China Law Blog

Anyone who criticizes Jim for failing to incorporate the collected wisdom about doing business in China in a book that can actually be carried by a human being is setting an impossible standard. My response in cases like this is usually to hand the offender a pen and say "well, then you do better."

What Jim has done is all you could ever ask any author to do on a subject so vast that changes so quickly: take a snapshot of the situation as it stands and offer a primer that provides advice you expect will continue to apply as time goes on.

I for one am grateful to Jim and others like him - Tim Clissold, James Kynge, Tom Doctoroff, and Joe Studwell, among others - because their books enable me to move my clients past the "China 101" phase as quickly as possible and get down to the kind of specific counsel that applies to their situation.

David

" 1 billion customers" would have been a better book had it been written by a chinese business person who knew the economic realities of the 1 billion people who are on the fringes or completely out in the cold in regards to China's development. There would be no economic miracle if hundreds of millions of peasant farmers, factory workers or construction workers were getting paid anything near a livable wage (and actually getting paid the money they are owed by their employers).

These people are so frugal and so burdened by the costs of simultaneously paying their one child's tuition, taking care of their parents and taking care of their own day to day subsitence that they don't buy tissue paper to wipe food from their mouths, they use the sleeves of their shirts/jackets. While higher class chinese and foreigners may laugh at this, that is their economic reality and in similar circumstances we would all do the same. The same economic frugality is why you'll see the average local person haggling over food as if it is a life and death situation and why the kids of those people do so well with money management in the west. Just ask your grandparents about depression era budgeting. Would any of those people spend money on some western products they've never heard of?

So I see "1 billion customers" as a combination of disillusionment, ruler and graph projections and a bit of a lie.

I'll believe it when I see construction workers and contract laborers showing up to the site in late model pickups.

I have had similar thoughts re: McGregor's book. I enjoyed it, very much, and tend to be amazed at the people who nit pick it to death.

God, have any of us written a book as enjoyable to read as his in our lifetimes or will we do so? I doubt it.

I listened to the podcast. He is, for sure, a strong confident personality!

I agree with Dan Harris on his analysis about Mc Gregor and the book "one billion customers". I read the book 5 months ago; I found it very insightful even for people like me who have been around for 10 years and speak Chinese fluently. You cannot summarize business in China in one book, not even inside encyclopedia Britannica but some interesting aspects are developped for whom I agree.
When I read the blogger Nanheyangrouchuan writing that only Chinese can understand China, it is a shortcoming answer. Mc Gregor didn't write that he got all the answers or explained all the problems facing China. Foreigners especially the ones who speak Chinese fluently and have been around for a long time can have an out-of-the-box thinking compared to Chinese people and Foreigners who do not have China experience.

David --

Yea, that's what I was thinking. Really.

I mean what do people really expect? I recently finished China Shakes the World and was hugely impressed with it, but it mostly deals with China's economy, not how to do business there.

nanheyangrouchuan --

With all due respect, I get the sense you have not read the book. The title is One Billion Customers, but the book is really a primer on doing business in China and it does not claim there are actually one billion consumers in China.

Chris --

So what exactly are their criticisms? I agree it is not a perfect book, certainly, and it is somewhat irritating how McGregor seems to act as though what was true in situation A will be true in situation B even though he may never have been in situation B, but what are we to expect?

Romain --

I completely agree with you. The Chinese will see the Chinese one way and Americans will see the Chinese another way. Neither is right, neither is wrong.

I am so glad you, a Frenchmen, said what you said because I am absolutely convinced that the best book ever written on Americans is Democracy in America, by, yes, you guessed it, Frenchman, Alexis De Toqueville. There is definitely some truth to the cliches (there I go using French again) that outsiders can "know us better than we know ourselves" and that sometimes one can get so close to something as to "not be able to tell the forests from the trees."

McGregor is no DeToqueville, but he never set out to be. He set out to write a book on doing business in China and he succeeded at that.

Hi Dan.

A few examples ...

"He focuses only on horror stories" -- this fails to acknowledge that more is often learned through defeats than wins, and that, I thought, is one of his main points for why he uses the examples he uses.

"His stories focus more on his ego and who he knows" -- and that defeats the purpose or value of his book because ...?

"His supporting evidence is anecdotal stories and experiences, not hard data" -- okay, but this is a Wall Street Journal veteran we are reading here; not some ding bat writing for People magazine.

"I did not like his writing style" -- huh?

You get the picture ... I think what some of these folks are really saying is "What I am really pissed off about is that I didn't write this damn book and he did."

Chris.

Chris -- That's funny because I actually have the same criticisms of the book. In fact, if you look to your right, you will see that I say the following:

"It was not until I finished the book, however, and really started thinking about it that I realized that well over 90% of my Chinese business encounters are very different from those described in the book. This caused me to realize that this is not really a book about doing business in China so much as it is a book about doing big business in China. Among other things, the book eloquently details the difficulties of establishing a foreign wireless network, a foreign media empire, and a large scale foreign investment bank, but it never delves into the nitty gritty of the small and medium sized manufacturing and service businesses that operate so successfully in China. So while this is the best book I have read for understanding the Chinese business persona, the China picture it paints does not really apply to most foreign businesses coming in to China. Indeed, early on, the book reveals that nine out of the ten most successful brand names in China are foreign. If everything were indeed so bad there, this obviously could not be true."

So you see, my criticisms were based on it did not deal with what exactly what I was looking for in a Chinese business book, not on anything inherently wrong with the book itself. It would be like reading a book on Bobby Knight and complaining that it was not all that helpful for learning more about John Wooden. Well, maybe it should have had more on Wooden, but that hardly means it was not a good book on Knight.

One can always criticize a book for what it doesn't say and the only reason I did that here on this blog was becuase I wanted people to know how it might help them and how it might not.

I don't think it is so much jealousy though that leads to the criticisms, I think it is snobbery and the belief that so many of the really smart China consultants out there could do better. What I think people fail to realize is that extolling the virtues of the book does say McGregor knows wherof he speaks, but it does not say he knows China business better than anyone else.

Right?

The problem with deToqueville is he wrote it centuries ago and that since then, French and American didn't do too much to understand each other.
As a 10-year experience manager and consultant in China, I am still amazed how dumb Europeans and my fellow countrymen work in China. You give advices and they are only able to learn the hard way. Only this morning, I had 2 clients (one SME and one Fortune 500 but both French), who didn't listen to my advice and now are in deep trouble. You would think good for me I can charge them additional fees. Yes but it would be also nice to focus my energy on success and not damage control. I think European companies and French especially still lives in this social romantism that characterizes French society since 1789.

Romain --

I don't care when DeToqueville wrote, it is still great stuff for today.

I like hearing you light into the French for not understanding China, but only because we Americans like to make it seem that we are the only people in the world who cannot instantly be transported into a foreign culture and fit right in. I am always saying all people have huge problems in foreign countries. Americans in China. Americans in Korea. Chinese in America. French in China. Americans in France. The reality is that it is difficult and the first key to understanding is recognizing you don't know.

I don't know about you, but we find our best clients are those who have been in China for around 3-5 years, made their mistakes, but survived, and now want to do things right. They know enough to know what they don't know. It is the guy who just starts doing business who typically thinks he knows it all. C'est vrai?

Dan,

I agree with you; after 3-5 years you start to have a better idea. Even after 10 years, I still learn a lot, it is probably why I stay here. China is tough but never boring. I cannot say the same with France even if it is the most beautiful country in the world (chauvinism?).
To make sure that understanding about China improves, some of my fellow countrymen and I, we often travel to France to attend conferences about doing business in China.
France is behind countries like Greece and Italy in terms of export to China. With the 30-year economic crisis in France and a high unemployment rate (between 9-10%, we need China but few are the people who are aware of it.

Romain --

Chirac got it, that's for sure.

While it is true that I haven't read the book (and don't really need to in my line of work), the title simply reflects the hype and hope of businesses around the world...expect to see a book like this about India as well. Even as far back as 2001 when I was in China, the talk was of "1 billion customers" and companies selling the smallest consumer products went dizzy with the idea that if everyone in China bought 1 item of theirs every month, or even every other month, the quarterly returns would be sub-orbital. CCTV9 has a show called "Dialogue" that used to have a great host (Rui something or other) who would openly show disdain as western manager after western executive after "old hand" came on his show and talked about "the vast market potential" of China and would occasionally mention "1 billion potential customers". The chinese themselves love selling the hype but they themselves know that even if it possible, they won't see it in their lifetimes, just ask some.

Hi Dan.

"I don't think it is so much jealousy though that leads to the criticisms, I think it is snobbery and the belief that so many of the really smart China consultants out there could do better. What I think people fail to realize is that extolling the virtues of the book does say McGregor knows wherof he speaks, but it does not say he knows China business better than anyone else.

Right?"

Definitely agree on the second part of the paragraph.

But not so much on the first part. I think, as a generalization (always dangerous I admit) it does tends to be fueled by jealousy. The Monday morning QBs out there, unlike a guy who actually went out and did it, did not have the great job of being an investigative reporter for the WSJ, they could not take 2 years off to write a book like he could; but yes, of course, had they been able to take that time off "they" would have written a much better book. This drives me nuts. I played football in college and the hackles on my neck go up each time I sit next to the guy (usually with a beer belly) in the stands at a college game who never played discuss what the coach or QB should have done!

Chris --

I didn't even know Nebraska had a football team.

I somewhat agree with your football analogy, and I somewhat disagree. When I watch a basketball game, I'm always commenting on the reffing and the coaching, but I will be the first to admit that I can neither ref nor coach. I have reffed scrimmages and by the time my brain has processed that a foul occurred, the possessions have already changed a few times. When it comes to coaching, what I think people fail to realize is how many things the coach needs to think about at once and how incredibly difficult that is. That is why even great coaches make little mistakes all the time and they have great assistants helping them. But, that does not mean that those of us who paid the money to get in and sit in the stands should not be allowed to point them out. I remember a game where my daughter was playing and she started driving the lane and was fouled so threw the ball up so she could (and did) go to the line to shoot two. I was so proud because it was the first time she had mastered the court savvy to do something like that and then some idiot behind me yelled, "Pass the Ball." I shot him a dirty look.

The simple solution for those who think they can write a better book is to write it. Not writing it, however, does allow them to persist in believing they could.

Don't get me talking about sports and analogizing it to life or I may never stop.

Good comment.

OK. I will meet you in the middle ground ... cold beer in a good pub, with ESPN on the big screen, and talk of China and sports.

Chris --

Sounds like some good sensory overload. Count me in.