It seems odd that a company doesn't have to "earn" your business as we understand it in the West. It also seems to run against the theory of competition, which in part is "you can easily be replaced." But if it's a fact of doing business in China, we best get used to the idea.
yes I'm afraid it is completely correct, business is based on relationships, so much so that it can control the whole supply chain and in some cases have a significantly negative effect.
Consider a big factory requiring a part, the M.D went to school with some guy who produces low cost metal parts of inferior quality, such a relationship is likely to result in business for the School friend rather than an ISO 9xxxx company.
Now consider what happens when the metal parts enter the Quality system of the larger factory, in many cases they will be red stamped through and 'issues' will be corrected next time, in such a relationship it would be very rare for the parts to be returned back to the substandard supplier, sometimes it can be infuriating to have to deal with such methodology especially when a simple solution exists.
However as with most things in China there is a system and a way round such business practices, this is why 'tea' drinking and after hours entertainment is so popular, but that is only part of the story.
In order to win business deals, one must get used to the idea of going to nightclubs and karaoke and gifts to swoon the customers. Then again if you are relate to the government officials somehow or if you give some undertable kickback there is definitely better opportunities. That's part of the culture there. It's indeed everywhere but just to the degree. In U.S. networking is also very key to landing jobs / getting deals but just that there are other "rules" that regulate the deal making process.
As a part of globalization all most all the countries had opened their internal markets for foreign investment with red carpets & attractive soap facilities. Some of the key factors of globalization are they can take the advantages of economic growth, availability of skilled manpower, low labour cost, availability of raw materials etc. Since everybody wants to gain the advantage of these factors for their growth, companies had expanded their foot print outside the territory. China got much benefited from globalization because almost all companies started their production unit in china.
We can say Electronics industries are much global because regional distinctions play major roles. Here the product life cycle is like US/Europe will come up with idea and investment plans, design is done either in India or China, Manufacturing is done in Singapore/Taiwan/China, packaging is done in China/Malaysia. That means, for the same product different process at happening at different countries.
In my opinion, countries like US, Europe have to come up with some key policy and guidelines for attracting investments, which can in turn generate better economic growth and job opportunities
The kick backs is bribery and not desirable. It is an unfortunate exageration of giving tips by foreign nationals to locals which developing countries learned from foreign business partners and have mastered to an art - sadly.
The partying is also a learned behavior which the locals assume to be what foreign nationals expect and a lot of good business men offer to Americans night clubs etc as past of doing business.
What is networking in the US, is relationship building in other countries. Business is still seen as an interpersonal contract in maany developing economies and the lack of this level of relationship may break deals. Call it culture clash!!
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
To save this item to your list of favorite EBN content so you can find it later in your Profile page, click the "Save It" button next to the item.
If you found this interesting or useful, please use the links to the services below to share it with other readers. You will need a free account with each service to share an item via that service.
Tweet This
