Hiwin President Enid Tsai
Assertive Leadership, Soft Touch
She is known as the top female CEO in Taiwan’s machinery industry, building Hiwin Technologies into the world’s No. 2 precision components maker without a technical background. So what skills does she bring to the table?
Assertive Leadership, Soft TouchBy Monique Hou
From CommonWealth Magazine (vol. 520 )
The place: The Industrial Development Bureau, Taipei, 2005.
Sitting in the audience were officials from the Industrial Development Bureau and the Institute for Information Industry, university professors and leaders of Taiwan’s machinery sector. On stage was a woman of slight build delivering a briefing on how the machinery industry could help build a platform that integrated the front and back ends of the supply chain. Her report left the audience stunned.
“They couldn’t believe that it was done by somebody like me without an engineering background,” recalls Hiwin Technologies Corp. president Enid Tsai proudly. Tsai was the company’s vice president at the time.
Up until that moment, most outsiders considered Hiwin synonymous with its chairman, Eric Y.T. Chuo. But when Tsai delivered her breakthrough report in 2005, people suddenly realized that Chuo, who actually got his start in the banking sector, had a strong team behind him.
Chuo has been the only boss the machinery sector’s top female executive has ever had. From when Chuo ran a magazine to opening a consulting firm to founding Hiwin, Chuo has always been each company’s first employee and Tsai the second.
When Tsai runs into the owners of other companies in the industry, they often ask her what her responsibilities are.
“Actually, what they really want to ask is, ‘You don’t understand technology, so what is it that you do?’” she says.
When she gets questions like that, Tsai, who is anything but confrontational, answers: “Nothing special. I just come up with ideas. I don’t do much of anything and stay behind the scenes.”
Yet her demure approach belies an engaged personality. “Actually, my boss and colleagues know how much thought and effort I put into this,” she says, “but people on the outside are completely oblivious to it.”
Last week, the president of a Japanese tool maker visited Hiwin and asked Tsai: “How have Chairman Chuo and you, neither of whom has a technical background, built this company to today’s level in just over 20 years?”
“I answered, ‘There are so many other capabilities beyond technical skills that need to be developed, like leadership, talent cultivation, branding, marketing and innovation. These all require people with different areas of expertise, who then work together. Service innovation, especially, is not something a mechanic can deal with. You need a group of people with different skills, to think outside the envelope,’” she said to her nodding visitor.
Hiwin, a specialist in linear motion components such as ballscrews and precision linear guideways, stands out in Taiwan’s machinery sector in several ways: it produces components but still has a brand; it has risen to the top of its field in Taiwan and to second in the world despite having a chairman and president who lack technical backgrounds; and in a testosterone-driven world dominated by mechanics, it has eight female executives.
Unique Approach to Women in the Sector
“The chairman always tells me not to worry about those smelly guys and to hold my head up high,” says Tsai, who often thanks Chuo both in public and in private for not favoring men over women. Not only does Hiwin pay equal wages for equal work, it has more female managers than the rest of Taiwan’s machinery industry combined. Chuo’s logic is simple: the world has both men and women, and women make up about half the mix, so why not use them?
A few months ago at a banquet, Evans Tu, the president of Taiwan’s largest IT products distributor and service provider Synnex Technology International, ran into Tsai, and said, “So you’re Enid Tsai! I can’t figure it out. Why does a ballscrew have such a high gross margin?”
“I have to tell you, Mr. President. That’s not a ballscrew. It’s a precision component,” Tsai replied.
Hiwin’s gross margin and output value are unrivaled in the industry. “And we are a components maker. Other companies make machines worth tens of millions of Taiwan dollars, while we make small items that accumulate revenue bit by bit. So of course we have to have stronger managerial skills,” Tsai explains.
Pin her down on her skills, and she’ll tell you she is responsible for everything but technology. And even when it comes to that, she’s a quick learner.
“Whenever I ask about technical issues, my colleagues all laugh at me. But I’ll only let them laugh at me that once, because five minutes later I’ll understand what’s going on,” she says, explaining that her greatest strength may be to take complicated concepts or ideas and make them simple to understand.
“What I want to sell isn’t a product; it’s a brand. The people I deal with don’t have mechanical backgrounds either, so if I want them to understand what I’m saying, I have to understand what I’m saying first.
“If people ask about things in greater depth, I have one of our technical managers come out and provide an explanation. But by that time, the role I intended to play has already been fully communicated,” Tsai says in explaining how the brand has been built.
Tsai is also deeply involved in the company’s cultivation of talent. She shows up from time to time at training sessions and sits in the back corner of the classroom, a smile on her face to reassure her colleagues not to be nervous, because she’s also there to learn.
“In fact, I’m observing which manager has potential. I want to study our human resources situation – where we currently lack what kind of person and if there are people here with potential,” she says. “If I want to recruit somebody from the outside, what kind of person should I be searching for?”
“In today’s environment, if you want a breakthrough, you have to think or do things in ways that are different from others, which sometimes requires nourishment from outside,” she says.
Two years ago, Tsai earned a doctorate in organizational psychology, a degree that took her five years to complete after flying to the United States every six months for three to four weeks of intensive courses.
“At the time, the company was nearly 20 years old, and I got to thinking. In Taiwan’s machinery industry, the founders of companies usually lead them directly. But as organizations get bigger and develop more layers, directives cannot be given as they once were, when they quickly reached nerve endings. You need group leadership. How do I change to group leadership, and where do I want the company to go? How should I lead people? I needed to give myself new energy,” she says.
Tsai strongly values people and processes. “If the process is right, the result will be at least an 8 or a 9, if not a 10,” she says.
When Hiwin acquired German ballscrew manufacturer Holzer GmbH in 1993, Tsai spent a lot of effort trying to win over Holzer’s anxious and disgruntled employees. “I even gave each employee a scarf with their name embroidered on it. At that time, there were only 20 or 30 people, but even if there had been 100 or 200, I would have done the same thing,” says Tsai of the German factory, which now has 117 employees.
Many high-profile overseas acquisitions engineered by Taiwanese companies have ended in failure and gone bankrupt. And even when they remain profitable, the Taiwanese parent company often faces staunch resistance from the subsidiary they acquire.
“The buyer cannot be overbearing and take over with great fanfare as though it is going to dominate others. In a merger, both sides have to win. You must care for the feelings of the employees of the company being bought out, and that’s the most difficult thing to do,” she stresses.
Tsai compares her mind to a computer divided into A, B, C and D drives, where things are stored based on their urgency and importance. But when it comes to matters involving employees and their families, “I don’t store them in my mind. They go to my heart.”
The first time she met Synnex’s Tu, she asked him to “give me five,” getting the normally stern and serious Tu to laugh. In a way, it is not surprising, because she has a way of endearing herself to others. She likes to grab people by the arm, or tell them their fortunes based on their ID or smartphone numbers, to create a personal bond.
Those who are not close to Tsai often describe her as gentle and kind, but those who know her well see her as rational and assertive. When she decided on an English name, she wanted something uncommon, and as she flipped through the dictionary, she decided on the neutral “Enid,” which reminded her of the Chinese phrase yi nide, meaning, “As you like it.” Much like her name, Tsai rarely states her opinion under normal circumstances and lets people do “as they please.” But when it comes to crucial decision-making moments, then others must defer to her and say, “As you wish.”
To Tsai, Chuo is both a mentor and an older brother. For more than 30 years, they have built chemistry and mutual trust that extends far deeper than that seen between family members. And the two may take that chemistry to a new realm in the future, with Chuo suggesting that Tsai’s next task should be to become a university president.
“The chairman really wanted me to get a doctorate. If an appropriate opportunity presents itself, we want to buy a university and use it to nurture talent for the machinery industry.”
Translated from the Chinese by Luke Sabatier