Wednesday, June 8, 2011


Back to the conversation I had with the “China sourcing expert”…

I’m going to pick on this guy again.  Not because this guy just deserves being picked on but because he embodies the mindset of most Westerners in the manufacturing business in China.  It’s a mindset that is focused on the short-term.  It’s also a mindset that leads to a multitude of the problems you see with China manufacturing, whether quality issues, certification / health scares, late delivery times, inconsistent pricing or loss of time.

 Not only was he calling long-term relationships with vendors pointless (Supplier Love), but he gave good insight into how a large chunk of Western companies are managing their businesses in China. 

I asked him a pretty straightforward question: “do you take the time to teach your staff in China, the business principles and skills you acquired over the years?” 

His answer, “No, they don’t think like we do.  I have a manager and she is the only one I talk to and then she handles China”. 

This is typical for many Western companies, especially the ones in manufacturing.  You have Westerners on the executive staff and then 1 to various (depending on the size of the company) “go between” managers.  The “go betweens” are generally good at English and higher-level thinking and planning.  The Western owners/bosses/managers pile everything onto the shoulders of these managers and then these managers are the ones who are actually running the company. 

Ok, Jacob…so what? 

For the standpoint of the brands and end-users, they are buying from so-called expert importers who are masters at controlling Chinese manufacturing.  But actually they are buying from guys who are great at loading work onto one manager.  These kinds of higher-ups are not running a long-term business but more fly-by-night.  Sort of “get in while the gettin’ is good”. 

What happens when this/these managers leave?  Bring in more managers, start back at square one?  I’ve seen it happen on more than one occasion.  The manager leaves and the company takes mucho steps back.  They are at the mercy of these “managers”.

It is not these foreign guys who are the manufacturing experts; it’s the managers who are behind the scenes.

The entire staff of a company like this are loyal, trained and in reality work for this manager.  So not only if this manager leaves are the higher-ups’ hands tied and they have to start back at square one, but they have no immediate control and leadership over their own team. 

How these kinds of companies present themselves to their buyers is not fully accurate.  Even if it is by name their own company, most of the end-user and brands’ projects, are being outsourced to this manager.  Sort of like “re-outsourcing” even though same company. 

Since the oversea executive team never has direct dealings and interpersonal relationships with the Chinese staff, the core values and beliefs of the company, for example, how on their website they “say” they operate, is not really how they operate.  It’s how the Western higher-ups hope to operate, it’s how they want to operate, but since they are never in direct dealings with their staff…it’s not really how they operate. 

I’m glad at my company, I’m only a cog in the machine.  I’m glad that if something happens to me or I’m glad that once Leeds goes on leave that the company will still run.  I’m glad that our buyers know our team by name and some of the buyers even know them better than they know me.  I’m glad there are things that the team knows that I don’t; and I have to ask questions and they have to teach me. 

This comes from treating your team like gems:  like necessary, unique folks who without them, there would be no “business-you” and no company.

A lot of the attitude that is prevalent is, “the Western hero is coming to China to show these know-nothings how to do real business”.  There is no unity in the company, it's "us and them" mentality. 

If you don’t start sharing with your team and training them the soft-skills and expertise you acquired from your home and the education that you were blessed to have, the ship is going to pass you by.

If you come to China, don’t come with the mindset of “how can I control a bunch of Chinese to my benefit?”, but come with the mind of becoming part of the fold and making an even better fold than the one that exists.

I’ve seen the Western companies’ websites that promote “American/Australia/Western eyes in the factory”.  But I tell you pal, I don’t want a non-Chinese speaking wide-eye foreigner checking my goods….the factory will eat ‘em alive. 

If I’m in New York, I want a New Yorker telling me about the "in's and out's" of New York.  If I’m buying from China, I want a Chinese professional, trained, one that knows quality, branding and business…one that can manage that factory and one that can hang internationally: best of both worlds.

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