Busting myths about China

This blog post is a first! As many of you know, I’m very active with outbound Chinese private equity funds and high-quality Western companies seeking investment.
This post was written by my teammate, KC Yoon, and I found it a useful view that busts some myths I’ve heard far too often about China.

Enjoy!

Some quick background- I am a Singaporean and used to be a civil servant; and currently have lived in China for the past 8 years. Singapore like China is also a”Government; command-driven” economy…..with smart governance Singapore has managed to do well. Singapore started China’s first industrial park in Suzhou some 20-30 years ago…today Suzhou is generating a GDP the equivalent or more of Singapore! That must surely tell us some key learnings..that China and the Chinese Government can adapt and adapt well.

I believe there are several unique factors and facts which will lay the foundation for a successful transformation of China into a modern global nation.

1.  The Chinese Government is more flexible than we think!- the Chinese Leadership & communist party takes its history lessons very seriously and I believe they will want future generations to view the Communist party as having brought the Chinese people from the brink of being conquered by foreign invaders; a decaying Manchurian empire in the 1949 – after the Party’s 100 year rule -by 2049- that China re-emerges as a leading global leader.

2. China is laying a stronger and broader foundation for future growth than we can see!-urbanisation of the remaining 600M rural population; driving these 600M to consume by taking away the traditional need to excessively save for healthcare and education costs-  A new healthcare regime is slowly be paved.

3. The Chinese youth are enjoying more freedom than we think!  Thanks to internet, spread of weibo/blogging..the younger generation are exposed to global news and events; with internet as their social media- rapidly forming opinions by the millions should they sense any wrong doings or unfair treatments by the elite; by the rich on the ordinary citizen- this is creating a powerful “policing” effect on society.

4. The Chinese people are more entrepreneurial and hungry for consumption that we believe!  The Chinese have always been business-minded and through history natural consumers of material goods & services..So much wealth has been created over the past 10 years by this whole generation of entrepreneurs who are now feeding the system by being investors/LPs in VC/PE Funds sprouting and growing strongly throughout China.  Already we are witnessing the hunger for luxury goods by these wealthy Chinese.

KC Yoon

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Michelle Randall Addresses AMCHAM China on Results-Driven Strategy

Michelle Randall, president of the global management consultancy firm Enriching Leadership International, recently addressed the American Chamber of Commerce in Beijing, China on How to Integrate Strategy and People for High-Stakes Growth.

San Jose, CA (PRWEB) August 17, 2011 — Michelle Randall, president of the global management consultancy firm Enriching Leadership International, recently addressed the American Chamber of Commerce in Beijing, China.
Speaking to a group that included senior officers at leading companies and organizations headquartered in Beijing, her topic was How to Integrate Strategy and People for High-Stakes Growth.

Ms. Randall discussed the importance of developing a results-driven strategy centered on clearly defined goals instead of believing what she sees as the mistaken yet pervasive notion that strategy drives results. She emphasized the importance of incorporating execution and accountability into every aspect of strategy development to make implementation more effective.

Ms. Randall also spoke about how companies can profit from seeking outside help for strategy development. “Having an outsider lead the process avoids the dangers of the CEO stifling the diversity of approaches, whether it’s done intentionally or not,” she said. Other benefits discussed included an outsider’s ability to broach taboo topics normally ignored by an organization and the best practices and intellectual property they can bring to the table.
She warned that companies should not shy away from strategy development for cost reasons, stating that the biggest investment any company will make is with time. “With a results-driven strategy process, business leaders can expect a ten times return on their investment,” she said.

Ms. Randall stressed the importance of building a well-balanced team and promoting employees with both skills and spirit to management positions, noting that, “The potential of any company expands directly with the development of its people.”
One staffer who attended said, “The presentation was lively and interactive, with attendees asking questions and engaging in a dialogue with Ms. Randall about their own experiences and challenges they have come up against in their work environment.”
Questions from attendees included how to best keep a company’s vision top of mind and how to push staff to help drive the company forward instead of just going through the motions.

Enriching Leadership International works to accelerate the growth of global organizations. The firm’s clients include top leaders and their teams at Fortune 500 companies such as IBM, Quest and NetApp, members of the U.S. House of Representatives, and notable mid-tier businesses.
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Michelle’s talk to AmCham China

AmCham-China welcomed Michelle to discuss how to integrate strategy and people for high stakes business growth. Michelle emphasized the importance of a results-driven strategy versus strategy-driving results and discussed how strategy adjustments can affect a company. She then highlighted that companies profit from seeking outside help regarding strategy as they can bring fresh thoughts and opinions into the arena.

Do you have the vision and the people to drive your organization to the next stage of growth?

Michelle emphasized the following key points in her presentation:

  • A results-driven strategy classifies goals and execution as one in the same.
  • Integrate strategy and people to accelerate results and grow potential.
  • Remember that strategy does not execute itself, people do.
  • Investment in the process of integrating strategy will lead to extraordinary returns.

Read AmCham’s article about Michelle’s talk.

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Charming Chinglish

A charming aspect of China is Chinglish, the literal translation of Chinese into English. It is often the result of Google translate or like tool. There are thousands of examples to be seen in places that want an international flair or to genuinely communicate with non-Chinese speakers.
Sadly, Chinglish is considered by some to be an embarrassment and efforts have been made to eradicate it. For me it offers an insight into Chinese language and mentality that I would otherwise be without.
Here are a couple I’ve stumbled across in the past week that tickled me. Enjoy!


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Feeling the (Economic) Heat

This is my fourth trip to China since first coming here two years ago. While cab fares have remained flat, precious little else costs the same as I remember it previously.

Over lunch with a business professor in Shanghai, he told me that the cost of living for his family had doubled in the past three years. His salary hadn’t.

I’m not an expert in Chinese monetary policy, and I don’t believe that the Chinese economy is overheating. Nonetheless, this certainly feels like some excess heat.

The question is, how will people deal with this kind of inflation squeezing their wallets?

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Is China’s Economic Potential Oversold?

Construction opportunities abound

Two days ago we travelled from Beijing to Xiangtan, the second largest city in Hunan province. We flew into the airport in Changha, and took a 90-minute bus ride past rice fields glinting in the last rays of light at sunset.

As we arrived in Xiangtan at 8pm on Sunday evening, there was active construction everywhere. We drove past several large, contemporary apartment complexes and into our own enormous and beautiful hotel. Xiangtan is being transformed into a welcoming, modern city.

Ever heard of Xiangtan before?

I hadn’t before arriving. This minor city in China is a palpable economic engine. What’s striking is that there are hundreds of cities like this here.

As I write this I’m on another bus driving through Hunan Province. Every city is full of cranes. Between them land is cultivated and towns are being built up.

The domestic demand for construction and all related development is phenomenal and lasting.

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Groupon in China

In case you’re considering jumping in on Groupons IPO, this may help make up your mind!

What do you think of Groupon in China?

Update:

The ad pictured is for a Chinese company, GroupOn.cn, which is #7 in visitors among coupon companies in China.

The American company Groupon is in the Chinese market as part of a joint venture named GaoPeng, which is #8 in visitor traffic.

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Learning to Say No

I arrived in China with a pair of cellphones I bought in Switzerland last summer. A friend brought SIM cards for them to the airport, I plugged them in and thought I’d be connected in China. As it turned out the phones were locked to the Swiss carrier I purchased them from.

The next morning, I went with my Chinese friends to a mobile phone store to have the phones unlocked and I purchased an inexpensive phone to use immediately. When we returned the next morning at the appointed time, the phones weren’t unlocked. The store owner told us he hadn’t done it because it was more complicated than initially expected and would cost more.

I agreed to the increased price and when we returned the following they still weren’t unlocked. This time the owner told us that it would take two days instead of the one he promised so he hadn’t started.

We thanked him and left with the phones. He made sheepish eye contact as I looked back over my shoulder. He was obviously embarrassed by his inability to do the work. I was disappointed by his reluctance to tell us that up front.

Much is made of the importance of ‘saving face’ in China, but this reluctance to deliver bad news shows up in every culture. I’m always surprised when business people choose to comprimise their relationships over the discomfort of simply admitting that they can’t accomplish what they had expected. The result on the deliverable is the same, but the damage to a trusting working relationship is simply unnecessary.

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Chinese Student Generosity

While walking from our hotel to the metro station, the kids, my dad and I ran across this scene.

A produce vendor’s motorbike had been knocked down by a car in an intersection. About ten students were helping the man stand his bike up while deflecting traffic and picking up his inventory of cherries and lychees that was strewn on the street.

The students understood that the bike and the fruit represented the vendor’s financial world and engaged with immediacy and compassion.

I’ve been a student in two countries and this level of generosity and leadership from these Chinese students struck me as noteworthy.

Does this strike you as exceptional student generosity?

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Innovative Customer Service

PlayPlay

Last night we arrived in Shanghai and went to dinner at a shabu-shabu restaurant. The customer service was extraordinarily innovative and personal.

For patrons waiting to be seated, the restaurant provided a ping pong table, a mini-play area for kids, and complementary manicures–which should tell you how long the wait and how popular the restaurant is!

Our kids were tired after the long-day’s travel, so the wait staff brought over extra chairs and lined them up into little beds. When our kids curled up and dozed off, the staff came back and covered them gently with little blankets.

The pièce de résistance of customer delight was the Kung Fu noodles. In shabu shabu, richly flavored broths are placed in the center of the table and you cook meats and vegetables in the broth. At the end of the meal, noodles are added to absorb all the amazing flavors.

Instead of just adding the noodles, as in every other shabu shabu restaurant I’ve been to around the world, this place offered what is called Kung Fu noodles. Watch the video to see how the noodle dough is stretched into long lengths in a part dance, part martial arts performance. Kung Fu Noodles video

In digesting the entire experience it made me think about more innovative customer service for my own company. It’s food for thought for all of us who endeavor to delight our customers instead of simply satisfy them.

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