" And knowing is half the battle..."

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.