With the Chinese Communist party about to anoint Xi Jinping as its new secretary general, there is plenty of speculation about the implications of its political and economic changes for the rest of the world, but little about its capacity to inspire management innovation.
China is overdue a modern management guru (Sun Tzu, born around the sixth century BC, doesn’t count).
Walter Kiechel has written an excellent potted history of “The Management Century” in the latest Harvard Business Review, starting in the late 19th and early 20th century with an “age of scientific management” (led by Frederick Winslow Taylor), moving through a more sophisticated era of growing self-confidence from the 1940s to the 1980s (dominated by the insights of Peter Drucker, whose life and work is celebrated this week at the Global Drucker Forum in Vienna) and on to the modern era of specialisation and globalisation. But, as Kiechel writes, “most of our story so far takes place in the United States”: Read more
To read the scathing condemnation of Chinese telecoms equipment suppliers fired from Washington this week, you would think we still lived in another world. In that world, telecoms networks were built by national monopolies such as AT&T, France Telecom and British Telecom, and outsiders stayed away.
US national security concerns apart, China’s Huawei has one of the strangest governance structures of any multinational company: a “panel” of three chief executives each of whom rotates into the top executive role every six months.
On the issue of Huawei’s links with the Chinese military, the telecommunications equipment company has proved the equal of any western counterpart when it comes to using spin-doctors to push out a strong and consistent message that it has been maligned. But when it comes to the rotating CEOs, its founder, Ren Zhengfei (who is one of the trio), is remarkably frank that the arrangement is a bold experiment. “Even if we fail, we will not regret our choice because we have blazed a new trail,” he said in the most recent annual report. Read more
Apple $60m settlement with Proview Technology of Shenzhen, the manufacturing city in the Pearl River delta, to gain undisputed control of its iPad trademark, shows how tricky controlling intellectual property in China remains.
China is still stuck between its official policy of moving to more innovation and protection of intellectual property and the sketchier reality on the ground. It remains very easy to buy knock-off Apple phones and components in the Pearl River. Read more
I’m fascinated by the first part in a new FT series on manufacturing, led by our expert Peter Marsh, who has a new book coming out on the topic.
In particular, I love the bar chart in this interactive graphic about the “seven ages of industry“ (click on the “chart” tab when it opens). Read more
Embattled defenders of horseracing in the UK and Ireland will allow themselves a wry smile at China’s decision to buy into Irish thoroughbred racing and breeding expertise. Just as communist China is trying to breathe new life into a sport it once outlawed, racing is under fire in the decadent west.
The 2012 Grand National at Aintree – next time, Tianjin? (AP Photo/Jon Super)
The news that Ireland will help China set up a $2bn national equine centre came the day after critics renewed calls for a ban on the Grand National – English racing’s best-known and most gruelling steeplechase. Two horses had to be destroyed after falling in Saturday’s race. Read more
To fly from New York to Beijing, as I did this week, is to enter a looking-glass world. Eight o’clock in the morning becomes the same time in the evening. One transfers from a country aggrieved at China to one aggrieved at the US.
Greetings from the Central Party School of the Chinese Communist Party in Beijing, the training college for the elite cadre of administrators, academics and politicians that run the country.
I am here for a seminar on China’s economic development organised jointly by Wilton Park, an independent agency of the UK Foreign Office that runs political and economic conferences, and the Central Party School. Not long ago, they would have seemed like unlikely bedfellows, but times have changed. Read more
The FT’s story about the alleged torture of a billionaire businessman in the Chinese city of Chongqing under Bo Xilai’s populist administration is an explosive reminder of how high are the stakes in the leadership transition.
The story of Li Jun, who was allegedly tortured in a detention centre in Chongqing after falling out with the city’s administration, also shows the roughness of the internal battles among China’s political factions.
As Mr Li says of his alleged arrest and maltreatment, after being arrested for refusing to hand over some former People’s Liberation Army property in the city to be turned into a park:
“When they told me I’d breached the contract and would have to pay for my freedom, I felt I had been kidnapped by a group of bandits. But I didn’t have any other choice.”
The news that sales of Rolls-Royce cars in China have overtaken those in the US, and that China now accounts for 31 per cent of Rolls-Royce’s sales, makes me wonder if we have reached a turning point for luxury design.
That sprung to mind when I saw a BMW M5 driving along a parkway in the US the other day. Although this is subjective, my first reaction to looking at its rear view and tail lights was that it would have looked more at home on the Bund in Shanghai. Read more
If you seek a lively leadership campaign, the place for you is not Iowa or New Hampshire but China. Instead of caucusing among voters in schools and halls, these all-action candidates are punishing Walmart in Chongqing and pacifying 13,000 irate villagers in Guangdong.
The protests in the southern Chinese village of Wukan, which has now established its own administration outside the control of Guangdong province, cap an extraordinary year of street protests from the Middle East to Wall Street.
It is worth watching this FT video filmed inside Wukan by Ben Marino, with commentary by Jamil Anderlini, our Beijing bureau chief. It features villagers speaking openly of their defiance of the local and regional Communist Party structure and calling for Beijing to step in.
It reminds me of my visit to Guangdong this autumn, talking to migrant workers who come to the Pearl River Delta to find relatively high-paying jobs. Although they are far better off than their parents, they also see others profiting – sometimes illicitly – from special treatment. Read more
It is a shock to hear Muhtar Kent, chief executive of that quintessentially American company Coca-Cola, suggest that the US is now less friendly to business than China.
But Mr Kent’s comments – “In the west, we’re forgetting what really worked 20 years ago” – echo what I heard two weeks ago at Harvard when I talked to Michael Porter, perhaps the world’s best-known expert on competitiveness. Read more
Having spent the past couple of weeks in Hong Kong and the Pearl River Delta, I found the obituaries for Keith Tantlinger, the engineering brain behind the shipping container, poignant.
I took a stroll along the Pearl River in Guangzhou on Wednesday, nearby the ports from which vast amounts of electronics and textiles are shipped via containers to the rest of the world. It was a reminder of how much Mr Tantlinger’s little-known invention in the mid-1950s revolutionised the transport industry.
As recorded in Marc Levinson’s book The Box, Mr Tantlinger was asked by his boss, the maverick entrepreneur Malcolm McLean, to make practical the idea of storing goods in box containers rather than in break-bulk ships which had to be loaded and unloaded at each port. Read more
Li Feifei, a 19-year-old migrant factory worker from China’s Hubei province, dreams of becoming a clothes designer.
Ms Li, to whom I spoke this week at Fuji Xerox’s plant in the Longhua district of Shenzhen, got the idea of attending a fashion college and changing jobs from watching television. “When I saw beautiful girls in dramas, I thought of them wearing clothes I made and designed,” she says.
I’m fascinated by Huawei Technologies: it encapsulates all the challenges that fast-growing Chinese companies face – from governance to branding – and then some.
It’s already the world’s second largest manufacturer of mobile network equipment by revenue, but Huawei’s latest big bet is to be one of the world’s top three mobile handset brands by 2015. Wan Biao, chief executive of Huawei’s device unit, set the target at Wednesday’s launch of its cloud-computing smartphone, the “Vision”, based on Google’s Android operating system. Read more
Barclays: "a Britain-and-onetime-colonies bank"
It’s common to think of Barclays and HSBC as global banks. Certainly, they’re more international than their big UK rivals, as their recent interim results demonstrate. But Pankaj Ghemawat, professor of global strategy at IESE Business School and author of World 3.0, points out that they are more geographically concentrated than most people think – and that’s a good thing. Read more
The collision of two Chinese bullet trains in Zhejiang this weekend ought to prompt the country’s leadership to think carefully about how one of the world’s biggest engineering projects has been handled.
The government’s first reaction was to to dismiss three senior officials in the Shanghai railways bureau for allowing the fatal crash to occur, as well as ordering emergency checks on the entire national high-speed rail network. Read more
The problem of Chinese companies that have run into trouble after gaining listings on US and Canadian exchanges through reverse mergers reminds me of the controversy about emerging market investment companies being listed in London.
I noted last week Richard Lambert’s FT article on Vallares, the investment company run by Nat Rothschild and Tony Hayward, which has promised London investors transparency along with chance to buy undervalued commodity assets.
Meanwhile, the FT has covered the short-selling attacks on Chinese companies listed on the Toronto Stock Exchange and US bourses, including Nasdaq. Twelve of these have been suspended from trading on Nasdaq over accounting flaws. Read more
Li Ka-shing’s interest in the British utilities company Northumbrian Water has set off a predictable ripple of nationalism.
Local politicians have started to air their fears that a takeover by Cheung Kong Infrastructure, controlled by the Hong Kong tycoon, would put local jobs at risk. But it would be odd and inconsistent if anybody in authority acted on those fears to impede the bid. Read more