Notes on Intercultural Communication

Archive for the ‘Intercultural Economy’ Category

Trade, Geography, and the Unifying Force of Islam / The Silk Road

leave a comment »

Trade, Geography, and the Unifying Force of Islam

~

Inequality in regional suitability for agriculture across the Old World

Inequality in regional suitability for agriculture across the Old World

~

Percentage of Muslim population in AD 1900 in the Old World

Percentage of Muslim population in AD 1900 in the Old World

~

Major trade routes in the Old World AD 600-AD 1800

Major trade routes in the Old World AD 600-AD 1800

~

(…) We start with the observation that, on the one hand, Islam surfaced in the Arabian Peninsula under conditions featuring an extremely unequal land quality distribution across regions. And, on the other hand, Islam surfaced in areas close to lucrative trade routes. As a result, when dwellers from the oases were attempting to cross the surrounding vast arid lands in pursuit of trade profits, they were facing threats to their livelihoods from nomadic groups. These encounters had the potential to bring trade flows to a halt, setting the stage for the emergence of a centralising force that featured redistributive rules. We argue that Islam was such a centralising force and that, accordingly, its economic tenets had to address inherent economic inequities across clans. This resulted in an economic doctrine that promoted poverty alleviation and redistribution, equitable inheritance rules and anti-usury laws.

(…)

Fortunately, among the pre-colonial traits recorded by Murdock (1967) there is an entry describing whether a group believes or not in gods that are supportive.. of human morality. Anthropologists and evolutionary biologists have argued that the belief in moralising gods – gods who tell people what they should or should not do – was necessary to keep societies together by condemning infringements on other group members. Similarly, we  argue that the presence of an unequal geography and proximity to trade opportunities intensified the need for cooperation among heterogeneous clans. Such cooperation could be achieved by adopting a religion which, besides the appropriate economic rules, would provide a coordination mechanism that penalised those who deviate from prescribed norms. With this in mind, it is not surprising to find that a 50% increase in Muslim adherence within a group increases the likelihood that a group believes in gods that dictate what should or should not be done by 40%. If anything, Christian and ethnoreligious groups are less likely to have harboured beliefs in a moralising god in the pre-colonial period.

(…)

Conclusions:

Our findings show that Islam flourished in very challenging geographical terrains. These terrains harboured inherently unequal economic opportunities and bred conflict. Any political platform that attempted to bring clashing populations together had to address these primordial inequities. Islam was certainly such a movement, and its spread is a prime example of how geography shapes a society’s institutional and societal arrangements. (…)

8 December 2012
~

Stelios Michalopoulos
Assistant Professor of Economics, Brown University

Alireza Naghavi
Assistant Professor of Economics, University of Bologna

Giovanni Prarolo
Assistant Professor of Economics, University of Bologna

~

Read the full post online at VOX, download  pdf at Brown University here, or as pdf here.

(retrieved 19.04.2014 at http://www.voxeu.org/article/trade-geography-and-unifying-force-islam-0)

~

Ann. of the Editor: I personally do not agree to the conclusions. Trade is based on trust. The Quran (similar to the Bible) has the character of a constitution. Moral norms as “Not Lie, Not Steal” are crucial until today’s  international trade. “Being balanced against a feather” is a keyword in Muslim morals. International institutionalised morals can appear as international law (see INCO-Terms).

~

The Silk Road and Related Trade Routes

Map of  the Silk Road and Related Trade Routes

(retrieved 20.04.2014 at http://www.metmuseum.org/learn/for-educators/publications-for-educators/art-of-the-islamic-world/introduction/~/media/Files/Learn/For%20Educators/Publications%20for%20Educators/Islamic%20Teacher%20Resource/Map2.pdf)

~

The Islamic World

Map of the Islamic World

(retrieved 20.04.2014 at http://www.metmuseum.org/learn/for-educators/publications-for-educators/art-of-the-islamic-world/introduction/~/media/Files/Learn/For%20Educators/Publications%20for%20Educators/Islamic%20Teacher%20Resource/Map1.pdf)

~

Trade Routes Africa  15th century

Map of Trade Routes in  Africa  around 1500

“History of Africa”  27 February 2008.  HowStuffWorks.com. <http://history.howstuffworks.com/african-history/history-of-africa.htm>  20 April 2014. (retireved 20.04.2014 at http://history.howstuffworks.com/african-history/history-of-africa2.html

See the whole article about Africa around 1500 online here or download as pdf here.

~

Additional Material

.

Southeast_Asia_trade_route_map_XII century

(retrieved 20.04.2014 at https://laofutze.files.wordpress.com/2014/04/d9ba6-706px-southeast_asia_trade_route_map_xiicentury.jpg)

~

(…) Perhaps no one has described in more ringing language than Tome Pires the advantages of a port commanding the straits :

Whoever is lord of Malacca has his hand on the throat of Venice. As far as from Malacca, and from Malacca to China, and from China to the Moluccas, and from Moluccas to Java, and from Java to Malacca and Sumatra, all is in your power. (…)

Read the full article about Ancient Asian Trade online here or download pdf here.

(retrieved 20.04.2014 at http://www.angelfire.com/mi/mitrakumarmunich/delta4.html)

~

Can a Chinese ‘maritime silk route’ cool tensions in Asia?

Many, both in China and in the region, view China’s mooted Regional Comprehensive Economic Partnership (RCEP) with the ASEAN+6 countries as a Chinese effort to push the regional agenda towards softer objectives. For Beijing, RCEP also has the benefit of countering the US-led Trans Pacific Partnership.

Yet the benefit for China of achieving either of these objectives would pale in comparison to the potential benefit of President Xi Jinping’s realising his dream of reviving the ‘maritime silk route’, which he unveiled during his October 2013 visit to Malaysia and Indonesia. The route would build on the East Asia region’s proven strengths in sharing production. It could also enable a greater role for overseas Chinese communities in forging relationships to reduce regional tensions.

The movement of goods along the maritime silk route has a history of over two millennia, which reached its peak in the 15th century when legendary explorer Zheng He led an armada from China through Southeast and South Asia to the Persian Gulf. Today some of these same corridors support East Asia’s unique production sharing network which brings components produced throughout the region to China for assemblage and shipment to Europe and North America.

The production network allows all countries, regardless of their size and technological sophistication, to benefit from deep specialisation and economies of scale by producing parts and components, and adding value to production along the production chain. With labour costs in China now rising, many ASEAN economies stand to gain from any future outsourcing of production. This, combined with the trade deficits that China runs with most of its Asian neighbours (in contrast to its persistent surpluses with the West), makes it easier for ASEAN countries to see China as an opportunity rather than a threat. (…)

Yukon Huang is Senior Associate at the Asia Program, Carnegie Endowment for International Peace, and a former country director at the World Bank in China.

East Asia Forum at http://www.eastasiaforum.org/ is always worth a visit!

(retrieved 06.05.2014 at http://www.eastasiaforum.org/2014/05/05/can-a-chinese-maritime-silk-route-cool-tensions-in-asia/)

~

Restore the Silk Road

Last September (Ann. of the Editor: meaning September 2013) when he delivered a speech at a university in Kazakhstan, Chinese President Xi Jinping raised the suggestion that China and Central Asian countries should work together to build the Silk Road Economic Belt. The proposal was met with immediate resonance among neighboring countries and received a warm reception. Some provinces in the western region of China have even begun preparing to participate in the new round of cross-border economic cooperation.

Undoubtedly, the Silk Road Economic Belt will benefit all parties including China and her Central Asian partners. The mutual-benefit economic zone will help accelerate the development of China’s remote northwest regions and also facilitate China’s international cooperation with Central Asian countries.

For both China and Central Asia, the Silk Road played an important role in creating marvelous civilizations and economic prosperity in ancient times. Around 2,000 years ago, a Chinese emperor of the Han Dynasty sent his envoy, Zhang Qian, to the unknown west in search of allies to resist the threat of northern nomads. Unexpectedly, Zhang’s journey pioneered a significant bond between China and Central Asia. Since then, a trade road linking China and Central Asia—even stretching as far as Europe—formed and countries along the road thrived. The historic Silk Road was the world’s longest trade route on land.

Although the ancient Silk Road was eventually replaced by shipping routes via sea, China and Central Asian countries have great incentive to revive the historic link under the spirit of cooperation and mutual benefit. Today, China is the largest trade partner of Kazakhstan and Turkmenistan as well as the largest investor in Uzbekistan. (…)

Read the full article online here or download full pdf here.

(retrieved 07.05.2014 at http://www.bjreview.com.cn/quotes/txt/2014-03/24/content_608631.htm#)

~

Silk Road to Prosperity

Drug production in Afghanistan has increased 40 times since NATO moved in there 13 years ago. The profit from that drug production has become the financial support of terrorism. I think there must be international cooperation among all neighboring countries of Afghanistan, i.e. China, Russia, India, Iran and hopefully others, to wipe out the drug traffic. The drug traffic problem has become a major security problem for Russia—hundreds of thousands of people die every year as a result of drug smuggling from Afghanistan. It has become a big security problem for China, because one of the drug routes goes through Xinjiang. It is also feeding terrorists in Tajikistan, Russia’s Chechnya, Pakistan and the whole region from Afghanistan all the way to Syria, North Africa and even Central Africa. This has become a major source of threat to the stability of the region.

There must be international efforts to stabilize this region. That is why we have been proposing a very concrete extension of the Eurasian Land Bridge to the whole region, and even to Afghanistan, Syria and North Africa. You have to give incentive to the population and let them see the economic cooperation that gives them the chance to have a better future. There is better incentive than to go to drug production, or to support terrorism, which many people do because it’s being paid. Many people are just poor. You have to change the entire region with an economic development prospect which can only come from the New Silk Road Economic Belt.

Helga Zepp-LaRouche, founder and President of the Schiller Institute, an economic and political think tank headquartered in the United States and Germany

.

Read the full article online here or download full pdf here.

(retrieved 07.05.2014 at http://www.bjreview.com.cn/world/txt/2014-03/24/content_609047.htm)

.

Read more in the Islam category

.

(reviewed 07.05.2014)

 

White Box Computers – The Chaiwan Model

leave a comment »

White Box Computers on the Rise

Mobile devices can be built in a modular way. Like Lego, the different modules can be sourced from different companies and assembled into a desired device. The key component is the Application Processor (AP).

~

application processor dialog

Application Processor (AP)

(retrieved 20.04.2014 at http://www.dialog-semiconductor.com/products/power-management/applications)

~

Worldwide Tablet and PC Forecast 2012 - 2017

(terieved 20.04.2014 at http://www.idc.com/getdoc.jsp?containerId=prUS24129713)

~

An interview with Joanne Chien, senior analyst & director, Digitimes Research

(…) a brand like Apple or Samsung controls everything in the process of bringing their products to market. Under the Chaiwan model, each sector does what it does best. For example, it starts with the key component provider, which in the case of smartphones is the application processor (AP). Companies like MediaTek or Qualcomm provide a turnkey solution and reference design to the players in the market.

Those other players include independent design houses (IDH), which provide design services and recommendations for components (such as connectors, casing, etc) that are not included in the AP turnkey solution. You also have EMS players, who do the manufacturing. And ultimately you have the customer, which could be a large brand, a small white-box brand, or any vendor that wants to bring a smartphone to market. Moreover, under this model, the order volumes don’t need to be very large, which means pretty much anyone who wants to can bring a smartphone to market in China, and it can be done quickly and cheaply.

Originally, this business model was developed by white-box players but it has been increasingly adopted by larger brands, such as Huawei, ZTE and Lenovo in China. A vendor such as Lenovo can direct development of one model through one IDH and EMS provider, while working with another pair of manufacturing partners for development of another model.

This has been a seismic shift for the market, but players are adapting. If you look at at AP provider MediaTek, the company no longer follows a strict roadmap. It simply reacts to what the market wants. In 2013, for example, MediaTek sometimes went a couple of months without releasing a new product and then would release two products in the same month. They weren’t following a roadmap, they were chasing demand.

This is also a new model for EMS providers, since they have been used to dealing with huge orders and following longer-term manufacturing plans. They now have to become more nimble and are learning how to cooperate with the IDHs and smaller brands for small orders and quick delivery.

Players adapt because this is where the growth is. China-based vendors account for approximately one-third of global smartphone shipments and the region had four of the top-10 vendors worldwide in 2013. For 2014, Digitimes Research forecasts that China will have five vendors in the top 10.

Looking at the rest of the market (non top 10 or “Other” segment) is even more interesting. This portion of the market is dominated by Greater China vendors and white-box players. The Other segment accounted for 12% of global smartphone shipments in 2012, 21% of the global market in 2013 and Digitimes Research forecasts the share will rise to 25.6% in 2014.

This means that the global smartphone industry is opening up rather than consolidating and it is directly a result of the dynamic interplay seen in the Chaiwan model. Moreover, China vendors are now exporting about 30% of their smartphones (as of 2013) and that proportion is forecast to rise. (…)

.

1_r

.

Read the full article online here or download pdf here.

.

(retriewed 13.04.2014 at http://www.digitimes.com/news/a20140221VL203.html)

~

2014_tablet_market

(retrieved 13.04.2014 at  http://www.digitimes.com/news/a20131231RS400.html?read=toc#66)

~

 

Branded Unbranded Tablet Panels
(terieved 20.04.2014 at http://www.idc.com/getdoc.jsp?containerId=prUS24129713)

.

(reviewed 23.04.2014)

The Stan Shih Smile Curve

leave a comment »

The Stan Shih Smile and Frown Curve

.

Stan Shih`s Smile Curve

.

.

Stan Shih`s Smile Curve / Frown Curve

Bill Weinberg completed Stan Shih`s Smile Curve by adding the “Frown Curve”, which describes the increased efficiency of the producing units. Read the whole article online here or check his LinuxPundit Weblog.

(reviewed 13.04.2014)

China’s GDP in 2013

leave a comment »

Only 30% of the world now has a higher GDP per capita than China (2013)

~

In many ways, what we are witnessing is not the ‘emergence of Asia’, but the ‘re-emergence of Asia’

(…) In 1820, Asia accounted for just under 60 per cent of total global output, with China and India together accounting for nearly half of global GDP. This was followed by nearly two centuries of economic decline in Asia, ignited by the European industrial revolution—a trend that has now been reversed. (…)

Jayant Menon, ADB

Read the full article online here of here.

/retrieved 09.06.2013 at http://www.eastasiaforum.org/2013/06/09/asia-yet-to-earn-its-future/)

~

batman

(retrieved 09.06.2013 at http://adnanramin.wordpress.com/2013/06/02/racism/)

~

China’s economic achievement is so enormous, indeed literally without parallel in human history, that it is sometimes difficult for people to take in its scale. A country which in 1978, when “reform and opening up” was launched, was one of the poorest in the world, has now reached a point where it has a higher GDP per capita than the countries containing the majority of the world’s population. Only 30 per cent of the world’s population now lives in countries with higher per capita GDP than China.

China and the World's GDP

To give absolutely precise numbers, drawing on the newly published data for the world economy in 2012 released by the IMF, the chart shows that by 2012, only 30.2 per cent of the world’s population lived in countries with a higher GDP per capita than China, while 50.2 per cent lived in countries with a lower one. China itself constituted 19.6 per cent of the world’s population at this time.

China is, therefore, now in the top half of the world as far as economic development is concerned, and to avoid any suggestions of exaggeration, it should be made clear that these comparisons are at the current market exchange rate measures usually used in China – although calculations in parity purchasing powers (PPPs), which are the measure preferred by the majority of Western economists, makes no significant difference to the result.

The chart also illustrates China’s extraordinary progress. In 1978, when “reform and opening up” began, only 0.5 per cent of the global population lived in countries with a lower GDP per capita than China, while 73.5 per cent lived in countries with a higher GDP per capita. The transition to a situation where China has overtaken the majority of the world’s population in per capita GDP is the greatest economic transformation in human history, both in terms of the short time frame required and number of people affected.

Given that the data clearly shows China has progressed into the top half of the world economy in terms of economic development, why do some persist with misrepresenting China as being “in the middle” or even more misleadingly dubbing it a “poor” country by international standards?

Such misrepresentations make elementary statistical errors which are familiar to those who analyse income distribution data. For example the following argument is sometimes presented: The IMF World Economic Outlook database gives GDP per capita statistics for 188 countries with China ranking 94th – therefore China is “in the middle”. Another sometimes-cited statistic compares China to the world average – in 2012 China’s GDP per capita was 59 per cent of this average figure – making China appear a “poor” country.

The problem with this “list” method is that it does not take population into account. For example, the Caribbean state St Kitts and Nevis, population 57,000, has a higher GDP per capita than China while India, population 1.223 billion, has a lower one. To say China is “between the two”, as though St Kitts and Nevis and India represent equivalent weights in the world economy, is playing games with words rather than carrying out serious analysis. This elementary statistical rule is particularly relevant given that the number of developed economies with small populations is disproportionately large. The population of countries must therefore be taken into account when calculating China’s real relative position in the world economy.

The second mistake, comparing China to the “average”, makes an error so well known in income distribution statistics that it is somewhat surprising anyone gives it any credence, let alone continues to propose it.

Statisticians know that averages, technically speaking the “mean”, can be disproportionately affected by small numbers of extreme values. It is well known that this applies to incomes within countries as small numbers of billionaires artificially raise average incomes in a way that misrepresents the real situation.

This statistical distortion is clear from international data. Average world GDP per capita, that is world GDP divided by the number of people, is slightly more than $10,000 per year. But only 29.9 per cent of the world’s population lives in countries with GDP per capita above that level while 70.1 per cent live in countries below it. Something with only 29.9 per cent above and 70.1 per cent below is not most people’s idea of an average!

What most people understand by an average, the mid-point, is, in proper statistical terms, not the average but the median. Reputable studies on income distribution, therefore, almost invariably use the median, not averages, to avoid this distorting effect of small numbers of extreme values. Using the statistically misleading average, instead of the mid-point, bizarrely transforms the real situation – that China now has a GDP per capita above that of the majority of the world’s population – into giving the impression that China is a poor country!

There are three main reasons why it is important to accurately present China’s level of development.

First, policy must be based on accurate analysis – in serious matters there is no virtue in either optimism or pessimism, only in realism. As the famous Chinese phrase tells us, it is better to seek truth from facts.

Second, accurate presentation is necessary to clearly understand the real economic challenges China faces. For example China’s GDP per capita is now higher than all developing South and South East Asian countries except Malaysia – clarifying why any competitive strategy for China based on low wages is unviable.

Third, China’s position in the top half of the world in terms of GDP per capita makes clear its technological level – China’s economy is now dominated by medium, not low, technology.

Does an accurate presentation of China’s real level of development endanger its international legal status as a developing economy? The World Bank has not yet published new criteria for the GDP per capita necessary to qualify as an “advanced” economy, but the 2011 criteria and statistical data is available and it tells us that the answer to the question is “no”. To classify as “high income”, an economy must have an annual GDP per capita of slightly more than $12,000. Only 16 per cent of the world’s population lives in such economies. It will take 10-15 years for China to achieve “high income” status – although when it does this will more than double the number of people living in such economies.

Achieving the “Chinese dream” requires that the present reality is accurately understood. China has entered the top half of the world’s level of economic development. Only 30 per cent of the world’s population lives in countries with a higher GDP per capita than China. That is the accurate analysis of China’s relative position in the world economy. To achieve the “Chinese dream” requires eliminating not only any exaggerated bombast but also any systematic underestimation

This article originally appeared in Chinese at Sina Finance and in English at China.org.cn.

~

 John Ross

John Ross

Is Visiting Professor at Antai College of Economics and Management, Jiao Tong University, Shanghai

~

TrackBack URL for this entry: http://www.typepad.com/services/trackback/6a00e554717cc988330192aa48c0e8970d

(retrieved 25.05.2013 at http://ablog.typepad.com/keytrendsinglobalisation/2013/05/only-30-of-the-world-now-has-a-higher-gdp-per-capita-than-china.html)

 ~

Read more about China and it’s economy from John Ross

Key Trends in Globalisation

Seek truth from facts – 实事求是 (Chinese saying originally from the Han dynasty)

http://ablog.typepad.com/keytrendsinglobalisation/

~

World Economic Outlook (WEO) – International Monetary Fund – Survey 2013

World Economic Outlook 2013

http://www.imf.org/external/pubs/ft/weo/2013/01/

http://www.imf.org/external/pubs/ft/weo/2013/01/pdf/text.pdf

https://laofutze.files.wordpress.com/2013/05/world-economic-outlook-april-2013.pdf

(above retrieved 25.05.2013 at http://www.imf.org/external/pubs/ft/weo/2013/01/, http://www.imf.org/external/pubs/ft/weo/2013/01/pdf/text.pdf, https://laofutze.files.wordpress.com/2013/05/world-economic-outlook-april-2013.pdf)

~

What that dramatic economic shift means to people, describes Onionjuggler in her Force Feeding Duck Style:

A student told me this story as part of a midterm last year, and I thought it was so cute I would share it with you.

For her fifth birthday, Helen’s* mother wanted to make her a special dinner. She lived in the country, and at that time everyone was very poor, so meat was hard to come by. Her mother had to take the day off to travel to a different town to buy some pork, and in the end was only able to afford enough meat for Helen– the rest of the family would have to make due with the usual vegetables and noodles.

That night, Helen was so excited to eat her fancy dinner. But when her mother handed her the bowl, her older brother pointed at it and said, “Look out! There is a spider on the bottom of the bowl!”

Helen tipped the bowl over to look for the spider, and poured her whole dinner onto the dirty floor. Her mother scolded her brother, but she couldn’t salvage the dinner. Poor Helen cried and cried, and she never forgot that birthday.

*Her real name isn’t Helen– that’s just the name she chose for class.

(retrieved 25.05.2013 at http://onionjuggler.wordpress.com/2013/05/20/a-short-story/)

~

China in 2050

China in 2050Photo by Benoit Cezard

(retrieved 13.07.2013 at http://de.ce.cn/photo/right/201211/21/t20121121_597748.shtml)

~

(reviewed 13.07.2013)

Learning to do Business in China

leave a comment »

Learning to do Business in China

~

The Evolution of BAT’s Cigarette Distribution Network in China 1902 – 1952

~

Hatamen cigarettes

http://www.bbc.co.uk/news/magazine-20042217

~

(…) Today, a visit to the Duke Homestead and Tobacco Museum in Durham provides one with a fascinating overview of the history of tobacco, the development of a unique local tobacco culture, and the pioneering role of the Duke family in the manufacture and marketing of cigarettes. Less well-known is the fact that the Duke family was involved in the global marketing of tobacco products well before the term “globalization” was coined. It is reported that immediately after the invention of the cigarette machine in 1881, James B. Duke (1865-1925) leafed through a world atlas to survey the population of foreign countries. Upon coming to the figure 430,000,000 he exclaimed: “That is where we are going to sell cigarettes.” The country was China and from 1890, when the first cigarettes were exported there by the Dukes, sales skyrocketed to 1.25 billion cigarettes in 1902 and to 12 billion in 1916 earning $20.75 million with a net profit of $3.75 million. From 1915 through the 1920s, more cigarettes were exported each year (with one exception) from the United States to China than to the rest of the world combined. British American Tobacco Company (or BAT, a multi-national company formed in 1902 with the Duke’s chief competitors in England) would sell 80 billion cigarettes in China in 1928 alone and amass a total profit of over $380 million between 1902-1948. Leading the way was James A. Thomas (1862-1940), the managing director of BAT in China from 1905 to 1922 (…).

Stanley K. Abe

received 17.11.2012 at http://ducis.jhfc.duke.edu/archives/tobacco/introduction.html

~

(…) There was an anti-cigarette movement in the early 1900s, but it was more concerned with morality than health. A rise in smoking among women and children fed into a wider concern about the moral decline of society. Cigarettes were prohibited in 16 different US states between 1890 and 1927.

(…)

Bonsack’s cigarette machine

retrieved 18.11.2012 at http://news.bbcimg.co.uk/media/images/63659000/jpg/_63659428_cigarette_machine_bonsack.jpg

~

Howard Cox of the University of Worcester says Thomas was one of the first Westerners to understand Chinese ways of doing business, based on networking and reciprocal favours. At first, cigarettes were imported from the US, but manufacturing soon shifted to China. For Cox, this transfer of production technology rather than product marks a move from colonial trade towards the current age of globalisation and multinational corporations. Thomas had his own team of salesmen from the US, but he also formed joint ventures with established Chinese firms to distribute his product. This way of doing business is the norm today for international firms hoping to tap into the Chinese market. (…)

received 17.11.2012 at http://www.bbc.co.uk/news/magazine-20042217

~

Howard Cox about James A. Thomas

(…) Under the managerial guidance of James Thomas, BAT soon began to look beyond (those) limited horizons. On assuming control in Shanghai, therefore, Thomas began to step up local production facilities and recruited an expatriate sales team who, supported by salaried Chinese interpreters, could take these low-priced cigarettes “up-country” and establish relations with the traditional Chinese merchant houses that managed China’s internal trade. During the ten years in which Thomas was in control of BAT’s operations in Shanghai, the company established an extensive network of Chinese dealers who conducted warehousing arrangements for them beyond the treaty ports, and who took responsibility for the distribution of their products to the final consumer. So effective did these links with Chinese merchants become, that, by the latter part of the 1920s, the need for Western salesmen to engage in travelling had more or less ceased.

(…)

Traditionally, American tobacco manufacturers had merely employed a few travelling salesmen to make contact with local jobbers and retailers, while the bulk of the trade remained in the hands of independent wholesalers who supplied small retailers with a variety of goods, of which tobacco was only one. However, during the mid-1880s the largest cigarette manufacturers began to set up their own warehouses to serve dealers in the largest cities. The effect of this was to eliminate many commission merchants and some of the largest urban jobbers from the distribution system for cigarettes in the United States.

(…)

One of the tasks of these travelling BAT salesmen was to monitor the market conditions in the different parts of the country to which they travelled. This was undertaken through the completion of Form 163, a survey of market conditions which had been designed by Thomas during his early excursions into the field. The form was completed monthly by all of the company’s travelling representatives as they visited dealers, before being returned to the company’s headquarters in Shanghai. It set out the prevailing conditions for each town in terms of population, dealers operating, depot facilities available, stock levels by brand, the local currency exchange rate and the general income levels of the inhabitants. Duke had understood well the importance of accurate information of this kind, and his chief accountant in New York, W.R. Harris, created an accounting system for the American organisation, based around daily reports on brand sales by town, in order to keep stocks flowing smoothly.

(…)

Important as the American and other foreign salesmen were to the company’s early growth in China, the expansion of BAT’s distribution system also necessitated the increasing participation of Chinese merchants. One reason for this lay in the provisions of the trade treaties themselves which prevented foreigners from owning land outside of the treaty ports and thus presented BAT with severe problems in terms of expanding their network of warehouse provision. To overcome this it was necessary to develop a system of warehouses which were under the ownership of Chinese nationals. In addition, BAT needed to tap into the well-established Chinese trading networks that already delivered goods extensively within China.

Download here the whole pdf, or see below for the online versions.

UNIVERSITY OF WORCESTER , Learning to do Business in China: the Evolution of BAT’s Cigarette Distribution Network, 1902-41 by Howard Cox 1997. This is an electronic version of an article published in Business History, Vol.39, No.3, (1997), pp.30-64. Business History is available online at: http://journalsonline.tandf.co.uk/fbsh
Received 17.11.2012 at http://www.google.de/url?sa=t&rct=j&q=james%20thomas%20cigarettes&source=web&cd=2&ved=0CCwQFjAB&url=http%3A%2F%2Feprints.worc.ac.uk%2F221%2F2%2FLearning_to_do_Business_in_China.pdf&ei=J32nULyfCMnNswavtIGAAw&usg=AFQjCNHbO53II9i8xtSNravGLxFi3_qXcQ

~

James A. Thomas with two Eunuchs

~

See more about the Life of James A. Thomas in the Duke University / North Carolina, USA http://library.duke.edu/lilly/about/lillyartproj/

~

reviewed 17.11.2012

Individualism-Collectivism and Accountability

leave a comment »

Individualism – Collectivism and Accountability in Intergroup Negotiations

.

.

However, for those who place a high emphasis on collectivism, cooperative behavior and harmony with others, especially with persons with whom one is similar, is normative and is likely to ensure positive evaluations in accountable negotiations.

(…)

In the low-accountability condition, those who had high levels of collectivism reported less cooperative intentions and behavior, and achieved lower outcomes, as compared to representatives with low levels of collectivism.

(…)

However, the current research suggests that negotiators’ behavior depends both on the nature of the negotiation situation, as well as on negotiators’ collectivism. Applying this to cross-cultural investigations, this suggests that broad generalizations about the negotiation styles of cultural groups, which does not take situations into account, are likely to be inappropriate.

Read the full essay online or download as pdf.

Michele J. Gelfand / University of Maryland at College Park
Anu Realo / University of Tartu, Estonia
Journal of Applied Psychology , 1999, Vol. 84, No. 5, 721-736 – retrieved 08.12.2011 from http://www.bsos.umd.edu/psyc/gelfand/index.html

.

Structures of International Business (Vertical Disintegration)

leave a comment »

Vertical Disintegration

.

Vertical Disintegration in Supply Chain Management (SCM)

(…) Acer’s supply chain management strategy can perhaps best be characterized as a strategy of “vertical disintegration.” In the recent past, Acer sold majority stakes in both Wistron and BenQ. These companies were main providers of manufacturing services in Acer’s supply chains. By selling its majority stake in these companies, Acer clearly demonstrates that it intends to “disintegrate” its supply chains and focus on branding and marketing.

(…) The vertical disintegration of Acer’s supply chain becomes even more evident when analyzing the supply chain of specific Acer products. Components are sourced from many different component manufacturers, while assembly is carried out by a small group of selected contract manufacturers. In some cases, Acer holds a considerable stake in these contract manufacturers, although it almost never owns these companies. The selected contract manufacturers are allowed to manufacture final products for Acer. It does not matter whether a desktop computer or notebook is assembled in China, the Philippines or in the Netherlands. In the end, all Acer products are sold as “made in Taiwan”. The following charts show the supply chains for two Acer notebooks: the Travelmate C110 (…).

.

Supply chain for the Travelmate C110

.

.

(…) In most cases, one particular component can be provided by two or three different component manufacturers. A hard disk drive (HDD) for the Travelmate C300, for example, can be supplied by Toshiba or Fujitsu. This is necessary to guarantee continuous supply of critical components. If a supplier fails to provide a particular component just-in-time or on demand, the selected contract manufacturers can rely on other suppliers that are able to provide the same component. For some components, however, the contract manufacturers depend on a key supplier. If these components are out of stock, delays in delivery are likely to happen. (…)

Acer Incorporated / Company profile (Draft Version) Bart Slob Amsterdam, December 2005, SOMO Stichting Onderzoek Multinationale Ondernemingen – Centre for Research on Multinational Corporations http://www.somo.nl / info@somo.nl

Get the whole script here.

.

Direct and Indirect Supply Chain Management

Stan Shih, the founder of Acer Computers in an interview in October 1996: (…) beginning in 1992, we developed the fast-food model, which revolves around each of our local businesses doing local assembly from components manufactured here. So today we have 39 assembly lines in 35 countries. We operate these assembly lines globally the way fast-food restaurants operate locally. We airship components from Taiwan — which is cost effective — to the regional business units overseas for assembly into products. This approach provides “hot and fresh” computers to our local customers.

Not only does this provide fresh products, it also accelerates the speed of new-product introduction and it accelerates the inventory turnover rate. This fits with our strategic philosophy. (…)

Read the full interview with Stan Shih (founder of Acer Computers) from October 1996 in the web or here.

.

Indirect Supply Chain Management (Fast Food Model)

.

Direct Supply Chain Management

The Emerging Global Direct Distribution Business Model – Its Making and Research Opportunities; Shong-Iee Ivan Su, Ph.D.; Professor, Director of Supply Chain and Logistics Management, Research Lab, Department of Business Administration, Soochow University (Taiwan)

Get the full article here.

.

International Matrix of Acer Inc.

Source http://www.acer-group.com/public/The_Group/organization.htm

.

Innovation in a Modular Network

Learning From Evolution: A Study of Acer’s Corporate Strategy by Anil Kumar Sahai; System Design and Management, Sloan School of Management, Massachusetts Institute of Technology

This work also explains the cultural background of Asian companies. Get the pdf in the web or here.

.

Additional Material

Network Structures

Modular network structures appear as a logical consequence of horizontal Supply Chain Management systems.

The modular network form compared to other organizational forms

.

.

Country-specific production network models: where the modular production network model fits

.


.

Modular Network Matrix of Walter W. Powell

Source: adapted from Powell (1990: 300). Italic entries added to original. Powell, W. (1990), ‘Neither market nor hierarchy: network forms of organization,’ Research in Organizational Behavior, 12, 295–336. / Industrial and Corporate Change, Volume 11, Number 3, pp. 451–496, Modular production networks: a new American model of industrial organization Timothy J. Sturgeon

Read the whole article here.

.

Links

Links about SCM (Supply Chain Management)

Nice introduction to Supply Chain Management – A REVIEW OF APPROACHES TO SUPPLY CHAIN COMMUNICATIONS: FROM MANUFACTURING TO CONSTRUCTION (2007)

For easy understanding a ppt about supply Chain Management by A.V. Vedpuriswar

.

Links about Acer

The Globalisation of Acer 1976 – 2009. Author unknown

Acer Incorporated 2009 Annual Report in the web or here.

.

For the history of international trade / globalisation see the post “Learning to do Business in China

.

For info about Stan Shih please click here.

.

reviewed 13.04.2014

Stan Shih 施振榮

leave a comment »

施振榮 (Shī Zhènróng or Chen Jung) / Dr. PhD. h.c. mult. Stan Shih

Stan Shih (Traditional Chinese: 施振榮, Hanyu Pinyin: Shī Zhènróng or Chen Jung, born December 8 ( or 18 ?), 1944 in Lukang Township, Changhua County, Taiwan. Former President and founder of the Acer Group.

Married to Carolyn Yeh (Yeh Chi Hua) on September 28, 1971, with whom he has 3 children.

.

Stan Shih 2008

.

Genealogy (Ancestors)

Father: Shih Chi Shen (owned “The Shi Family Beautiful Jade Incense Shop”) + 13.02.1948

Grandfather father`s side: Shih Yi Chou, + 1953

Mother: Chen Shiu Lien (nickname Ah Shiu) 1923 – 02.09.2001

Grandfather mother`s side: Chen Mu Sung

Grandmother mother`s side Chen Yu Chou

Grand- Grandfather mother`s side: Liao Yen (opened the “Temple of Heavenly Virtue”)

Grand- Grandmother mother`s side: Chen Fen

Wife: Carolyn Yeh (Yeh Chi Hua)

Father in Law: Yeh Hsin (*1944?)

Mother in Law: Wang Ai Mei

.

Biography of Stan Shih – Made In Taiwan by Robert H. Chen (abstract)

Childhood in Lukang until the 1944 – 1960

Photo from  an interview with Stan Shih from 2002 by Ow Ying-Chuan / ReadersDigest in the web or here. (Ann. of the editor: this photo must have benn taken around 1950. It looks professional, so the little family must have paid money for this picture. How comes, they made a photo with this quite unhappy facial expression?  Was it taken 1948, after Chi Shen`s (his father`s)  death? What was the purpose of this photography? Can anyone help? )

.

When I was a child, I was an introvert and did not like to be in the spotlight. And my views were often different from others; neither did I like to follow the norm.

Shih in “Me Too is not my Style”

.

(…) Starting before dawn, Shiu Lien (Ah Shiu) would knit sweaters on the knitting machine. When the markets opened, she would sell duck eggs and patriotic raffles (ann. of the editor: betel nuts). When the grade school closed for the day, she would sell pens and paper to the homeward-bound students. In the evening, she would hurry to deliver duck eggs to the restaurants, and on the way, she would peedle lottery tickets and incense sticks. (…)

(…) ” Helping my mother do business when I was young greatly influenced my thoughts about business enterprise in the later years.” (…)

(…) Selling duck eggs and stationary goods in the same store provided an opportunity for comparison.The profit marge in selling duck eggs was very thin indeed: At the same time, one Jin (or catty, 600 grams or 1,33 pounds) of duck eggs sold for three dollars (7,5 U.S. cents). One could make 30 cents profit (,75 cents), a small profit margin of only ten percent. Further, duck eggs easily spoiled. If one did not sell it on time, they would become rotten, resulting a total loss. Stationary, on the other hand, had a very high profit margin, ten dollars of sale would usually result in at least four dollars profit, a margin of forty percent. Further, stationary was not perishable. One could leave them there for a year, two years, and they still could be sold. Clearly, it seems, it is better to sell stationary goods than duck eggs. “Actually”, as Stan liked to point out, “selling duck eggs makes a lot more money than selling stationary”. (…)

.

The Wiki about Lukang

“During the Qing Dynasty, the depth of Lugang’s harbour and its proximity to Fujian province on mainland China made Lugang an important trading port. During Lugang’s heyday from 1785 to 1845, Lugang’s population reached 200,000. Lugang was Taiwan’s second largest city after current Tainan and was larger than Bangka (now a district of Taipei), then the island’s third-largest city.

The subsequent silting of the harbour and the city’s refusal to allow railroads to pass through the city led to losses in trade in commerce, which, in turn led to Lugang’s decline. This same decline, however, averted the modernization processes that demolished historical buildings in Tainan and Taipei, leaving Lugang preserved as it was in its heyday. There are still many old temples in Lugang, such as Longshan Temple and Matzu Temple. The city boasts over 200 temples dedicated to a wide variety of folk deities.”

.

Youth in Chang Hua (Middle Taiwan)1960 – 1967

Shih in “Me Too is not my Style”:

While in high school, my academic performance was not outstanding and could only be rated above average. However, during my junior year, I surprisingly won first place in a school wide mathematics/science contest. In fact, I did not pay special efforts to the science subjects; I worked hard on the liberal arts subjects but I did not get good grades in return. This incident gave me great confidence and laid the foundation for my future development in engineering.

.

(Last row, second person on the right) Photo from  an interview from 2002 by Ow Ying-Chuan / ReadersDigest in the web or here.

.

(…) During his High School days in Chang Hua in central Taiwan, (…) Stan had never left Chang Hua. He was a typical country boy, who was shy, introvertedand thoroughly lacking social graces. On the few occasians he had to speak to a girl, his face would turn beet red.   (…)

(…) In high school one day, a group of students were caught gambling in the classroom. Luckily Chen Jung was only watching at that time (although he was fully prepared to join in the fun) and was not named when the school counsellors used the transgressing students in a campaign to eradicate gambling among students. The transgressors were rounded up and taken to the school disciplinarian who assessed a severe demerit for each student and informed the parents. (Once afoul  of the law or other authorities, the offender and his family are stigmatized for life.) (…)

(Ann. of the editor: Stan Shih must have finished high school around 1962. It is not clear how he spent his time during the years 1963 – 1967. He probably prepared to pass the exams for entering a “good” university. Depending on the marks, the students could choose what university they wanted to go to.)

1967 (…) The first time Stan took the examination, he made it into Chen Kung University`s mathematics department. (…)

.

Student Years at the National Chiao Tung University (Chiao-Ta) 1968 – 1970

“In 1968, Stan passed the examination for Chiao-Ta`s Electronic Engineering Research Institute. (…) His plan at that time was to pursue an academic career. (…) Stan made arrangements for deferred registration at the Chiao-Ta and then began his military service. Wit his background in electronics, he easily passed the examination to become a training officer and was assigned to the Phoenix Mountain Army Officer`s School in Southern Taiwan as an assistant instructor in physics. After the obligatory thirteen months of service, Stan returned to Chiao-Ta to begin graduate studies.”

1969, “In his second year at the institute, Stan attended a conference on “Modern Engineering” where he was exposed to many new ideas about industrial management.”  This must have widened his view to see all aspects of an electronic product like branding, production, marketing, service or sales.

At college, most of the ambitious student went to the US in order to return with the best possible qualification for becoming chairmen or presidents of major local (public or privately owned) enterprises. But Stan Shih was obviously more interested in practical business rather than research and development.

In those years Stan Shih changed his character. With his clear visions he suddenly had an approach to other people. From an “nerd” he emerged to a successful organiser.

Like many Chinese, Stan Shih liked to play ping-pong. At Chiao-Ta he became the captain of the official school team: “As captain, he had administrative duties which he enthusiastically performed, including a (2 month!) student competition. (…) Stan was also captain of the volleyball team, and president of the camera, chess and bridge clubs. (…) The shy introverted bumkin he become an engaging and forceful student leader.” Chen cites Stan Shih: ”In organising the ping-pong competition, I became to know and I became friends with all the other students. I learned how to organise and serve. It was a great help to me in later days in business.”

This change in Stan Shih`s character must have happened with a very short period: ” In the summer of his first year at Chiao Ta (1970), Stan invited all college and university students from Lukang for a dance party at the house his mother built for him. The house became a center for chess, bridge and dancing lessons and so on, a sort of Lukang student union building.”

This surely caused some concern to his mother, “who would often ride her bicycle from her store to check on what was going on with her now seemingly hyperactive son.”

Stan was a very promising young student, so his professors (as well as his mother) urged him to go to the USA. But getting in contact with modern industrial management ” made him begin to believe that a career could be successfully developed in industry as well as in academia. “ In 1970 Stan must have had developed clear visions about his career: to bridge the gap between engineering and management. In 1971, at Unitron, Stan brought his visions to life: “Maybe because it was because I was thinking about the final product while I was in the research and development stage. (…) I also tried to form an image of how the final product would look and what it’s markets would be. (…) I would package my circuit and take it to a local acrylic sign maker and have him making a casting for it. I was then able to present a finished product to my boss for his appraisal, and he could access it with an eye on how it would sell. I would also include a product cost analysis in my report, so I could also offer my opinion on weather my product was commercially feasible or not.”

In Chinese society the individual is more embedded into the surrounding than in western societies. It was an act of rebellion especially towards his hard working mother not to go for further studies abroad.

Chen indicates another motive in his book, which may also have played a role. “But thoughts of leaving his mother alone were a powerful dissuasive factor.”

Chiao Tung University Chinese: http://www.nctu.edu.tw/

Chiao Tung University English: http://www.nctu.edu.tw/english/

.

Yeh Chi Hua / Carolyn Yeh

1968 Carolyn was introduced to Stan Shih by a classmate. “ One day, during Stan`s junior year , his classmate was writing a letter to his girlfriend at the Fu-Jen University (Carolyn`s classmate) and Stan, noticing what he was doing, suggested a note at the end of the letter asking for help in finding a girlfriend for him.”

Carolyn tells: “In my sophomore year, my best friend and classmate told me one day that she wanted to introduce a boy to me. But she said: This boy does not know anything; in fact, he is less sophisticated than the least sophisticated boy in our school. (Ann. of the editor: today we would use the word “nerd”.) I thought to myself, if he is so out of it, why is she introducing him to me? Whereupon, as if reading my thoughts, she said, >But he is smart! And he is very well-behaved and dependable.< I thought to myself, well, why not? There is nothing to lose. I`ll have a look on him”

Stan Shih tells. “I was so taken by her that I began to write to her every day. (…) In the beginning I must say, she wasn`t very enthusiastic.” Stan kept on writing letters and waited for a reply. “Sometimes her classmate would try to shame her into writing, and if that didn`t work, sit her down and force her to write return letters to Stan.” Also Carolyn`s mother seemed to work towards this relationship “sometimes inviting Stan in for dinner”, while he was in Taipei jobbing in summer vacation.

1969, only one year later, Carolyn and Stan opened their engagement plans to their families. Carolyn recalls: “ Our family family was relatively well-off; Stan`s family had only his mother. My father was concerned that Stan was marrying me for the money and that my future Mother-in-Law would make life difficult for me. (…) Fortunately, Carolyn`s mother was for the marriage and pushed things through. Still, Yeh Hsin sent an emissary to Lukang to check up on the Shih family`s situation, and upon receiving a satisfactory report, finally agreed to the engagement. In accord with a certain “secret engagement” custom of the time, the engagement was not celebrated with an announcement and reception. Only the parents were present at a small ceremony where rings were exchanged.“

After 13 months of military service, and “about four months after graduating from the Research Institute, Stan and Carolyn were married on Teacher`s Day, September 28, 1971 (…).”

.

Unitron 1971 – 1972

Unitron was established 1969 by the “father of Taiwanese semiconductor industry” Prof. Shih Ming and the young engineer Andrew Chiu. Chen describes Unitron as “Taiwan`s first semiconductor company (and first high-tech enterprise).” The main investor was the family Lin, so the eldest son Mr. Lin Pei Yuan became president of Unitron. “When Stan started at Unitron, he was assigned to the R&D division together with his fellow Ciao-Ta graduate Lin Chia Ho (Fred Lin)” (without any bounds to the investor).

Chen: “Stan developed Taiwan`s first desktop calculator at Unitron and it came to market on April 26, 1971 (1972?) (…) Although the desktop calculator was not a commercial success, in Taiwan`s technological history, it must be considered as a milestone as one of the first truly technically commercial products, produced entirely by a Taiwan company. (…) He was doing such a great job that Unitron`s principal investor, the Lin family, began thinking about closing Unitron down and having Stan start up a new company, named Qualitron, to concentrate on manufacturing calculators.(…) He had been at Unitron for exactly 14 months.”

.

Qualitron 1972 -1976

Stan Shih recalls in his book “Me too is not my Style” : “I had been at Unitron for about a year and three months when Vincent Lin, the third son of the Lin family, invested in another company called Qualitron and invited me to join the start up company. Qualitron was positioned as a professional manufacturer specializing in calculator manufacturing, with its own brand name and OEM business. With its own brand name, technology and stable profit, it was one of the most popular companies at that time. (…) As president of the company, Vincent Lin was responsible for marketing andindustrial design; while as the vice president, I was responsible for R&D, manufacturing, business development and purchasing. (…) During the second half of 1976, as Qualitron’s financial problem became irremediable, George Huang, Fred Lin, and I, who were in the R&D department, had to leave the company. Together, we hastily founded Multitech with the initial target being the new microprocessor market. ”

.

Stan Shih goes on (tells the story of his career)

stan shih 2012 02

(retreived 14.09.2013 at http://www.youtube.com/watch?v=a72EvYNJovQ)

.

To be continued…

“Made in Taiwan – The Story of Acer Computers” by Robert H. Chen, Linking Publishing Co., Taiwan, 1996 ISBN 957-8496-24-9 if not marked differently.

.

.

Stan Shih about Stan Shih

(…) He also said that at the APEC conference, someone mentioned he had a strange accent. In fact it was an accent of Lu-kang (…).

Changhua County Government, 06.11.2007, in the web or here.

.

Ethics

Sharing is one form of happiness. When you obtain interesting information, you naturally share it with others. This kind of thinking has brought me certain advantages. It’s a little like religion – like believing that Jesus gives you eternal life. I for one believe that helping others is the best way to help yourself. Although the connection is indirect, it’s sustainable. That’s my winning strategy,

By Yu-chi Su, from CommonWealth Magazine Published: July 03, 2008 – Get the whole interview in the web or here.

.

About his Family

(…) My mother taught me how to treat my wife and children well. My mother-in-law taught my wife how to be a good daughter to my mother and a good mother to my family. Whenever my wife visited her own mother, my mother-in-law would ask her to go back home at around nine o’clock at night to stay with my mother. They were considerate. And this was of great help to my marriage. (…)

(My wife) is of great help indeed. First, she took care of my mother and my children so that I could concentrate on my business without looking behind. Second, she also took up a great deal of responsibilities in the development of my company. She was also a part of the management team. I felt secure concerning the items given to her responsibility. Third, sometimes, when encountering width difficulties, she would go forth to play the role of the “bad guys” and allowed me the comfort of being the “nice guys”. Many difficult problems were solved through such means.

Well, I don’t consider myself to be romantic. I don’t have sweet words for her. But I give her security and comfort through my actions. (…) In fact, up to now, I had never bought flowers to my wife.

I allow my children to grow and develop naturally without any pressure. However, in the past, I did have some expectations for myself to achieve in order to help win respect for my mother.

Interview from 2002 by Ow Ying-Chuan / ReadersDigest in the web or here.

.

Devotions

When globalizing, you always have limited resources of talent and capital. The best way to globalize is therefore to localize, to integrate the local resources of talent and capital and integrate it with the parent company. We think in terms of “global brand, local touch,” and try to for a group that leverages the size of the parent company but still draws on the experience of the local partners.   You must have a common vision and a goal, but implementation must be based upon the local leaders’ management style.

In the past, control is controlled by who owns 51% of the company.  It makes much more sense to control a company by managing the common interest of the people inside of it. This kind of approach, however, takes longer to establish because you have to establish a consensus, which requires a lot of communication and mutual trust.  And then we can share the common vision and common goal and reach strategies that serve the mutual benefit.

Leadership is the process of achieving a dream together, especially when that dream seems impossible to achieve.  Leaders have to be open minded, and have to accept the ideas of others, even when they might lead to mistakes.  The best training for leadership is to learn from your mistakes. This means that leaders never argue and they never try to shift blame onto others.  When something goes wrong a leader always asks “what’s wrong with me,” not “what’s wrong with them.”

We have a saying in Taiwan: “it’s better to be the head of a chicken rather than the tail of a cow.” What this means is that most entrepreneurs would prefer to run their own small businesses than work for a big company. The key to recruiting such entrepreneurs is a management philosophy that respects independence,coupled with employee ownership of the company. In a truly effective company, every employee should be a shareholder in a big way.

Abstract from an interview by Geoffrey James on July 2009 at www.blogs.bnet.com Get the whole interview in the web or here.

.

It’s important to at least break through many of the conventional approaches. I’m not sure my way is better. I will say it’s a new alternative, at least. I think my personal contribution over the last 25 years has really been to give a lot of young entrepreneurs a lot of hope: Acer can, they can. Stan can, they can.

Read the full interview with the SanFranciscoChronicle by Carrie Kirby 2002 in the web or get it here.

.

Success and Fate

(…) “Having to take up the challenge when the going gets tough seems to be decreed by fate. It’s not that fate has it in for me in particular, but rather that everybody’s turn comes sooner or later. It’s important to recognize this, otherwise you’ll always blame everyone but yourself. You have to save for a rainy day and be prepared for future challenges, but unforeseeable things will always happen, and when they do you just have to face them.” Shih jests that he will naturally shoulder whatever responsibility comes his way, but he will also let others share responsibility because “it makes me feel better when everyone’s in the same boat.” (…)

Read the full interview from November 2004 by Teng Sue-feng in the web or here.

.

Writings

• “Global Branding Building Strategies” – 2005, published by Commonwealth Publishing Group (in Chinese), by CITIC Publishing House (in simplified Chinese).

• “Millennium Transformation” – 2004, published by Commonwealth Publishing Group (in Chinese), by CITIC Publishing House (in simplified Chinese), by Acer Foundation (in English)

• “Growing Global” – 2000, published by Commonwealth Publishing Group (in Chinese), by John Wiley & Sons (Asia) Pte Ltd (in English).

• “Fresh The Perspective” – 1998, published by Linking Publishing House (in Chinese).

• “Me-Too Is Not My Style”: 1996, published by Commonwealth Publishing Group (in traditional Chinese), by CITIC Publishing House (in simplified Chinese), by Acer Foundation (in English), (in Japanese, and re-entitled Re-Engineering Acer) Download the full text in the web or here.

.

Projects

id SoftCapital

Stan Shih offers “expertise in asset and fund management, and consulting services” with  iD SoftCapital

See a pdf about Stan Shih`s visions in the web or here.

.

iD TechVentures Inc.

“iD TechVentures Inc., formerly known as Acer Technology Ventures, is a leading early stage tech venture investor in Greater China.”

.

StanShares

His website (Chinese version only) http://www.stanshares.com.tw (and the English Google version).

.

.

Written by NoToes

19/06/2010 at 08:25

Posted in All Articles, China, Intercultural Economy

Tagged with , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Cultural Aspects of Information Management in China

with one comment

Cultural Aspects of Information Management in China (Abstract)

Collectivistic Background

Chinese culture is a collectivist culture which stresses the interdependence and long-term mutual obligations between individuals and organizations. People are expected to follow group values and initiatives. As found in the study of western ecommerce diffusion in China, Chinese people prefer small group based operations with emphasis on long-term relationship, interorganizational collaboration and re-negotiation. Another ecommerce study also indicates that collectivist features like clubs, chat rooms and family themes have a higher percentage occurrence on Chinese websites than on US domestic websites.

Chinese collectivism, however, differs substantially from those prevailing in other Asian countries. They are individualistic collectivism where small group or family value is emphasized, rather than society oriented. In contrast to Japanese society, which may be considered as a block of granite, the Chinese resembles a tray of loose sand, where every grain is a family.

This opinion is consistent with the finding of Martinsons and Westwood (1997) that the Chinese power structure is perhaps best represented by a series of concentric circles or “family” with the patriarch in the center. The traditional family values are emphasized in this circle. The Chinese collectivism can be either an inhibitor or enabler of IS practices. Most information is gathered and processed in Chinese environment is intended to support the top managers of various small circles, which results in many independent systems and data that are hard to integrate or share. Such behaviors actually make Chinese collectivism a negative factor in ERP implementation. From above analysis, Chinese collectivism may be seen as individualistic collectivism.

Hierarchical Power Structure

Chinese management philosophy is characterized by centralized authorities as well as directive and hierarchical structures due to the long power distance and paternalistic tendency. The position of top management in Chinese business is overwhelming. No other champion is needed because such a champion would be seen as a challenge to the authority of top management, which often leads to power conflicts. And both top managers and lower level staffs are not comfortable with empowerment because they are accustomed to the practice that key decisions are made by top management. It is also natural that Chinese business leaders use their authorities to facilitate modifying subordinates behaviors in change management.

Unfortunately, Chinese top managers do not appear to realize the importance of IT and IT management. Consequently, they commit less on IT management. Problem arise when Chinese managers rarely accept knowledge input from their subordinates, and when the IT decisions by top management are seldom made with due consultation with end users This may be helpful to speed up IT decision and IT implementation, but such bureaucratic and arbitrary organizational culture is seen as one important cause of IT project failures.

The hierarchy management structure also helps to explain the correlation between power and information in China. Information control is one of the predominant sources of power in China. Critical information in China is selectively preserved instead of being distributed widely. Information is often treated as an individual property and critical information controlled by individual can be used to preserve discretionary power in Chinese organization. It is quite obvious in e-government practices in China where branches of government purposely hold back some information and obstruct large-scale information sharing in order to keep their power and interests.

Uncertainty Tolerance

Uncertainty tolerance is the extent a person feels comfortable in unstructured situations. It is commonly accepted that there are two different cultures, namely, uncertainty avoiding culture and uncertainty accepting culture.

The former tries to minimize uncertainly by taking strict laws and regulations, or risk control measures. The later tolerates ambiguous situation, and tries to live peacefully with it.

The majority of the studies, however, argue that the Chinese culture is uncertainty tolerant. Martinsons (1997) and Lam et al(2005) show that East Asians, especially Chinese people are more comfortable with unclear information. This corresponds with the informal communication path among Chinese that relies more on personal experience. They keep more information among themselves, rather than explicitly express it. It is common in China that you need to guess the “true” meaning of conversation beside the surface information, because Chinese people like to use allusion to tell something they think you should know and would understand.

Based on authors’ own understanding about uncertainty tolerance as native Chinese, the uncertainty avoidance mentioned in the literature is mainly because of the importance of information for the power, rather than unable to tolerate the uncertainty. So the idea that Chinese culture is uncertainty tolerant is supported. Contrary to the traditional thinking that Chinese people are more conservative in regard to change, the literature demonstrates that Chinese people’s attitude seems to be more positive toward change and towards new technology when they come to experience it.

Both Collis (1995) and Brown et al(1998) conclude that people from China hold more positive attitudes on change and new technologies than those from countries that they compare, namely, UK, US and Japan.

Intuitive Decision Making

The way that Chinese people make decisions or solve problems is relatively unstructured compared with westerners “the Chinese’s decisions are comparatively implicit, relying on analogical and correlative thinking, rather than on rational and analytic thinking”. Although Chinese managers refer to information or data to support decision making process, only a few data analysis is used even when deciding the most important issues.

The entrepreneurial model of strategy making that relies on personal knowledge and intuition rather than objective criteria or formal and quantitative method is dominant in Chinese decision making. Therefore, “the decision making process usually involves few people and takes short time to make”.

The decision making of Chinese people is also characterized to be highly contextual. Regulation and rules may play important role in directing the decision, but in most situations, Chinese people like to adopt “the individual-policy-for-individual-issue approach”, which means that the executors of rules usually can find some room for themselves to make flexible decisions.

Cultural Aspects of IS in China
Xiang-Hua Lu / School of Management, Fudan University
Michael S H Heng / National University of Singapore

Download the full pdf here.

The PACIS (Pacific Asia Conference on IT Systems) has tons of other interesting material and is worth a visit.

.

The I Ging – structure in East Asian Collectives (Natural Order)

This Matrix defines the Relationship Layer (Ranking/Relation) and the Appeal Layer (Distance/Approach). Still many Asian companies follow this structure.

.

Download an introduction to Hofstede`s theories as pdf here.

.

Religion and Income in the USA

leave a comment »

How economically successful are different religions in the USA?

(retrieved 05.01.2013 at http://www.pewforum.org/Income-Distribution-Within-US-Religious-Groups.aspx)

Get the full survey “Income Distribution Within U.S. Religious Groups”  online here, or download pdf there.

 ~

Immigrants and their income in the US 2010

~

Immigrant’s Top Ten Countries or Origin and the Top Ten Destination Countries 2010

Countries of Origin - Destination Countries~

Religious Breakdown of Migrants 2010

Faithonthemove-chart-11~

(retrieved 05.01.2013 at http://www.pewforum.org/geography/religious-migration-united-states.aspx)

Read the whole survey “Faith on the Move” online here or download pdf there.

.

(reviewed 05.01.2013)

Applications of Circular and Linear Thinking

leave a comment »

Working Culture

(…) For the Chinese, quite a lot of concepts have a circular nature. One clear example is time: the same things happen again and again. History is circular and not lineal like in the West. The best example is the history of China which can be summarized as the continuous succession of the following four stages: “arrival of a new dynasty”, “dynasty at its height”, “decline of the dynasty”, “China in chaos” and start back again. Note that this circular pattern cannot be easily applied to the history of western civilizations.

Another clear example is human relations understood as a continuous exchange of favors or services among people. In China, the idea of doing something for somebody else in exchange of nothing is less common than in the West. The reason is that the favor is circular and it has to come back to the person who did it. For example, at work in China, if a colleague or business partner helps you in something, he understands that he is developing an important link with you and that he will have the right to ask for a favor back in the future. The favor has to come back to him because it is circular. (…)

Pedro on Globthink 14.01.2010: http://globthink.com/2009/06/10/chinese-working-culture/ (sorry, broken link.).

.

Religion

After hours of fruitless discussions if there is a God in Buddhism, I found a nice approach of an Anglican priest towards Eastern religions. Bishop Spong reflects the so called “theistic” definition of God in the Mosaic religions (Jewish, Christian and Muslim).

(…) Western religion has regularly and consistently defined God in theistic terms. That is, God is perceived as an external being, supernatural in power, who periodically invades the world in miraculous ways to establish the divine will or to answer our prayers. Eastern religion in general, but Buddhism in particular, does not define God in theistic terms. That has caused some westerners to refer to Buddhism as an “atheist” religion. Well, it is, but only in the sense that “atheist” means “not theist.” It does not mean that there is no sense of God in Buddhism. Language is our problem. The theistic definition of God is so total in the western world that the word “atheism” has come to mean that there is no God. Theism is a human definition of God and, as such, is destined to die like all human definitions do in time. Theism is not God. (…)

Bishop Spong Q&A 28.01.2010  http://www.johnshelbyspong.com

.

For more info about different conceptions of time please click here.

.

Hofstede’s Cultural Dimensions – Comparing by Cultural Parameters

with one comment

Gerard (Geert) Hendrik Hofstede (born 3.10.1928) defined a model of 6 cultural dimensions/indices to compare different cultures

Power Distance Index (PDI) that is the extent to which the less powerful members of organizations and institutions (like the family) accept and expect that power is distributed unequally. (…)

Individualism (IDV) on the one side versus its opposite, collectivism, that is the degree to which individuals are integrated into groups. (…)

Masculinity (MAS) versus its opposite, femininity, refers to the distribution of roles between the genders which is another fundamental issue for any society to which a range of solutions are found. (…)

Uncertainty Avoidance Index (UAI) deals with a society’s tolerance for uncertainty and ambiguity; it ultimately refers to man’s search for Truth. (…)

Later added: Long-Term Orientation (LTO) versus short-term orientation.(…)

and the Indulgence or Restraint Index (IRI).

PDI-world-map-50

(retrieved 18.03.2018 at https://geerthofstede.com/culture-geert-hofstede-gert-jan-hofstede/6d-model-of-national-culture/)
“Culture is the collective programming of the mind that distinguishes the members of one group or category of people from others”.
geert hofstede
Video retrieved 13.08.2018 at https://www.youtube.com/watch?v=LBv1wLuY3Ko

See his website at: https://geerthofstede.com or read his essay online here or here.

For a short & handy ppt click here.

Download an introduction to Hofstede`s theories as pdf here.

For practical applications of Hofstede`s model see this page.

For Hofstede`s theories and their application on genetics click here.

.

Hofstede’s Country Classification 25 Years later

Abstract: Nearly 3 decades have been passed since Hofstede (1980) collected the data used to classify countries by their underlying work-related structures. The present study, in which recent data from 9 countries and 4 continents was collected, is a re-examination of his country classifications. The results suggest that many shifts have occurred since Hofstede’s study in 1980. These shifts are related to some of the major environmental changes that have occurred.

(…)

Discussion: Overall, the findings of the present study suggests that there have been significant shifts in value classifications in some countries since Hofstede conducted his original study. Many of the countries examined in the present study showed a shift in ranking when compared with Hofstede’s original data. This finding underscores the fact that, although a nation’s work-related values are deep-seated preferences for certain end states. they are subject to change over the years as external environmental changes shape a society. Managers and scientists should use caution before attempting to use work-related values to understand human behaviour in organisations. At the least, managers should make an effort to determine the values currently prevailing and not rely on classifications or labels placed on cultures by researchers.

D. R. Fernandez, D.S. Carlson, L.P. Stepina, J.D. Nicholson at The Journal of Social Psychology, 1997, 43-54

Download the full article as pdf here.

~

Geert Hofstede interview January 2013 (introducing the IRI – Indulgence or Restraint Index)

.

IRI

(Retrieved at 06.06.2011 at http://www.youtube.com/watch?v=LBv1wLuY3Ko)

.

About the practical application of Hofstede’s theories read this post: https://laofutze.wordpress.com/2010/01/08/applications-of-hofstedes-theories/

.

(revised 13.03.2018)

Written by NoToes

09/01/2010 at 12:21

Posted in All Articles, China, Collectivism and Individualism, Communication, Communication in Different Cultures, Comparing Cultures, Cultural Dimensions, Emotions in Different Cultures, Hofstede, Intercultural Economy, Intercultural Management, Surveys, Time in Different Cultures, Tools / Software, Uncertainty Avoidance

Tagged with , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Practical Applications of Hofstede’s Cultural Dimensions

with one comment

Organizational Culture as a Root of Performance Improvement

.

(Organizational Culture as a Root of Performance Improvement:Research and Recommendations; R.C. Rose, Naresh Kumar, Haslinda Abdullah; Universiti Putra Malaysia – download pdf here).

Map of Corporate Cultures

Nation Branding in Pop-Culture

Sources: http://westwood.wikispaces.com/file/view/Hofstede.pdf (retrieved 22.11.2012)

.

Somewhere in western Europe a middle-sized textile printing company struggled for survival…

Cloth, usually imported from Asian countries, was printed in multicolored patterns according to the desires of customers, firms producing fashion clothing for the local market. The company was run by a general manager to whom three functional managers reported: one for design and sales, one for manufacturing, and one for finance and personnel. The total work force numbered about 250.

The working climate in the firm was often disturbed by conflicts between the sales and manufacturing managers.

The manufacturing manager had an interest, as manufacturing managers have the world over, in smooth production and in minimizing product changes. He preferred grouping customer orders into large batches. Changing color and/or design implied cleaning the machines which took productive time away and also wasted costly dyestuffs. The worst was changing from a dark color set to a light one, because every bit of dark-colored dye left would show on the cloth and spoil the product quality. Therefore the manufacturing planners tried to start on a clean machine with the lightest shades and gradually move towards darker ones, postponing the need for an overall cleaning round as long as possible.

The design and sales manager tried to satisfy his customers in a highly competitive market. These customers, fashion clothing firms, were notorious for short-term planning changes. As their supplier, the printing company often received requests for rush orders. Even when these orders were small and unlikely to be profitable the sales manager hated to say ‘no’. The customer might go to a competitor and then the printing firm would miss that big order which the sales manager was sure would come afterwards. The rush orders, however, usually upset the manufacturing manager’s schedules and forced him to print short runs of dark color sets on a beautifully clean machine, thus forcing the production operators to start cleaning allover again.

There were frequent hassles between the two managers over whether a certain rush order should or should not be taken into production. The conflict was not limited to the department heads; production personnel publicly expressed doubts about the competence of the sales people and vice versa. In the cafeteria, production and sales people would not sit together , although they had known each other for years.

.

Different cultures choose different approaches for the dilemma about

(1) the diagnosis of the problem and

(2) the suggested solution

These two dimensions, Power Distance and Uncertainty Avoidance, affect our thinking about organisations. In addition to the affected business areas listed in the tables below, taking these two dimensions together reveals differences in the implicit model people from different cultures may have about organisational structure and functioning. Organising demands answers to two important questions:

(1) Who has the power to decide what?

(2) What rules or procedures will be followed to attain the desired ends?

The answer to the first question is influence d by indigenous cultural norms of power distance; the answer to the second question by the cultural norms about uncertainty avoidance. Taken together these two dimensions reveal a remarkable contrast in a society’s acceptance and conception of an organisation and the mechanisms that are employed in controlling and co-ordinating activities within it (Hofstede, 1991).

Same researchers have tried to measure the link between the ‘implicit’ models of organisation and objectively assessable characteristics of organisational structure. Inthe 1970s, Owen James Stevens, an American professor at INSEAD business school in France, presented his students with a case study exam which dealt with a conflict between two department heads within a company (Hofstede, 1991). His students consisted primarily of French, German and British students. Inthe graph below their countries are located in the lower right, lower left and upper left quadrants respectively. Stevens bad noticed a difference in the way 200 students of different nationalities bad handled the case in previous exams. The students bad been required individually to come up with both their diagnosis of the problem and their suggested solution. Stevens sorted these exams by the nationality of the author and then compared the answers. The results were striking.

The majority of French diagnosed the case as negligence by the general manager to whom the two depart­ment heads reported. The solution they preferred was for the opponents in the conflict to take the issue to their common boss, who would issue orders for settling such dilemmas in the future. Stevens interpreted the implicit organisation model of the French as a ‘pyramid of people’: the general manager at the top of the pyramid, and each successive level at its proper place below.

The majority of the Germans diagnosed the case as a lack of structure. They tended to think that the competence of the two conflict­ing department heads bad not been clearly specified. The solution they preferred was to establish specific procedures, which could include calling in a consultant, nominating a task force, or asking the common boss. According to Stevens, the Germans saw the organisation as a ‘well-oiled machine’ in which intervention by management should be limited because the rules should settle day-to-day problems.

The majority of the British diagnosed the case as a human relationship problem. They saw the two department heads as poor negotiators who would benefit from attending, preferably together, a management course to improve their skills. Stevens thought their implicit model of a ‘village market‘ led them to look at the problem in terms of the demands of the situation determining what will happen, rather than hierarchy or rules.

.

Conclusions

A society’’s position on these two dimensions does seem to influence the implicit model of the organisation in that society, and the kinds of co-ordination mechanisms that people in that culture would tend to rely upon.

Employees in high power distance and low uncertainty avoidance countries such as Singapore, Hong Kong and Indonesia tend to think of their organisations as traditional families. The patriarch, or head of the family, is expected to protect family members physically and econo­mically in exchange for unwavering loyalty from its members. The most likely co-ordination and control mechanism for the family is a standardisation of work processes by specifying the contents of work – who does the chores.

Employees in countries such as France, Brazil, Portugal and Mexico that are high on both dimensions tend to view organisations as pyramids of people rather than as families. Everyone knows who reports to whom, and formal and activating lines of communication run vertically through the organisation. Management reduces uncertainty and provides co-ordination and control by emphasising who has authority over whom and in what war this authority can be exercised.

Where high uncertainty avoidance and low power distance are combined, in such countries as Israel, Austria, Germany and Switzerland, organisations are perceived as well-oiled machines; they are highly predictable without the imposition of a strong hierarchy. Uncertainty is reduced by clearly defining Tales and procedures. Co-ordination and control are achieved primarily through standardisation and certification of skills, specifying the training required to perform the work.

In cultures where there is low uncertainty avoidance and low power distance, the relevant organisational model is a ‘village market’. Countries such as Denmark, Ireland, Norway, the UK and the USA are representative of this model. People will feel less comfortable with strict and formal rules or with what would be perceived as unnecessary layers of hierarchy. Control and co-ordination tends to take place through mutual adjustment of people through informal communication, and by specifying the desired results.

Download an introduction to Hofstede’s theories here or online at https://westwood.wikispaces.com/file/view/Hofstede.pdf – retrieved 24.11.2012

.

More Applications of Hofstede’s Cultural Dimensions

Intercultural Management

Having or Making – The Transformation of Danish Culture and Chinese Culture in Sino-Danish Business Settings in China by Xiaomin Li  Click here to download the PPT or get it in the internet: http://www.orientus.org/downloads/Transformation_Danish_Chinese_Culture.ppt

AM+A used Hofstede’s system for an analysis of website design in different cultures/countries. Get the .pdf here or visit the website http://www.amanda.com

Xiang-Hua Lu of the School of Management, Fudan University (China) and Michael S. H. Heng of the National University of Singapore did a great work on applying Hofstede`s theory on the Chinese/Asian approach to IS (Information Systems: all systems related to the information exchange by computers). Get the .pdf here.

C. Becker and S. Palmer compared Mexican and German approaches to decision making and found out, that often “the type of business indicates more how decisions are made rather than the impact of national culture.”  Download the essay as pfd here or online from essays.se

www.essays.se provides more quality stuff about Hofstede: http://www.essays.se/about/hofstede/?startrecord=16

International business negotiation in the South and North China online or download as pdf here.

(retrieved 27.01.2013 at http://mdh.diva-portal.org/smash/record.jsf?searchId=1&pid=diva2:127352

.

Sexual Harassment

Using Hofstede’s cultural dimensions to explain sexually harassing behaviours in an international context

Vipan K. Luthar and Harsh K. Luthar, Using Hofstede’s cultural dimensions to explain sexually harassing behaviours in an international context, Int. J. of Human Resource Management 13:2 March 2002 268–284 or download pdf here or online at http://link.springer.com/article/10.1007%2Fs10672-008-9072-4 – retrieved 24.11.2012

.

Nation Branding in Pop-Culture

Pavinee Potipan and Nantaphorn Worrawutteerakul from the Malerdalen University in Sweden wrote their master thesis about the financial and cultural background of modern Thai, Korean and Japanese culture. Using Hofstede’s Cultural Onion they examined Asian pop cultures. It describes how Korean pop culture “Hallyu” has an immense success by serving all layers of the onion. Download the full pdf here or download here http://www.essays.se/essay/63a1debf3b/ (retrieved 24.12.2012)

.

See more about the importance of Nation Branding at Simon Anholt`s website or the GFK Custom Research North America

.

reviewed 27.01.2013

Written by NoToes

08/01/2010 at 21:49

Posted in All Articles, China, Collectivism and Individualism, Communication, Comparing Cultures, Cultural Dimensions, Germany, Hofstede, Intercultural Economy, Intercultural Management, Sexuality, Surveys, Uncertainty Avoidance

Tagged with , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,