Tuesday, July 19, 2011

Post-trip Reflection

I've been home for a few weeks now and have had time to reflect on the entire China experience. The point of the trip was personal and professional growth. So, how have I changed? How have I grown? How have I become more qualified as a "master of business"? Here are my thoughts on the matter:

The first thing that comes to mind is the impression that guanxi left on me. It is clear to me now that to succeed in business in China, one must not only understand the nuances of this dynamic concept, one really needs to invest Gladwell’s “ten thousand hours” practicing guanxi to really become an effective businessperson in China. In this regard, the trip revealed to me the reality that foreign firms won’t succeed in China if they ignore or attempt to bypass the role that guanxi plays. If my employer were to ask me to weigh in on personnel strategy for our China operation, I would strongly encourage them to take guanxi into account when choosing personnel. I would encourage them not to bring in foreign managers just because those individuals “know the business”, or “have proven themselves elsewhere.” I would tell my employer that a manager’s network and reputation are much more important factors for success in China than elsewhere. Furthermore, developing a network and a strong reputation takes much longer there than elsewhere. Moving forward, I am sure that we will see fewer and fewer Chinese branches of Western firms led by Western managers. My peers might think that it is because of lower costs but I will know better.

I often hear China described as a land of opportunity and the new frontier for entrepreneurs. I see her as something a little different. To me, China is a land of problems and the new frontier for problem solvers. Everywhere I looked I saw problems of epic proportions, problems with incredible complexity and nuance. Class inequality, pollution, human rights, inflation, the one child policy… the list goes on and on. When I think about Western products or services that could be successfully exported to China, the first thing that comes to mind is ingenuity. China doesn’t need people looking to make a quick buck. What she needs is our best and brightest stepping forward to help solve her unprecedented environmental, societal, political, and economic problems. That being said, to help China overcome these challenges, the problem solvers that we export will only be effective if they learn how to solve her problems her way. We must take context into account. This trip has taught me that Western solutions will not solve Eastern problems. Take Internet censorship for example. The most memorable part of the trip for me was the time that we spent with Kaiser Kuo, Baidu.com’s Director of International Communication and a Stanford graduate. My understanding of the Internet censorship problem was turned upside down as Mr. Kuo explained the fundamental differences between how a Chinese view freedom of speech compared to a Westerner. We cannot help our fellow man until we actively listen to what they need help with. The opportunities for western businessmen involve solving China’s business problems, not what we perceive to be China’s business problems.

What is my biggest fear after visiting China? 1.3 billion “educated” people who are determined to reach a standard-of-living that they see their western counterparts enjoying. By educated, I am referring to the role that the Internet now plays in conveying to the “have-nots” of the world everything they “have not.” What am I trying to say? The average American consumes 35 times more electricity than the average Chinese. Our planet cannot support a Chinese consumer that consumes even a fraction of what an American consumer currently does. What will happen when the Chinese consumer reaches a point where he can afford the car, the computer, and the home, but is told that the environment will not support this kind of consumption even though it supports that and more from Americans. We flaunt our wastefulness with our SUV’s and our McMansions. We taunt them with our MTV and our Hollywood films. We use our first-mover advantage and relative to justify the double standard. But will the Chinese consumer accept this? We are like the younger sibling that gets away with murder because we are forever mommy’s baby. Do you remember what happened to Jacob’s favorite son, Joseph, in the bible? The first chance they get, his brothers level the playing field. If this inequality, whether actual or perceived, continues, what will China do to level the playing field. When will they say, “if we can’t have everything we want then neither can you…”

We were fortunate to get to visit an elderly Chinese man in his home in a small village outside of Beijing. This man, well into his 70’s, is the former mayor of his village and his warmth, kindness, eloquence reflected his career as a politician. Thus, we were all shocked by the sudden change in his demeanor when I asked him, “what are your hopes for your country?” His answer was, “My hope is that China will grow strong, so strong that all other countries will fear us and none will ever be able to invade our land again…” His message was clear, China never forgets and revenge is always a possibility. So, how does this apply to business? I left our time with Lenovo extremely uneasy about the value of American intellectual property in the eyes of the Chinese. Lenovo’s MyPad looked exactly like Apple’s iPad. I am certain that Apple is finding the Chinese marketplace a less-then-level playing field when it comes to competing against Chinese firms. It appears that China is adopting the famous adage: keep your friends close and your enemies closer. It is my opinion that China has invited Western businesses into the country to learn how to compete with them and will eventually throw them out. Be warned, access to the Chinese market may be a double-edged sword and future profits are by no means certain.

In summation, it is my opinion that this trip has the potential to provide Cal Poly’s MBA program with a competitive advantage over others. This trip changes participants’ worldviews in so many direct and indirect ways. It solidified my relationships with many of my classmates. It prepared me for business travel. It provided me the opportunity to negotiate in a cross-culture environment. It was an opportunity to apply so many of the lessons learned throughout the program. The trip tested the knowledge and skills that we had acquired throughout the program because repeatedly asked to apply them in a new context. For example, in our marketing class we learned about consumer’s purchasing decision process. China provided us the opportunity to think about how the Chinese consumer’s purchasing decision process differs from the American consumer’s purchasing decision process. This deepens our understanding of both. The same could be said for macro- and microeconomics, business law, org. behavior, and many others. The trip had the same effect on our training as the kiln has on a piece of pottery.

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