Filling the gaps between a business school education and the China business reality, The China Executive is also a definitive text for business school students, in particular MBA students, around the world.
Western business leaders tend to presume too much and underestimate the difficulties of doing business in China. Taking a few leaves out of Wei Wang's book could help.
By Stefan Stern, Management Columnist of the Financial Times, Special for Business Voice, September 2006.
"China tantalises executives with its promise of riches, but also with the threat of muscular and strengthening competition. How to engage with this fast-growing market of 1.3 billion people - or, as Procter & Gamble has put it, a land of 2.6 billion armpits?
Wei Wang is ideally placed to help. A Chinese national, he took an MBA at Loughborough University in the 1980s, and has been engaged on Anglo-Chinese (or should that be Sino-Western?) projects ever since for multinationals and investment companies. He is managing director of 2W China Investment Consulting, a firm that specialises in advising businesses on their strategic investments in China. (He also runs an online forum at TheChinaForum.com.)
In his book Wang offers sound advice to business leaders planning on making the long march east. His broad message is that we tend to presume too much and underestimate the difficulties for foreigners trying to do business in China. The good news is that there is lots of business to be done by those who take the right approach.
There are four critical skills needed to find a suitable business partner in China, Wang says. First, China is a connections-based society, rather than a rules-based society. Second, you need the ability to interpret both 'analysis- and intuition-based methods', China being a market (and culture) where hard data is only part of the story. Third, choosing a partner well, based on location and your strategic aims, is vital. And fourth, negotiate wisely according to Chinese principles, where 'a contract may seem to be only a draft' as a basis for an ongoing relationship.
Western business schools, Wang says, have concentrated too much on sophisticated analysis and failed to see 'what business really is and how it can be successfully done'. Nowhere is this insight more valuable than in China, where relationships, tact and understanding the concept of 'face' (or public standing, reputation and esteem) are so vital.
The pull of China is stronger than ever but it is important not to be carried away. Huge doubts remain over the solidity of its banking sector. Corruption and bribery are widespread. And despite extraordinary economic growth, exports and inward investment, many foreign firms in China feel they are not always on a level playing field. Where is the protection from intellectual property piracy, and equal access to an open and transparent regulatory regime?
Tensions with China's trading partners are growing, as we saw earlier this year in the 'bra wars' with the European Union. This is a highly complex, if potentially rewarding market. Wei Wang has several important insights to share in this timely, well-informed book."
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Most Helpful Customer Reviews
18 of 19 people found the following review helpful:
5.0 out of 5 stars
The first revealing book on investing in China!,
By Cheryl (Birmingham, UK) - See all my reviews
This review is from: The China Executive: Marrying Western and Chinese Strengths to Generate Profitability from Your Investment in China (Paperback)
Our company has made a good number of multi-million-dollar investments in China in the past decade. While a couple of them have been doing fine, most have been struggling since day one. As the director in charge of these operations, I have been trying to understand why but I am puzzled.
I have also tried to make sense of what happens in China by seeking help from classic Western business theories (such as those developed by Peter Drucker and Michael Porter) as well as a number of China business books (such as Tim Clissold's Mr China and James McGregor's One Billion Customers), but I find that they are of limited help because I still struggle to grasp the big picture. For example, I find Drucker's management-by-objective philosophy too rigid in China because local people do not like to act according to pre-determined plans; Porter's five-force competition and three-point strategy models too static because, apart from significant regional differences, the China business environment is characterised by rapid changes in regulation, competition and technology. Meanwhile, Mr China has made me disheartened (are the terrifying stories going to happen to me as well, given that the author offers no clues on how to deal with such challenging situations?) and One Billion Customers has made me confused (are the Chinese really one of the most individualistic and selfish peoples in the world, given their apparent valuing of and great attention to human relationships?) The good news is that, with The China Executive in my hand, I am not puzzled any more! Not only do I now understand why my fine China operations are doing fine, but also how I might turn around the poorly-performed ones. If you are contemplating investing in China or have already made investment there, this book is for you.
20 of 22 people found the following review helpful:
5.0 out of 5 stars
The next business classic!,
By Marshall Williams (London, UK) - See all my reviews
This review is from: The China Executive: Marrying Western and Chinese Strengths to Generate Profitability from Your Investment in China (Paperback)
Jack Welch, "manager of the century" according to Fortune, wrote in his latest global best-seller Winning:
"At speaking engagements, I am often asked what industries I would recommend to college grads and MBAs today. I tell them to look into companies doing business at the intersection of biology and information technology. And I suggest they learn everything they can about China because it will permeate every aspect of business in their lifetimes." Yet, although thousands of business books are published in any year, most of them are written by "get-rich-quick tipsters, motivational preachers and one-minute-solution merchants", as the FT's Michael Skapinker has described them. In fact, the situation is so bad that the Financial Times and Goldman Sachs decided in 2005 to establish an annual award for the world's best business book. I vote The China Executive for this year's award. To be sure, there are an increasing number of books published on China business, including the highly publicised The China Dream, Inside Chinese Business, Doing Business in China, The Chinese Century, Mr China, The Chinese Tao of Business, One Billion Customers and, most recently, China Shakes the World. But while these books enhance our understanding of China business, they at the same time add much confusion because they are either not grounded in the authors' direct experience of doing business in China or do not link the China business reality with the well-developed Western business and management theories. For example, if it is so hopeless to invest in China as The China Dream depicts, why are most Western investors not leaving China? True, the China business reality can be as tough as Mr China presents, but surely the question is: how to rise to the China challenge? And if virtually everything you hear about China is true, so is the opposite (John Frankenstein, University of Hong Kong), how do we find their limits? In The China Executive, you will find answers to these and many other crucial questions. I have particularly appreciated the fact that the book has exploded many fashionable myths about doing business with China, such as the collectivism of the Chinese and their negotiating advantage in dealings with Western business people, which have been created because many so-called "China hands" have really been a prisoner of their own culture - whether in a professional or philosophical sense. As the author observes, "China cannot thoroughly be understood from either a Western or a Chinese viewpoint. To grasp its nature requires an orbital, historical view of both the West and China." There is no doubt that the author has successfully uncovered the nature of China and has demonstrated its profound implications for business. Given also China's growing part in global business and as the world's Leadership Guru Professor Warren Bennis endorses, I cannot see any reason why any existing and future business executives will not find this book valuable. Indeed, we may simply conclude that China has advanced over the past two-and-a-half decades as a result of its learning from the West. Isn't it time for us Westerners to ask: what can we learn from China so that we can succeed in the 21st century? I recommend The China Executive, because you will find the answer to the above question in the book. In fact, you may find that The China Executive is your business bible in the age of globalisation because it will stimulate you to develop a global mindset, which is the start of a successful global business journey. And a global mindset is "an elevated, enlarged mindset that seeks to combine the strengths of the Western mindset and those of the Eastern mindset." I have read many business and management books during my MBA study. I find The China Executive, which is full of original and stimulating ideas and above all wisdom, extremely valuable in helping me link what I have learnt in the classroom with what I am experiencing on the China ground. For all this, I thank the author!
16 of 17 people found the following review helpful:
5.0 out of 5 stars
A book that has to be read at business schools and in company boardrooms,
By An expat based in Beijing (US and China) - See all my reviews
This review is from: The China Executive: Marrying Western and Chinese Strengths to Generate Profitability from Your Investment in China (Paperback)
This is an outstanding book because Dr Wang has demonstrated an ability to generate original, durable thinking on the hard task of making a successful investment in China.
Given this challenge and the lack of books that reveal its nature, it is obvious that Western executives will greatly benefit from reading the book, in which the author has successfully made a connection between China and the West - their histories, cultures, worldviews and, above all, their implications for business - in the most practical way. I guarantee that with this book in your hands, China will never be a puzzle for you again! But the book is not just a practical guide for practising executives; it also offers ideas and concepts that challenge business management theories taught at Western business schools. For example, it extends Peter Drucker's results-oriented business orientation, which has produced not only material results but also people who are driven by such results, to one that is based on both results and relationships (which are really two sides of the same coin). Drawing on Sun Tzu's strategy wisdom, it extends Michael Porter's competitive force-based strategic framework to one that sees business success as being determined by moral, temporal, spatial, organisational and leadership forces, and his three generic strategic positions to four levels of strategic advantage that are pursued as a moving target. At the heart of these ideas and concepts is actually intuition, which Henry Mintzberg, another business guru, has long advocated against the analysis-based mainstream business school thinking. (As a business school professor, he is really a courageous rebel.) But Mintzberg has achieved limited success in connecting intuition with analysis in a theoretical form. And this is where Dr Wang has, in my view, made the most important contribution. He has demonstrated the role of intuition in dealing with Chinese people, in reading the dynamics of the China market, in finding a suitable business partner, in running a business organisation and, more generally, in achieving global business success. As such, The China Executive is required reading for every business school student, whose business career will not only be related to China but also inseparable from globalisation.
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