I hope you all are not only enjoying your reading, but also looking forward to the journey ahead. When you have time, check out this short documentary about the people and culture of the Yunnan province at: http://www.youtube.com/watch?v=-r9nHrGten8.
So I was one of the folks that got my book very late and I just read the first chapter. It is a book called "China Shifts Gears" and it is about the automotive industry in China. The first chapter was really just to set up the book and it explained what the book is about. It is looking at how much growth there has been in the Chinese automotive industry and how much of that has come from the aid of American manufacturers. It also is going to look at how much pollution cars are causing in China and how bad the pollution could get from the cars. It does not seem like a very exciting read but very informative, so I will keep you posted.
ReplyDeleteThis most recent chapter had two parts in it, one where it explained some very encouraging economic trends in East Asia, and then a second where they explored some very negative hypothetical scenarios that could happen and would wreck Asian-American relations. But I really liked their summary of the positive trends currently happening, so I will focus on those.
ReplyDeleteIn summary, they said that competition for goods, services, and investment are raising the quality of goods and forcing resources to be used more efficiently. Also the competition for foreign investment is forcing governments to loosen up, crack down on corruption, cut red tape, and reduce regulations. These also require greater transparency and accountability, which makes it harder for entrenched elites to hold onto power, hopefully bringing greater equality to the region. And also this increase of competition is making the Asian countries look to neighboring markets increasingly, and that is helping the poorer countries.
So they said that all of these are positive trends, and I mostly agree. It will be good to see people benefiting from these things. Hopefully it'll be a true quality of life enhancement for them.
@ Evan
ReplyDeleteIt'll be interesting to hear about how involved America is in China's car manufacturing. It would put more worries at ease to know more in depth how much of our trade imbalance with China comes from American investment that is just shipped back to us, or whatever it turns out to be. Also I don't know anything about China's air quality, so that will be interesting to hear about as well, especially compared to how it is here. That would be enlightening.
@Stefan:
ReplyDeleteMy book talked about similar positive effects of the competition in economy in China. I find it fascinating to see how countries change over time - for the better! It's very encouraging to see countries improve instead of remain the same over time. We can only imagine all the improvements that China will make over the next few years. They are on the right track so far, although there are still a lot of other issues they need to deal with. It would be interesting to compare/contrast the positive and negative effects to see exactly how many more things they need to improve on.
Week 6 Post :: Vanessa Lézeau ::
ReplyDeleteThis chapter in my book was about money, banking, and legal issues. It is strongly suggested to hire a completely bilingual attorney who is familiar with Chinese business law when in need of legal assistance or when writing legal documents for your business. All documents should be written in English and in Chinese so that both parties involved in the process understand exactly what is happening. Foreign attorneys and accountants are not allowed to practice in China, so you’ll need to find new ones there. I think that would be a hassle, but if you have some good connections when you begin your business in China, you will have an easier time finding the right people to hire.
I found it interesting that China is the worst offender of piracy laws. In fact, the book says that 8% of China’s GDP is from counterfeiting. So you should be very careful with your intellectual property. One solution is to have different parts of your final product manufactured by different companies and then assemble the final product in the US, so that they will not steal your idea. There are various patents and copyrights you’ll need to register in China, but be aware that they do not enforce them much.
This chapter was informative. I am glad that I learned about the intellectual property rights and the different problems that could arise with the abundant counterfeiting that is present in China. It’s definitely something we all need to keep in mind in case we have to deal with it in the future.
@Vanessa,
ReplyDeleteI think your book and mine are talking about the same stuff! :) It was interesting how your book and mine both specify that when someone is planning to starting up a business in China that they make sure they are either fluent in Mandarin and the Chinese laws or that they have a Chinese middle man that will do all the negotiations for that company or person. Also it was interesting to hear that China doesn't really enforce the patents and copyrights! I loved all the information that your share because its very important to be informed about China especially because they are becoming such a huge power nation. I look forward to reading the rest of your blogs.
Continuing from my last blog about the 5 major relationships:
ReplyDelete1. Ruler-subject: If you do not respect the hierarchy that prevails among the Chinese you are dealing with , you will not be respected by them.
2. Parent-child: The relationship is more complex and subtle than is often thought: an unequal role does not mean unequal obligations. The child's obligations are more powerful, but the parents owed affections, sustenance, respect, and self-sacrifice to their children.
3. Husband-wife: Is often been misunderstood as a kind of charter for exploitation, but it is not. Many Chinese woman are powerful individuals, often behind the scenes but not always. And in modern China women hold many senior positions.
4. Elder-younger: The young must always respect the old because the elder is the one that has the most wisdom and experience.
5. Friend-friend: Between a friend to friend relationship both individuals are equal.
The this chapter also mention a concept called: Face. Face is about one's self-respect and prestige and, crucially, about one's standing in the group. Face is so important that it justifies spending money even if you have very little or none at all! And face is gained by good connections, wealth, power, intelligence and even (in modern China) attractiveness. Face is like a credit card, the more you have in the account, the more credit you are given :) so keep that in mind when we travel to China. Start build face right away and protect it with all that you have because once you loose it is extremely hard to gain it back!
in my book this week i read about the luxury markets of fashion and watches. in the fashion market totals out at $2.6 billion and has been growing anywhere between 20% and 30% a year. And its the only market where mens ready to wear products sell more than woman's
ReplyDeleteWatches this market represents 10% of the world wide sales is worth about $1.3 billion with a growth rate of 20% and 75% of watches are bought as gifts.
these are just some of the big markets in china that i have read about so far so keep looking forward to more.
@Evan
ReplyDeleteEvan your book sounds really cool im jealous. cars are alway interesting to me. i am really looking forward to reading more of your blogs` and for your presentation at the end of the year. i bet there is a lot of pollution in china if it is anything like america where most families have one our two cars seeing how there are way more chinese families. thats a lot of cars.
Chapter 5
ReplyDeleteValley of the Headhunters- The Wa
The Wa villagers are a group of about 1 million people who reside between the border of China and Myanmar. The Wa have the reputation of being barbarian, hence the name "headhunters". The rumors about them being cannibals stuck with them for awhile. People were actually afraid to cross into their village.
However, Rawson and Legerton (authors) found the Wa people to be quite welcoming and hospitable. They spent a majority of their time visiting with the teachers and children of the school there. Apparently six years of schooling is enough. High school isn't required, mainly because they cannot afford the tuition. Surprisingly the principle of the school hadn't even gone to high school, and he held a somewhat high position.
One other event Legerton and Rawson attended was a funeral. The Wa people mourn in a different kind of way. They celebrate the life that the person once had by, "eating, drinking, and playing games". Also, the funeral is held at the families home, and the deceased are buried in their garden.
I find it interesting every week I read this book, because of how deep and personal the authors get with people. They are legitimately interested in what they do on a day-to-day basis. They are so eager to learn about the different cultures and literally live the life of the villagers for however many days or weeks they are there.
Haslel,
ReplyDeleteIt's interesting because some of those relationships are common in a lot of other cultures. It's pretty much an understood sign of respect, and knowing what your place is.
This past week I learned about China's origin of socialism and the master mind. It was a man named Fei Xiaotong, and he was one of China's most prominent and brilliant scholars of the 20th century. He proposed that to understand China, one must first use research and concepts originating in China. He developed his unique sociology governmental scheme by first learning the way of the Chinese people. I guess maybe this is why their government is working so well!
ReplyDeleteShanshan Zhang
ReplyDeleteThis chapter talks about migrants’ parents had terrible instincts. They had no idea how outside looked like, and they gave a lot bad advice to their children. They only care how much money that their children could sent, told their daughters to get marry, and warned them to stay in the factory where their children work. Soon, when migrants came outside, they learned how to deal with their parents if they really want to change their life. Most of them fought or lied to their parents. Also, the author talks about her family history, especially her grandfather. Her grandfather was a migrant, and he worked hard to be success. Actually, the author grew up in United States, and her mom told her many family stories. Furthermore, she talks about her great-grandfather too. The author writes a lot of diaries that her great-grandfather wrote. It is cool that how her family can keep her great-grandfather’s ideas and believes. Her great-grandfather was a smart person, and successful person in her family history.
@Ms.Toruno
ReplyDeleteWhen I came to United States, I also learned about relationship in different majors. It took me about one year to learn, to understand, and to get used to.
I saw the video-http://www.youtube.com/watch?v=-r9nHrGten8
ReplyDeleteYunnan is so beautiful, and it is so different from the city where i live.
Different from westerners stress business efficiency and contractual process, Chinese focuses on both hierarchical rank and ‘face protection.’ Therefore, foreigners have to know the roles and relationship of the negotiation. Chinese possess a large negotiating team which deals with foreigners. The team includes technical members and administrators, but they are not the one who makes the final decision. The team tries and learns as much as possible about the other side’s goals, advantages, disadvantages and interests and give the information to the senior Chinese managers. After a long analyzing, the senior managers may make a good decision, so foreign businesspeople should practice patience. The decision-makers don’t need to show up in the Negotiating, they remotely control the entire negotiating process.
ReplyDeleteIn China, eating is a culture which is famous around the world. Business is always related to eating because Chinese place high premium on hospitality. There are many forms of banquets in China such as welcoming banquet, personal banquets, official banquets, company banquets, and farewell banquets. So when you are coming to China, we can have a welcoming banquet.
@ShanShan
ReplyDeleteI think it's called feudalism because of China's poor education. Culture is hard to be changed, so we should open our door, for foreign culture, that we can learn the advantages from it, comes in.
That is why we are in the US to study western education.
Chapter 5 is building a topic around two words-“big project”. When Volkswagen achieve success in China, many others countries’ automobile vendor wanted to open a business in China. It would create a competition once there is another automobile company besides Volkswagen. Volkswagen had not thought about there would be another automobile company or join venture beside them at that time. But soon enough, Volkswagen realized Chinese government did not want to hang all hope in once place, and Chinese government wanted to push pressure on Volkswagen, and force them to do better. Thus Volkswagen tried to get the opportunities in anytime they hear a big project is ongoing. As their wish, they got ship production project which it was a big project and it was the first time for Volkswagen group to build ship. In the end of the chapter, it mentions that the second joint venture was hold which was between Volkswagen group and First Automobile Works. This joint venture produced both Audi 100 and the VW Jetta. I can tell pretty much all taxies are VW Jetta in Shanghai. Now I know origin of VW Jetta, and why all taxies are VW Jetta. Take a look when you arrive at Shanghai city, it is not hard to recognize. I believe competition is needed in many places. Competition creates challenge which force two or more parties to work harder and to work best. Thus we can find out a better product in a comparison. Volkswagen group always accepts the challenge and reveal the best effort to Chinese. I think that is the reason they could seal deals and got early success in China.
ReplyDelete@ Evan
ReplyDeleteAir polution is one of the issue in China. It will be interesting to see what idea about air polution comes from your book.
Tyler,
ReplyDeleteThat is interesting how the luxury market is expanding so much there. I know luxury is big here in the US but I did not know that it was so big over in China. I am guessing that that boom in the market is more recent because in the past they did not have that opportunity. So they must be taking advantage of their ability to start buy luxury things. I also wonder if all of the luxury things over there are as high quality. I know somethings over in China might not have quite as high quality. I do find it interesting though that in this culture that the luxury market is so rapidly expanding.
Tyler, woah thats crazy. I didn't know people in China were that much in their luxury goods. Especially more men than women. I guess when we go there we will have to whip out our Gucci watches and such things to compete with them. I wonder how long it took for the Chinese people to really start looking for these luxury items.
ReplyDeleteAs I have said in my previous post my book has to do with the internet in China and how it is taking off. I just got to a part where they find out that the government is going to get more involved in the internet and begin to regulate it more. The government wanted to start cracking down on the flow of information from the west into China. One of the businessman, Bo was extremely calm about the news. He went on to say that China is just figuring things out and they don't have to be worried. He points out that there is always a different story underneath. They just have to keep working and not worry about what the government is doing. He says that "we can not worry about all the voices." So I found it interesting that they were not very worried about the regulations because they knew that the government is not that strict on all the regulations. He specifically says that regulations in China are like bamboo - stiff but bendable. So I found this as something useful when looking into doing business in China.
ReplyDeleteTyler:
ReplyDeleteI always enjoy reading about market shares and statistics like that. Does your book say that the fashion industry totals out at $2.6 Billion revenue or profit? Those numbers never sound like much for a whole market, but in retrospect anything with "billion" in it is pretty good. It sounds like you have a pretty interesting book!
For this week I just wanted to focus on one point instead of all the ones that I read. So, the main thing I was captivated by in this weeks reading is the importance of developing a strong sense of understanding iand respect for your partners and potential partners in the Chinese market.
ReplyDeleteIn my book, the author John Chan talks about how the Chinese people often aren't afraid to end negotians if they feel that you are benefiting more than they are. So it is important to really get to know your potential partners before going into business in order to understand eachother's motives and wishes for the business relationship.
Also, Chan says that many Chinese business will try and negotiate a deal with you just for the practice in negotiations. They may trick you, or use your foreign naïveté to their advantage. One tip he gave for making sure potential partners know what you want and know what you think they want is to take incessant notes during any and all meetings. Then give them a copy of your notes. Tis way you have documentation of what you understand to be the terms of the meeting. Really a good tip for any business person!
The next chapter in my book talks about the legal aspect of starting your company and how to license your company.
ReplyDeleteThe book states that entrepreneurs new to China should seek help when licensing their company. This is because the regulations in China are often vague or incomplete. The book advises hiring an international consulting firm that has expertise in the Chinese business legal system or hiring low-cost advice from Chinese that are familiar with the chamber of commerce and business practices.
The book emphasizes on getting the correct legal form and business scope for your enterprise. This is because you can only do so much with your license that you apply for and if you want to do business that is outside of your business scope then you have to file another license. The four types of legal forms are an offshore company, representative office, foreign invested enterprise, and domestic-owned enterprise. The book doesn’t encourage one form over another and they all have their pros and cons, but it does stress the necessity of getting the correct legal form for your type of business. The best way to insure that you have the right legal form for your business scope is to seek help and advice from experts.
Winston,
ReplyDeleteThats interesting what you were saying about the government regulations on the internet. Its weird because I feel like that topic has come up in pretty much all of my classes this past week. Its odd for us to watch this country that is just getting in to the internet be so regulated when the internet in our country has essentially become a way for us to be free and to express whatever we want and connect with who we want. It will be cool to see how the future of their online interactions plays out.
This comment has been removed by the author.
ReplyDelete@Vanessa
ReplyDeleteThat is really interesting to read about how the government doesn't really enforce patent and copyright laws. I was aware of China's piracy problems and it makes you wonder how its economy can prosper with so many consumers pirating the goods and not paying for them. It seems like this would really hurt businesses. I read somewhere that close to 80% of software in China is pirated. Things like this make businesses reluctant to do business in economies like this, especially software companies. I also read that business in China don't spend a lot on research and technology out of fear that it will be stolen. So, I'm just surprised that the government hasn't cracked down on this and the economy still thrives despite these circumstances.
This chapter of my book was talking about the declining automobile industry in the United States. The United States used to be home to the world leaders in automobile companies from the 50's to about the 70's, but gradually our title has been stripped from us. With the slump in 2008 essentially being the "straw that broke the camel's back." Our auto industry went from a position of having one of the largest employment bases to being a drain on the taxpayer. At the same time, automakers overseas have been gaining strength. They've been coming up with new technology and picking up our extra baggage that we've were forced to leave behind during the recession and making bank out of it.
ReplyDeleteChina especially is stepping up its automobile game with over 9.3 million cars being manufactured in 2008 compared to only 2.1 million in 2000.
Their innovation is sucking the life out of the industry that we once dominated, and we need to watch out.
@ Lauren
ReplyDeleteWow. That's intense. I wonder did the energy crisis or something else have anything to do with it. I wonder how China first began making such huge leaps in economic growth.Those are really good statistics.
One of the essential keys to being a successful business manager in China is to learn to like new things. If you are steadily holding on to past things you won't be able to keep up. In the words of Ekkehard Rathgeber, President of Bertelsmann Direct Group Asia,"You must be very open minded to new things, excited by new things-not someone who wants to perserve his own culture and identity."
ReplyDeleteWeek 7 - My book is talking about the Information Technology Industry. After a decade of catching up, the Chinese information technology industry is finally emerging into the global market. Some of the main factors of competitive advantage in the information technology industry are the speed of innovation, human resources, and market. China is rapidly developing, and owns an enormous market which is growing very fast. There is a shortage of skill supply, and compared with the other companies in China the skill supply is the lowest in the information technology industry, but given the increasing trend of outsourcing from MNCs to developing countries, that should be a good start.
ReplyDeleteOzzie - I think that is very interesting, and very true because China is moving and developing so fast that if you don't learn to like new things you will get left behind.
ReplyDelete@ grant
ReplyDeleteIts always good to developing countries grow. Chinas human resources are vast and to this day one of the best ways of still doing things is with some sort of human help. Machines cant do everything, so a country with many human resources is always good for a manufacturing company, especially if the labor is cheap as it is in China. Since so many counties are outsourcing to different cheaper countries, the information tech industry not only is helping with the spread of knowledge but, helping them develop even faster.
In my reading, The author describes living in south China where there were many foreigners. The foreign community made up a minority of the community, so they had a developing real-estate industry. Because this town was located next to the train that went directly into Hong Kong, he expressed how this area was prone to price discriminations. During a certain time of year people would all plan their trips and vacations because there was a huge convention of Global Commerce where many importers came for a while to talk to the different chinese manufactures. In China where mutual back starching is an excepted norm, if you say the right things and kept your governments secrets, the rewards were quite sweet, and you could have a nice standard of living. Since many exporters came to see the manufactures, the landlords would jack up the prices of the spaces their companies gave them to live in, and move across the street where rent was cheaper. During the conference there would be much price negotiating for products that had to be made. Importers were starting to have a tough time in China, and some threatened to take their business elsewhere, but once they threatened the chinese manufactures, the chinese would work with them just to keep their business and settle on a price. The idea of getting hooked up wit a naive foreign buyer proved a fantastic temptation for these company representative, and it trumped whatever other prejudices they had.
ReplyDelete@Evan. Your book looks very interesting. One of the reasons I have come across as to why the automotive industry has taken off is that the Chinese are smart in technological advancement. If possible, they will take technology that has already been developed and change or modify it and not spend a huge amount of money developing technology that is distinctly Chinese.
ReplyDelete@Julienh
ReplyDeleteThis price discrimination is very prevalent in many countries, especially in the United States. Since I live in a city where tourism is one of the main sources of income, price discrimination is very common. Duringthe summer, many stores will jack up there prices on everything and during the slow parts will have sales and lower the prices.
In my book this chapter spent a lot of time on Daoism and different forms of leadership the most interesting one was the "wateristic" I talked about the ultimate goal of a leader being to serve their people without desire to gain for personal benefit or to receive gratitude. Any specific leader come to mind?
ReplyDelete@ Lauren I totally agree the US better watch out it really sounds like China's auto industry has exploded in the past 10 years and its pretty obvious if you take a look at any parking lot see how many Hondas or Toyotas you can find. China is on top of the auto game
ReplyDeleteI find it absolutely astounding that China is hailed for being one of the strongest markets and countries in the world today, however the average income is still only $10,000. That really puts into perspective how wealthy America is.
ReplyDeleteA part of this chapter talked about the culture of Shanghai and how it is so similar to Las Vegas. The streets are packed with clubs, Porsche cares, $800 phones and citizens craving a party. This is not the way that I think of China at all so this section completely blew me away. It talks about how this area is extremely showy and wrapped up in the material things, unlike the rest of China. That's extremely intriguing to me.
@Ozzie: I think that's very true of any economy, but it seems like China struggles with that a lot. It took them a long time to get out of the poverty/recession that they experienced and now that they finally have, they are being extremely cautious of not falling back in to that.
ReplyDeleteIn my reading, my chapter proceeds to breakdown the Chinese business structure.
ReplyDeleteSome interesting points that were made:
Small businesses account for approximately 90 percent of enterprises and produces approximately 30 percent of industrial turnover. State-owned enterprises (SOE) have been the major economic force in China. They account for 10 percent of enterprises and yield more than a 30 percent turnover. They have established a three-tier management system that has worked well and consistently. China has implemented policies that takes control of industries that are associated with national security and economic stability. This will in turn move toward the formation of Chinese enterprise groups.
Despite the progression that has been made with SOEs, they still have not withdrawn from industries that they should have already. This has resulted in financial losses due to the competitive industries.
This time in my reading, the chapter I read was talking abpout different types of Human Resource Management (HRM). This has been the most interesting reading so far because of the case studies that showed the differences between HRM practices of different companies. One thing I found interesting in this chapter, among other things, was that even though working long hours tends to lessen productivity and highten stress and more and more companies are starting to incorporate after work activities for their workers, some research suggests that Chinese workers would rather work extra hours to make more money.
ReplyDelete@michael
ReplyDeleteI think its pretty cool that there are leaders out there who really adhere to those principles. It stands to reason that those types of leaders get allot done and at the same time have the genuine respect of their workers