By their slogans, ye shall know them. “Build a better mousetrap and the world will beat a path to your door.” “Time is money.” “Give the people what they want and they’ll buy it, no matter who makes it.” “We’re only in this business to make money.”
Americans in business, like all tight knit communities, have their own set of thrice-told, proven sayings that always ring true. At least, they seem to work as long as you are dealing within the community.
When you step beyond our culture’s borders, as amazingly more businesses are doing nowadays, these truths lose a lot of acceptability. Globe trotting businessman Walter Schwab, who has two decades of life and business experience in east Asia, has gained a huge amount of insight into operational differences and ethical similarities between countries.
At the Society for Human Resource Management’s Central New Jersey Chapter meeting, Schwab speaks about the human resource practices of China, Japan, and India, and how they reflect each nation’s particular circumstances. This event is on Wednesday, April 11, at 5:30 p.m., at the Holiday Inn in Somerset. Cost: $65. Visit www.shrmcnj.org.
Schwab says he thought he was “pretty hot stuff” after he graduated from high school. “I spent my final year studying in Barcelona, and was totally bilingual. A real know-it-all.”
The youthful delusion was shattered when Schwab’s management-consultant father and free-lance-artist mother suggested a grand tour around Europe. Germany, Switzerland, France: young Mr. Schwab found himself at a loss to communicate. This he decided had to change.
As a solution, Schwab attended Colby College and majored in East Asian studies. Upon graduating in 1986, he headed for Japan where he taught English, and then plunged into that nation’s breakneck-paced IT world as a Tokyo computer programmer.
Three years later, he returned to take his MBA at the Thunderbird School of Global Management. Schwab then took his talents to Accenture, helping the consultants of this international firm, “gain the necessary tools so they could perform better and more rapidly,” as he puts it.
At ReSourcePro, an outsourcing provider for insurance firms, Schwab served as director of learning and coaching. Currently, Schwab is the global talent director for Marsh, the insurance giant, with its 24,000 employees. His eight years in Asia have led to business dealings with China, India, Indonesia, Japan, and the Philippines.
Time = money. Definitely a truth in the bang-it-out, get-it-to-me-Tuesday New York realm of business. But better leave that attitude at home when you head for China, says Schwab. “Everything in China is about the relationship,” he says, “and building that takes time. No way around it.”
China is a very connected society, Schwab explains. There exists no “one pioneering person alone carving out a fortune” concept here. Everyone dwells and operates very much within a network. To succeed in this nation, the newcomer must become fully acquainted with the established business people, the laws, along with the cultural norms, which are far more involved here than back on American soil.
The Chinese style of business involves an initial discerning of each other’s character. Potential partners or vendors will spend long hours in social outings and extensive discussions striving to gain a level of comfort. Though this upfront time investment may be seem exasperatingly endless to Westerners, once the comfort level is found, all future business dealings will glide smooth as silk.
To make money. Of course, you are in business to make money, but if you step ashore like a greedy conquistador, you will be justifiably shunned.
“Rather than immediately talking cash, in China tell the officials what you plan to bring to this land,” suggests Schwab. “Whether it’s useful goods, employment for 100 people, whatever, make yourself a good corporate neighbor.”
All around Asia, the lustrous appeal of Western companies has become substantially tarnished since the massive corporate layoffs of the mid-2000s. Be it India, which is witnessing reduced foreign outsourcing budgets, or China and Japan, which both continue to develop domestic competitively capable corporations, working in a Western firm has dropped from holy grail to a viable option.
This somewhat novel need for Western companies to prove themselves as equals requires an added flexibility for those seeking to expand abroad. One no longer can plant the American business footprint on foreign shores blindly.
“Probably the largest hurdle is accepting the loss of control,” says Schwab. “You are going to have to find yourself a Sherpa to guide you through the methods of business operations, the culture, rules of banking, and the laws.”
Inspiring loyalty and maintaining top talent has traditionally snared the foreign business entrepreneur. For the past three decades, U.S. corporations have made it clear to employees that their security lasts only until the firm can find someone to perform cheaper. This, coupled with widening avenues of opportunity, has made loyalty vanish.
Japanese employees, facing similar corporate attitudes, however, tend to hold much longer terms of service with employers. India’s workforce, sharing this immensely broadened horizon, has begun to occupationally carom upwards, but fears of the long fall downward into poverty keeps many clinging to secure positions.
“China is a mixed bag,” says Schwab. “Capitalism and job choice are relatively new to their cultural experience. The whole understanding of corporate financials is not as strongly imbued in the society yet.” The individual employee sees his company making great profits and often feels his share should be reflectively forthcoming. While many seek security within a job, salaries vary immensely and the lure of greater personal funds has many employees ever on the move.
Better mousetraps. The globe has caught entrepreneurial fever. Everywhere, in all nations, the numbers for new businesses starting up are rising to record levels. The initial reasons, and methods of launch, however, remain very reflective of the cultures from which they spring.
In the new world of the United States, new business almost invariably follows new invention. Tell an American you are beginning a new company and his immediate question is to ask what’s your better mousetrap that is going to conquer the market. Be it a new piece of custom payroll software or a wine chiller that brings bottles to the ideal temperature in 75 seconds, the risk and adventure lie in this new product.
In India, entrepreneurs trend to be more business driven. Money is harder to obtain, regulations are more numerous and less friendly. And, most important, original thinking is less valued within the educational system. For this culture, the challenge lies more in establishing an enterprise with one’s own name on the door, which will latch on and grab a piece of the nation’s explosive economic growth.
“China’s entrepreneurs come with a totally different perspective,” explains Schwab. “Here is a land where individual wealth is relatively new, and where movement is restricted.” People within this environment see business launch as one best option for bettering their personal financial condition. It’s less the product than the personal profit.
Likewise, opportunity is frequently seen as a matter of geography in this vast country. Beijing’s would-be business owners have for the past decade flocked to Lhasa, Tibet, lured by promises of owning their own shops. The overwhelming host of very well connected computer firms in old Shanghai may lure the enterprising software designer to ply his trade in the scenic city of Guilin.
Certainly adaptation and flexibility are key to the foreign business owner seeking to expand into Asia or to bring Asians aboard onto his team. Schwab offers the obvious caveat against trying to set up a U.S.-centric or global-centric model that ignores the location’s culture.
At the same time, he advises against creating too many general categorizations. “There are 1.5 billion people in China,” he reminds us. “They stick with a company or leave it. They launch a business in this spot or that, all based on their own very personal reasons. It is not because they are Chinese, but because they are individuals.” That’s probably the best thing to remember when doing business in Beijing or your own backyard.