Posts Tagged ‘China Business’

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China’s Sticky Floor

May 13, 2009

A friend of mine (thanks Matt) sent over this article about the concept of a sticky floor in china’s work places.

If you are confused about the concept of a sticky floor, it has nothing to do with spittle and cigarette butts, rather it is a similar concept to a glass ceiling but for workers much lower down the food chain.

The authors claim that sexual discrimination is rife amongst China’s factories and women are unable to rise from the factory floor. Worker’s rights being a concept left for wealthy western employees.

I’m not sure that this is true though. In my experience of China, particularly of working with senior party officials, I have met many extremely powerful women. I have dealt with many companies with female CEOs and even negotiated against a fearsome female opponent who was the head of a state owned steel mill.

I am sure that the authors are not incorrect, it is just that one needs to take a step back.

I would like to see more of the study to really understand wage levels for men and women doing the same job. Perhaps they differ greatly.

However, when you look at the numbers of men and women employed in foreign invested companies at managerial level I believe that you would find a far greater number of women employed. It is a simple fact that foreign companies tend to favour women over men.

As with all surveys if you look hard enough you will always find the answer you were expecting but I do think that if we look at the economy as a whole then China is doing pretty well on sexual equality.

There is no doubt that China still has a long way to go on sexual equality but the same might be said for most western countries as well.

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Interesting Article on the China’s Copper Strategy

April 22, 2009

My friend Matt sent me this article yesterday, which I thought I would share with everyone.

Seemingly a dry look at what China is doing regarding copper, it contains one or two interesting bits of information and style.

I have seen the question of whether or not China looking to use the current economic situation to further its interests quite a lot lately.

I often find it interesting with western journalists that they see such a move from the US as ‘prudent financial policy’ (although i suspect when it comes to the US that term is oxymoronic) but when China does it they are ‘trying to take over the world.’

The stand out part of this article is that it does not take such a tone.

So China’s longer-term view is that now is the time to secure a substantial foothold in copper to ensure the country will not be exploited in the same way it was with oil, iron ore and other materials in the last boom. ”

As someone who was on the western side of negotiations on iron ore deals 6 years ago I witnessed first hand just what that exploitation was.

At the top end of the scale were the major mills who had to purchase in a sellers market. It wasn’t so bad for them but they were definitely the weaker party during talks.

At the bottom end were thousands of massively uninformed small Chinese buyers scrabbling around for any bit of iron ore they could lay their hands on ripe for exploitation by anyone claiming to have ore. Right in the middle of this unholy mess were the mines in India and Brazil just putting up prices until it all collapsed.

No wonder the Chinese have decided to change their strategy- I would say that is a very smart move.

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China’s Net Crackdown and the International Economy

January 12, 2009

I thought I might start a new thread mixed in with the language posts for those not so bothered about learning Chinese but still interested in China news.

China has started yet another internet crackdown, the usual suspects are up for ‘not being tolerated’ these being porn/ lewd pictures and political dissent.

Different blogs and news groups have tackled the issue from various angles- “Nervous China Tightens Grip on the Internet” in the Sydney Morning Herald/ China widens “vulgar” online crackdown- Reuters/ Cracking down on internet lewdness- China Rises Blog and quite a few others have reported on this.

So what does this mean?

Firstly, Zhang Ziyi has been seen topless on a beach with an enormous Israeli financier (her fiancee). Pictures have surfaced and there are few things the Chinese government likes seeing less than a national beauty ‘disgracing herself’ with a foreigner!

This has lead to a general crackdown on lewd sites and the Chinese pornography industry, which thrives on the net despite the best efforts of the government.

However, the government is, at the same time, cracking down on political sites. This is less well publicised as it makes less interesting headlines than stories about Zhang Ziyi but the major discussion site Bullog.org has been taken down and it seems that the government is putting pressure on academics to remove signatures from petitions potentially embarrassing to the government.

Normally I do not comment on politics too much but I do think that this has serious ramifications for business.

The Chinese government sees the economic slowdown as a major threat to China’s stability and its control on power. People are losing jobs, factories are closing and demand in the economy is dropping- now is not really the time to relax the grip on power.

I doubt that the tightening of regulations on lewd internet pictures is just a ‘pretext’ for other crackdowns but it is likely to be the start of a much less tolerant attitude during the coming months.

Some foreigners will make much out of this- any headline featuring China and the internet usually grabs attention, however, as business people we should be glad of the government’s actions.

A stronger control on power and an obvious acknowledgement of the challenges facing China during the economic problems show that the government means to keep stability.

Stability means a better environment in which to do business for both Chinese and western firms, which means people keep their jobs, money keeps flowing and people are more content, which leads, in turn, to more stability.

It’s a shame that we don’t get to see pictures of Ms. Zhang’s bottom* but when you get past the attention grabbing, anti-China headlines it actually all makes sense. A political and economic meltdown makes no sense for anyone, least of all the average working Chinese just trying to feed their family.

*Actually I have never thought Zhang Ziyi that attractive- something I have in common with many Chinese men. Just goes to show that western and Chinese concepts of beauty can be quite different.

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Recession pulls hemlines down

December 9, 2008

Now that the recession is biting, skirts have nearly hit the floor, says Celia Walden.

The above article seen today in the Daily Telegraph (UK). How is this relevant to China?

Well, quite simply, and I do not say this lightly, right now I am ashamed to be British. A once proud and great nation now so depressed and complacent that the current economic crisis is actually cause to celebrate as it gives everyone even more of a reason to be gloomy and to give up.

I cannot even begin to comprehend the thought processes that would make a fashion writer link hemlines to the economy nor do I wish to consider just how far Ms. Walden’s grasp of macro-economic theory goes but I do find it very sad that even Chris Moyles, the doyen of early morning puerility on British radio is obsessed with talking about how the whole nation is going bankrupt. That’ll help keep the kids off drugs and alcohol and working hard in school.

The sad thing is that Britain is not going bankrupt, there is more wealth in London than ever before and as soon as people take the blinkers off and start to invest in real projects* again then the economy will get back on its feet.

Britain is a country that, for the most part, believes that it has had its time at the top and that it is all downhill from here. China, on the other hand believes that this will be its century.

Never mind the fact that the two economies are of roughly equal size and that means the GDP per capita of China is miniscule when compared to that of the UK, China has terrible levels of innovation, poor protection for those who do innovate and is still essentially the work-house of the world churning out cheap goods for K-Mart.

None of this matters because China believes that IT CAN and as Henry Ford said- If you believe you can, or believe you can’t, generally you are correct.

Economic growth is not a zero sum gain. Now is the time for Britain (and anyone else reading this) to ignore what Gordon Brown and Chris Moyles say and go participate in what is happening in the emerging markets.

China may not yet be the economic super-power it wishes to be but at least it has a vision and that is a very positive thing indeed no matter who you are or what you do.

*May I be so bold as to suggest that rather than investing in bank products that not even the people who invented them understand, let’s try putting money into projects that produce real things that will be demanded by real people.

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Let’s get a few things straight about China consultants…

October 27, 2008

How on earth do you explain what you do when you are someone who primarily deals with China? China Hand? China Expert? China Consultant? I hate all of these terms. I suppose China consultant is the best of a bad bunch but really, it is still awful. Have you ever heard of a ‘Spain Consultant.’

The Middle Kingdom, China, Cathay has held an enormous fascination for westerners for hundreds of years. We’ve tried to trade since the times of George III and even gone to war for the right to trade, a subject that is still a pretty thorny issue in China today.

My livelihood and by extension, that of my family is inextricably linked to China. Over the years I have tried to escape from its clutches, to consider a change of direction but it always come back to me that China is ‘in my blood’ even though I have no Chinese blood in me.

A chance encounter with my father’s Chinese colleague at the age of 12 led to this point. I told him I wanted to be able to read Chinese like he could, only to be told that no gwailo could ever really master the language. Degrees in Oriental Studies from Oxford University, several years as a translator and negotiator in China and an accreditation in Chinese translation from the Australian government followed. It is a magical language and the classical form of ancient Chinese even more so.

But back to China Hands. To understand how ridiculous the concept of a China Consultant is, one has to really first consider China as a concept.

Nearly 1/4 of the world’s population is Chinese, 75 times the population of Australia in a place roughly the same size. China spans from Mohe on the Siberian border to Hainan and Yunnan in the tropics and the cultures of these places are far from similar. Yes, China has a strong central government but is governed in a very decentralised manner. Dealing with bureaucracy in Guangzhou is very different to dealing with bureaucracy in Harbin, for example. Banqueting culture literally means the difference between some nice food under palm trees in Guangzhou right through to the total destruction of your liver and brain due to the local liquor in Harbin.

So to claim that you consult on 1/4 of the world’s population spanning an area similar in size to and about as diverse as Western Europe seems a touch arrogant to me.

Anybody who claims to ‘Help Western companies enter the China market’ worries me greatly. Which markets? Which areas? Do you really understand PCB manufacture as well as you understand setting up a language school or selling luxury goods? I doubt it.

There is no doubt, however, that when a company wishes to be successful in China they really do need assistance from people who understand the culture and the business environment.

So what makes a good China Consultant? I humbly suggest the following criteria be applied?

1) Would you work with this person in a territory other than China?

Don’t compromise on who you deal with just because you perceive China to be different.

2) Do they have focus and direction?

It is quite acceptable to have worked across a number of different industries in China. However, someone who claims to be all things to all people is unlikely to be good at any of them.

3) Do they have a solid track record in China?

You want someone who has run their own businesses in China or at least has an impressive list of satisfied clients. An expat worker who has decided to stay on after recently getting fired from a multinational is unlikely to be of much help to you unless they really know your industry inside out.

4) Do they speak fluent Chinese? I know some disagree with me, but if someone can’t even tell what their own staff are saying to each other or speak to the 98% of Chinese who don’t speak English then how can they possibly know the real China?

5) Is their experience recent?

Emerging economies change fast, 10 years in China in the 80’s isn’t much use in 2008.

5) Do not make the mistake that all Chinese know their own country. Just being Chinese does not mean someone is going to be of help to you. There are many excellent Chinese consultants but the same rules apply; credibility, experience and knowledge count for everything.

Above all, make sure the person you are dealing with is willing to work WITH YOU to EMPOWER YOU to be successful in China.

No one knows your business like you do. You need a guide, someone who can decode the complex cultural and political landscape. Someone who can explain it to you and aid you to work with, not against the business culture in order to smoothly get on with the business you do so well in other countries.

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What’s In a Name?

September 10, 2008

Talking about Hollywood film stars with Chinese friends can be a bit of a trial at times. Maybe it is because of laziness, but I like to think that there are more deep rooted cultural reasons why I find calling Tom Cruise tangmu kelusi faintly ridiculous and therefore refuse to learn their Chinese forms. Poor Julia Roberts has her name mangled in Chinese into something that when pronounced without full care actually sounds like Chinese for ‘radish strips.’ Whether you sell cars or movies, in this world, brand recognition is everything and being recognized as Miss Radish Strip is hardly going to help your career. Admittedly Brittany Spears fares a little better in Chinese as xiao tiantian or ‘little sweetie’ and our very own Beckham has recently become xiaobei or ‘little treasure’ after being known as beikehamu for many years. If all of this matters so much for celebrities, then how much more important is it to get your naming right when entering the Chinese market for a product that doesn’t have its picture plastered over every counterfeit DVD cover in China?

We have already touched on the importance of the written word in a previous article, talking about the way that the written language binds China together and how people are used to the sight of slogans everywhere. Given that the Chinese language is a thing of such beauty with hidden meanings and cultural associations going back thousands of years, the naming of your brand in Chinese is an extremely important and yet incredibly difficult process that may just help to make the difference between success and failure in such a large market.

There are three main ways in which brands have gone about naming their products in China. You can opt for transliteration of your brand name, i.e. choosing Chinese characters that sound like the original English name. Famous examples of companies that have chosen this method include MacDonald’s maidanglao and Sony’s suoni, names that are instantly identifiable even in Chinese. Another option is to choose a name with a similar meaning to the name in English. Apple Computers becomes pingguo diannao, and many of the Japanese brands simply leave the Japanese kanji characters when naming products in Chinese, leading to the slightly odd fengtian meaning ‘abundant field’ for Toyota in Chinese. Some companies use a name with a more Chinese meaning like that of Marriott Hotels who become wanhao in Chinese which loosely translated means ‘infinitely luxurious.’ Certainly not a bad name for a hotel, but this leads to huge confusion for first time visitors to Shanghai when trying to explain to a taxi driver that you wish to go to the Marriott The third option is to change nothing and leave the product in English. This is by far and away the least popular option and can lead to problems with brand recognition; LG have managed to get away with it well and are a popular brand on the mainland, Calvin Klein seem to have been less lucky with this strategy.

There are some products that when you hear the Chinese name you instantly think, ‘wow, that’s clever!’ It may be no surprise to hear that many of the companies that fit into this category are the large fast food and beverage companies with huge marketing budgets and access to experts all over the world. No article on clever naming of products would be complete without mention of Coca-Cola’s kekoukele in Chinese which not only sounds almost identical to the original English but also means ‘tasty and delightful’. Pepsi cola have also managed to come up with baishikele which roughly means ‘100 loveable things.’. To this day I have never worked out what these hundred things are but until then I shall stick with Evian on health grounds. Sprite is called xuebi which although sounding less like Sprite combines the characters for ‘snow’ and ‘emerald jade’ which sounds rather cold and refreshing. Whilst the duller transliterations of MacDonald’s and KFC have seemingly done little to slow their mission to create a Chinese addiction to fast food, Pizza Hut has gone further with bishengke which can be translated as ‘cannot fail to win over customers.’ Judging from their long lunch queues and their sky-high prices, they certainly weren’t wrong.

The Japanese firm Canon have done very well with jianeng, jia meaning ‘fine’ or ‘distinguished’ and neng ‘capabilities’. Clearly this is not the only factor in their huge market share over their boringly transliterated rivals Epson aipusheng and HP huipu but the name has surely not done them any harm. Chinese firms are now catching on themselves with Legend rebranding themselves Lenovo on the international stage and the ‘Higher and Higher’ campaign by white goods manufacturer Haier.

Car companies have not escaped the need for clever branding in China either. BMW is called baoma, taken from the American habit of calling them ‘Beemers’ but the fact that the name was used to describe the best horses in ancient China will also not be lost on the Chinese. Mercedes Benz has had a more difficult job on their hands as the word ‘Benz’ when pronounced in Chinese could either mean ‘rushing to death’ or ‘stupid to the point of death’, a common way to insult someone. Neither of the names would be ideal for a luxury car manufacturer so they have come up with benchi on the mainland which gives the idea of speed and agility that they would rather conjure up in the minds of potential buyers.

Any regular visitor to the Far East will be quite used to seeing some hilarious English brand names, many quite unprintable in a respectable publication; one of my personal favourites is Pocari Sweat. As a drink it doesn’t sound great but in hot climates is quite a life saver. Some Chinese brands clearly need to put a little more thought into their English branding- the electronics store called ‘Go Home!’ sends a mixed message to their customers and baoxiniao (bow she neeow) who make the best men’s suits in China has probably embarrassed some foreign customers when they try to explain to friends where they bought their suit and then fail miserably to pronounce the name. Among western brands, Calvin Klein took a gamble that may not have paid off when leaving their name untranslated- the sounds of CK ‘cee kay’ don’t exist in Chinese and probably has a similar effect on the Chinese as that of baoxiniao on westerners.

So how has The Sino Group faired in the name game? Rather than outsource the naming of our Chinese arm to a major London consultancy we decided to brainstorm it with our Chinese staff and friends and came up with shinuo, loosely translated as ‘world promise’ and a transliteration of Sino. Earlier suggestions to mirror the Sino name had been put down as the sound si is the same as ‘death’ in Chinese- ‘death promise’ whilst great for a company in the contract killing business would probably not be ideal for a company offering business services. Changing the si to shi made all the difference to the name and it was put forward. However, this was not the end of the process as the name had to be checked against various company details to check if it was auspicious. It was certainly lucky for the Taoist monk who did the check as he ended up fifty dollars richer and following his complicated calculations it was declared that shinuo would be a lucky name for us.

Even in this day and age it seems that in China, there really is so much in a name. Apart from brand recognition, ease of remembering the name and the similarity with the English form, you also have to consider the thousands of years of culture that may be associated with your company name. Nobody would ever suggest that your company’s success depends solely on a name, but getting it right first time certainly won’t hurt!