Silk Road International Blog

October 12, 2008

Once again, I’m speaking to new buyers at the Global Sources Electronics Show in Hong Kong.  If I may, I’m speaking at the good show, out by the airport, not the other one downtown.  This is not just my own (biased) opinion, but rather the general consensus from a number of buyers I talked with.  With that out of the way, here are the “new” takeaways from the show speakers.  Besides myself, speakers included Mike Bellamy from Passagemaker, Charles Kirmuss from Infinity and a representative from Bureau Veritas.  This presentation will be repeated on Tuesday at 12 noon at the same show location.

First, set appropriate expectations.  This includes time, communications, price, professional experience, etc.  I know that I’ve joked more than once that low expectations are the key to happiness but coming to China probably no general theme could be more true.  China is honestly amazing, you’ll be overwhelmed, but not always for good reasons.  So manage your expectations and the expectations of those that are paying for your trip (if it’s not you personally).

First, you need to understand that you will most likely not be working in factories on an architectural par with the Bird’s Nest or Water Cube. Yes, we all saw those on TV and yes those are in China too—but so are 800 million peasants living in cement houses or huts they built with their own hands.  The Bund (Shanghai) is not China, just like Times Square is not America.  But if you think of China more like the US than like Singapore you’ll be better prepared for what you really encounter.  While you’ve seen the Chinese equivalents of Washington DC, Rodeo Dr. and Michigan Avenue most Chinese and most of your factories are more likely to be in the Chinese equivalents of Corona California, Price Utah, Lander Wyoming, and DeKalb Illinois (all places I’ve lived)—in other words, small towns a ways outside of larger city centers with infrastructure and factory capabilities that are nowhere nearly as nice or modern as you’d think if you’ve only seen China from the MSM.

Second, Chinese factories are not going to be nearly as good with design as they are working with counter samples.  Know this before you ask them to start working on design for you.  In fact, I would go so far as to say that unless you have invested in the design department of your supplier you most like do not want your supplier’s engineers or designers creating/working on anything of yours.  China’s value is still in copying, mass producing and finishing things that are designed elsewhere.  Are their exceptions to this?  Certainly, but exceptions do not make the rule.

On a related note, to help you secure your IP, spread the components of your products around to various suppliers.  Don’t disclose your end use and requirements rather than the market.  And don’t share all your IP/design/ideas with every booth you visit at Chinese shows.

Third, don’t assume anything is “just industry standard” or “everyone knows this.”  This goes for everything from component parts to color standards to testing requirements to packaging.   When you are working across cultures there is no such thing as “common knowledge.”

Since this was an electronics show, it’s probably appropriate that most of the audience questions were centered around IP and protection.  So here are some issues that you should be aware of in China.

First, what kind of IP rights are recognized in China? China has a First To Register (FTR) not a First To Market (FTM) legal system for IP.  This means that if you share all your own IP with a supplier and they run out and resister it before you do then legally it’s theirs.  For this simple reason you need to put all of your legal ducks in a row BEFORE you start sharing all your sensitive information with potential (or even final) suppliers.

Second, can you be successful in a lawsuit in China against a manufacture that has violated your IP?  Simple answer, yes.  All of us speakers on the panel have had successful experiences with lawsuits in China.  But the real question isn’t can you win in court in China but have you set yourself up for success in court or to be taken advantage of.  To know the answer to this question you most likely need professional help.  I’ve used Harris & Moure before—they know China.

Last, what’s the best way to coordinate your shipping?  Don’t do it yourself.  There is really no reason why you should be doing anything but paying for your shipping.  International shipping can involve up to 15 different entities for a single shipment and there are professionals that can handle all of it for you, door to door, for very manageable fees.

Tags: Business, China // Add Comment »

UPDATE. Like many in China, I was on vacation this weekend when the Skype story broke.  I’m a bit late to the party, but here are some additional links and great analysis at Rconversation and Imagethief.

All I remember from the old G.I. Joe cartoons of the early 80’s is this one line.  No character names, villains, stories or the “lessons” that each episode ended with.  But this one line, I’m sure everyone in my generation remembers.

Well, today I thought of it again.  I read these two articles and realized that foreigners are coming to China with way too much trust, to many assumptions based on “western” experience.  What I’m not saying is: you can’t trust people/businesses in China.  What I am saying is: you’d better know who you are dealing with, because they certainly know you.

Article number 1.  Americans don’t know Jack (or Zhou, or Zhang) about China.  No real surprise here.  But the fact that so many thought Singapore, Buddha, Toyota and Nike were “Chinese” is flat out scary.  (Fortune cookies, which are from San Francisco, also made this list.)  Nike?!  More than the war, the economy or the current pres and the two buffoons running for election, this exposing of collective ignorance has to be one of the most embarrassing things to ever be said about Americans.  Are we really that dumb?  Don’t answer that.

On a lighter note, over 40 percent of Americans couldn’t name a single Chinese brand name, which to me says more about Chinese companies than Americans.  Worried about China taking over the world soon?  Don’t hold your breath.

But this does speak to one of the most important causes of foreigners’ failures (or at least bad, money losing experiences) in China.  As most of my posts on this blog insist, if you know who your working with, what they really can do and what they really expect from you, then your Chinese manufacturing experience has a much better chance of being successful.

Article number 2. China knows alot more about you than you think they do.  That’s right.  They are monitoring VOIP calls and text messages sent via computer by anyone that downloaded the Chinese version of Skype-i.e. your supplier, your trading company, your rep in China.  This isn’t the same as the ability to wiretap that is mandatory in the US.  This is a Trojan horse installed in the downloaded Chinese software that is triggered by keyword usage.  Conversations as well as individual computer and usage date are not just filtered, but also saved by net nanny.  For more on the media see this link.

If you’re like me this could be very scary. I’ve used Skype for more than 4 years now–since Feb of 2003. It probably saves me $1000 a month in international phone bills. I use it for chat with factories, QC, clients, and the office staff when I’m out. At first glance, maybe this is not big deal to many people outside of China.  But more than the time and money it saves little old me, the fact that everyone else in China uses Skype too make this a really big deal for anyone communicating with people/factories in China.  In the past couple years I’ll wager that almost every factory I’ve been too uses Skype–and that would be almost 1000 factories in 11 provinces and Taiwan.  Ditto for all the trading companies, project managers, sourcing companies and all the expats I know here. It’s scary, but hardly surprising (remember the reality of the Chinese environment: all the phone (land and cell) carriers are nationalized and search engines filter content (Google, Baidu, Yahoo) and Media, email and websites are censored).

In addition to G.I. Joe, these two articles also reminded me of James McGregor’s “Little Red Book of Business.” This “book” is actually a list at the end of each chapter in his still VERY GOOD book, One Billion Customers.  His list at the end of chapter one is particularly applicable to this story.  Here are a couple of his points (p.56-57):

The Chinese now understand the outside world much better than the outside world understands them.

You will never be successful walking into an meeting cold.  Know who you are dealing with and what they really want and need.

Foreign businesspeople who come to China often have too much goodwill, too much trust and too little patience.

Tags: Business, China, Culture // Add Comment »

Update 30/09/08: others are noticing the contradiction between walking in space and the disasters on the ground in China.  Many are saying that the solution is increased accountability within the system.

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I’ve said more than once that much of what you see here in China is scripted.  The 0lympics should have convinced you of that.  But, if you still don’t believe it, read this report about recent Chinese astronauts first night in space–published BEFORE their rocket even left the ground!!!

Foreigners going into factories for audits, inspections, first visits, etc. need to be very aware of this–I promise you, your Chinese partner is actively “putting their best foot forward” even if that foot is not theirs.

Since this is just “business as usuall” from the government down to the smallest factory, from accounting to business dinners, is it any wonder that locals have very little faith that there is someone, be it in government, business or society, which is looking out for the little guy?  People here are dependent on themselves and their immediate families and that’s honestly about it.

About 2 weeks ago there was a great article (in the Times Online, I think) about the difference between the Chinese perception of a “successful” 0lympics and what the West will expect from London.  The difference lies in the importance placed on presentation vs “reality.”  The best take away from the is the concept that China values clean, smooth (face-saving) presentations while “the west” likes to see raw emotion and “real” human interactions rather than fantastic stage productions.  The corollary is that any public presentation in China is known, or at least assumed, to be completely scripted (e.g. fake).

What my experience in China and these issues speak to is a systemic lack of trust outside of any given individuals’ inner circle of friends, family and close business associates.

Here are a few more examples from the news and just this last one week of work in China.

We know of a factory that will not keep the contractual agreements with the client for shipping/payment terms.  The factory has repeatedly held product hostage to price increases and shipping delays.  Now that everything is done and finally ready to ship, there is an argument over retention of the molds.  The factory will not honor the contract payment terms (balance after FOB) because they think that the client will, as they have done, play games with the payment to gain the upper hand in the mold argument.  The client, of course, says that the factory has proven to be untrustworthy and will not pay until the truck is secure in the port.  The stalemate requires someone (SRI in this case) to step in and act as an acceptable third party.

Next example: Talking with the owner of a small print factory today I was reminded how “normal” this kind of thing is (product held hostage and the milk scandal).  I was trying to empathize that on a day that Chinese people should be proud (because of the space walk) there are still thousands (hundreds of thousands?) of people affected by contaminated milk.  My point was if you can’t trust people making baby food and the government inspectors then whom can you trust?!  The factory owner just shrugged and commented that this is how things work here.  If you have connections you can stay away from the contaminated milk, or make a lot of money, or just not have to pay as much to get the things done you need.  He listed a couple of example of social and business policies that “everyone knows you just pay officials” and you can get around the law.  He was much more resigned than angry.

Next example, from the media: the melamine scandal is no longer linked only to milk powder—and it’s still growing.  Milk powder, fresh milk, yoghurt, ice-cream and other milk products, Pizza Hut pizza (cheese), cookies (Lotte Koala bears and others), White Rabbit candies, coffee (fresh and canned), bread, protein bars and drinks, cake mixes and “anything that should have protein in it.” Let me repeat that: anything that should have protein in it is now suspect!!! In Thailand, for example, that includes: “Oreo wafer sticks, Dove milk chocolate bars, M&M chocolate candies, Snickers caramel peanut bars and nougat, Mentos yoghurt candies, and Mao Huad coffee and oatmeal crackers.”  The EU has now banned ALL children’s food imports from China.

(Angry side note: do you know that they are stopping any Chinese crossing the SZ/HK boarder with more than 4 cans of milk powder?!  Can you believe that?  How many times can the average Chinese cross the border in a week/month to buy milk for their children, family members or neighbors?  If you don’t have a HK ID it can be a few hour process and most people only have one day off a week.  I find this maddeningly insensitive—since the government is at least partially responsible!  Sure there will be some abuse of the crisis by people trying to make a buck off the situation.  But to limit people who really need it is really pretty cold hearted, I think.  Of course, (white) foreigners with more than 4 cans can cross with nary a question asked.  Now back to the trust story.)

And then, just this morning, the NYT is reporting that eyewitness accounts and photos of the bus attack on the Chinese officers in Kashgar, China last month differ GREATLY from the official report.

So as all of this is happening, I’m about half way through with a GREAT book, Will Hutton’s: The Writing on the Wall: China and The West in the 21st Century.  It’s well written, well researched, and timely.  Read it.  I’ll review it next week when I’m finished reading it.  Anyway, as I was reading this book and the milk crisis broke out I found myself thinking that everyone should read at least this section of his book (p.130-132)—so here it is!  Timely and appropriate section title:

Is Corruption Endemic?

Lu Xiaobo, director of the East Asian Institute at Columbia University, take the analysis even farther.  IN Cadres and Corruption, he argues that a post-revolutionary party is trapped between its need to become a bureaucracy bound by rules, and its revolutionary purpose—to break rules and bureaucracies.  As judge and jury for its own cases, abjuring any external scrutiny, communism cannot easily police its own deviant party members.  But that is not the only reason corruption is difficult to eradicate.  The organization itself is driven into deviance because, one the revolution is over, there is an unbridgeable inconsistency between revolutionary rhetoric and the compromises of non-revolutionary practice.  The morality of revolution—that the ends justify the means—becomes a morality that justifies corruption.  And when as many as 40 per cent of officials are not paid regularly they seek self-preservation in a morally ambiguous political climate.  This reality, coupled with the growing opportunity for corruption, has characterized China’s development.  The deviant officials of the deviant part-state can prey on wealth with no ideological discomfort because of the ambiguity over where the state ends and private life begins.

Lu’s argument is similar to my own.  China has a well developed concept of the state, but communism cannot permit the conception of an intermediate public domain between state and civil society.  In this respect it is the faithful heir to the Confucian tradition of governance with systemic corruption.  Absolute power, along with moral exhortation to its official class to refrain from plundering the people, is preferred to offering institutional, legal or ideological protection in authoritarian states; but, founded on the doctrines of communist revolution, official are more powerful and more psychologically predisposed to corruption in a communist one-party state than in any other.  I have argued in earlier articles that corruption flourishes where social norms that might induce a sense of shame are weak, where there is a widespread belief that a high income results not from effort or merit butt from effectively working the system and were there is a belief that corruption is victimless—crime involves someone else’s money.  In China all three inducements to corruption exists in spades.  Add the peculiarities of communism and it is not difficult to understand why corruption is so dominant and so hard to root out.

James Kynge, a former Beijing bureau chief of the Financial Times, writes in China Shakes the World that in China ‘trust is a commodity constantly under siege.  Poverty and competition for scares resources impinge upon it.  The ideological vacuum that replaced communism undermines it.  The daily diet of propaganda disorientates it.  The venality of officials devalues it.  The ascendancy of a value system dominated by money hollows it out.  What is left is a society in which describing someone as “honest” can jus as easily be a gentle criticism as a compliment.’

The costs of this mistrustful, corrupt environment can be very high.  Kynge describes a crooked blood bank scheme in Henan in the 1980s that was run with the full knowledge of corrupt local officials.  Donors received blood back, minus its plasma, from a general blood pool that had been infected by HIV-positive blood.  The scheme seems to have left as many as one hundred thousand children orphaned.  Yet the enriched officials have arrested Aids activists, shut down orphanages and harassed journalists.  In another scandal, officials allowed companies to sell fake and poisonous milk powder that caused disfigurement and even deaths; even though officials have been imprisoned, the production has reappeared on the market.

Corruption is part of the system’s DNA.  Jiang and his successor Hu Jintao have thus been disabled, despite their rhetoric and their attempted actions.  Legislative injunctions have to be implemented and policed by the very system which is corrupt and which disallows any external independent agencies because they would challenge the party’s political independent agencies because they would challenge the party’s political hegemony.  The party begins successive ‘rectification’ campaigns and inquiries, but these are compromised by the fact that the investigators are themselves corrupt and becoming more so.  The climate of psychological warfare creates an atmosphere of fear and uncertainty: corrupt individuals demand even higher bribes because the risks are higher.

The full book can be purchased online at Amazon here.

Tags: Business, China, Politics, Thailand // Add Comment »

The following is a list of tactics presented by managers, bosses or engineers to me in meetings that we had regarding rejected product with a couple of large factories (more than 600 employees each) over the last month.  The quotes and the “translations” are from meeting notes that I took (to make sure positions and options don’t change later on (and they quite often do)).  By the end of the meeting with the second factory I realized that I was hearing some of the same things from each factory—and many of them I’d head before from others too.

1.    “We have a lot of pressure from our boss to get this product moved.”

Translation: “We are under internal (financial) pressure, by our boss, to get the product out the door, or we may lose our jobs.”  But instead of fixing the problems the position most often chosen is to take a hard line with the client and get the product sold, more or less as is, rather than spend more money to repair/replace it.

Some times this is not as bad as it may initially seem—you now have a few folks whose jobs are very dependant on your satisfaction.  You have the opportunity to now show them how it’s in their best interest to meet your standards (and move their product).  A starting point is often convincing them that you really do want the product.  For western buyers going to this level maybe a “duh! Of course we want it” experience.  But for Chinese factories who are often burned by buyers who can’t pay for orders this is a very necessary starting point.  With the stink that you probably just threw over product quality, they are honestly unsure if you’ll really take it (late and substandard as it is).  Once these managers realize that they can keep their jobs if you’re happy you’ve essentially got some people working for you on the inside.

2.    “We did our best.”

Translation #1: “We’re not exactly sure what you’re complaining about—this level of quality has been fine for other clients (that didn’t do their own QC).” What this boils down to is either the factory over sold their abilities in the bid process or they underperformed in the production process.  Of course, neither is acceptable.  Further, I almost always doubt this claim because usually reworked product, samples and some of the production all met the contracted standards.  So if they can do it some of the time, the problem is QC and the management of inline processes in which case the people you are talking to are most like the ones directly responsible (and the ones least likely to want to admit it).  But even if they do admit it, this doesn’t mean that they are willing to or have the ability to fix the problems (in this case sub-standard product).  Which is why there is a second translation.

Translation #2: “This is as good as it gets from us.” Just because factories have some international experience/clients and have the same machines that you’ve used back home does not mean that they can consistently achieve the same results.  Often, specifically because of where the blame sits, factories are completely unwilling to redo product that is “just slightly off.”  Remember, going from 85% approval to 95% approval is typically much easier than going from 95% to 97.5%.  If you’re already at your factory’s threshold point pushing them may not be worth for either of you.

3.    “We’ve already spent a lot of time and money to fix it.”

Translation: “We’ve have used up our limited amount of boss-given leeway to redo your product; the costs of doing any more work will be taken out of our salaries/bonuses.”  You will never get past this obstacle unless you move up the corporate ladder and get to someone who can both make money decisions and override the managers’ objections.

Sometimes you need to work with the people that you’re given and sometimes you need to go over their heads.  It’s a tough call, and I’m second guessing myself a lot as to when to piss people off and when to work with them—because that’s really what going over their heads means; you’ve decided your quality is more important then their face.  And while it is to you, it’s most likely not to them.

The difficult part about going up the ladder is that the higher you get, the less the people know about your project (and the more they rely on the people you’ve diss’d for information).  Of course, one word from the boss and you can get all that you asking for too.

4.    “The rework is not very good and we were worried about this before we started.”

Translation: “This is not our fault, you rejected it and asked that we fix the problems we thought were really non-issues in the first place.”  Of course the replacement of rejected product was a choice too, and was what most clients want, but what factories won’t due unless they are under legal pressure to do so.

This is an attempt at managing your expectations. Expect to hear this just before doing some QC on re-work.  Often, when the rework is done right, this can also be interpreted as humility and/or an attempt at preserving face.

5.    “If the client had agreed to these standards in the beginning we could have avoided all the arguments.”

Translation: “See, we told you that you were too strict!”  This is the classic transfer of responsibility for delays to “unreasonable” client demands rather than poor internal QC.  Never mind contracted standards, when things go south what can actually be done becomes the real standard.

We hear this all the time as we’re finalizing shipments—original standards can’t be met, we battle for all the rework we can squeeze of the factory and then settle for “as good as it’s going to get” and then the factory says something like this—“see we told you it was already good enough.”  Implying that actually trying to achieve the contracted QC standards was a stupid and unnecessary waste of time on my part.  Silly me.

6.    “We didn’t know this was going to happen when we did X rework.”

Translation: “Your client’s request for rework is the source of this new problem (and additional expense), not anything we did.”  Probably more than any of the comments listed, I hate this one the most.  Why?  Because it means there are now new problems, and new problems can turn a late project into a really late and expensive headache.  Cost can really rise any time retail packaging is ruined by reopening/repackaging, for example.  This is never what you want to hear—it almost always means that you are back to square one in your resolving-concerns-negotiations.

This also means that as little as possible effort (and planning/forethought) went into the rework process; and that’s what’s most frustrating about this.  With just a little preparation or even an honest desire to do it right the second time this can almost always be avoided.

For example, we had to get a factory to remake large plastic lids for a client’s cooler project.  The factory had to go into their own pockets for the money to replace a full 50% of the order and what happened after the new lids were made and painted?  They put them in $0.03 plastic bags before they were dry and ruined the finish on 20% of them!!  They had to buff/polish and repaint hundreds of lids because someone just didn’t care enough to check and see if the paint was dry.

7.    “We’d really like to sell the entire quantity.”

Translation: “We expect that you’ll buy the entire ordered quantity regardless of your problems with quality.”  This is another tricky situation.  If you agree to buy everything, and you may have too to avoid losing deposit money and/or current product, you’ve got to both manage rework and control the rejected product (so that you don’t see it on eBay later on).  If you don’t agree to buy it all the factory may just take a loss on the project and recycle it (e.g. sell to another “trading company” that will sell it and share the profits).

Asking a factory to rework 100% of an order (or even 50%) and honestly letting them know up front that you’ll still probably reject 10-20% of it leaves them with very little incentive to help you out.  There are times when it’s prudent to be quite.  If you play your card right you may get the final rejected qtty’s offered to you at a discount—you laugh.  I know, you didn’t want it in the first place and now that the whole order is sub standard why would you want an additional 10% that’s really substandard?  Why?  Because sometimes that the best option.  Getting out of a bad agreement by taking everything with you and not leaving any sellable product behind can be a very good thing for you.

My definition of Chinese Cooperation: Paying more to get less than you originally agreed to and being honestly happy about it.

8.    “This is good enough for the Japanese.”

Translation: “As everyone knows, the Japanese are the end all be all of QC; you’re being unrealistic in your quality expectations.”   You know, for a country that openly hates the Japanese, Chinese people sure respect Japanese work standards.  At least they do whenever we reject product.  I have to admit, I’m not sure that Japanese standards are as great as they are cracked up to be.  I mean, if they would, on a regular basis, accept our rejects then they’re actually pretty low.  Or…it could be that the factories are overstating their indignation to get us to back off of our QC demands.  No, couldn’t be that.

Regardless of what other clients will or will not accept (I really don’t care), my opinion is that your standards should always be as high as possible.  You can almost be assured that you’ll have to come down at some point—and the higher you start, the higher your standards will still be when you’re finished.

As I’m constantly reminding my project managers, negotiations isn’t about what you want as much as it’s about understanding where the other party is coming from and what they can actually do for you.  Understanding what options are realistic for your supplier is a valuable starting point in discussing how you’ll get what you expect (or at least what you can accept).

Bonus: here’s our list of 30+ negotiating tactics that we’ve collected over the years working in here in Asia.

Tags: Business, China, Culture // Add Comment »

After watching hours of the milk scandal news from China and stock market news from Hong Kong my Chinese wife said to me yesterday, “You know why China is the sick man in Asia?  It’s because we are willing to kill ourselves for money.”

The “boycott made in china” calls do not seem so racist any more, especially now that Chinese are making the calls for the boycott themselves.

I don’t mean to mock the significance of the milk powder crisis in any way, but it’s not all that surprising that something like this has happened (again).  After the raucous nationalism of summer 2008 it seems like everyone forgot about all the humiliating recalls of the summer of 2007.  Everyone except for those of us who do QC for a living.

As the milk powder scandal shows, out in the trenches, over the past year, nothing’s really changed.  Sure, the toy industry is paranoid or has moved on to SEA countries, but no one else seems to be talking much about the recalls from so long long ago.  We still have the same issues with factories not meeting agreed upon standards, not understanding those standards in the first place, substituting cheaper domestic products in place of more expensive imported ones, using uncontrolled sub-suppliers, working rejected product back into approved stock, and of course purposeful and natural quality fade issues.

Whenever we have to deal with these issues I’m always amazed at how a QC issue can quickly turn into a debate over national superiority.  We’ve been in QC or rework negotiations (arguments) on behalf of clients numerous times where we’ve been told something like: “It’s good enough for the Japanese.” Or “Of course these are the correct numbers, do you think that a Chinese manager would lie to you?!” Or “You Americans think that everything has to be the best or it’s not good enough for you.”

Of course, QC has nothing to do with race or nationality.  But because it is often foreign QC personnel that identify substandard product, these conversations happen more often than you may think.  And you can bet they are thought, but not spoken even more often.

Like so many other issues in China, nothing will change in the quality of products being sold to the domestic (and international) markets until enough people get angry enough to force a change.  And then the change will only be effective if there is enough transparency in government to make sure that enforcement is effective and consistent.  Remember this tainted milk issue happed before, just 4 years ago.  And while there was anger and temporary outrage, which resulted in rich people buying milk in Hong Kong, nothing else really changed.  Reports are that as early as 2005 warnings about chemicals in milk went unheeded and the government actually allowed Sanlu to make milk powder without any inspections!!

Another thing that has to happen is that these big-crisis lessons have to become cross-applicable to individuals outside of the dairy industry.  Meaning, the lesson that bad-milk-can-kill-people-so-there-needs-to-be-better-regulations,-enforcement-and-QC needs to be transferred to other industries like: poorly built autos and auto parts, shoddy domestic consumer products, clothing with too many chemicals/dyes, all contaminated food products and, farther down the list, non-essential consumer products made for export.

But I fear that I may be asking for too much.  In my experience, I’ve found that Chinese can be brilliant, talented, capable and thoughtful—just like anyone else on the planet—given the right motivations and opportunities.  I’ve also found that the Chinese system (in government, education and business) rarely reward these traits.  More often than not, talented individuals do not have experience in cross-application of lessons or “thinking out of the box,” or standing out from the predominant group-think.  I don’t mean to say they can’t or won’t or always don’t act individualistically.  Just that it’s not common.

How many Chinese right now, who are not dealing personally with affects of the milk tragedy, are going to recognize that a lack of enforced regulations across the board in China and the consistently substandard products being passed off as acceptable are a chronic and deadly problem in China right now? When are Chinese people going to realize that they are entitled to the same quality as the rest of the world?  How many will realize that while calls to boycott all Chinese goods are often stupid and always extreme there are a significant number of real concerns that are not racially motivated?

We’ll see if anything changes here—for those of us that live with our children here, I pray they do.  But I won’t hold my breath.

OK, off the soapbox and onto what can be done about your individual products in China.

I’ve been harping on the test everything, test often mantra so much, I fear that people will get sick of hearing it.  But then we have a series of recalls like this and I realize that I’m not crazy and I’ve obviously not said it enough.  Here are some processes (from previous posts and published articles) that will help you immediately with your quality control in China (or anywhere else, for that matter).

First, the rules for working with Chinese factories.
Second, how to qualify an appropriate factory.
Third, here are the ways to avoid quality fade and ensure consistently good quality product.
Fourth, here are some tips on negotiations.
Fifth, here’s what you can do to make sure you get what you ask for.
Sixth, what to do about missed shipping dates.
And finally, here are some tips on returning product to China if all else has failed.

Tags: Business, China // Add Comment »