanCheng Wang. His daughter Lina Wang and her husband Winson Yeung currently manage the business.

Ecosystem Pain Point

The introduction of the environmental legislation in China negatively impacted on the profitability of the crystal business.

These significant changes to the crystal production industry in China required the company to search for paths to diversify. Anticipating future difficulties, Mr Wang identified LED lighting as a means to ensure sustainability through generations.

Business Strategy

The new Singbee business is building a stronghold in the LED market. The company seeks to use only the best raw material and combine it with innovative designs.

Central to the success of Singbee's business model is its lighting design that utilises a modular base for lamps. This makes assembling easier, increases efficiencies in maintenance and keeps costs lower. This modular design also significantly reduces the waste produced by LED lamps because the design allows individual components to be changed. Previously, if a single part failed, the entire lamp would need to be discarded.

Singbee’s high-end LED lamps have a lifespan of up to 244,000 hours. Important to maintaining the quality of the lamp is Singbee’s strict 21-point quality check system that tests each lamp and LED as it is manufactured.

Performance

Singbee’s new product series has been installed in Portugal, Russia, Mexico and the United States. Singbee holds over 100 patents in invention and design. By contrast, the old Singbee crystal business is in decline. As political pressure has grown, Singbee Crystal cannot function as it had in the past. Singbee has decided to phase out crystal and focus on the lighting side of the business.

Prognosis

Winson Yeung and Lina Wang strive to learn from the family business’s past failures, and avoid falling into the same trap in their lifetime. With the determination of a new generation, the future is promising.

Overview >
About the Company >
Next Generation Singbee >
Building the Next Generation Singbee >
The Maturing of the Next Generation Singbee >
Prognosis: The Future is Bright >


About the Company

In essence, the next generation LED business of Singbee needed the next generation of the family to help shape its future.

Founded in the 1990s in Zhejiang province, Singbee was originally a manufacturer of decorative crystal glass in China. The business grew very successfully as the crystal industry expanded in its early years. The success that Singbee experienced in the crystal industry, however, seemed unlikely to last. It became clear that there were some significant problems.

First, there were low barriers to entry into the crystal trade, especially in the early days when there was no government regulation. At the crystal industry’s peak, there were 22,000 crystal glass workshops and factories in Pujiang County in Zhejiang province alone. [1] Second, this rapid expansion of the crystal industry and lack of regulation meant that economic benefits came at the expense of regional environmental degradation. The environmental damage that resulted from the crystal industry was particularly profound on local rivers. Pujiang became infamous for having a “milky” river due to the tons of chemicals dumped into local waterways from the crystal cutting and polishing process. [2]

YuanCheng Wang, the founder of Singbee Group, recognised these significant challenges facing the crystal business – particularly the environmental damage caused by the production of crystal – and understood that something had to be done.

[1] “China’s ‘Crystal Town’: Industrial Changes Lead to Environment Protections,” CGTN America, 24 August 2016. Link.
[2] Ibid.

Overview >
About the Company >
Next Generation Singbee >
Building the Next Generation Singbee >
The Maturing of the Next Generation Singbee >
Prognosis: The future is bright >


Next Generation Singbee

As YuanCheng Wang explored more environmentally friendly business alternatives, he encountered LED lighting. In the early 2000s, LED lighting was a new product category and was relatively unknown in China. As with most new technologies, many were either unsure or sceptical of the opportunity this new technology presented. The technology was expensive, costing several times more than the traditional fluorescent lighting. Therefore, commercial applications seemed unfeasible. Given the cost, most were content with traditional compact fluorescent lighting, despite the growing awareness of the inefficiencies and presence of toxins such as mercury. The very concept of energy sustainability, like the LED technology itself, was in its infancy. The market had to be educated about the benefits of LED lighting such as the significant energy savings and the positive environmental impacts. LED lighting contained no mercury, and was clean in production, usage and disposal.

YuanCheng Wang anticipated the potential of LED lighting in the future and foresaw a high potential market. Singbee faced the classic business scenario of needing to pivot in order to sustain the success of the company into the future. The risks would be high for the business, but, if done successfully, Singbee could realise great benefits by capitalizing on a technological innovation with high commercial potential.

At the same time that YuanCheng Wang was considering this business pivot for Singbee, he was also thinking about the future leadership of the firm. For this strategy to succeed long into the future, he needed to bring through the right future leaders. The next generation LED business of Singbee needed the next generation of the family to help shape its future. Wang’s daughter Lina Wang was in her last year at university in the United Kingdom and it became crucial to Wang’s strategy that Lina Wang be committed to taking Singbee forward in this new direction.

Overview >
About the Company >
Next Generation Singbee >
Building the Next Generation Singbee >
The Maturing of the Next Generation Singbee >
Prognosis: The Future is Bright >


Building the Next Generation Singbee

The senior leadership change and their consistent emphasis on high quality product development and manufacturing helped to revive the business again.

In 2006, Lina Wang joined the business and Singbee Lighting was founded. She knew that completing a successful pivot is not simply about finding a new business opportunity. It is also about building the right culture and capabilities within the organisation.

On her arrival, she identified that the company culture seemed indifferent to the quality and design of products. She saw that ensuring a high quality and reliable product was non-negotiable for the business. There was no getting around a sub-standard product and a culture that was indifferent to it. Without the best possible product, the company could never build its reputation and client base.

As soon as she recognised this, Lina Wang made the creation of quality and reliable products the highest priority in the business. However, she knew that changing the cultural dimension of the organisation might prove a challenging and sensitive task. To compound matters, Lina Wang was still in the process of building her own credibility within the company as a capable leader.

Nevertheless, to begin addressing this culture challenge, Lina Wang took two important steps. The first was to establish higher and more rigorous product and process standards, while also increasing levels of accountability. The second was to bring in a like-minded business ally in, her husband, Winson Yeung. However, these two moves also met with two accompanying challenges.

Following some in-depth market research and feasibility studies, it was clear that the commercial lighting market in China was not yet sufficiently developed. Therefore, the decision was taken to try and launch Singbee in Europe. Although geographically distant, Europe had the benefit of being more open to environmentally friendly products. Out of the garage of a rented house in Bristol, England, Lina Wang and Winson Yeung started a European division of Singbee. Unfortunately, although good progress was being made in Europe, Singbee’s existing General Manager and Chief Technology Officer remained stuck in the old company culture that did not take quality and reliability seriously. The effect was that some products were rushed through the design and manufacturing process. Ultimately, his failure to comply strictly with the quality control checks meant that products unready for distribution and sale entered the market prematurely. His hasty decision- making impacted Singbee’s market position negatively, resulting in significant reputational and financial damage. Eventually, his actions led to his resignation and that of other senior managers.

In the wake of these disruptions to Singbee’s fledgling lighting business, Lina Wang and Winson Yeung had no choice but to sell off the United Kingdom division and move back to China to resume leadership of the company. Lina Wang was appointed General Manager and Winson Yeung was made Vice President. They brought in a new leadership team made up of a number of high calibre businesswomen. The senior leadership change and their consistent emphasis on high quality product development and manufacturing helped to revive the business again. Most importantly, it also ensured that the new culture of Singbee Lighting could consistently be championed from above. Further, Pufa, YuanCheng Wang’s son would also be joining the company. With the new generation leadership team in place, Singbee’s transformation was closer to completion.

Overview >
About the Company >
Next Generation Singbee >
Building the Next Generation Singbee >
The Maturing of the Next Generation Singbee >
Prognosis: The Future is Bright >


The Maturing of the Next Generation Singbee

In overcoming these significant challenges and establishing the new generation of business leaders at the helm, Singbee is now on a steady upward trajectory. Over the years, LED has become a mainstream product in the lighting industry and global demand is high. YuanCheng Wang’s foresight in recognising LEDs as a growth industry helped insure the longevity of his business Today, Singbee has successful product series across the globe, in countries such as Portugal, Russia, Mexico and the United States.

The industry continues to evolve, demanding new designs, better lifespans and efficiencies. Fortunately, from the start, Lina Wang and Winson Yeung have emphasised the importance of innovative product development. That Singbee has registered over 100 patents in invention and designs attests to the company’s emphasis of innovation.3 Along with the innovation, a rigorous 21 step quality check system is in place to ensure that at each stage of production the lamp and LED is thoroughly examined for quality and reliability. The testing system consists not only of spot-checks, but also of long term tests designed to provide feedback information to drive on-going improvements. Singbee’s latest LED lamp product’s expected lifespan is up to 244,000 hours (83 years with eight hours daily usage). [4]

Although quality and reliability are indispensable business principles, at the heart of Singbee is something more: a purposeful drive to deliver both profits and positive environmental impacts. For example, Singbee’s modular lighting designs make it possible to realise efficiencies in cost and waste reduction. If a lamp is damaged or fails, the whole unit does not need to be replaced. Rather, the faulty or damaged module in the lamp can be replaced with a new component. As a result, the lifespan of Singbee lamps can be extended. The transition from the crystal business that was causing significant environmental harm to today’s Singbee Lighting products that bring up to 96% energy saving is truly striking. [5]

[3] Andrew Bryson and Carline Seow, “Polaris Resource Kit,” Family Business Network International, (2015): 33.
[4] Ibid.
[5] “Singbee | B Corporation,” B Impact Report, B Lab. Link.

Overview >
About the Company >
Next Generation Singbee >
Building the Next Generation Singbee >
The Maturing of the Next Generation Singbee >
Prognosis: The Future is Bright >


Prognosis: The Future is Bright

In October 2016, Singbee successfully registered as a certified B-Corp. The B-Corp certification is a well-known, rigorous and highly regarded certification process for businesses that want to put purpose at the heart of their business model:

B-Corps meet the highest standards of verified social and environmental performance, public transparency, and legal accountability, and aspire to use the power of markets to solve social and environmental problems. [6]

Joining the B-Corp community has been a natural fit for Singbee. Currently, there are only four B-Corps in all of China. [7] By taking steps to meet high environmental standards, Singbee plays an important leadership role in the Chinese business context in showing that purpose and profits are not inevitable trade-offs.

Singbee's next step is move beyond being carbon neutral to being Net Positive. Singbee has developed an ionising lamp that is able to extract carbon dioxide, purifying the air and hence reducing existing pollution. This prototype is currently being tested in four industrial sites across China. Given the global economic and political importance of China, the more Chinese businesses that lead by example on issues of environmental and social importance, the better it will be for the world. A decade ago, Singbee had to take the risk of pivoting into an emerging LED market. Today, it again finds itself at the forefront of another shift in the Chinese economy, one where business is becoming a force for good.

[6] “Why B Corps Matter,” B Lab. Link.
[7] “Social Enterprise: Building up Business to Do Good, Improve Enterprise Social Value,” China Global Philanthropy Institute,16 April 2017. Link.

 
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Authors

Based on research by Alastair Colin-Jones. With contributions from Winson Yeung, Singbee and the Mutuality in Business Research Team, Saïd Business School. Edited by Justine Esta Ellis. Visit Saïd Business School's Mutuality in Business web page

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About This Series

The businesses featured in these case studies share a commitment to objectives beyond purely financial performance, as well as a serious intent to implement mutual practices through new forms of ownership, governance, leadership, measurement and management. They were first developed for the 2017 Forum.

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Authors' Note

This is a descriptive case study, based on publicly available materials as well as on the information shared by the company described. This case study is not meant to provide critical analysis of the literature or information used to develop it. All errors and omissions are the authors’ own.


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