SOE Reform: CSCEC Boosts High-Quality Development

China State Construction Engineering Corporation (CSCEC) has been implementing the decision and deployment of the three-year action of the reform of state-owned enterprises (SOEs) and is making efforts to stimulate vitality and improve efficiency to boost enterprise development.

In 2020, CSCEC signed contracts valued at about 3.2 trillion yuan ($496 billion) and realized operating revenue of 1.62 trillion yuan, making it the only construction enterprise in the world to have more than 1 trillion yuan in both newly-signed contract values and revenue.

The company's operating revenue and total profit in the first four months of this year were 544.99 billion yuan and 23.1 billion yuan, up 49.2 and 36.5 percent year-on-year respectively. Its total labor productivity per employee was 508,000 yuan, a year-on-year growth of 14.4 percent.

The company has built more than 170 indicator databases in efficiency and effectiveness, operation and management, innovation and development as well as risk prevention and control, guiding its subsidiaries to value medium- and long-term development in those areas. The company also required its subsidiaries to set up their own goals according to their special positioning and development situation.

Performance has also been highlighted by the company. It has built various assessment and incentive modes with different levels. The more difficult a task is, the better rewards the employees will obtain once they reach the goal.

In terms of market-oriented management, CSCEC established a university and college directory for recruitment of graduates and launched a unified examination and assessment system, intending to strictly control recruitment of talents and realize complete openness and transparency in graduate recruitment.

In addition, the company released new rules saying that staffers with three or more years of grassroots working experience or two or more years of overseas working experience will have the opportunity to join the headquarters. As for a promotion to senior positions in the headquarters, employees must have more than 2 years of experience in leadership positions at the grassroots level. Such rules fundamentally establish a long-term mechanism for staff exchange between the headquarters and the grassroots-level departments.

What's more, the company also initiated an innovative ranking system that involves managers, professionals and operators. It effectively promotes exchange of employees between departments.

CSCEC developed a human resource value index evaluation model which covers the three dimensions of scale efficiency, per capita efficiency and input and output as well as the six indicators of operating income, profit, per capita output, per capita profit, wage profit ratio and wage output ratio. It also selected 52 outstanding listed companies in China and abroad to build 10 benchmarking panels such as international counterparts, central enterprises, construction, real estate and design, which promotes a performance-based salary system.

It also implemented a diversified medium- and long-term incentive method to create a comprehensive incentive and restraint mechanism of career co-construction, value creation, benefit sharing and risk sharing.

Since implementing the three-year action of SOE reform, the company has targeted outstanding frontline project managers, highly-skilled personnel and technicians at key positions for incentive modes.

(Executive editor: Niu Yilin)