Monday, September 14, 2009

China Musings, Day Five (1 September)

I started today in first gear. Er, one uses first in China. Right. The good news is, the room at the Grand Metro Park lived up to the hotel’s five star ranking in just about every aspect. The only downside is that in calling their beds firm, they mean firm. As in, sleeping on a box spring, which my neck didn’t particularly like. I spent the first couple of hours of the morning walking around with one flap down. Where’s Jeffrey Leonard when you need him?

After a quick buffet breakfast, we loaded up the bus and moved to Beverly. Hills, that is. No, wait...we moved to yet another new development--Suzhou Science & Technology Town (SSTT). The bus toured the expansive industrial park before arriving at our meeting location, a brand-spanking new office building, one of dozens sprinkled throughout the park. And, again, when I say “industrial park”, I don’t mean the low-rise stuff we have in the States. I mean an enormous number of very impressive-looking high-rises just waiting to be filled by industrious folks hoping to add to the local GDP. The education-cum-employment cycle here is pretty astounding. In the U.S., we often hear anecdotes about how China and India are churning out engineers and other technical graduates at a rate that leaves our own levels in the dust. Well, based on the numbers we’ve heard and what I’ve seen over the past couple days, I can confirm that--we’re getting our asses kicked. Part of it is the sheer numbers of college-age students; part of it is the importance that parents here put on their child’s (and yes, it’s almost always a sole child, based on the one-child-per-family policy) education; part of it is on the government’s unabated pace construction of schools at all levels; and, frankly, part of it is China’s desire to become the number one country in the world, to be recognized up with (and to eventually surpass) where the U.S. is today.

On our way in and out of the SSTT, we passed a newly-occupied building with a WebEx sign on it, which was pretty cool--a Cisco outpost, this far from home. During our meeting, we also learned that companies like Motorola, Siemens, and Philips were already here, among many others. The competition to attract investment is pretty insane--if I were to form a company in the Suzhou region, I’d be hard-pressed to determine where to do so. Suzhou Wuzhong is freakin’ GORGEOUS, looking like something off of a Hollywood set...Wisteria Lane West, if you will. SIP has the attraction of 15 years of operation under its belt, with a remarkable track record of success and continued input from the Singapore side, which I have to believe can only be beneficial to the cause. And, SSTT looks to be on the same success path as the others.

So, how’s a guy to decide where to put a company, either a China outpost of a foreign firm, or an actual Chinese company? Each of the places we’ve been, we’ve heard about tax breaks, free land and office space, cheap or free administrative support, etc. The problem is, I can put all this stuff into a spreadsheet to see who wins on paper, but that’s a one-dimensional look at the matter. How to really determine who has the best mix of ingredients to enable a company to be successful? Maybe it’s as simple as determining where you as CEO want to live, then siting the company there--that happens a ton in the U.S., so maybe that’s the way to play it over here, too. Frankly, I doubt it, as I’d think that certain regions would do a better job on software, or chip design, or outsourcing, or solar (which EVERYONE over here claims to be experts on), so maybe it’s just a case of continuing to ask a ton of questions--I know how I’d go about deciding on choosing Santa Clara, Sunnyvale, Mountain View,, so perhaps the math translates fairly similarly here.

Rolling out of SSTT on our way back downtown, we passed the same rock formations (buttes?) that’s we’d passed on the way in. This time, we saw a handful of climbers out for their late morning exercise. Very cool. I’ve heard that Suzhou is the “Venice of the West”, with canals and character a plenty. We certainly haven’t seen that so far in our visits to high tech areas of various ages (infant to teen), so it’s at least good to see something aged--if not canals, at least really cool rocks.

Unless, uh, they just built those, too.

No canals on our way into downtown for our pre-luncheon meeting with one of the senior government officials in Suzhou. My Chinese-American colleagues have been helping me try to understand the structure of provincial and local government here, but it’s tough. I’m used to governments at the federal, state, county, and local levels. Here, it’s quite a bit different. Below the federal government sits the provincial government (little different than us), but then you move to the city level, and finally the county level. That’s right--cities are larger than counties. To make matters even more confusing, China also has four regions (districts? cities?) that are autonomous--Beijing, Shanghai, Tianjin, and Chongqing (where we head on Sunday). Today, we met with Mr. Cao, the Executive Vice Mayor of the Suzhou City Government. Cities here are governed somewhat like corporations, where the mayor is similar to the chairman of the board, and the multiple vice mayors are like board members, the Executive Vice Mayor being the topmost.

When we arrived at the hotel where our meeting and luncheon were being held, we were ushered into a room with two luxurious chairs at the front of the room, with three rows of six overstuffed chairs apiece on each opposite side, facing one another. The UCGEC contingent was seated on the left side of the room (as you enter); the right side was reserved for the local contingent. We stood in front of our seats according to where our name tags indicated; shortly afterwards, Mr. Cao and his staff arrived. After a very brief series of nods and smiles, we all took our assigned seats, in chairs which can be best described as “comfy”.

No shrubbery, though.

Mr. Cao delivered a series of remarks; Jessica Zhang, who led the UCGEC delegation for this part of the trip, translated for us--thankfully. The SSTT meeting had consisted of a series of presentations delivered entirely in Mandarin, making the time block pretty much worthless for the three of us who don’t speak Mandarin. Word to the wise--if you’re hosting a delegation from a foreign country, ensure availability of both time and personnel for translation. Otherwise, you’ve reflected very poorly on yourselves, as well as made it very difficult for the non-local speakers to consider investing--if you can’t provide translation support for a 90-minute meeting, I have to question your ability to provide other necessary support functions to a foreign-backed startup.

After Mr. Cao and Jessica Zhang delivered their respective remarks, Mr. Cao opened the floor to questions. The first few were posed in Mandarin; again, Jessica summarized both the questions and Mr. Cao’s answers. He then asked if any of the English speakers had any questions; never one to shy away from a query, I asked Mr. Cao the question I’d been pondering--with each investment area painting such a rosy picture of opportunities and upside, how was a guy like me, with no local language skills and no direct ties to any of the local areas, to evaluate my options and choose the location with best potential for success?

Mr. Cao responded as I expected--that each area had its own strengths; that each area had its own attractive package of financial incentives; and that each area had a team of experts available to work with each of us to determine the best possible offering to meet our needs. His answer came across as both legitimate and extremely sincere, but I still wasn’t any closer to figuring out which of the three Suzhou-area parks we’d seen would be the best location for a Silicon Valley/China joint effort.

After a few more minutes of Q&A, and after a few last shots of audio and video from the news media covering the meeting, we adjourned for lunch. For the first time this week, we didn’t have a massive luncheon at a huge round table. Instead, we had a massive luncheon at a huge rectangular table. A sit-down lunch for 36? WAAAAY impressive.

Mr. Cao led off the luncheon with a wine toast; like our other toasts, we enjoyed (?) about a third of an ounce of wine in a cordial glass. Now on our third banquet where I couldn’t smell the wine in my glass (both due to lack of quantity and size/shape of glass), I decided I needed a proper glass of wine. I asked the SSTT lady sitting next to me if it would be possible to have a serving of wine in the big goblet in front of me--the one that I’d use as a wine glass. She immediately instructed the wine server to provide me a proper (~4 ounce) pour of wine. Sweet mystery of actual Great Wall bouquet! No, not odor from the horde-repelling rampart--the Great Wall Cabernet Sauvignon I’d been drinking (but not tasting) our previous two banquets. Sweeeet.

I think I ate less at this luncheon than I had at our previous two banquets. Maybe it was the rectangular table instead of the round one, but I didn’t feel sick from eating too much. I merely felt fat.

We thanked Mr. Cao and his staff for being such gracious hosts, then waddled onto the bus for the drive to Nanjing. After grazing for a couple hours, what better way to digest our meal than by sitting on our behinds for a few more hours?

The scenery on the way to Nanjing was pretty cool, with reasonable-sized mountains and lots of trees on the three-plus hour drive. As we entered Nanjing, Jessica filled us in on some of the city’s history. Best known in the West due to Iris Kang's The Rape of Nanking, Nanjing was the seat of six dynasties, and was the first capital of the Republic of China after its founding in 1912. Jessica went to college here, so she knew quite a bit about the city; after two days spent in largely brand new developments, arriving in a city with some actual history (and five million residents) was extremely refreshing. Nanjing was loud, crowded, developed, and old--characteristics we hadn’t necessarily seen since leaving Shanghai almost 48 hours earlier.

After working our way through the challenging rush-hour traffic, we arrived at the four-star Ramada Plaza Hotel, where I had just enough time for a quick shower before heading out for dinner. While just about anything would’ve been a disappointment after our lodging the last two nights, the Ramada Plaza is a pretty big step down. But, the bed’s good (and not a box spring), the shower has good water pressure, and the air conditioning’s sufficiently cold. As Martin Mull used to say on Red Roof Inn commercials, “All hotel rooms look the same in the dark”. Generally, he’s right.

In keeping with the day’s four-sided theme, we enjoyed our dinner banquet at a large rectangular table. In a special treat, our hosts had arranged for traditional Chinese entertainment, including songs; instruments, including a flute, a violin, a lute, and a guy playing a tune on a piece of hollow balsa wood and a long string; and most impressively, a paper puppet show called The Tortoise and The Crane. Tonight, we were fortunate enough to have nearly an hour to walk around the center of Nanjing’s cultural and tourist area; the opportunity to walk off one of these huge meals was more than welcome. As we walked around the pedestrian-only area, we found the scenery to be beautiful, as well as extremely crowded, with almost no Westerners around, which was nice. The only downside is that the lack of Westerners also translated into a lack of diet colas--after no caffeine whatsoever yesterday, I spent much of the day yearning for a Pepsi Max or a Coke Zero. Sadly, in the two dozen locations I checked after dinner, not a single one had diet soft drinks, although regular Coke was in plentiful supply.

We hopped back on the bus for the short ride back to the hotel; before arriving, we were told what time we needed to be at the bus for departure tomorrow morning. I asked if anyone wanted to take a post-dinner walk (so I could find a supply of diet cola), but everyone opted out. I popped over to the concierge to ask where I could find a Lawson’s or a Family Mart--two chain stores (similar to 7-Eleven) which I’d seen plenty of as we drove through Nanjing. After more than a dozen years of doing business in Asia, I’m pretty good at boiling my questions down to tight sound bites, but even my simplified request for a 24-hour store met with blank stares from the concierge. And from the bellman. And from the valet. And from the front desk. Finally, they called the assistant manager, who arrived promptly. She spoke enough English to inform me that if I simply crossed the street and walked to the right for about five minutes, I’d come upon an all-night convenience store.

An aside. People often ask why I stay with Western chains (Marriott, Hyatt, Starwood, Hilton) when I travel internationally, claiming that I’m robbing myself of immersion in the local culture by not patronizing hotels geared towards locals. The above story is exactly why--when I’m traveling on business, efficiency is vital. If I need to repeat a question a half-dozen times to a half-dozen people, I’m wasting time. U.S.-flagged hotels have staff with better English skills, and are better-equipped to handle the needs of American business travelers. No offense intended, and no opinion or judgment passed. That’s merely a fact.

I headed out the door, walked about 50 yards to my right, then prepared to cross the street. At this point, I realized that walking in Nanjing seemed different than walking in Shanghai or Beijing. In those cities, I expect to get hit while crossing the street. The problem is, in Nanjing, I also expected to get hit, but had no freakin' idea from which direction or by what form of conveyance. In a walk that couldn't have been more than 200 yards, and which required crossing a single intersection, I must've had traffic come at me from eleven different directions, in the form of bicycles, motorized trikes (tuk-tuks, if you've been to India), scooters, cars, vans, trucks, and buses.

But it was worth it--a six-pack of Pepsi Max for my troubles. Breakfast tomorrow will be good.

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