Get up and dance

THROUGH THE SMOG in Beijing’s Financial Street you can see the glass-and-steel headquarters of many of China’s giant state-owned-enterprises (SOEs). The flash buildings are a statement of might, but inside them the mood is more of anxious self-reinvention. Most SOEs are in fast-changing industries, and since last year China’s government has made clear that it wants them to become more market-orientated and more competitive. As a result, some of these organisations now face the largest transformation in corporate history.

Top of the list is China Mobile, the world’s biggest mobile-phone company both by customers and by profits. One of the first SOEs to list, in 1997, it has three-quarters of a billion subscribers, about 200,000 staff and the 11th-largest capital expenditure of any firm globally. Yet times are tough. Competition from other telecoms firms has increased, and China’s booming internet firms offer messaging and voice services that cannibalise its core business. In the first quarter of this year the volume of voice calls and text messages was 5-7% down on the previous quarter. Profits dropped by 9% on the previous year.