대부분의 미국 입장이 중국에서 실패하는지 왜
폴 Denlinger의
중국에 있는 고문 산업은 번영하고 있다. 어쨌든 세계에 있는 가장 큰 잠재적인 단일 시장이고, 모두는 그것에 무리를 짓고 있다. 새로운 회사는 이 시장의 유일한 도전을 달려드는 방법에 관하여 정보 그리고 통보를 필요로 한다. 중국어로 유창하거나, 중국에서 자란 어떤 주 전투지역든지를 위해, 그리고 재정적인 만들기 사업 교섭과 같은 무역의 공구에 익숙하 회사 평가, 중국은 그들의 경력을 장차 몇년 동안 만들 "철 밥 사발"를 대표한다.
또는 그것은 인가? 나의 경험은 계속해서 또다시 반복되는 과실이 있다 이다. 그것은 Broadway 단 하나 쇼를, 계속해서 또다시 보는 얻는다 비난 같이 변화하는 유일한 것이 세트 및 배우인 곳에; 선은 동일하.
나는 이전 기입에 있는 중요한 착오의 한을 커버했다, 중국 시장 마약중독을 지나가기, 중국에 들어가기를 위한 그들의 처음 이유를 커버한. 이 기입은 어떤을의 고장나는 post-entry를 위한 이유 포함할 것이다.
나의 경험의 대부분이 미국에서 기술로 또는 매체 또는 개시 이었기 때문에, 나는 나의 평가에 있는 그 회사로 자연적으로 치우친다. 재정적인 분야, 기술설계 및 소비재에서 많은 성공담이 계속 있다. These areas, unlike hi-tech, have had decades, and in some cases even more than a century of experience, building their China presence, and understanding the challenges involved. They have the money, and have built up a knowledge base of experience which they can draw from, and because of the large scale of their businesses, even if they cannot draw from in-house experience, they know how and where to get it when needed.
Some of the US technology companies which have come to China and have failed to succeed in the Chinese market are eBay, which basically had to hand over its operations in China after running into the strong local player, Taobao.com, in the auction field. Yahoo! had to basically pay a China partner, Alibaba.com, US1B to take over its China operations. More recently, Google, the US search advertising firm, has had to fight an uphill battle against the largest Chinese search firm, Baidu.com. Online gaming is a new area which does not exist in nearly as large a form as the US, with Shanda being the granddaddy in China, while newer players such as Perfect World (PWRD) have sprung up with new and different business models, and successfully going public on the Nasdaq. In instant messaging, Tencent’s QQ has been able to rack up 600M registered users, and unlike any US IM clients, become profitable.
Because most US startups come from technology backgrounds, they tend to believe that their business is scalable. The word “scalability” is in itself, an engineering term, which means that an architecture can go from 1 user to one billion (or infinite) users, or across national borders and into different languages and markets, without any major architectural hiccups. For this reason, they tend to play down distribution and cultural differences in their most initial stages. Most of the time, they have people on staff or in management who know something about the local market; more often than not, they are not in senior decision-making roles.
Then, when they get to China, they try to do what they did in the US, and quickly discover that the rules in China are very different. Whereas labor is very expensive in the US, with each hire drawing the attention of different company committees, in China it is one of the single cheapest expenses. (Except for senior and executive management, where highly qualified individuals cost just as much, if not more, than in the US.)
The most common failing comes in the area of product management, when the US insists on controlling the product development and launch schedule, with local product launches coming only after the US is ready. In smaller markets, that’s fine, but in fast-moving large markets, especially one as large as China’s, it’s a killer. (Even in fast-moving small markets it’s a dubious strategy; in South Korea, Google has been consistently beaten by Naver, a highly successful Korean company.)
This puts the China office in a continuous battle with the US headquarters for resources; the Chinese local competitor has no such restrictions on what it can do, and the Chinese company surges ahead in capturing market share, and eventually, revenue. The American company then organizes what can best be called a “strategic withdrawal”, as did eBay.
In more mature industries where there is some kind of brand equity, product lines are already fairly mature, and headquarters makes resources available to country managers as needed. Because of the fast-changing nature and relative immaturity of hi-tech, this has not yet happened.
When the American companies fail, the blame is usually assigned to some form of Chinese government protectionism, and favoritism to the local companies. Of course, this explanation is more palatable to Congress members seeking re-election and US TV talk-show hosts, but more often than not, it is a vast over-simplification of a complicated issue.
Paul Denlinger, The China Vortex, Owner at China Business Strategy
July 18th, 2008 at 4:46 pm
Dear Paul Denlinger,
Your precise report about the more than mature Chinese markets is very interesting to read. However, I learn again one single factor that frightens most of the CEOs after the JV has failed or before it will go bankrupt.
I guess that the marketing studies of culture, marketing and trade departments do not use or accept the traditional ancient Chinese knowledge in their analysis, which is based on Sunzi.
The impact of the so called “Sanshiliu ji”, the ancient 36 stratagems, plays a major key role. Why did you not mention this in your analysis?
Teachers in mainland China drill their students starting from the ground school up to the wealthiest internationally seen, well known Chinese speaking universities; they all involve their students in this wisdom.
Finally reaching personal maturity for the labour markets they are eager to use the tricks only when future decision makers and managers need it in order to survive in the often technologically poor equipped firms.
The result must be then: get in touch with the real stuff/ patents from outside company groups.
The avoidance of that reality could reflect one single investment in know-how that would cost less than a last minute ticket in Europe before the oil crisis appeared in our life.
It helps decreasing risks of failure reports.
However, salient Chinese based businesses are prepared five years before we can remark it in law cases at court and auctions of bancruptcies.
Their originally business plans are not identical to those non disclosed internal documents as you could see with the SAIC - Rover take-over or the global strategic investment strategy plans of the Chinese government: you can also track the path when labour opportunities have to be created for the well trained students every year.
I guess that some of the magic marketing ideas fail due to the global lack of language knowledge.
Seen with eyes of recently joined EU members, we are faced with 23 languages, seldom used written and spoken lingua, in our EU parliament.
Sincerely yours
July 18th, 2008 at 5:13 pm
Protectionism and favoritism in China are rife. This attempt to dismiss these issues as “talking points” for the media is nothing less than a direct insult and is so far from the truth it is impossible to fathom the hubris. It totally defies all objective evidence!
Companies from the US and other countries make mistakes in their attempts to enter the China market. There is no question on this point. Chinese companies make mistakes in entering the markets of other countries. There is room for improvement all-around.
In China, numerous road-blocks have been put in place to give “local” companies the advantage. These include additional costs (the “special prices for foreigners”), obscure corporate registration requirements, limits on (and back door) patent and copyright registrations, lack of enforcement of local laws when the offender is local or conversely the stringent enforcement of local laws when the company is not Chinese, … shall I go on?
The outright theft of intellectual property by Chinese companies who then rebrand and market the stolen property, in some cases, will full government support is the core cause of failure for hundreds of companies in China - both international and local. Worldwide, Chinese pirates cost US and international companies billions each year. Yet “dao ban” is winked at by Chinese authorities as a way to promote Chinese businesses.
International companies who set up operations in China have frequently found their plans and designs stolen, replicated and available in the marketplace before their own releases in the same markets. This, with the implicit and sometimes explicit assistance of local authorities.
Blaming US companies for problems created by China is unfriendly, unprofessional, and inappropriate finger-pointing.
July 21st, 2008 at 7:42 pm
China loses WTO car parts dispute
http://news.bbc.co.uk/2/hi/business/7514592.stm
Foreign-made car parts are in a less favourable position, says the WTO.
China has been told its tariffs on foreign car parts break World Trade Organization (WTO) rules.
At least 60% of components used in Chinese cars must be made in China or firms pay higher taxes under Beijing’s current system.
The international trade body said the practice was protectionist and called on China to change its import caps.
The US, Canada and the European Union complained to the trade body that Beijing had broken the WTO’s rules.
“The panel report leaves no doubt that China’s discriminatory treatment of US auto parts has no place in the WTO system,” US Trade Representative Susan Schwab said.