Using the services of advisers


Recruiting staff for an in-house China capability is difficult for companies which have decided to tackle the Chinese market and which, almost by definition, do not have any in-house expertise to enable them to judge the quality of outside advice, or the suitability of potential recruits on offer. Therefore, many companies entering the China market find themselves in uncharted waters and at the mercy of outside advisers and interpreters. The choice of reliable advisers and effective interpreters is crucial to the success of any initial operation, but there is no magic formula that can guarantee the right choice. The rule of thumb for businesses starting out in the China market is to take counsel from more than one adviser.

When seeking external advice, consulting firms can be valuable contacts, if they can provide a holistic evaluation of the market, knowledge about business practices and understanding of cultural background based on their hands-on experience. In many cases, consulting firms claiming expertise on China do not even have Chinese staff in the team and rely secondhand on lessons that they learnt from published literature. Being critical of everything Chinese seems to be a convincing tool for some consulting firms. However, being critical is also an effective tool for screening consulting firms. Of course, there are a number of good consulting firms that can be of great assistance in designing your entry strategy. Nevertheless, the fact remains that the quality of specialist advice available to a company addressing the China market for the first time is variable.

Frequently, companies will encounter overseas Chinese offering various kinds of advisory services, and proclaiming their advantages of having 'close contact' with government or governmental organisations at certain level. Sometimes they even produce some kind of a document “ an agreement or Memorandum of Understanding (MOU) “ to demonstrate their 'strong ties' with governmental organizations. Some of these claims are true, but many are not quite what they seem. The documents might have been obtained through cold contacts warmed up by the lure of offers of 'opportunities of cooperation' in exchange for cooperation agreements. It is all too easy for foreign businesspeople to be so impressed by the good English spoken by their new- found friend that they suspend their critical faculties . Such advisers will have a vested interest in maintaining the momentum of the China project; their instincts are likely to be to emphasise opportunity, not difficulty. The lesson from experience is that much damage has been caused by uncritical, careless acceptance by inexperienced foreign businesspeople of advice from golden- tongued, plausible overseas Chinese. Of course, there are good candidates to be found amongst overseas Chinese, but foreign companies should beware of too ready an acceptance of specious claims that racial origins and good connections can by themselves solve every business problem.

There are other types of advisers in China who can be extremely useful, but whom many companies have ignored in their effort to seek outside assistance. They can be any of the following:

  • retired government officials;

  • those who previously worked with the government but are now running private consulting practices or are freelance consultants ;

  • researchers in leading research institutions;

  • university professors;

  • journalists who specialise in covering the dynamics of a particular industry.

Such people have a considerable understanding of the China market and also many contacts that few, if any foreign advisers might have in practice. They can be contracted under special arrangements to constitute part of your China team. Unfortunately, companies seldom take the time to seek out such local advisers.




Doing Business with China
Doing Business with China
ISBN: 1905050089
EAN: 2147483647
Year: 2003
Pages: 648
Authors: Lord Brittan

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