"Passing cars on the curve" has been the proven strategy used by Baidu.com's Li Yanhong to not only survive but thrive since the global financial crisis started last September.
Li is the co-founder, chairman and CEO of Baidu Inc, the largest Chinese search engine company, which is listed on NASDAQ with a closing price at $397.53 per share and market value of $13.76 billion Tuesday.
He delivered a speech to more than 300 American and Chinese business people during the US-China Economic and Trade Cooperation Forum, held in Chicago on Monday.
Li told Xinhua in an exclusive interview that Baidu's business was affected by the global financial crisis as well, particularly its revenues in the last quarter of 2008 and the first quarter of 2009.
"We have over 200,000 small and medium businesses as our clients. Quite a large number of these companies died during last year's financial crisis. As a result, our business was affected," he said.
However, Li said: "In our Chinese language, 'crisis' means both 'danger' and 'opportunity.' It is the crisis that propelled us to think what we should do to deal with it. During this process of handling the crisis, we developed a 'passing cars on the curve' approach."
"The crisis is just like a curve. How to make a smooth turn and pass other cars when they are driving at full speed? To achieve this goal, you not only need to stay extremely focused, see the road conditions clearly, but also need to hold the wheel correctly. And then when you are ready, step heavily on the gas to speed up on the curve to pass other cars."
So how did Baidu complete this manoeuvre? Li says: "First of all you have to give up unrealistic dreams. Before the crisis, everybody felt that the world was so beautiful that you could make a lot of money easily. But the reality is not so. Every success needs huge effort and hard work.
"Secondly, if you want to do better than your competitors, you have to stay focused on just one thing. Only in this case can you have better opportunities to win against your competitors. In addition, you must learn to innovate and adjust to changes. When crisis comes, we must create a 'new norm' because old ways won't work anymore," he added.
Baidu, which was established in 2000, has developed into the largest search engine company in China, with nearly 80 percent market share.
When asked about Baidu's amazing success, Li said: "Our success is largely due to several factors. First of all, we were lucky to raise enough funding in 1999, right before the burst of the Internet bubble in 2000. Then we got enough time to work on the search engine technology before the market was ready in 2004. Furthermore, we have stayed very focused and dedicated most of our time to the Chinese search engine."
Talking about future development of the Chinese search engine industry, Li introduced a new technology, the "box computing" platform, which is a simple and reliable interactive mode for Internet services.
With this platform, Li said users could ask for whatever they wanted and enter their needs in the search box and all Internet-based application demands would be directly satisfied by this "box" in the future.
Baidu started developing its international business strategy in 2007. In January 2008, Baidu launched its Japanese search engine business, its first step toward global expansion.
Li is very pleased with the company's fast development. He said "currently Baidu is ranked among the top three in photo and video search services in Japan."
As more and more Chinese companies are interested in going abroad to expand their business, Li advised them to have a transparent management system first to obtain the trust of foreign investors.
He said: "The United States is a huge market. If Chinese companies can grasp good opportunities ... they should have an opportunity to succeed in the US market."
In the nine years since founding Baidu in January 2000, Li has turned the company into the largest Chinese search engine and the third largest one in the world. Baidu completed its successful IPO on NASDAQ in 2005 and became the first Chinese company to be included in the NASDAQ-100 Index in 2007.