Chapter 400: Make Full Use of Resources

It's no wonder Hu Zi cried out—the R&D of Li Dongling High-Tech is divided into two parts: one is naturally Li Dongling High-Tech's own technical department, managed by Chen Tao, with annual funding fully covered by headquarters.

The other part is the Hanxi Joint Laboratory, established several years ago through cooperation between Li Li Dongling and Xi'an Jiaotong University, later expanded to include Xi'an University of Technology, Harbin Institute of Technology, Peking University, and several other universities.

The over 400 million yuan allocated will be distributed among the Hanxi Joint Laboratory, Dongxin Semiconductor, Dongfang Optoelectronics, Shenzhou Storage, and other R&D departments.

The actual funding consumed by Li Dongling High-Tech's headquarters technical department and the Hanxi Joint Laboratory has far exceeded the original decision to allocate 5% of profits for R&D.

The original 5% of profits was pulled out gritting one's teeth—back then, Li Dongling High-Tech had just been founded, and its survival was uncertain; that funding was meant solely for joint R&D with Xi'an Jiaotong University on the "Sirius" domestic landline phone chip, a truly hard-won expense.

Not to mention projects like photolithography machines, computer chips, mobile phone chips, solid-state drive development, and Chen Guangwei's carbon fiber R&D—all funded directly by Li Dongling High-Tech headquarters, not from the 5% pool.

Even so, the 5% profit allocation amounts to nearly 400 million RMB; in today's world, that might sound small, but in this era, it's already a fortune for most domestic universities and research institutes.

This year, the total official R&D funding allocated nationwide to universities, research institutes, state-owned enterprises, and various R&D units adds up to 30 billion RMB.

That means hundreds of universities, hundreds of research institutes, and state-owned enterprise tech departments combined can only secure 30 billion RMB through approval.

Of course, this doesn't include funding universities earn themselves through industry partnerships or state-owned enterprises self-invest, but each university or institute typically receives from the national finance department no more than tens of millions at best, and as little as tens or even thousands of yuan at worst.

Li Dongling High-Tech alone invests more in the Hanxi Joint Laboratory than the combined funding dozens of universities can apply for—this is already an enormous sum domestically.

For universities like Xi'an Jiaotong University, Harbin Institute of Technology, and Xi'an University of Technology that joined the Hanxi Joint Laboratory, the annual funding they receive from it has become their most vital R&D source.

"Including funding for the Hanxi Joint Laboratory, Dongxin Semiconductor's special R&D projects, and headquarters' technical department, Li Dongling High-Tech now spends nearly 1.8% of its total revenue on R&D annually!"

"With Li Dongling High-Tech's revenue, this R&D investment far surpasses domestic peers and even exceeds that of many overseas tech companies!"

After calculating, Hu Zi said to Li Li Dongling—he was Li Dongling High-Tech's chief financial officer, responsible for the entire company's operations.

Moreover, Hu Zi had suffered losses in Yazhou and placed great emphasis on cash flow, constantly increasing Li Dongling High-Tech's cash reserves to ensure the company could survive two to three years—or longer—without profit and without layoffs.

For Hu Zi, being chief officer wasn't easy: Li Dongling High-Tech appeared to earn a lot, but it spent even more.

So many people depended on Li Dongling High-Tech for their livelihood—monthly salaries and bonuses had to be paid on time, production bases needed to operate, raw materials had to be procured, new factories required land and equipment purchases, and even overseas engineers had to be hired.

Besides, Li Li Dongling hadn't stopped investing in companies over the past few years—all of which cost money—and Hu Zi was gritting his teeth, stretching every yuan into two.

Of course, companies that relied on loans from banks, city investment firms, state investment groups, or even overseas conglomerates didn't care about this—they lived for today, spending freely as long as they could borrow, because they never intended to repay—defaulting meant only losing the company…

But Li Dongling High-Tech was different—it was built from scratch by the people in this meeting room, including Hu Zi, who poured immense effort into it; behind them stood countless supporters who depended on them, and none of them wanted Li Dongling High-Tech to collapse.

"Li Dongling High-Tech is a newcomer in the tech industry. If you only want to stay put and remain within China, you truly don't need to invest so heavily—but…"

Li Li Dongling looked at Ren Ren Yuefeng, Hu Zi, Zhang Ao, and others in the meeting room, "If Li Dongling High-Tech wants to go overseas, it must face Nokia, Motorola, Ximen, IBM, Sony, Toshiba—and even stronger rivals!"

Li Dongling High-Tech's technology is still far inferior to theirs, constrained by their patents; to catch up, we must invest even more in R&D.

Countless wars throughout history have proven: fall behind, and you get beaten—if you don't spend this money on military power, you'll end up paying reparations!"

Hearing Li Li Dongling's words, Ren Ren Yuefeng, a professional manager, gave him a long, deep look—Li Li Dongling's remarks clashed sharply with the globalization wave currently led by America.

Right now, America and old Europe are promoting globalization and division of labor, enthusiastically pushing the idea that under America's rules, every region and company can find its place in this system, that following America's plan guarantees profit for all—everyone wins big, right?

But if you truly believe this theory and hand over your lifeline to others, then past Chinese companies like ZTE, Huawei, and O-Film, which were choked and tormented by America, are the direct result of believing this theory.

Whether others believe it or not, Li Li Dongling doesn't care—he has no intention of placing Li Dongling High-Tech's lifeline in anyone else's hands.

The others in the meeting room weren't particularly surprised by Li Li Dongling's stance—since Li Dongling High-Tech's founding, it had clearly differed from all other domestic companies.

Other Chinese companies either avoided confrontation with foreign brands or clung to them for support; Li Dongling High-Tech chose another path, having directly clashed with Microsoft, Ximen, and Toshiba.

We never surrendered back then—how could we kneel now? Besides, as Lao Gu from De Yun She once said: sometimes even if you're willing to bow down and beg to become someone's dog, they won't even take you—they want to eat your flesh, not just have you as a leg!

"Next year, Li Dongling High-Tech's total R&D budget—including the Hanxi Joint Laboratory, Dongxin Semiconductor, and other departments—will be raised to 3% of revenue, and within two years, to over 5%!"

Li Li Dongling said. Hearing this, Chen Tao, Wu Wu Xinyi, and the two managers from Dongfang Optoelectronics, Tang Tang Qinliang and Miao Miao Xuguang, all wore smiles—increased R&D funding was the best possible news for their money-hungry departments.

Hu Zi frowned, his face clouded with worry—this wasn't a simple adjustment; changing this would force a complete overhaul of Li Dongling High-Tech's entire next-year plan.

Though reluctant, after muttering under his breath, Hu Zi said, "The finance department and budget committee will re-adjust next year's spending plans, but 3% funding… is really…"

The money wasn't his own, yet Hu Zi still felt physical pain—so much had been poured in; how many domestic companies couldn't even earn a single yuan, while Li Dongling High-Tech was throwing away such sums on R&D.

Hu Zi felt too much had been spent, but Li Li Dongling thought it still wasn't enough—globally, the tech industry hadn't yet formed a decisive generational gap; as long as money was thrown in and the R&D direction was right, catching up remained possible.

If not for the impending Soros-led financial raid in Southeast Asia, Li Li Dongling might have invested even more in R&D—but now he couldn't rashly pour in too much, lest something unexpected happen.

Having spent so much, Li Li Dongling demanded results—he turned to Chen Tao, "Next year, beyond continuing upgrades to the Silver Mink mouse, Shenzhou phone, Little Smart, and Shenzhou USB drive, your department must develop several new projects!"

Whether it's the Shenzhou digital cordless phone or the Little Smart phone, each year must get a new skin, redesigned exteriors, and upgraded features—otherwise, how will you lure more users in?

Chen Tao took the two project proposals, flipped through them for a while, then said, "The R&D department can handle the tape recorder and electronic dictionary projects!"

Having spent so much money on R&D equipment, hired so many researchers, and established R&D centers in Xi'an and Beijing, Li Dongling High-Tech's technical department was even preparing to build an innovation lab in Silicon Valley, America, to recruit overseas talent.

If they still couldn't develop the tape recorder and electronic dictionary, Chen Tao wouldn't even need Li Li Dongling to speak—he himself would have no face to stay.

"The tape recorder's R&D isn't difficult—it's essentially converting an analog recorder into a digital device; your department can finish it by the first half of next year!"

Chen Tao was confident about the tape recorder: "As for the electronic dictionary, it will take time—the hardware isn't hard, but the most critical part is the software compatibility, which will require considerable time."

Chen Tao was excellent at hardware, but software wasn't his strong suit—he wasn't completely clueless, but his skill level lagged far behind his hardware expertise.

"The software functions of the electronic dictionary, including the games included, will be handled by Jinshan and Xishanju; from now on, Li Dongling High-Tech's software-related business can collaborate with Jinshan," Li Li Dongling said.

(End of Chapter)