During our two weeks in Beijing, China, we made four corporate visits to KPMG, Hanergy, Hyundai, and Yanjing.  Each one of these visits help shaped my perception of China’s economy and business principles in numerous ways.

Our first visit was to KPMG, where Luke Treloar spoke to us.  His presentation was a great introduction to my experience in China that showed me the growing significance of China’s economy. KPMG’s statistics showed that the middle class had grown thirteen percent in the past five years and that it was projected to grow to make up fifty-one percent by 2020.  Mr. Treloar also spoke about how China’s government has five-year plans, which are a number of goals set every five years for China’s economy.  Right now China is on their 13th five-year plan.  Some of their goals include increasing innovation, improving living standards, and shrinking the disparity between rural and urban communities.  I found these five-year plans very interesting, because the plans are a completely new idea to me and vastly different from how our U.S. government plans and operates.

Our second visit was to Hanergy, which is a solar energy company.  We were able to tour one of the company’s buildings and see the new concepts and designs that they were working on.  One of the coolest designs in my opinion was the self-driving, solar-powered car.  It was very modern looking and the interior resembled a dining room with four chairs surrounding a table.  Other product concepts included solar powered jackets and shorts that possessed the capability of charging phones and other electronic devices.  Hanergy was a great insight into the future of solar energy products that will be used not only in China but around the world as well.

Our third visit was to a Hyundai manufacturing plant.  I enjoyed seeing the massive assembly line, and the ease with which the production process flowed.  There was neither wasted movements nor time by both the machines and the factory workers.  One of the most notable features of Hyundai’s assembly line was that they were able to produce several different car models on the same production line.  The manufacturing process of Hyundai showed me how vital supply chain management is to businesses.

Lastly, we visited Yanjing, which is one of the leading beer manufacturers in China.  Yanjing showed us a video that presented us with all the different marketing techniques that they have used over the years.  Sponsorships were one of the main marketing avenues used by Yanjing.  The have sponsored events such as the Olympics in 2008 when they were in Beijing.  They have also sponsored the Houston Rockets when they had star player Yao Ming.  Similar to Hyundai, we were able to visit Yanjing’s factory and see the production process.  The efficiency in production was flawless, evident by their ability to produce over thirty thousand beers every minute.  The visit to Yanjing showed me the importance of marketing and how to market products in China.

The four corporate visits to KPMG, Hanergy, Hyundai, and Yanjing really shaped my perception of business in China.  KPMG showed us how China’s economy is going to continue to grow for numerous reasons.  Innovation such as Hanergy’s solar power, efficient manufacturing processes like Hyundai’s, and great marketing techniques such as Yanjing’s are great examples of how China’s economy has grown so rapidly to this point and why it will continue to grow.

Categories: 2016 Trip

Nothing can compare to the size of China. Nothing can compare to the history of China. Nothing can compare to the potential of China. Spending two weeks in this unique and distinctive country, I was able to learn more about the world than I would ever learn in a textbook in Texas. The country’s past has allowed it to stagger behind in the feat of our current world economy. As the country continues to implement reform to allow for a more open market, it is rapidly catching up to the developed nations including the U.S.

During our time in China it was interesting to learn about the state owned enterprises(SOE) that the country has. A state owned enterprise is where the company is owned by the government, not by investors nor privately owned.  Living in the United States where this practice is not only uncommon but considered preposterous, it was interesting to see this perspective. One of our corporate visits was to Yanjing Beer which is one of these state owned conglomerates. With the help of the Chinese government Yanjing Beer has grown into one of the world’s largest beer producers. Its target market is primarily Chinese, but its beer can be seen across the world. The Beijing location being its largest factory, the scale of the location truly impressed me. While the size and production of this large SOE does seem remarkable, these large entities to falter in one category, “innovation.” With a strong grasp of their market there isn’t room for competition. The lack of competition does not allow for innovation to occur. This is a common issue that many of the SOEs face.

Another corporate visit that we had was Han Energy company. This was my favorite visit from all the four companies. China’s pollution issue has been the biggest influence for this company to grow. It is a privately owned company and it is the largest producer of solar energy in the whole world. During the tour, the company made it very clear on how important solar energy is for the preservation of our world. This is an issue that United States has staggered behind in because it does not see the problem as an immediate threat. China on the other hand can visibly see the problem on a day to day basis. My favorite part of the tour was the companies vision for the future. They wanted to be able to provide everyone with benefits of using solar energy, and while this idea may be far-fetched the company is closer than anyone else.

My experience is China was unforgettable one. I learned so much about the Chinese culture, international business, and more about myself. I hope I can take what I learned in China and use it throughout the rest of my life.

Categories: 2016 Trip

Beijing was such an amazing experience, I got out of it exactly what I came in wanting to get: A better understating for the way the Chinese conduct business.  This was learned through several company visits and lectures thought by Chinese professors.

Our first visit was to KPMG Beijing, here we learned the ins and outs about entering the Chinese market. We learned what it takes to enter, whether or not its worth entering their market, the benefits to entering. One benefit that out speaker stated and that I noticed personally was that business have the opportunity to rebrand themselves when they enter a new country. There was no better example than Pizza Hut. In the United States, Pizza Hut is mostly seen as an averaged priced take out/delivery restaurant. But in Beijing, it’s a completely different restaurant. It resembles Olive Garden in America, an up scale sit down restaurant where families come together. This absolutely blew my mind. For as long as I’ve been alive I have never nor have I known anyone who went to dine in at Pizza Hut, much less see it as an up scale restaurant. What made things harder to believe was that when I looked at the menu, there wasn’t a focus on pizza at all, It was more Italian food than anything. As weird as I thought it to be the Chinese didn’t think so, the restaurant was completely full, there was a wait time. Pizza Hut completely changed it’s image in another country.

Another interesting thing I learned from this trip was the organizational behavior within Chinese businesses. During lecture our professor went into great detail explain a lot of the norms of Chinese business such as exchanging gifts during meetings, picking up their customer at the air port, and probably the most interesting to me was that it is very common for businessmen to be friends first and be friends second. This stood out to me because it so much different than the cold crew world of American business. In America, aside from relationship-based sales, businessmen could care less about being friends with who they are doing business with. Its very cut throat and to the point, its focused on what is the best way I can make the most money that I can in a very efficient manner. Chinese are more focused on building a friendship and being friends down the road. This can be pointed back to their culture. They are very selfless people who are always looking on how they can better the group and boost moral rather than individual achievements. America is the complete opposite.

Lastly we something I really took away from this trip is how to be respectful to Chinese people. There are a lot of things that they do differently than we do that we must come to understand and adjust too. For example they are always prefer to have their drink warm instead of cool like most American do. This information is useful If one is ever in a meeting with Chinese businessmen, it will be a lot easier to accommodate to them and make them feel more at home. The more we adjust to their culture while they are in America, the more success we are likely to have.

I would not trade this experience for anything in the world, it will be a memory I will forever treasure and one that I hope others get experience after me.

Categories: 2016 Trip

In our trip to China, we did four corporate visits. Our first visit was with KPMG. They had a really nice building, and also nice offices. We went into a conference room and had a presentation on what KPMG does in China. I felt that the presentation was very informative and interesting, but even though it was an hour and a half, we needed a little more time so he could cover a little more in depth about what he was talking about. I especially enjoyed the part about the State Owned Enterprises and Privately Owned Enterprises, because up to this point I didn’t know how foreign companies worked in China.

The second visit was to Hanergy, a company that produces solar panels among other stuff. They bought several smaller companies and are now one of the biggest if not the biggest solar energy company in the world. When entered they had this huge globe that looked like the sun. We went on a tour of about eight different rooms, and they had amazing technology. They had screens with really high definition and showed us the history of energy and why solar energy is the way of the future. At the end they showed us a short movie about the vision they have for their products, and how using them can improve the quality of life for everyone, as well as help the environment.

We then went to Beijing Hyundai. There we saw a video and then went to see the final part of their production line. What stands out from this plant is the high degree of automation. Also, the number of cars they were producing was very impressive. We learned about their four stages of production, and how they get 96% of their materials domestically. Also, it is a joint venture between South Korea Hyundai and China Motors.

Our last visit, which we were all looking forward to, was Yanjing beer. They showed us a video, but it was in Chinese with subtitles, so it was very hard to keep up with the images. They sponsor a lot of athletes from China, as well as the Ping-Pong Olympic team. They said they have very good relations with Chinese government, but we could all tell they have a sort of monopoly. The government gives them preferential treatment, which is why they grew up to be this huge company in a very short amount of time. After the video we went to look at how they produce beer, and then how they bottle it up. I don’t remember how many beers they produce in a day, but it was a ridiculous number.

Overall, I liked the corporate visits very much. They were very informative as well as entertaining, and it showed us how companies we view as normal have to adjust to do business in China.

Categories: 2016 Trip

Choosing to go to China for a study abroad was one of the best decisions I have made thus far in my college career. I was apprehensive about it beforehand because I had never been to Asia before, and the culture is so different than anything I had ever experienced. With China being one of the major players in the world’s market, it is important to learn how to interact and accommodate Chinese culture when working in business. That was a main driver for why I signed up for this trip. The class lecture we had from about the differences between US and Chinese work environments was very helpful and informative. In the US everyone is very competitive and tries to set themselves apart from their coworkers.  In comparison, the Chinese try very hard to blend in with their peers and not stand out. There is a very distinct difference between the individualism in the US and China’s collectivism. There is also a much larger power distance between employees and their managers. The Chinese are also very indirect and try to avoid conflict. The culture is to not upset or hurt anyone’s feelings. Due this, you have to read between the lines. This is evident in the way the Chinese do not give away how they feel in their facial expressions and body language.

I also got a feel that China wasn’t as communist as it is perceived to be in the media. While I know they are a communist country, there was never a point I was completely taken aback by something due to its communist nature. The closest thing I came across was the lack of property rights in China. All properties are bought from the state and have to be repurchased from the government every seventy years. While this is very different than anything we face in the US, it is better than other countries such as South Africa where the government can come take away your land anytime they want with no warning or compensation.

I really enjoyed hearing about the many facets of what makes up China’s economy. There has been a lo of focus on it in the news and the ramifications it could bring to other countries around the world. For the first time in recent history, their GDP is slowing down and that is scaring many people. A big part of this is that their economy has always been driven by manufacturing and they are now at a point where they are overproducing. It was very evident on our business visits to Beijing Hyundai and Yanjing Beer with the massive quantities they produce in a single day. I thought it was very interesting that every year China sets a target GDP and legislation will reverse engineer to ensure they hit that target. Even though their economy is slowing down, China is still about to take a bigger stage in the world economy. Fifteen percent of the newcomers to the top cities in the world determined by nominal GDP will come from China. This is reinforced by China gaining 77 new companies to the Fortune 500 companies. In comparison, the US is losing a lot of these spots. It is for this reason that it is important for people to learn how to interact with the Chinese market. I am so thankful I got the opportunity to study and learn in China.

Categories: 2016 Trip

 

I truly enjoyed being able to visit all of the companies Dr. Gaspar had planned out for us. They were some of the first company visits that I had been on, and I gained a lot of knowledge about different industries. The first business trip we went on was KPMG. This company was my by and far my favorite one. The reason I had come to China was because I expected there to be incredible potential in the economy considering it is one of the strongest economies in the world. I want to be able to take advantage of that. KPMG affirmed my suspicions. The KPMG lecturer who presented to us was Luke Tremoar, he was a Senior Marketing Analyst. He gave us a 30 minute presentation that I truly enjoyed, and I could see myself doing something extremely similar in the future. Our second business trip was to Han Energy. Han Energy is one of the global leaders in sustainable energy. Immidaitely as we entered the building we could tell that it was a top-tier firm. The floor and ceiling were made of mirrors, and a giant, gowing orb was attached to the sealing that look like the sun. We went through several rooms, examining all of the solar powered items. One of them was a backpack that charged your phone and laptop as you walk. It was really cool, and I’d like to purchase it sometime in the future. After viewing how solar energy can be applied, they sent us to a movie theatre were we watched a video of all the ambitions Han Energy has for the futures. These include fully solar power driven cars, home amenities, among other items. Han Energy would like to dispose of fossil fuels, as it has seen the dramtic impact it has had on the atmosphere in Beijing. The third visit we went on was Hyundai. Hyundai is an utomobile factory, and we were able to view the final assembly portion. We got to experience what afully automated cars manufacture looks like from the inside. While it was not my favorite visit, simply because I didn’t enjoy the atmosphere, it was still cool to hear about the history of Hyundai across the world. Finally, we visited Yanjing Beer Factory, which is the largest beer manufacturer in China. I was very excited to visit Yanjing because we had been drinking their beer throughout the trip. They sold this beer in every restaurant and store across Beijing with little diversity. When we entered the factory you could immediately smell the fermenting beer. Like the Hyundai Corporation, it was heavily automated. While it was cool to see the sheer size of this company, I didn’t very much enjoy the smell or sites of the company.

 

Our class visits were very interesting, and I took it as a valuable learning opportunity. We had several lectures stretching from the economy, values and traditions, marketing, and new business development. It was particularly interesting learning about the cultural barriers that have kept companies from succeeding in China. It is important that companies have a degree of cultural awareness, because as we learned things in China operate entirely differently than in the United States. It was also interesting learning about the government in China. The government owns everything from the land to business rights, and it’s a stark contrast from the United States. I find it particularly interesting that the Chinese people rent property from the state. The Communist form of government has worked well for China, but it is entirely possible that they will be switching to a more free market economy in the near future.

Categories: 2016 Trip

It has been one week since my return from China. I’ve mulled over everything I learned and witnessed on our trip.  As I said in my previous blog I am excited to see China continue to develop over the rest of my lifetime.  What we learned in our classes about China’s business environment is inspiring.  What China is accomplishing with such a vast population is something I truly believe only China could do.  They are moving away from a majority of state owned enterprises and working with the private sector to create more and more privately owned businesses.  This is key in continuing the development of China’s business sector and growing their middle class.  Yes, the growth rate of the middle class has slowed but as long as it continues to grow at a steady pace China will move closer and closer to a developed economy and country.  What I learned during my time in China is priceless.  I’ve shared what I learned with many of my family and friends and what I’ve realized is that unless you have been there and seen the country and the way it works you cannot truly grasp the importance of what I learned.  Unless you’ve been there you cannot understand the difference between a developed and a developing country.  The opportunity Mays Business School gave me in traveling to China and learning from Chinese professors is something I will never forget and never take for granted.  I am so thankful that I was able to travel to China this summer.

Categories: 2016 Trip

I’m back! After returning from China and recovering from jet lag, I’ve had time to reflect on all that I learned during my two-week stay in Beijing. What makes China so interesting is how completely different it is from the United States and Western countries in general. I really enjoyed the four business visits we went on: Hanergy, KPMG, Beijing Hyundai, and Yanjing Beer Group. The latter two of those visits were especially beneficial for helping me connect the dots between the reality of the business world we were seeing and the material we were being taught in lectures at Beijing Jiaotong University.

I really enjoyed getting to tour the final assembly section of the Beijing Hyundai factory! Beijing Hyundai is different from other plants of Hyundai in that its ownership is a 50-50 split between the Korean company, Hyundai, and the Chinese company, Beijing Automotive Group. This joint venture was necessary for Hyundai to enter the Chinese market because of China’s foreign direct investment policies. Foreign companies in certain industries, including automotive, cannot just enter the Chinese market on their own. These policies help China to be more in control and involved when foreign companies enter the Chinese market.

I also loved getting to tour Yanjing Beer Group’s factory. I learned a lot from this tour, and this company is a good example of China’s business environment because it is a state-owned enterprise. This type of company is much more common in China than it is in the US, where normally state owned enterprises are limited to industries like infrastructure (railways, etc.). The large scale of Yanjing Beer Group and its government ownership make the company stand out and are indicative of China’s unique business environment.

Companies interested in entering the Chinese market should place high importance on understanding their foreign direct investment policies, as these may differ and/or be more stringent than the company is used to. It is also very important that companies understand the culture of the country in which they are aiming to do business. China and the US are opposite on several of Hofsteade’s Cultural Dimensions. For example, China is a much more collectivistic culture. Harmony is important and smooth social relations are put above diversity of thought. In China, it’s friends first, business second. This collectivistic culture can be seen in many other ways as well, such as the manner in which people sit at a table or stand around at a party. Another dimension in which the US and China differ is power distance. Chinese culture has a much higher power distance, and a higher focus is placed on the leader. Respect is extremely important, and dissenting opinions should be expressed only with great heed (as to maintain harmony). In order for foreign companies to succeed in business with China they must understand the culture of the people with which they will be working.

China’s business environment is truly fascinating because it is so different from what I knew. Just as companies interested in entering the Chinese market should aim to understand this different culture, I should too. This knowledge and understanding will be helpful and set me apart in the working world and I’m thankful I got to experience what I did first hand.

Categories: 2016 Trip

My favorite thing by far about this trip has got to be the corporate visits and the lectures. It has been an incredible experience to travel across the world and learn about a new experience first-hand. Coming on this trip made me realize the importance of being culturally sensitive as well as being globally exposed to different markets and economies. I appreciate everything a little more than I did the day I returned to the US.

Our first visit was to KPMG. I feel this visit was the most informative out of all of them. Our presenter, Luke, gave us an overall overview of China. Luke talked about the economy in China as well as the culture and problems China is facing. The moment he began his presentation it finally sunk in that I was in China. It is hard to believe that I was no longer at home. I felt very welcomed and informed after his visit. From that moment on I began to experience the culture a little more than I had when I first got off the plane. The information he provided was vital in understanding who the Chinese people are and why they do what they do. I also enjoyed that he was American and was able to relate to us and simplify the differences between China and the US.

The second visit consisted of going to Hanergy, a leader in solar power. From the start the visit was amazing. The facility at Hanergy is simply amazing to say the least. They have devoted a lot of time and care into the appearance of the facility itself both outdoors and indoors. Walking into Hanergy my immediate reaction was that the place was just so enormous and gorgeous. The first thing you see as you walk in is a huge sun on the ceiling (it is incredibly amazing in person). The tour was pretty awesome. There was so much cutting edge technology. I am sure that Hanergy will expand to be a global leader in solar power. They showed us all of their products and future plans and I’ve never been so amazed in my life. Definitely one of the coolest visits I’ve ever been on.

The third visit was my favorite! On out third visit we were able to visit the Hyundai facility in Beijing. I really enjoyed that the tour was a walking tour of the facility. We were able to see the assembly of a car from start to end. I didn’t realize how much work went into making a car but also how quick it happens. Another small thing that I enjoyed on this visit was learning that China and Korea work together and to symbolize their friendship and welcome the Korean workers at the factory there are native Korean trees planted right at the front of the factory.

On our very last visit we were able to visit the largest beer producer of beer in China, YanJing. The factory was very cool! We were given an overview of the production of beer and we were also able to walk above some of the beer production and fermentation processes. The morning before this visit we learned about China being a Collectivist society and we were able to see that directly through YanJing. YanJing beer sponsored what we know as our NASA but the Chinese version and I thought it was very interesting that a beer company would sponsor outer space research.

All of the lectures were perfectly timed with accordance to our visits. The lectures provided a lot of background knowledge for the visits and plenty more. I really enjoyed my time in China and I can honestly say that I left knowing a lot more than I expected to. I thought that I had China all figured out but after this trip I realized that there is so much more to China.

Categories: 2016 Trip

Returning to the United States feels surreal, even though my stay in Beijing was only two weeks. Cars actually stay in their lanes, the sun doesn’t rise at 4:00 AM, and I have to use a fork and knife! All hilarity aside, I learned a great deal of practical knowledge regarding Chinese business. Corporate trips and lectures from Beijing Jiaotong University professors informed me about state owned enterprises, Daoist management strategies, trends in China’s demographics today, and more.

Communist countries tend to possess state owned enterprises (SOE’s) in addition to companies we are normally used to in the west, and China is no exception. The implications for these companies are interesting in China’s case; is it anticompetitive to have massive corporations fully supported by the state, or is it necessary because they are firmly entrenched? A common example of these SOE’s is China’s banking system. Nearly all of China’s main banks are among the ten largest in the world, but their size stems significantly from government support. They tend to keep to themselves rather than enter the global market, so this may not be a large issue with regard to competition.

Daoist management philosophy surprised me with its hands-off nature. We in the west prefer to possess visible influence as managers, while in China it is encouraged to do as little as possible. Such a management philosophy could only work in the east; here, American businesses need managers who function outwardly and with straightforward actions. Western management styles would likely cause loss of face in China, due to their direct praise and punishment styles. Speaking of punishment, a manager punishes employees not through confrontation, but by “feeding the fire.” An employee who openly seeks to climb the hierarchy will have their ego fed until they lose face, and likely their job. It will seem as if they brought failure upon themselves, rather than falling through deliberate action by the manager.

Despite all these differences, China has risen to a prominent position in the world today, where I expect it will remain for a long time. In a series of remarkable changes, the country transformed from an agricultural nation with universal poverty to a fairly developed manufacturing powerhouse. The middle class greatly increased in size even within the past five years, and it is still projected to grow further. Increasing investment in services means China will diversify and compete even more effectively with the west. Whether the rest of the world is ready or not, China brings increasingly better business to its own people and beyond. Understanding how Chinese businesses rose to the world stage in recent years will help the west innovate and learn from the new competitors.

Categories: 2016 Trip