Saturday, October 9, 2010
Tuesday, September 7, 2010
So what does a Mantha Crane Index© of 50+ indicate you ask? Growth fueled by economic expansion. The Thursday we were in Beijing the Q3 growth number was reported at +10% for the third quarter in a row (known as a triple double). This led me to wonder how a countries infrastructure accommodates such rapid growth. The answers where all around us. Aging power distribution lines attached to new transformers. Roads with the waste construction materials left by the side. Exposed water and gas mains. All these things where not truly wrong, just not how we would do them. It did however cause me to rethink my position on the regulatory agencies in the United States and their role in all our lives.
It also provided insight into how issues and challenges are tackled by the Chinese. Whereas we may estimate a project to cost X and include all the tasks that would be required of us were it done in the United States or Europe, a Chinese competitor or customer may see the project as much less. Do just enough, no more. This can be a source of confusion for western business people whose native industries are typically held to a higher regulatory standard. Business is a little more like settling the wild west.
To get a better understanding of how to engage the China market a friend recommended an event:
Put China in Your Business Future: Health & Green / China
Ill post again to let you know how valuable the event was.
I’ve also been asked to meet with a delegation from the Ministry of Commerce. They are interested in discussing B2B aspects of the energy sector with Americans with experience in that field. It’s amazing how small the world is becoming. We all have the same needs.
Wednesday, September 1, 2010
From the moment we got off the plane it was as if we had been invited to someplace important, the kind of placed you're always being watched so that you don't sit on the fancy furniture. Oddly enough, you are. Sometimes in the most obvious of ways such as in the form of armed guards, and other times as discretely as a street or hotel cam, or everyone's favorite... The Internet.
Between business visits, cultural events and sightseeing, it was incredible to see that a country on this small earth of ours was so different than our own. It was almost as if we had been transported back in time. Rules and standards felt very stiff and old, and technology and standard of living more harsh than I could ever have imagined.
But regardless of how uncomfortable we were with difference, having this great group that's grown so close in a matter of months, made it easier to take risks. To venture out of your own personal norms and experience a life that many never will, nor will they understand. Perhaps the conditions weren't what we have all grown so accustomed to in our own lives, and the food less than appetizing (and at times unrecognizable nor indigestible) the experience and memories are some which I'll never forget.
Prior to leaving for Beijing, many people were worried about the government and police in China. However, it turned out to be the opposite. There was no significance presence of cops in Beijing and nobody was watching us. I guess if one does not make any political statement, government will not bother you.
For me, this trip was an eye opener. On seeing Beijing’s huge airport, huge skyscrapers, modern showrooms, one can easily conclude that China is working hard to meet Western world’s standard of living. One of the most interesting presentations during the trip was from BASF, a German owned energy company. The amount of information presented was phenomenal- why China, business requirements in China, world economy, 20 years later etc. It was quite interesting to know that companies need to have the right connections in order to be successful in China.
Being from India, I was familiar with the bargaining concept, though by Asian standards I am not a good bargainer. In the beginning my American friends were hesitant to bargain but once they got the concept, there was no stopping point. It was quite hilarious to see Rich and Orlando doing hard bargaining.
One of the last memories of the China trip was the amazing bonding and friendship among the group. I had never imagined that such good bonding would have formed in such a short period. Group lunch, dinners and trips were the best part of the trip and made the trip memorable.
Tuesday, August 31, 2010
Monday, August 30, 2010
Based on my observations, the Chinese have a much different concept of personal space than Americans. I found myself apologizing to strangers on the street every time I bumped into someone or I got an elbow for a greeting. However, it didn’t take me long to adjust to the culture by not acknowledging my rude behavior according to the American way. I assume Darwin visited China before developing his theory on survival of the fittest.
Another lesson learned from our trip is the environment challenges in China. Every morning when I take my dog, Bailey, for a walk I am grateful for the fresh air and EPA. It may not be the cleanest country in the world; but it is a wonderful place to live. I often take a deep breath and just stare at the blue sky and wonder what people from Beijing would think of our clean skies and water.
A daily observation of mine is how our two countries operate their businesses. In PBBI – US, every promotion, new hire or transferred employee is expected to sign non-compete and confidentiality agreements but in our office in China employees receive one document when they are first hired. Both countries have a similarity in that the businesses are having a difficult time keeping employees engaged and loyal to their company.
In addition to the many business lessons learned, I now know why Walt Disney does not have a theme park in China, you can experience enough of a thrill driving on the roads. Riding in the heart of Beijing is definitely enough of a thrill ride for any tourists. If it wasn’t for Mervet’s wonderful advice on looking out the side window I would never survived the cab ride. I couldn’t imagine getting stuck in a 10 day traffic jam.
Thank you all for helping make such great memories.
That observation I could relate to the country. Just like the contrast in the bathroom fixtures there were contrast in their way of life.
Ferrari dealerships and many bridal stores were around every corner, the very corner that had very depressed areas. I was moved by the poverty and the blatant begging that occurred on the streets. Blind men playing string instruments while a sighted person held out their hand. My heart went out to them. It opened my eyes that there are issues in all countries that need to be dealt with regardless of government.
So, on our last day, the sun came out for a little while from behind the smog and we climbed on the plane to start our journey back to America.
I learned to not judge but to try and understand. It was truly a moving experience.
Saturday, August 28, 2010
Going into our trip, I didn’t quite know what to expect. Having frequently traveled myself (due to parents who believed that exploring the world was really the only true way to learn life’s lessons), I had never been to China. Visiting the Great Wall had always been on my bucket list, but for some odd reason, I had never really thought about exploring the surrounding areas. When it was announced that we would be headed to Beijing, I was incredibly excited! A new city on the planet I had never been to and I was about to explore it on an entirely different level than any of my past travels.
The intensity of the schedule was something that I loved. The bus rides, not so much. I get motion sick easily. But the actual visits to each company were so eye opening. I was and still am grateful for such an opportunity to visit places like Topnew to get an inside look on how state owned factories are operated; Microsoft to get an insider’s perspective of patent and trademark laws in China; getting the perspective of a Chinese company looking to expand globally in Lenovo; and also going to BASF where Joerg Wuttke gave an incredibly candid view of his own experiences of doing business in China coming from the western world himself. The discussions that we had with William Baker and Jack Perkowski were insightful as well. To hear their take on doing business in China, both positive and negative, allowed me and I believe the entire class to really think for our self and allow us to come to our own conclusions. This entire trip was a true learning experience that allowed us to learn something that may have taken us 4 months to learn in a traditional classroom in a very quick 7 day trip. It was incredibly valuable and I have already taken back a few things to my company to implement as we look to expand to mainland China.
Another fun aspect of the trip that I didn’t really think about prior to going was the friendships that I ended up making on the trip. Bonding with some fellow cohorts made this trip that much more enjoyable. Having dinners at restaurants in different hutongs each night was like an episode of the “Amazing Race” for us as we went through dark alley ways to find GEMS hidden in restaurants that had some of the best food I had ever tasted! It was such a bonding experience each night that I walked away from this trip having made lifelong friends. You can’t beat that.
Friday, August 27, 2010
Thursday, August 26, 2010
On July 9th we arrived at the SUNY Albany campus to meet our bus waiting patiently to drive us under blue skies to the airport. These two things, the driving and the blue skies, were where I noticed an immediate difference between the United States and China. I was looking out the window of our plane, anxiously waiting for us to break through the clouds so that I could get my first glimpse of Beijing, but the clouds didn’t seem to break during our descent. The combination of overcast and pollution created a fog like atmosphere that surrounded us the entire trip. This was my first realization of actually how populated China is and brought the related challenges into perspective.
Our fantastic tour guides, Isabel and Grace, led us to our bus where we met, who I consider, the most talented bus driver in the world! It takes sheer skill and nerves of steel to drive a car, let alone a bus, through the populated streets of Beijing. It’s everybody’s right-of-way. Pedestrians, cyclists, cars, buses and trucks all own the road. On one of our trips an elderly woman bravely walked out in front of our giant bus, put her hand up – as if stopping the bus all on her own, and walked calmly across the busy intersection. One of our driver’s most impressive moments was turning the massive bus around in the jam-packed parking lot of B&Q (the business our group introduced). B&Q was very similar to a Home Depot here in the states, except the cultural differences create challenges that Home Depot doesn’t necessarily have to deal with. The home improvement and construction mindset for most Americans is “do it yourself”, which is much different than in China. The Chinese would most likely hire a builder to take care of home improvement items. This obviously changes their marketing strategy, product sales, etc.
One of my favorite presenters was Jack Perkowski, founder of JFP Holdings. Mr. Perkowski had great success on Wall Street, but then saw an opportunity and made the move to China. His vision and entrepreneurial spirit is inspiring and truly made the world seem a lot smaller in my eyes. I thought of China as this far off land and never expected to have theopportunity to travel there. Mr. Perkowski, on the other hand, saw a business need and made it happen. Possibilities are endless if you truly put your mind to it. His presentation made me think of my own capabilities. Am I looking at things from every angle? Am I living up to my full potential? What are my ultimate goals and how do I make them happen?
Our trip to China was extremely educational and motivating. It helped me better understand both the Chinese and American cultures. I have a stronger appreciation for the United States, and I have a newly found appreciation for what the World has to offer. We climbed the Great Wall, toured the Forbidden City, visited the Temple of Heaven, negotiated at the silk market, met with inspirational business professionals, had a ton of fun, and much more. Amazing trip – I’ll remember it always, and I couldn’t have asked for a better group of people to travel with.
Tuesday, August 24, 2010
Beijing’s new airport was built for the Summer Olympics of 2008. It’s a modern airport with wide open architecture and spotless, clean marble floors serving as the gate for the rest of the world to the capital city of China. The forty minute bus ride to the hotel took us through some of the modern neighborhoods of Beijing, where tall buildings covered in neon lights illuminated the early night sky.
The Novotel Peace is a French chain hotel decorated in a modern western style. If it had not been for the Chinese personnel that in a very efficient way checked us in with the expert direction of our tour guides, I would not have felt that I had arrived to China yet. A short walk in the immediate neighborhood that night helped me set my mind in the right place and time.
I have had the good fortune of traveling extensively not only in my own country of Mexico but in many European countries as well. I have to say that I really never had an interest in visiting China or any of its Asian neighbors. I must now confess that this trip changed my mind. Being in China, seeing its people smiling at us, and experiencing their culture, opened my mind to the desire of knowing more about whom they are, and the place where they come from.
Ten days in China is certainly not a lot of time but I was determined to make every minute count. After all, I did not think that I would ever go back but this thought had vanished by the end of the journey.
Two companies I enjoyed visiting were Topnew which provided us with a one hundred percent Chinese business experience; and BASF where I learned that, for the most part, to succeed in business today, whether in China or elsewhere, a global perspective with local knowledge is required.
In the evenings I enjoyed dining out with friends trying different restaurants and regional cuisines. Venturing into the city’s hutongs at night was quite an experience.
One of the highlights of the trip for me was traveling to the Jinshanling section of the Ming Great Wall. Initially, we were disappointed that it was a rainy day. Once we got there we climbed the mountain under what felt like a monsoon. Ascending steep slopes that had become muddy streams we finally got to the top and reached the wall. This section of The Great Wall is eleven kilometers (seven miles) long and has sixty seven watchtowers. On a better day we would have walked for four hours to reach the Mutianyu Great Wall where a zip line would have taken us to the bottom of the mountain to meet our driver. But the weather and the fact that this last section was closed for visitors shortened our adventure to two and a half hours. At the end, we were thankful for the rain. If it had been 90 degrees, humid and sunny we probably would not have enjoyed it nearly as much as we did.
The second amazing experience was traveling to Xi’an with Mervet and Chris. Our purpose was to visit the Terracotta Army built by Qin Shi Huang, the first Emperor of China, to watch over his tomb. The statues date from 210 BC. Estimates indicate that in the three pits that contain the Army there are over 8,000 soldiers, 130 chariots with 520 horses and 150 cavalry horses, the majority of which are still buried in the pits. It was a pleasant surprise that Xi’an had much more to offer than just this famous place. Xi’an is a walled city. The wall is very well preserved, can be enjoyed by walking or cycling and offers a great view of both the inner and outer parts of the city. Xi’an’s Shaanxi History Museum has amazing artifacts and offers a glimpse into the history of some of the most important Dynasties. Other sites we visited included The Great Mosque, The Drum Tower and The Big Wild Goose Pagoda.
Recently I met an interesting Chinese couple. Her American name is Corrine and her Chinese name is Chin Ai which means “True Love”. There is a story behind her name: when her mother was pregnant with her she already had a daughter and her grandfather wanted a boy. Because she was a girl grandpa did not want her and grandma decided that she would keep her and take care of her with true love. The gentleman’s American name is Daniel and his Chinese name is Fook Ang which means prosperity and peace.
China has an amazing culture and history, and after decades of isolation China has emerged as a worldwide economic powerhouse. The government has made many efforts to show a new face to the rest of the world, that of a modern and dynamic society that can and has shaped the world that we know today. However it is hard not to recognize that deep in their society they still cherish their philosophy which calls for a constant pursuit of balance in body and mind and this governs everything that they do, including the way that they do business locally and globally.
Monday, August 23, 2010
• As of last week, China has surpassed Japan and is now the second largest economy in the world behind USA!
• The opportunities for new business ventures are endless as made clear by speakers from Mahon China and JFP Holdings. Anything is possible but not necessarily easy.
• Though urbanization is creating a growing middle class that in Beijing looked much like the American counterparts in terms of style and dress, there is a great difference in cultural value of money verses actual value.
• As Americans visiting China, we took great pride in our “negotiation skills” that are a given in the Chinese culture. We most often failed to understand that we were often negotiating literally over the equivalent of pennies.
• One of our speakers, Jack Perkowski, presented our group with the concept of a "cultural" equivalent of $100 vs. 100RMB. That 100RMB is valued to Chinese as much as our $100 is to us, even though it's real equivalent was only $14.74.
• A lot of items really are very cheap in China!
• The one child family rules are very acceptable to the Chinese. They feel they cannot afford more children, thus more than one would be a financial burden.
• Young couples that BOTH come from a single child family are allowed to have two children. I had the impression that Isabella was disappointed that her husband had a brother thus only one child allowed. It seemed in direct conflict with her earlier statement that one child was acceptable due to expense.
• China has a huge population, however, the one child rule has created this 4 grandparent, 2 parent, 1 child population that over time will dramatically reduce the population over the next generation
• Health care delivery in China is very inefficient with such large populations outside of city areas; they are often hard to reach. The rural populations also are less literate, and have less money.
• Due to the many poor, particularly in the rural areas, I came to understand why "good enough" quality needs to be considered even though we see it as “bad” quality. It makes goods available that the poor can afford.
• Cities like Beijing and Shanghai are international cities and thus may not reflect the overall Chinese population. For example, it was quite a surprise to see a Rolls Royce and a Maserati car dealership along with stores like Chanel and Louis Vuitton along the avenues. However, as we took advantage of services on the same street, foot massages, we got a little different story. The young masseuse told us he worked 6 days a week, 12 hours a day, and had no time to go home and visit his family who lived hours away.
• I was fascinated by the multinational company speakers, American and European, who were in China for a very long time. For foreigners whose earnings reflect their home countries, the lifestyle in China seems to be very appealing.
• Topnew, the government owned textile company, offered some interesting points for consideration. Many of us felt that there was a lack of transparency throughout much of the presentation. The factory was impeccably clean and seemingly efficient. It was a clear example of Chinese efficiency with limited expensive technology offset by inexpensive labor, as it seemed like endless rows of employees at sewing machines. I couldn't help but wonder if it typically looked that orderly or if it was cleaned up for visitors. Were the workers usually that focused and with little interaction with each other?
• The dormitories, at first seemed a little disconcerting for many of us, but when you consider how little the factory workers earned each month, you can also appreciate that they were also housed and fed, thus having little or no expenses.
• Factory workers came from rural areas for short stints to make enough money to bring home and survive until the next time they were in need. This makes for a pretty young and/or ever changing employee population. I wonder how it affects loyalty and commitment to the employer. Do these temporary workers go back to the same factories?
• B&Q looked very similar in many ways to our Home Depot and Lowe's home improvement stores. They do a much greater business in a complete installation vs. "do-it-yourself". They say this is due to apartments bought only as 4 walls and everything from kitchen to bathroom must be purchased. Because the buyers must work and labor is cheap, it has great value to hire the installation. This confuses me a bit. If labor in general is cheap, how are they earning enough money to pay for the labor? Another contradiction...only fancy western style toilets, but there were predominately eastern toilets used everywhere we went.
• Guanxi not only is very important, but must be successfully developed if a company is to be profitable in China. Most interesting to me is that there are a diverse number of ways that it can be cultivated. Joint ventures or partnering with a Chinese organization is helpful. Developing relationships with appropriate government officials can also create a “partnership” that allows the government to have some say if the company provides some important good or service that helps the government with its goals. Bribery too, can be an acceptable form of quanxi. In a nutshell, you must find the right Chinese “support” for your particular company or industry to make it all work.
• Microsoft seems to have lacked in guanxi in its first years in China. My interpretation of what was presented to us is that Microsoft was very Unsuccessful in China for the 15 years due to what may be seen as American arrogance. It seems that they are “giving away” their operating system to saturate the market and hope to profit by that later.
Sunday, August 22, 2010
It’s been 5 weeks since returning from Beijing and I think my body has finally adjusted! My first trip to Asia was certainly exciting, eye opening, physically challenging and educationally fulfilling. Upon arriving in Beijing I was overwhelmed with the size of the airport (and lack of people?) and it’s modern features. I couldn’t help thinking how busy and exciting the facility must have been during the Olympics of 2008. The lack of people did not last long however. The traffic and density of the buildings started just outside the airport and seemed to grow as we moved toward the center of the city and our hotel.
The hotel was in an amazing location, just a few minutes’ walk from the Forbidden City and many upscale store fronts (so much for cheap deals! That would have to come later.) My first morning started with a 3 mile run around and through the Forbidden City with Rich and Linda (thanks for taking it easy on me) followed by more formal tours of the Forbidden City, Tiananmen Square and the Temple of Heaven. That was followed by visits to a Kung Fu show, many interesting and sometimes tasty/terrifying lunches and dinners as well as an amazing visit to the Great Wall. The cultural experiences of China were truly once in a life time and it really gives you a great perspective on just how much the Chinese people have endured throughout time. Change has been ever present in China and we just happen to be witness to the newest chapter in a long story of social and business triumphs and tragedies for this nation.
From a business and educational standpoint, our trip provided me with a new perspective on what is and will be a formidable nation for many years to come. The commitment to math, science and technology was brought up many times by several of our speakers and the fruits of that commitment could be seen all around Beijing. From the sky scrapers and architecturally stunning buildings, to the impressive business parks surrounding the Lenovo headquarters and the Microsoft complex the city was booming with new business. While clearly the communist government was in full control of this growth it was also interesting to see what a struggle it must be at times to maintain the control of central government with so many business and entrepreneurs looking to stake their claim in what looks like a modern day Wild West!
The highlight of the trip for me was Mr. Joerg Wuttke from BASF. Not only was he a captivating speaker, but it was clear he had an immense library of knowledge on China and Asia as a whole. He was candid about the business and political environment for not just BASF, but for any business trying to enter or operate within China. It was evident right from the beginning why he was stationed in Beijing and interestingly both Adam and I saw him on the BBC news the following day meeting with the German Chancellor upon her arrival at the Beijing airport. Mr. Wuttke gave us great perspective about where China was in her economic growth cycle, as well as the positions of the EU, U.S.A and the world economy. While the current cycle is in their favor, they too have much to work on, just like the U.S. and Europe and it is clear that we all depend deeply on each other’s success.
This trip was a great end to the 1st year of what has been a tough and fulfilling MBA program. It solidified for me what a great group of people I am sharing this experience with and just how much I am learning from my new friends as well as the classes and programs we are sharing together.
This trip has been an exciting experience. I met truly captivating people, from the first presenter Mr. Baker (Mahon Investments) to the last Mr. Perkowski (JFP Holdings), and many in between. One of the most interesting facts is that B&Q (Home Depot type chain store) is the market leader, but captures only 2% of the market share! This gave some insight on how local things are in China. The stall markets are very important in this segment. This emphasized one of the themes I have seen recurring. To do business successfully in China, one needs to think global, and act local. This applies when hiring local managers, to having/ finding the right guanxi (social connection and business networks).
China’s market is HUGE. We learned this from JFP holdings using the automobile industry as an example. A large pyramid represents personal transportation, where only the top third would be automobiles, and the remainder being bicycles, scooters, etc.
The real automobile market is thus much larger due to substitution effects, and the fact that China is a developing nation, where people will be trading up to buy automobiles. Many Chinese in the cities buy something just for the look/ image of having a specific brand. Buying a car, just to own one for instance, and not necessarily having a need for one is somewhat common. As, a result, there is a large discrepancy in the quality (price) of vehicles. This also applies to all other manufactured products.
One car may typically only last 2-3 years but for a cheaper price meets many lower income users purpose of owning a car. Owning a car is very important, as they do not own their homes or apartments, but have to lease from the government. There are little to no real property rights in a communist nation, and a car is something that gives them expression of freedom, and ownership in my view. One cheap low quality car may last a family many years as a result not being driven often and thus suites their needs of “owning a car.”
I personally liked the Kung-Fu show, and was a little disappointed at the trip to the Great Wall. It was good, but I had very high expectations as it is THE GREAT WALL. Part of the let down was that it was foggy, and limited any great captivating views or picture opportunities. It was neat being at spot where there were padlocks on a chain up and down the wall. I think it was shown on one of the reality shows… here is the best picture/ view from my photos.
I feel China is interesting, complicated, and boy, do they matter. Orlando touched on the haves and have nots. If the have nots move up the pyramid, China will more than matter (that is a lot of people with a lot of potential).
Thank you to all.
Tuesday, August 17, 2010
My classmates have shared many of the details from our international trip to Beijing and shared all of our interesting experiences from the trip. Specifically the people we met, what we ate, where we toured, our modes of transportation and the interesting business leaders we met. While we all look through a different lens, I do echo many of their perspectives.
Monday, August 16, 2010
Upon arrival into Beijing Capital International Airport, I was surprised to see how few people were there. We arrived around 6:30 p.m. on a Saturday and there was hardly a person around. What a complete opposite from JFK Airport 13.5 hours earlier! Navigating through the airport to luggage and ultimately our bus was very easy.
The hotel was beautiful! Our rooms were very spacious and modern…something else I was not expecting. Like others, the whole key in the switch to get power was a bit confusing…would probably have been standing in the dark if my roommate hadn’t figured it out…thanks Brenda! Sleeping the first not was not a successful event. Needless to say, I think I was still on eastern daylight time!
Sunday’s trip to the Forbidden City was great. This is where the “as seen on TV” crowds came into play. I’m not great with crowds, or heat, but I think I did great! Not one frustration the whole time. It was amazing to see how the Chinese people were fascinated with us. We were told on the bus that they will probably want to take pictures with/of us. Until it actually started happening I had no idea how true that was! We were just as fascinated with them as they were with us. At the Temple of Heaven when we all took pictures of the local people dancing or playing cards or whatever it was they were doing to “enjoy their lives”, they must have been feeling what we were feeling when people were watching us and taking our pictures. I enjoyed seeing the military playing basketball at the Forbidden City. I was amazed at how young a lot of the military we did see seemed.
My favorite site visit was probably the tour of Lenovo’s assembly plant. I figured it would be mostly machine driven. However, I was wrong. The storage facility was all machine driven…and huge! The assembly floor was filled with people putting their particular part of the computer together. It was very interesting to see an assembly line in action.
The eye opening site visit for me was to Topnew. Again, an assembly line setting but vastly different than Lenovo! Whenever I tell people of the site visits, these are the two that I talk about most. Specifically how, according to US standards, the living conditions at Topnew are not up to par. Eight people to a small room, in most of the US, would be unheard of. And this is considered a good job for these girls! It made me realize just how easy/good most of us have it. These young girls come from the farms in rural China and leave their families for years to work and earn enough to bring back home. Talk about dedication to family!
The only part of the trip that wasn’t so enjoyable for me was the food. I’m not an adventurous eater so I knew going in that that would be a hurdle. Every time I told someone I was going to Beijing, their first question to me was “what are you going to eat?” I did try the Peking Duck dinner. I also had the traditional Beijing lunch which was delicious. That was pretty much the extent of my Chinese food experience in Beijing. McDonald’s tastes exactly the same as home. However, grilled cheese sandwiches are completely different! Cold cheese between two sliced of toasted bread. But it was still better than the alternative for that day
Ultimately, I am very thankful I had the opportunity to participate in this trip. It was very interesting to see how a country half way around the world conducts business. The “made in China” tag in products in the US have a whole new meaning now!
Sunday, August 15, 2010
Tuesday, August 10, 2010
Before leaving for China: I envisioned a lot of people, weird and tasty food, smog, and some interesting old buildings with historic significance.
What I learned in China: There's a lot of people, the food is great (in moderation), smog does exist, and foot massages rule!
Kidding. The learning experience commenced as soon as we stepped off the plane in the incredible Beijing Airport. As we scampered through customs an interesting sign greeted us and served as a friendly reminder that we were "not in Kansas anymore".
Shortly after arriving in the hotel a small group of us ventured out to sample the local cuisine. We first came to the street with all of those "snacks", but we kept walking. Charles found a great place and we had a terrific meal that Saturday night. Sunday was also enjoyable with all of the sight seeing.
Monday's presentations went well, but I still hadn't gained an understanding of the real differences in doing business in China versus the US. For me that moment came during our discussion on the bus ride back from the B&Q store. In that discussion it became so clear to me that retail in China is nothing like retail in the US.
- Store Design: A two-story home improvement store? This is unheard of in the US...and apparently it wasn't working well in China either.
- Transportation: "I don't think this refrigerator will fit in the basket I have on my bike...do you offer delivery?"
- Staffing: It might be fair to say that there were more employees than customers in the store that Tuesday morning when we were there. US stores tend to have far fewer people out on the floor.
- Pricing: "You mean you won't knock 30% off of the sticker price? I'm out of here..."
- Products: Don't even try to start a business selling ovens in Asia...they don't bake, period!
In all seriousness, these were excellent observations by the class because it showed such a direct link between culture and business. These observations don't just apply to B&Q, or even retail in general, they apply to all businesses. I came away from this discussion with a new appreciation and understanding of how culture dictates how businesses function (or is it vice-versa?). I recall this as the most educational portion of the trip.
The most interesting visit of the trip for me, however, was the presentation by Joerg Wuttke of BASF. During the hour-long discussion I managed to fill four complete notebook pages! I believe most of the class was impressed with his level of knowledge about economics in China and the World, and what the future holds. What an excellent presentation for a group of MBA students to experience.
The last visit I'd like to highlight is the trip to the Lenovo manufacturing site. Working in manufacturing for my whole career, I was immediately struck by how many employees they had working in such a small space. In the US, businesses simply cannot operate this way because labor is far to costly...a PC would cost $10K! Instead, we implement more and more automation to reduce head count. This observation prompted a question that I posed to Jack Perkowski during his presentation. I asked what he would recommend to a US company opening a manufacturing operation in China. Specifically, should a US manufacturer with lean operations and a high level of automation use the same approach in China. Jack's response was that he would not recommend that, but rather conduct the operation the way the Chinese would (more people, less machines). His answer shocked me...I would never even imagined that this concept would be one that could influence the success of a new business in China.
All in all, I firmly believe the trip was successful in meeting its objectives. Regardless of what was listed on the syllabus my take is that we were expected to experience and learn the culture, understand the differences in doing business in other parts of the world, and continue to build relationships within the group (make friends). I'm 100% satisfied in all of those aspects, especially the making friends part (karaoke anyone?).
Overall, my expectations and goals for this trip were different from my first trip. I wanted to explore Beijing more and find the real China hidden behind courtyard walls and mobs of cars and tourists. Some of my greatest memories from this trip are experiences we had on off-hours, whether it was the great dining nights at Nuage, the Dali Courtyard, and Source, or the trip to the Lama Temple and the hike along the Wall. This trip reminded me of the love of travel that is in my soul. The class-bonding from a trip like this will last a lifetime and I am grateful to have experienced all of this in Beijing again.
Monday, August 9, 2010
I found the trip to be very educational on every level. I learned not only about the culture of the country, but also about international business in general: what to expect from the local government, challenges faced by foreign companies, how important "guanxi" is to a successful business and gained an overall sense of the business environment. I recall some of the remarks from Joerg Wuttke, BASF Chemical Company, "that you should always verify the statistical data coming from the Chinese government". I appreciate his level of honesty and after we left his office I thought about the fact that he gave us some information that we may not have been able to learn about from any other source. If anyone is going to open a new business and be successful in this fast developing country, you need to have accurate data to make projections, budgets and sales quotas. Wuttke's presentation really clarified the difference between a political economy and a market economy on many levels.
The "Great Wall" was one of the most rewarding historical places to visit for me personally. When you think about the number of people who were forced to help build the wall, the number of those that never returned home and the stories of loved ones filled with sadness because their beloved never returned back to them, it brings so many things about life into perspective and how lucky we are to have the freedoms we have here at home. This Chinese landmark that's nearly 7000 miles long ( per the professor), represents so much about the old style of the communist government and the history of the country.
I can't end my blog with out mentioning about how people drive in China. I can tell you I shall not complain about NYC drivers or Connecticut drivers anytime in the near future. I am not sure that they have any traffic laws because it appeared to me they have an everyone for themselves policy and if you get in the way that's too bad. It would not be pretty if I had to drive in Beijing and I am sure the car would "not" be dent free for very long. I must say that the bus driver did an outstanding job and I hope he earns more than the .86 cents per hour minimal wage because he deserves it!
I did enjoy the international studies professionally and personally. I am confident saying I would never have visited China and now that I have I am ready to go back and visit other areas across the country. The culture experience and learning experience is something I will never forget and remember for many years to come.
There were some surprises for me and the lack of government or state presence was one of them. I was expecting more police visibility and more show of state power and force and that really was not the case. It is a communist country and the power of the government is real, however in ways much more subtle and less intimidating than I expected.
One of the things that struck me was the joy the people seemed to take in their children. Looking back at a history of not valuing females (or more specifically, girl children) I was heartened to see that most of the children I saw, boys or girls, appeared to be happy and well loved. I, too, disagree with mandated family size but the Chinese seemed to enjoy what they have and to take great pleasure in their children, something that made my heart happy.
The traffic in China is something that will live in my mind forever. It took me three days in China to come up with an analogy for traffic patterns and it is this: dumping a huge bag of marbles of ALL sizes on a floor, then watching them scatter. For every car, truck or bus there are roughly 15 "something else's" and I truly mean something else's. There were silver metal somethings that looked like phone booths on wheels, mini mini-vans, miniature flat-bed trucks, bicycle contraptions, scooter contraptions and many other "modes of transportation" unlike anything seen in the US. The entire time I was in China I saw three helmets; I know because I counted in total fascination. Two people on a motorcycle and one on a scooter. I thought our bus driver should have been making a million dollars a day because that is roughly what it would take to prompt me to drive in Beijing. Observing the bicycles challenging the tour buses is something that will forever be imprinted in my "Believe it or Not" memory file.
Friday, August 6, 2010
The most intriguing aspect of visiting China was the people. Although I did not speak the language, I did not really feel out of place. The people were usually very welcoming and friendly. Some of us wondered about the ‘real’ Chinese life. In Beijing, all one had to do was venture outside of the immediate hotel vicinity, to see and experience some of the 'real' China. Those who stepped outside of these boundaries experienced a different culture, whether it was soldiers exercising in the early morning hours, or street vendors making Chinese breakfast pancakes, or ordinary people at the beginning of their day, trying to catch the bus on their way to work, or store vendors getting ready to open shop, or some grandparents practicing Tai Chi in a catholic church's courtyard.
Two of my colleagues and I went to Xi'an hoping to get a glimpse into the true Chinese culture. Superficially, things were not much different in Xi'an. Xi'an is a walled city which affords visitors a bird's eye view of the complex life that goes on both within and outside the wall. The wall is 14 km, which roughly equals 8.6 miles. We only walked about half way around, which was enough to give us a glimpse of the disparate conditions that exist between the 'haves' and 'have-nots', in China and in many parts of the world, including here in America. Seeing the desperate conditions that some people live in, is not only disheartening, but makes one feel quite guilty about much of what we have and take for granted. For many of us, visiting the textile factory in Beijing was an unsettling experience. Those of us who had never been in a factory before were taken aback by the process and conditions of work, even though the facility we visited appeared to be well operated, clean and organized. Some students were overwhelmed with feelings of guilt especially after viewing the living quarters for these workers, which were very basic rooms with bunk beds, accommodating eight people-too many people per room, according to our standards - with one commonly shared bathroom. However, some of the sites in Xi'an made these humble quarters appear like a 'four star hotel', to quote my traveling partner, Maria Elena. These poor, destitute quarters were only a few blocks away from what appeared to be clean, nice, middle class areas with paved roads and modern cars parked outside the dwellings.
Whether walking by the poorer areas or more developed ones, the greeting was the same - a friendly smile and wave, eagerness and willingness to pose for our photos, whether in the streets below or on the rooftops. Observing some of these 'less fortunate', by our western standards, made me feel desperate to help them and provide for them, until I looked a little closer and realized that they have something we all strive for: contentment. On our first walk in Xi'an, there was an elderly gentleman riding his bicycle and posing for pictures, proud to show me his friends and point for me to also take their picture, with their little pot on the street corner; or a group of senior citizens sitting on the side walk, playing games, socializing, laughing and enjoying each other's company. Yet, when you look outside of the wall, on the other side, it appeared to be uniformly well developed with elaborate canals and parks. While the surroundings may have been more modern, the human element was similar. People gathered with families and friends, singing songs, playing instruments or games, ping pong, or just strolling in the park.
Chinese society has a reputation of being centered around the family. This became quite evident from visiting both Beijing and Xi'an. China has an impressive abundance of well groomed parks that are family friendly (all ages from grandchildren to grandparents), with plenty to do for everyone.
Lastly, I would like to note how humbling it was to be in the presence of people who did not expect, want or know anything about tipping. It was refreshing to observe the innocence of the people about something that has been around probably since the beginning of time. These moments exposed the true reality of how much this society had been sheltered from the outside world, yet, in spite of that, how far it has come in such a short period, and how much further it will go in the future. One can only hope the Chinese society will be able to balance the inevitable winds of change with the traditional family and Confucius values and therefore be able to have the best of both worlds.