Four Hours of *The Power of Evolution*: What It Taught Me About Family Succession

On October 28, 2023, “The Power of Evolution: Liu Run’s Annual Address” arrived as promised. It was a four-hour talk, and some of its content set off in me a number of reflections on family succession, the family business, and family education. I have gathered these thoughts and share them with you.

Hard and Complex

The opposite of hard is easy. They differ in the degree of effort required. The opposite of complex is simple. They differ in the degree of disorder.

What It Suggests

1. A Recognition of the Degree of Effort

Family succession is not simply the passing of property and reputation from one generation to the next; more important is the passing on of the family’s culture and values. This calls for the joint effort of family members and a deep understanding of the family’s traditions. Recognizing this, family members may throw themselves more earnestly into family affairs, actively preserving and carrying forward the family’s culture.

2. The Balance of Simple and Complex

In the course of passing on a family’s culture and values, one may face complicated situations—internal frictions within the family, pressures from outside, and so on. This reminds us that, when facing complexity, finding a simple and effective solution is often the more important thing. Family members need to learn, amid complex family relationships, to find the simple thread, to seize on the core values, and to ensure the steady transmission of the family’s culture.

3. The Choice of How to Pass Things On

The contrast between hard and easy, complex and simple, is also reflected in the manner of family succession. Some families may choose a rather complex, large-scale mode of succession, while others may lean toward a simple, direct one. This reminds us that, in choosing how to pass things on, we should take the family’s actual situation into account and choose the way best suited to the family’s own character, to ensure the succession is effective.

All in all, we must recognize the difficulty and the complexity of succession, find the point of balance, choose a fitting mode of succession, and ensure that the family’s culture and values can be passed on steadily.

Pessimism and Hope

In January 2023, Microsoft announced it would lay off 10,000 people, bracing for the coming recession. On the same day, Amazon announced 18,000 layoffs. A little earlier, Meta announced 11,000 layoffs, and Salesforce 8,000. According to the outplacement firm Challenger, Gray & Christmas, the U.S. tech sector as a whole shed more than 97,000 jobs. Layoffs on this “epic” scale had not occurred since the bursting of the internet bubble in 2000.

The whole of American tech seemed deeply pessimistic about the future.

Yet at the same time, a company only two years old, Midjourney, with just eleven people—“parasitic,” even, on someone else’s social platform, without so much as a standalone app—earned 100 million U.S. dollars in a single year, because it launched an AI image generator.

And another organization, called OpenAI, became a sensation across the internet because it launched an AI chat tool, ChatGPT. TikTok took nine months to reach a hundred million users. Instagram took two and a half years. The internet took seven years. The traditional telephone took seventy-five years. ChatGPT took just two months.

The whole of American tech seemed, once again, full of hope for the future.

What It Suggests

1. Adapting to Change Is Key

A family, too, needs the ability to adapt to great change—whether change in the market environment, or change in the family’s own internal structure and relationships.

2. Pessimism and Hope Coexist

As the address said, the whole tech industry showed pessimism in some respects, yet in others was full of hope. A family, too, needs to recognize that pessimism and hope are not mutually exclusive but can coexist. A family needs to learn to find hope within pessimism, while also guarding against the risks that excessive optimism may bring.

3. Small and Beautiful Is Also a Choice

The examples of Midjourney and OpenAI show that even small companies can achieve rapid growth through innovation and by seizing opportunity. For a family, this means that even if the family is not large, it should not underestimate its own potential. A family can, by focusing on its own strengths and responding nimbly to market change, achieve steady and sustainable development.

4. Seizing the Opportunities of the Age

The OpenAI example shows that seizing the opportunities of the age is the key to success. A family, too, needs foresight—to attend to the trends of the times and to seek out the opportunities suited to itself.

5. Building Resilience

The layoffs at large tech companies show that even firms of enormous market value and influence will face enormous challenges. A family needs to build resilience, so that when facing challenges it can remain steady, and can even find within them new opportunities for development.

A family should keep an open mind—daring to face and adapt to change, while also having the ability to seek out and seize the opportunities within that change. This calls for the joint effort of family members, for continual learning and progress, and also for the building of a sound family governance structure, to ensure that the family can develop steadily.

Take Life and Death Lightly; If You Don’t Accept It, Go and Do It

Take life and death lightly; if you don’t accept it, go and do it. When there is a tailwind, know how to surf; when there is none, know how to swim.

These words express an attitude of meeting life’s ups and downs head-on, and they encourage people to adopt different strategies in different situations. For the family business and for family succession, they carry an equally profound meaning.

What It Suggests

1. Take Life and Death Lightly—Hold Fast to the Family’s Values

“Take life and death lightly” reflects a mindset of magnanimity and tenacity. For a family business, it means that when facing the swings of the market, the pressures of competition, or internal frictions within the family, one should stay calm and hold fast to the family’s core values and long-term goals. Such a mindset helps the family business find the turning point within a crisis, and it also gives family succession a firm foundation.

2. If You Don’t Accept It, Go and Do It—Dare to Take Responsibility and Innovate

“If you don’t accept it, go and do it” embodies a spirit of initiative and of daring to take on a challenge. A family business needs this kind of courage and resolve—unafraid of difficulty, daring to face problems head-on, and seeking new opportunities for development through innovation and change. This spirit matters just as much for family succession, encouraging the next-generation successors to take an active part in family affairs and to dare to shoulder responsibility.

3. When There Is a Tailwind, Surf—Seize the Opportunity

When the market environment is favorable and the family business is on the rise, one must dare to seize the opportunity, expand actively, and raise market share. This can both strengthen the enterprise’s competitiveness and provide a good moment for the accumulation of family wealth.

4. When There Is None, Swim—Build Resilience

When the market is depressed and the family business faces hardship, all the more must one stay calm and decide prudently. At such times one should focus on raising the enterprise’s operating efficiency, controlling risk, and ensuring the business is run steadily. At the same time, a family needs, through education and cultivation, to strengthen the next generation’s resilience, so that they can hold to an unyielding spirit when facing hardship.

5. A Balanced Perspective and Long-Term Planning

The whole meaning of these words is to encourage people to respond nimbly to different situations, without clinging to one fixed pattern of thought. For the family business and for family succession, this means one needs vision and planning—attending not only to present gains but, more importantly, to long-term development.

Whatever the situation, a family needs to keep a heart both calm and tenacious, meeting challenges actively and seizing opportunities, to ensure that the family business and family succession can develop steadily.

The Pursuit of “Superiority”

The renowned psychologist Alfred Adler, in his crowning work Understanding Human Nature (also known in Chinese as Inferiority and Transcendence), said: the overall goal of a person is the pursuit of “superiority.”

What does this mean? Each of us needs our own distinctive sense of superiority. It need not be about money. It need not be about social standing. “I’m not clever, but when it comes to diligence, I think that’s something I can be quite proud of.” “You can’t write programs, but at badminton there’s no rival on the whole street.” “He has failed three times in business, but on the matter of doing right by his employees, his conscience is clear.”

Everyone meets with setbacks. At such times people need some belief to lean on. For instance: “At least in this respect, I’m still pretty good.” “At least this is something I have and others don’t.” “At least I’m different from them.” Only then can we live on happily and, in the end, walk out of the setback.

This is the emotional value of a sense of “superiority.”

What It Suggests

According to Adler’s theory, people by nature pursue “superiority,” and this pursuit is not confined to material wealth or social standing but also includes the recognition of personal ability and inner worth. In the context of family education, how should we understand and apply this idea?

1. Cultivating Distinctiveness and Individuality

Every member of a family is a distinct individual, with different gifts and interests. Family education should attend to discovering and cultivating each person’s individuality and strengths, rather than forcing them all down the same road. This not only helps family members build up their own sense of “superiority,” but also lets them face the road of life ahead with greater confidence and drive.

2. Educating for the Ability to Withstand Setbacks

Setbacks are an unavoidable part of life, and family education needs to teach the next generation how to face and overcome them. By recognizing their own strengths and advantages in certain respects, family members can, when they meet with a setback, find psychological support, regain confidence, and press on.

3. Emphasizing the Importance of Inner Worth

Success and worth should not be measured solely by external standards and the evaluations of others. Family education should encourage family members to recognize the importance of their own inner worth—to understand that even in areas where they seem, in others’ eyes, not “successful” enough, they can still find their own sense of superiority and pride.

4. Kindling an Upward-Striving Drive

By cultivating “superiority,” family education can kindle the initiative and enterprising spirit of family members, spurring them to strive to realize their own potential. This helps not only the growth and development of the individual but also the overall prosperity and stability of the family.

Through education of this kind, a family can not only cultivate a next generation with a strong sense of self-identity and inner drive, but also lay a solid foundation for the family’s long-term development.

Climbing the Highest Peak in Your Heart

At the end of his address, Liu Run shared the story of climbing Mount Kilimanjaro:

In 2015, I went to Tanzania to climb a mountain. That mountain was my yearning, my dream—a mountain I was going to climb no matter how high the wind or how fierce the waves.

Africa’s highest peak, Kilimanjaro.

I simply wanted to go and see it—the snow at the summit of Kilimanjaro. But climbing a snow mountain 5,895 meters high is not like climbing Fragrant Hill, or She Mountain, or Wutong Mountain. There is no cableway, no cable car. You rely entirely on yourself, climbing up step by step. And to go in and come out of the mountain takes seven days.

But on the third day, I could go no further.

Severe altitude sickness. By noon, when I reached 4,600 meters, my head was splitting. With a retch, all the energy gel and chocolate I had eaten in the morning came back up. I had underestimated Kilimanjaro. I wanted to eat something humbly, but could not get down a single bite. By then the heavy fog of the mountain, carrying rain, had caught up with our party. The descent began at once.

I said to the African guide: I have to go down the mountain. Otherwise I will die up here.

The guide said: “Has no one ever told you? On Kilimanjaro, you can only go forward, never back.”

Why? Because the slope is steep; going up is hard, and coming down is harder. So when can you descend? At the assault camp on the fifth day. Only there is there a path by which you can go down.

On the fifth day, we finally reached the assault camp. At this point, would you still go down? No. Having come this far, you go up even if it kills you. At eleven at night, we put on all our gear and prepared for the summit push.

I drew a deep breath, and at the moment my blood oxygen was highest, I stepped out with my left foot. Then, bracing my body with my poles, I breathed out deeply, and at the moment my blood oxygen was lowest, I dragged my right foot forward, sleeping a few seconds at the same time. I made myself forget how high the mountain was and how long the road. I let myself think only of how, with the least possible effort, to step out with my left foot, and then the right, and then the left again, and then the right again.

The guide suddenly announced: 5,000 meters. Everyone cheered. I was overjoyed—and then at once grew calm again. I must not give myself hope. Hope only brings pain. Despair is the greatest hope.

Every hour, we stopped for five minutes. Quickly eat an energy gel, take a few sips from the water bladder. After drinking, you must blow the water back, or the straw will freeze. One of the women broke down and wept aloud. You must not cry. Your nose will quietly run, and before you know it, it freezes into slivers of ice.

As it turns out, the summit push is not the least bit stirring.

At last, off to our right, there appeared a wisp of dawn cloud dyed red by the rising sun, and a faintly whitening horizon. By then it was four or five in the morning. I knew that the coldest night was at last about to pass; I rubbed my frozen hands, and the hours ahead could only grow gradually warmer. I turned my head slowly toward the rising sun, and slowly turned it back to face the high mountain. Still my head was splitting. But what upheld me had turned from despair into hope. In that moment, I suddenly wanted to weep. The night, it seemed, was already over.

Yes. Once you have arrived, it feels easy. But which true arrival at a summit was ever not without a road of retreat, ever not a flight into the wind?

In truth, what you climb is not Kilimanjaro, but the highest peak in your own heart. What you conquer is not the mountain—you can never conquer the mountain. You only ask the mountain to help you, together, conquer yourself.

Do not set out to conquer the mountain; do not set out to conquer adversity. Leave the mountain a meter. What is to be conquered is yourself. There is no mountain higher than a person.

What It Suggests

In this world full of challenge and uncertainty, the experience of climbing a mountain is like a miniature of life, revealing profoundly the core values and spiritual strength we need to hold to in family succession. In the face of grueling challenges and the limits of the body, the resolve to press ever forward and the persistence within the heart become an inexhaustible force for overcoming hardship. Every step holds the weight of life; every act of persistence is a transcending of the self.

In adversity, we learn calm and reason, and come to realize that the true opponent is not the high mountain outside but the self within. There is no mountain higher than a person; to conquer the self is the final victory. This spiritual strength of self-transcendence is the most precious wealth in family succession, the beacon that guides us ever onward.

The root of a family lies in the transmission of values and belief, not in the accumulation of material things. Through education and guidance, we are to cultivate in the next generation an unyielding spirit in the face of hardship, teaching them how to find inner strength in adversity, and how to forge their own future through effort and sweat. The prosperity of a family is embodied not only in material wealth but, still more, in the transmission of spiritual wealth.

This journey, though grueling, is life’s most precious wealth. On the road of family succession, we are to be like climbers of a high mountain—unafraid of hardship, pressing ever forward—and to pass on to the next generation this spirit of persistence, self-transcendence, and unyielding resolve, so that the family’s roots may grow ever firmer and its future ever brighter.