Life is Good

This evening, I went to a presentation by founders of the company Life is Good. The room was packed with business students hoping to get a taste of the entrepreneurial spirit which made brothers Bert and John Jacobs so successful. Bert led most of the presentation which focused on simplicity in business and the importance of living your brand. The company was inspired by the success of previous charitable events and decided to use the company to make a positive social impact. Bert discussed the power that for-profit companies have to change the world and remain profitable.

Tapping the China Market

On Thursday, I listened to an excellent presentation by Tim Heberlein about marketing in China. Some of the points he made were:
♠ The central government is always present but the regulatory environment is not developed. Issues are not likely to be black and white.
♠ Most consumers shop in street markets. Make sure your product can survive this environment.
♠ Chinese consumers like western products but nationalist feelings make market research difficult.
♠ Successful products are copied. Differentiation is best achieved through price.
♠ One child policy increases spending on children and produces negative population growth which will lead to increased spending on elderly products and services.
♠ Skepticism of domestic brands can be advantageous to foreign brands. Company reputation is very important.
♠ Credibility, 3rd party advocates, relationship with the customer, and brand experience are the components necessary to build a successful brand.
♠ Despite the low cost of labour, there is a shortage of skilled labour particularly in management.
♠ Cross influence among stakeholders is a more effective model than the single distribution channel.
Remember that most of the Chinese population still lives in an agricultural society and cannot afford foreign products and services. Despite migration to urban areas, many migrant workers have not been paid in the last six months. Business in China is highly competitive due to the ease of replicating any product or service which targets a relatively small percentage of the urban population.

Tactic or Spin?

I was disturbed by a presentation I heard this weekend in Chicago which was an introduction to the characteristics of terrorist tactics. The presenter described the targets of terrorism as being either symbolic or pragmatic. My problem was with describing any attack against American interests by any organization besides a uniformed force as being terrorism. Naturally, the presenter did not define terrorism in this manner, but it was clear from his examples that this was the intent. The most obvious example was 9/11 which was classified as a symbolic attack against the financial power of the United States. A few domestic terrorism examples were given without much analysis. Most of the examples came from Iraq and were mostly classified as pragmatic. My question, which was answered very diplomatically, was how to determine the difference between traditional guerrilla fighters and terrorist cells. The obvious difference would be that terrorism by definition must create terror through a symbolic act whereas guerrilla fighters are fighting a war with specific objectives and a clearly defined enemy. Guerrilla fighters typically attack pragmatic targets because of limited resources. The presenter began to turn pragmatic attacks into symbolic attacks by taking the stance that any attack on American interests was a statement against American power. This self centered style of analysis is sufficient at the tactical level, but a better form is needed at the strategic level. In order to thoroughly defeat an enemy, you must destroy his will to fight. The longer America stays in the Middle East, the more we are relying on direct military power to win battles. This is the same mistake that was made in Vietnam. America continues to win battles while losing the war. The reason for this trend is that battalion commanders are focused on tactical goals rather than theater issues. To this date, no battalion commanders have been relieved for failing to protect institutions and civilian leadership in their area of operations. If this continued with a substantially better police force, Iraq will devolve into a lengthy civil war and America will maintain a military presence until some future president is willing to take the political hit for pulling out.

Global Perspective

This is an excerpt from a letter I wrote to the English language newspaper ‘Insight’ at Sun Yat-sen University in Guangzhou in response to a request for my opinion on SYSU students’ global perspective.
The SYSU students were well prepared with thoughtful and well presented questions. However, Chinese students do not have access to the same information resources that American students have. One example of this is the forum itself. The Chinese students were given two weeks to prepare while the American students were given less than two days and no access to the internet. While we knew there was going to be an event, we did not know the topics we would discuss until two days beforehand and had no idea about the format until we arrived. Most of the American students’ answers were not well researched or prepared but they relied on the information that they remembered from watching the news at home.

Although the majority of Americans do not keep up with foreign affairs, there is a wealth of media outlets which offer differing viewpoints if you are interested in broadening your perspective. In recent years, the American media has become lazy and often caters to the lowest common denominator, but quality news is still available from smaller media outlets. I recently read an article in the Wall Street Journal regarding how Xinhua was restricting direct sales of financial information to Chinese customers. Our students have access to Reuters terminals and a Bloomberg terminal to use in their Securities Analysis course. The restriction of these resources will make it more difficult for Chinese business students to obtain the same experience making them less competitive to global firms. This will also make Chinese markets less efficient because of the reduced ability to react to information to which the rest of the world has direct access. This will ultimately put Chinese firms at a disadvantage.

In some ways, Chinese students have more of a global perspective than Americans. U.S. economic dominance has led many American students to discount the importance of foreign markets. This idea is perpetuated by the fact that it is possible to have a successful business career while dealing entirely in the domestic market. By necessity, Chinese students must learn how to harness the power of global markets in order to be successful. Although SYSU students have the right questions, the answers are harder to find. The question posed during the forum regarding the Kyoto protocol was good but the students did not go to the next step by finding out why the U.S. backed out of the agreement. That knowledge could have been used to form a much more effective argument. One strategy I use to overcome this is by collecting links to various foreign news and information sites in order to gain a more balanced perspective on an issue. While I do not agree with many American policy decisions, it helps to be able to explain both sides of the argument. This is skill is essential in order to work in international business.

Fishy, Fishy, Fishy!

I was diving out at Fort Wetherill IVO 41°28’39”N 71°21’42”W this morning looking for tropical fish. Every year around the beginning of September, the gulf stream moves close enough to Rhode Island for tropicals to be seen from shore dives. We were only 15 feet down when we saw a juvenile lion fish. Normally, lion fish are only found in the Pacific Ocean but recently there have been sightings in Florida and all along the coasts of Georgia and the Carolinas. Apparently, the eggs float up from North Carolina and hatch up here but the lion fish cannot make the swim south. As soon as the water temperature drops below 50 degrees, the lion fish will begin to die off. This is not necessarily a bad thing since the fish is venomous and by all accounts a voracious predator. Nevertheless, they are beautiful fish and we were the envy of every other dive team at the site.