Leaving China.
ChinaSolved is packing up and transferring operations to the US for a while. After 8 years in Shanghai there is pressing business back State-side, but the move is not likely to be permanent. Like many long-term expats, I’ll be spending the rest of my career shuttling back and forth.
Still, this is a good time to reflect on the past and plan for the future. I’ve seen so many changes in Shanghai and US-China relations over the last decade that it’s easy to lose perspective.
Regrets:
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My biggest professional regret was not experiencing enough of China. I like China, and as a long-term Shanghai resident, I miss it. I wish I had gotten to know Beijing better and would like to have spent more time in the 3rd + tier cities in the interior. Shanghai and New York City are similar in that they are IN their countries but not really OF their countries. Both Shanghai and NYC are constructs built by and for their nations’ international communities. Great for business, but always a step removed from the street view. They are their nations’ heads – not their hearts.
Took too long to find a focus. China offered a huge range of opportunities, and like many businesspeople – Western, Asian and Local - I tended to bite off more than I could chew in the early days. There’s nothing wrong reaching for a dream, but in Shanghai ambition can often turn into distraction and chaos. The more I focused, the more I accomplished.
Confused market gaps with market demand. Chinese people tend not to use clothes dryers, automated car washes, and a host of other products and services considered everyday necessities in the West. Like many newcomers, I assumed it was because they didn’t have access or knowledge. Often it turns out that they just didn’t have interest. When I learned that lesson, it was cheap. Now that kind of mistake is very, very expensive.
Things I did right:
- Went local early. Partially by choice and partially by circumstance, I avoided the ex-pat cliques and gated-ghettoes. I still talk to international bankers and investors who are making big bets on infrastructure and development plays without ever having ridden a Chinese subway – much less local bus. China is getting richer and spending more – but the ‘Chinese Middle Class’ that is the holy grail of MNC expansion plans still make less than 10,000 rmb per month. They are not drinking at Bund nightclubs or crowding Nanjing Xi Lu super-luxe retailers. Don’t talk to me about Chinese banks taking over the world until you have waited 45 minutes for a teller in a near-empty branch. Don’t say that “everyone under 20 speaks English” until you try to ask for directions in a seedy part of town. You have to get out of the service apartments and 5 star hotels to get a feel for China.
Developed a specialty or two. The days of being well paid for being ‘international’ are over, and they aren’t coming back for Westerners, Chinese or anyone in between. 5 years ago you could get paid for being a white guy in China, and I’m sure that as Chinese firms try to expand into the US and European markets there will be a few more opportunities for aspiring Vice Presidents of Caucasoid Features - but it is not a winning strategy. You have to be good a something that is valued by the market.
Stayed skeptical. China Inc. – like most emerging markets – loathes common sense. It is home to extremes. If you say ‘China will take over the world’, you will get respect and followers. If you say, ‘China is doomed to crash’, you will also win support and adulation. No one seems to hold the zealots responsible, but the moderates are pilloried as fools and cowards. There’s a difference between skepticism and cynicism, and on my best days I found myself keeping to a middle course. That sounds simple enough in theory, but when the crowds are screaming about the latest, greatest game-changing news, the cautious and sensible sound like Cassandra.
Stayed flexible and open to new ideas. In the last 8 years I stood in one place while the entire Chinese economy & society reinvented itself outside my window. Too many Westerners look at the big trends and think that they can outsmart the market by staking out a position just beyond today’s demand. Sometimes it works, but usually you have to be a bit more nimble – and brave. I’ve succeeded by being willing to change. The things that worked for you yesterday won’t necessarily succeed tomorrow.
Single Piece of Advice for Newcomers (and Old Hands):
- Develop your own sources of information and ask naïve questions often.
When I started writing about international business in China, there was very little reliable news or advice for entrepreneurs and managers. Today the challenge is keeping track of all the excellent online resources. But just because the resources are available doesn’t mean that your life has become easier. The bar is higher now, and your competitors know more and see further. You have to as well.
I am seeing a widening gap between Western mainstream media about China and the reality on the ground. The picture being presented by the major news providers isn’t so much distorted as it is truncated. Successful international business people have learned to make information a key priority in China – they simply dig deeper and make more of an effort than they would back in the West. If you don’t have time to learn about the China market then you don’t have time to be successful here. Relying on your counter-parties, suppliers or employees to feed you basic information about China business is digging your own grave. Learn to set up a Google reader and devote 30 minutes a day to staying up to speed on the most important developing market in the world. It’s not that hard, and there are few activities that will reap higher returns.
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