China's Mao School Of Business.
I just finished The Little Red Book of China Business, a book written by Sheila Melvin. Ms. Melvin called me a few weeks ago, told me of her book and asked if I would be interested in reading it. I told her I would, but that I was highly skeptical of its thesis: that understanding Mao's thoughts is critical for doing business in China. I have read the book, very much enjoyed it, but remain skeptical.
Here's the deal. Ms. Melvin clearly knows her Mao and she clearly knows Chinese business and those two things combine to make this an enjoyable and highly worthwhile read. I have not read about Mao for a long time and reading this book refreshed my recollection of his thoughts and taught me new things about him as well. I give the book an A for this. Ms. Melvin spent seven years with the US-China Business Council and she obviously has a deep understanding of how business is conducted in China and she does an excellent job of conveying this. I give the book an A for this as well. This book makes for an excellent introduction of both Mao and China business and I highly recommend it.
But....
I still question its thesis, which is as follows:
The current generation of Chinese businesspeople grew up with the lessons and teachings of Mao's Little Red Book, and these lessons guide their actions in business and culture. If you don't understand Mao and the Little Red Book, you don't understand China business.
The funny thing is that all of a sudden there has been a spurt of writings on this very topic. The Harvard Business Review (h/t to Sox First) says that China’s capitalists are deeply influenced by Mao Zedong thought:
Our research on the practices and attitudes of Chinese CEOs offers abundant evidence that Mao’s principles continue to influence top executives: All but one of 15 CEOs we interviewed told us they often turned to Mao’s teachings for management ideas. Consider the manner in which Mao wielded power: by keeping the country in a state of chaotic flux, often playing one group against another. To make a change in the political landscape, Mao would orchestrate a movement that sucked in the entire population, such as the campaign against Liu Shaoqi (the number two leader in the Chinese Communist Party) and his allies, then resort to a mixture of agitation, networking, and rallying to mobilize people at the grass roots to denounce certain cadres, or senior officials. Most of the cadres would be forced out of their jobs, and Mao would rehabilitate a few. Deng Xiaoping was denounced in this manner, rehabilitated, and denounced again.
China Hearsay ain't buying:
I don’t like doing this, but I’m going to have to call bullshit here, even based on my limited knowledge of this. First, I can think of lots of reasons why Chinese CEOs might want to cite Mao when asked about significant influences. Doesn’t necessarily mean it’s true. Second, the type of management style described sounds a lot like every boss I’ve ever had, most of whom couldn’t tell Mao from Ayn Rand. Third, the "management techniques" described also sound a lot like other world leaders over the years. Was that style really something that Mao invented? I don’t think so. Cute angle for an article, but not so convincing.
Many years ago, I was discussing the role of women in China with a female lawyer friend of mine, with whom I have worked on many cases. This lawyer holds a very prominent position with what is arguably Dalian's top law firm and I remarked upon how something like this would almost certainly not be possible in Korea. I then (thinking myself very wise) asked her if her position might not have been made possible, at least in part, by Communism. She immediately pointed out to me that China has a long history of strong women and that Communism has had little impact one way or the other on that. Good point.
My Chinese history is too weak to state this with any degree of confidence, but I wonder if Mao's thoughts as applied to business are not really just Chinese thought, particularly since Mao was himself such a student of Chinese history and thought. In other words, is knowing Mao really any different from knowing China, at least as applied to business? And anyway, is it not more efficient to focus on China's current business culture, rather than digging one level deeper to see where that culture originated?
I give the Mao as business professor portion of the book a C, subject to possible revising based on comments received. Is it just a gimmick?
Mao's birthday was yesterday. He would have been 114.
December 31, 2007, Update: The Black China Hand, in a post, entitled, Management@Mao.com, writes on reading an article in the Economist, entitled, "Mao and the Art of Management," on how businesses might consider Mao as a management role model. This Mao thing apparently has legs.
January 5 update: The Mutant Palm has a great post up on the resemblance between Jack Welch's use of Six Sigma while at GE and Mao's use of his teachings while ruling China. Uncanny.
Comments
I will definitely want to read this book. I fear that much of the current runaway money-madness and its accompanying moral deficit arises from Mao's involvement (if not outright masterminding) in sidelining, if not attempting to eliminate, traditional values. Many people are awakening now to the realization that he did them few favors in this regard, hence the need to reinstill in the young the meaning of how to "zuo ren" in an ethical sense.
Posted by: Law Office of Todd L. Platek | December 27, 2007 8:26 AM
I submit that Mao's 'style' had more to do with a desperate attempt to maintain control amidst the inherent flaws of the soviet-style government.
If there's a comparison to be made, it might be that some managers will do whatever they must in order to keep control. I doubt that is exclusive to China business.
Posted by: Nonin Stone | December 27, 2007 11:09 AM
CLB: In response to your question about whether Mao's thoughts as applied to business not just Chinese thought, that's a frightening proposition. "Dou zheng, dou zheng," i.e. public accusation parading as criticism, as the order of the day, is no way to run a company; it is the unrelenting criticism of others, not constructive and helpful, but hurtful, insulting and counterproductive to the long-term good of the organization. Too many fine people were ruined by "dou zheng da hui" for several decades, and it should go the way of the dinosaur. Modern executives employing this tool guarantee their own or their companies' short-term existence.
Posted by: Law Office of Todd L. Platek | December 27, 2007 12:28 PM
I haven't read the book yet, but I buy what she's saying. Have you ever worked in a REAL Chinese company? I'm not talking about a multinational run by a Chinese manager. I could tell you stories that would make your head spin. Yes, Mao Zedong Thought DOES influence today's management system in 21st Century China.
Posted by: Glen Loveland | December 27, 2007 3:02 PM
NS: I submit that Mao's 'style' had more to do with a desperate attempt to maintain control amidst the inherent flaws of the soviet-style government.
I wouldn't attribute any special significance to the influence of Leninist governmental structures on Mao's rule. In my view, Mao was just the first emperor in a new dynastic cycle, and he attended to the primary task of most such figures in Chinese history - consolidating power. Nobody really needs to look at Mao's machinations to figure out how to scheme and plot - any run-of-the-mill Chinese period costume drama can teach him that.
Posted by: Zhang Fei | December 27, 2007 4:47 PM
ZF: I wouldn't attribute any special significance to the influence of Leninist governmental structures on Mao's rule.
I absolutely agree with your point.
However, drawing from the citation above: "...by keeping the country in a state of chaotic flux, often playing one group against another..."
Chaotic circumstances were likely wrought by the communist socio-economic model itself rather than being Mao's 'management style.' And his reactions were simple CYA tactics. Whenever things don't go according to the grand scheme, totalitarian expedience comes to the fore.
I also agree with Glen L.'s comment and add that the new labor laws, becoming effective in a few more days, are current proof of his influence. It may take a couple of generations to dilute Mao's influence significantly.
Posted by: Nonin Stone | December 27, 2007 5:58 PM
@Glen:
So why don't you? (Tell us the stories that is)
Posted by: JL | December 27, 2007 11:55 PM
Did Mao's "style" or "thought" actually introduce anything that was not already described in Chinese history and fiction in much greater detail?
Posted by: Charles Stone | December 28, 2007 6:57 AM
The time and money could be put to better use by reading about neo-confucianism or a reputable historical account of the PRC. The former will teach the underpinnings of Chinese/East Asian society and the latter will help understand why contemporary PRC became a wildly distorted version that traditional confucian society.
Mao's management techniques boil down to (1) only trust knowledge that an average peasant can comprehend, (2) quantity matters more than quality, (3) revolutionary struggle is good, and (4) ends justify the means. While these outlooks are still much too common in the contemporary Chinese workplace, they're things that should be rooted out rather than celebrated.
Posted by: anon | December 28, 2007 8:08 AM
NS: However, drawing from the citation above: "...by keeping the country in a state of chaotic flux, often playing one group against another..."
Chaotic circumstances were likely wrought by the communist socio-economic model itself rather than being Mao's 'management style.' And his reactions were simple CYA tactics. Whenever things don't go according to the grand scheme, totalitarian expedience comes to the fore.
First things first. Mao was many things, but he was no George Washington, whose first act after turfing the Redcoats was to fire himself as commander-in-chief. After winning two presidential terms, Washington fired himself again at the end of his second term by refusing to consider a proposal by his ex-subordinates to crown him king.
From the beginning, Mao's every move was to destroy subordinates who challenged his ideas, privately or in public. He had them purged, executed or imprisoned (where many died of mistreatment probably ordered by Mao). Given this background, it makes perfect sense that Mao's primary reason for being wasn't to look for superior solutions, but to entrench himself in power. This is why I seriously doubt that Mao's lurches from one policy to another had anything to do with ideas - they were merely a means for him to consolidate his power in an environment where (1) the divine right to rule wasn't sufficient to cement his permanent rule, given the lack of such a concept in communism and (2) a change of dynasty meant that everything was up for grabs - which has historically meant that even the divine right to rule needed to be established by killing or otherwise neutralizing those of an aspiring dynast's brothers-in-arms who were suspected of harboring independent ambitions of their own. In other words, something you get to see in any garden variety Chinese period costume drama.
Posted by: Zhang Fei | December 28, 2007 5:23 PM
If there is admiration of Mao among China's entrepreneurs, it has to do with his leadership and political skills, not with his management and business skills, which were frankly, non-existent, and have little if any relevance for any growing Chinese business.
Let's not mix things up...
Posted by: Paul Denlinger | January 1, 2008 8:24 AM