Thursday, July 23, 2009

Final Blog

We traveled to China and India to learn about what it takes to do business on a global level. We were interested in whether the theories that work in America are effective when used abroad. We witnessed firsthand the challenges of doing business in an emerging economy. And we were fortunate enough, thanks to the efforts of Dr. Carr and Dr. Singh, to get an inside look at many companies in a variety of industries. Although no two companies operated in exactly the same manner, they had all found their own unique recipe for success. These companies focused on business’s basics, like staffing and communication, but they couldn’t stop there. To achieve success, they all needed to customize solutions to the problems particular to their environments.

I believe the most important characteristic common to these companies was commitment to communication. Not a single company took communication for granted. In fact, they all strived to continuously improve the process. Clear communication is absolutely essential to any successful business. This is never easy, and it becomes harder when cultures mix. At a basic level, a company needs to clearly communicate the value its products offer to its customers. Unfortunately, what works in one society often needs to be reworked in another. A grocery store can offer an example that was particularly insightful to me. Here at home, we like to walk in a grocery store and see clean, polished, freshly stacked produce. It gives us the impression that the fruit is fresh, inspected, and safe to eat. This model does not work in India. Buyers in that market view unorganized, blemished and dull produce as being fresher because it didn’t have to spend time being processed. Most of us have grasped the idea that no two people are alike, this notion can be extended and exaggerated when talking about people from different cultures. And, as this example illustrates, these cultural nuances can make all the difference in a business’s profitability.

Intra-company communication processes are the fibers holding a company together. No strategy can be effectively executed if these processes fail. Employees in global businesses often face language, distance, time, and cultural barriers. We visited one company where the employees overcome these obstacles on a daily basis. This company has large offices in both Germany and China. The German employees speak German, the Chinese employees speak Mandarin, and inter-office communication is held in English. It’s obvious that the language, distance, and time barriers are substantial, but the cultural barriers present the largest complications. The two cultures have different ways of conveying a message, different idioms, and different manners. The cultural contrasts are apparent when a question is asked. In response to the question, the Chinese employees tend to circle around the answer without stating it outright. The listener is supposed to come to the conclusion himself. The German employees answer questions quickly, clearly, and directly. The German employees who are not used to such a roundabout approach might not be able to pick the answer out from what was said; and the Chinese employees who are not used to reaching conclusions so quickly may wonder about the accuracy of the statement when they were not included in the reasoning behind it. The employees must be trained in the cultural differences before they can effectively communicate with each other. An understanding of their coworker’s cultural background can help to ensure that their message is not lost in translation.

Communication between companies based in different countries presents another challenge to businesses going global. We had the opportunity to hear from a young man who recently started a business in Beijing. He and his Chinese partner help foreign businesses market themselves in China. From him I learned the importance of having someone who can go between cultures. He attributes his recent success to his commitment to understanding the Chinese culture. He is an American, so he understands what American business men are looking for in a company, and he successfully delivers that. His Chinese partner has been helping to immerse him in Chinese culture so that he can be more successful at marketing. Individuals like this young man can help a company bridge cultural gaps that exist in the world of global business. He showed us how important it is, and how much work it is, to continuously pursue an understanding of the society you intend to do business in. This man was not atypical of the expatriates that we met in both China and India. The most successful expatriates that we met were genuinely interested in learning about and trying to be a part of the culture surrounding them. Employing individuals with this sort of passion will give a head start to businesses entering new markets.

There is a lot of literature depicting both China and India as an up and coming land of plenty. Both countries have markets of over one billion people. And the rise of globalized business is driving an exploding middle class. These appear to be markets ripe for the picking with nearly limitless potential. But these markets are not as easy to tap into as we’re often led to believe. The competition is fierce. The cultural barriers are many. The infrastructure is limited. And market data is extremely hard to find.

The streets of New Delhi demonstrate chaos as I’ve never seen before. In India, an effective work environment needs to be built from the ground up. Many businesses have started creating environments where their employees can spend their time outside of work. This serves a dual purpose—it can keep the employees happy, and thus more effective while they are working, and it helps to attract some of India’s top talent. One of the best examples of this was a call center we visited in Mumbai. This particular business spent a lot of time and effort creating a place where their employees could be safe, happy, and effective in their jobs. They had gyms, spas, game rooms, and cafeterias. They provided their employees a sanctuary from the chaos outside. From what I could discern, the benefits from this investment far outweighed the costs.

The cutthroat competition one could expect in these emerging economies was exemplified by a technology firm we visited just outside New Delhi. This firm had the most effective advertising campaign I’ve seen. They had spent the last few years doing a fantastic job of differentiating themselves from their competition. This firm taught us that the basic business principles we learned in the United States can’t always be transferred overseas. In the United States, businesses usually choose either a differentiation or a cost leadership strategy, and if they choose a differentiation strategy they can and should charge a premium for their product. However, this firm let us know that their incredible advertising campaign did not allow them to charge a premium for their product; this is just what needed to be done to gain market share. It appears that success in the Indian market requires both a cost leadership and a differentiation strategy.

I should end by noting that that this trip’s value extended far beyond these business concepts. These countries were the most foreign places I’ve ever been in my life. Nothing was familiar. I didn’t understand the customs or the languages. And their culture and history is nothing like our own. A recurring theme from throughout this last year was to always look for common ground. Meeting people from China and India provided us an amazing opportunity to practice. Even with so many cultural differences, I was able to find and build common ground with people where ever we went. By finding and building common ground, we can connect with people across cultures and work to develop solutions that represent collaboration rather than compromise. Of all the lessons that we learned on this trip, I believe that this is the one that will help us most if we hope to do business abroad.

Monday, June 1, 2009

HOW TO WIN FRIENDS AND INFLUENCE PEOPLE

What this book is about

This book revolves around the idea that people like to talk about themselves and that they are only devoted to ideas that they develop themselves. Dale Carnegie focuses on how to get people to come up with an ideal solution on their own. By encouraging people when they make good decisions, they are likely to develop solutions that you agree with, and they will be devoted to implementing those solutions because they own them.

Dale Carnegie began this book with the very basics. He gives advice which he expounds upon throughout the rest of his work. He begins by advising the reader never to criticize or condemn. Rather, we should find ways to appreciate and praise those around us. This is a recurring theme which leads well into the next section, which focuses on how to get people to like you. Carnegie structured this section around six principles which focused on ways the reader could show interest in the other person. He writes that many of us have things backwards. We try to get people to like us by getting them to focus on us. But the real key is to focus on the other person. Small actions like remembering a person’s name or smiling when you see them can make a difference. Even just letting the other person take control of a conversation demonstrates your interest. It appears that vanity takes total control and we can’t help but be flattered when we feel someone taking interest in us.

His next section focuses on influencing other people. He writes about twelve different principles in this section, but ten of them focus on ways to be agreeable. He begins this section by noting that you can never win an argument. People will defend themselves if they feel attacked. This approach will only entrench them in their ways. Rather than focus on differences, we should focus on what we have in common. We should attempt to understand why our opinions differ, and give their opinion respect. We should even try to let the other person feel that our idea was actually his or hers so that they are more receptive to it. After establishing an agreeable platform, Carnegie suggests that you “throw down a challenge.”

Carnegie makes a distinction between influencing other people and being a true leader. His last section is on being a leader. This section focuses on how to get people to act how you would like them to even when you’re not there. He suggests some ways you could help people develop certain habits so that you are no longer giving orders. This process starts off by letting people know that they are appreciated and valuable. Carnegie suggests that you don’t point out another’s mistake. As he mentions many times before, change must come from within that person if you expect it to be accepted and lasting. To accomplish this, Carnegie suggests that you let the other person realize their mistakes on their own by only getting at the mistakes indirectly or mentioning a similar mistake that you made. Finally, since change is a slow and incremental process, Carnegie stresses that the individual must be praised for every improvement, no matter how small.

What Carnegie Did Well

Carnegie wrote about what he knew. It was clear, even from his writing style, that Carnegie was a likeable guy. He knew how to talk to people, and how to have fun doing it. He made conversations with strangers into a game where he’d try to get the other person to like him through the strategies he wrote about in this book. But he was careful where to draw the line, and he cautioned against insincerity. Instead of promoting insincerity, he wrote about ways in which to foster compassion. He often invited the reader to step into the shoes of the person they seem to have a problem with; to listen to that person and to really try to see the validity in what they are saying. You don’t even have to agree with the other person, you only need to understand that their viewpoint is almost always justified in some way, and that you might not be completely right. This gives you the ability to respect their opinion and go from there. He also illustrates each principle with numerous examples. These examples are a bit outdated, but that really just added interest to the book.

What I Didn’t Like

While many of Carnegie’s examples were interesting, he had too many. The point was often made in the first or second example, but they kept on coming. Carnegie’s writing would have been stronger if he had cut down on the number of examples. He could have chosen one or two of the best examples to illustrate each principle so the reader didn’t feel like he was just filling space.

Recommendations

I was generally happy with this book. I began reading it with quite a bit of skepticism—its title makes it sound like a book on how to be insincere. It sounds like a book that gives MBA’s a bad reputation, but it was actually quite sincere. Most of Carnegie’s principles were common sense, but this book served as a nice reminder to enjoy those around you. I recommend this book to people looking for an easy, entertaining, casual read.

Wednesday, March 18, 2009

Billions of Entrepreneurs

Billions of Entrepreneurs
By Tarun Khanna

Report by Patrick Johansing


The Chinese and Indian economies complement each other. China quickly organizes people and resources. India hosts a highly educated and creative workforce. India excels in design work, China in manufacturing. Increased trade between these countries will strengthen both of their economies. Businesses that foster this relationship will profit from it. These countries will learn from each other, and their economies will become more integrated in the very near future.
The Chinese government has tremendous influence over the day to day activities of the Chinese people. Its one party, the CCP, operates the entire government. It decides which industries China will pursue, and it floods those industries with capital until its goals are met. This unilateral approach to the economy has earned the government the reputation of being the country’s entrepreneur, and, since 1979, their economy has grown faster than any economy on record. The government strives to operate as a meritocracy where the best and brightest in the country are rewarded with government positions, although corruption is rampant. The party takes a pragmatic approach to government; as a result, the country can’t accurately be described as communist. The party members look outside the country to decide which methods and strategies work.
China is a rising economic power. Its greatest strength is its ability to embrace foreign ideas. The government welcomes foreign business and studies it. It remains involved with its citizens abroad, taking full advantage of their skills and capital. And it is not afraid to abandon ideas that don’t work. The government expediently builds and maintains the infrastructure needed to support its industry. It strives to create an environment meant to foster economic prosperity. To accomplish this, the government has learned the value of diplomacy. China secures the resources needed in their development by courting the countries shunned by the western world. China takes advantage of its enormous pool of cheap labor and its top down leadership style by being the world’s leading manufacturer. Factories are plentiful and production is quick and efficient.
The government’s role as the single largest entrepreneur creates inefficiencies. Because government resources are plentiful and resource allocation is often made for political reasons, government backed ventures typically yield a very small return on investment. Poor decisions are also made because of the rampant corruption within the government. Good business information is difficult to find because government employees are incentivized to make their production figures more impressive than they actually are. On top of this, the CCP destroyed all meaningful market data during the Cultural Revolution. And censorship prohibits the flow of certain types of information. Censorship also inhibits the growth of soft power by stifling creativity. Chinese movies, which are heavily censored, are not well known outside of China. The Cultural Revolution and the overwhelming presence of the government have curbed an entrepreneurial culture within China.
India’s government is chaotic. A quarter of the members in parliament have criminal records, and most members are more concerned about being reelected than about seeing any public service projects through. Many government projects are abandoned when only partially complete, so government projects are terribly inefficient. The government is a staunch democracy that focuses more on property rights than public interest projects. The corruption, chaotic political process, and strength of property rights results in terrible infrastructure and a maze of regulations and taxes at various levels of the government. It takes an expert to efficiently do business amid the government fostered bedlam.
The people of India have found ways to make doing business profitable despite the inadequacies of the government. The maze of rules and lack of infrastructure has ironically led to opportunity for entrepreneurs. Many companies can’t offer certain products or services because of infrastructure restrictions. The person who can figure out a way to offer that product or service will face very little competition in that market. India’s intricate set of regulations drives many businesses abroad. Those who stay must learn to be creative. And this creativity gives the country soft power around the globe. Their movies are popular, and their software is used everywhere. India’s creative workforce gives the country its economic edge.
The purpose of this book was to point out how China and India’s strengths could complement each other. India’s workforce is innovative. Its workers are highly educated and creative. They are among the most capable designers in the world. China’s ability to organize many people around one task makes it efficient in mass production. Companies can benefit by designing their product in India and producing it in China. Both countries could benefit by studying and learning from each others’ strengths.
This book was based on Khanna’s experiences living and traveling in India and China. He used his own experiences along with expert opinions to support his beliefs. He illustrated each point with an example, so his opinions were well supported. He framed each country’s state of affairs through a brief history of relevant events. And his story-based teaching method made his writing style personable. That being said, this was not an easy read or altogether enjoyable read. While informative, it was scattered. He seemed to write in whatever order things popped into his head. And his many illustrations began to detract from his main point. I would not recommend this book.

Monday, December 8, 2008

The Post-American World Essay

The Post-American World
Author: Fareed Zakaria
ISBN: 978-0-393-06235-9
By: Patrick Johansing


Overview

The Chinese government replaced communism with pragmatism in 1979. China now leads the world in economic growth. Fareed Zakaria’s The Post American World is about the reemergence of a multi-polar world. He emphasizes the “rise of the rest” as opposed to American decline. The rest of the world is modernizing.

Zakaria proclaims that economy has triumphed over politics. Countries all over the world are westernizing. Ironically, this is leading to more nationalism and less focus on America. In light of this new world, Zakaria identifies a new task for America: “to construct a new approach for a new era, one that responds to a global system in which power is far more diffuse than ever before and in which everyone feels empowered” (p. 231). He means that America should create a framework for the world, a set of rules that will promote global prosperity.


The Relevance of The Post-American World

The rest of the world is modernizing and Americans are afraid. We are afraid of losing our economic and military supremacy. We are afraid of being poor and vulnerable, we are afraid of terrorists, we are afraid of China. Many of these fears are irrational. For Instance, we have a greater chance of being struck by lightning than being killed by terrorists, and China has only eight nuclear weapons and is fostering friendly relationships around the world. Zakaria separates truth from sensationalism.

The modern economy is strong, so strong that it trumps modern politics. Our old reactions will no longer have the effect they once did. This new shift in power changes who holds it. The most influential countries don’t have to be the ones with the largest army or the most land. The most influential countries will be the countries with the biggest economies. China and India have the fastest growing economies in the world. We can strengthen our own economy with a better understanding of theirs.

The recent shift in power requires a new set of tools and a new set of rules. America can establish the rules of fair play. We can create a framework to promote a peaceful and prosperous multi-polar world. We can avoid the circumstances that lead to the World Wars and the Cold War. If we regain our credibility, the rest of the world will follow these rules. America doesn’t act with international cooperation, and our unilateral approach abroad has lessened our credibility. Nations fear the United States, and Americans needs to change.


Where Zakaria Excels

Zakaria separates sensationalism from truth. He pinpoints the irony of our situation—the most powerful country in history is petrified by fear. The Post-American World focuses on American strengths as the media does not. Americans are inundated with news of our vulnerability. Zakaria begins the book by noting the exaggeration of the world’s political instability. He then illustrates the size of the gap, economically and militarily, between America and everyone else. And he brings in telling examples to make his points. For example, America spends more on its military than the next fourteen countries combined. Israel’s economy grew during the course of its most recent war with Syria.

Zakaria presents the rise of the rest with optimism. Americans are scared of losing complete control. Our fear shapes our perceptions. Under the influence of fear, we see a developing country as a military threat. Zakaria writes this book from a different perspective. He convinces the reader that the world is not interested in destroying America. The world is interested in strengthening itself. Developing countries focus on development, not on America. Developing countries will strengthen the global economy, and that’s good for everyone.

Zakaria traces the fall of American popularity. He takes us from its height under George H. W. Bush, through Clinton, to its pathetic current state under George W. Bush. He claims that American unilateralism abroad is the root of our decline, and he suggests that we strike at the root immediately.


Where Zakaria Falls Short

Zakaria’s chapter on American Power was scattered and unconvincing. He begins by acknowledging that we are the most powerful country in the world, both economically and militarily. He writes that we will lose our total dominance, but we will remain one of the top contenders. The only convincing argument that he makes for why we will be one of the top contenders is that we have a fantastic higher education system. This explanation falls short. He fails to link higher education to economic success. That link is crucial to his argument.

Zakaria didn’t explain the implications of his plan for America in enough detail. He proposed that the United States should focus on creating an international framework for the future, and he alluded to this framework making the world more peaceful and efficient. This allusion lacks many supporting details in the text. Perhaps Zakaria assumes that we can all agree that there is an inarguable set of rules that will better the planet.

Zakaria only briefly examined the variables that will impact the future of China and India. He mentioned the perils facing their governments from increasing regionalism, and he noted generational differences in work ethic. But he projected their sensational growth from the past few years in his estimations. He assumes that China’s economy will continue to grow at the fastest rate in recorded history. Wars, revolutions, worldwide depressions and natural disasters can all devastate economic growth. Zakaria should include the likelihood of a slowdown in his prediction.


My Recommendations and Closing Thoughts

The Post-American World exudes Zakaria’s optimism. He presents “the rise of the rest” as an event to rejoice. He fixates on global economic growth and deemphasizes America’s diminishing dominance. Zakaria recognizes our fears and explains them away—we are not in danger, we are ill informed.

Zakaria concludes The Post-American World with a word of advice (actually a chapter of advice). America should become the world’s role model by following that will better the globe. America should pave the way for a more integrated and peaceful planet by becoming the most amenable and approachable country. And, most importantly, America should listen. We should employ ambassadors who are truly interested in other worldviews.

The Post American World was well written and easily understood. It was informative and hopeful. I recommend this book to all those seeking to broaden their perspectives or to those who are merely interested in learning more about our competition. This book left me with a new impression, and I believe that’s enough reason to read a book.