Thursday, March 5, 2015

The Chinese “Quality” Problem.

It is always dangerous to simplify a problem down to one root cause but sometimes you just have to take that risk and make a point.

I recently over heard some Chinese business people say they are not too concerned with the legal details or what will happen in some future date. They just want to get the contract signed now and get started working the deal and make money. These statements are made to answer questions I had about mitigating their risks down the road and helping them structure the best deal possible to anticipate what potential problems. Working in an American law firm has made me appreciate the small stuff, the tiny details and the seemingly not so important risks. The large firm experience taught me that something so small now can and will hurt you down the road. In fact, the Chinese business people came to me precisely because they didn’t care about the details in some distant past and just wanted to get started making money. So now they are having problems that they themselves caused and I’m trying to sort those out.

Unrelated to their legal issues are also quality problems of their products. Well, in this messy all connected world, their quality problem is also part of their current messy legal problem, but going into those details won’t matter to the point I’m trying to make here. What I think needs to be said is this: Chinese are not stupid, not lazy, not less than any other people. But somewhere in our history, we accepted the mentality that letting the details fall is not so important. This is also not prevalent in all aspects of the Chinese experience. In fact, growing up in China I recall how much I have to pay attention to the details in math classes. Getting a 99% was unacceptable. But somewhere between that demanding math education and the way Chinese do business and treat the rule of law, details become less important. Money now is what drives Chinese companies, not quality of product and doing things right for the long term.

So how is this a quality problem? Well, because the Chinese business people don’t think details are all that important, and are willing to sacrifice the few dollars now to avoid having to think through everything, they are not capitalizing the quality of product—legal or otherwise. And with this mentality carried over to the manufacturing production side, well you see the problem: why spend money fixing this small detail about this particular screw now when we can just roll this vehicle off the production line and count the income on our books? Same line of thinking as: why spend money now fixing this one word about this particular sentence because of this seemingly non-existence risk now when we can just move on with the adverse party and count the money in our pockets?

The Chinese quality problem, as I come to see it, is a lack of care for what the final product is. Money is what drives their decisions. Whatever happened to the old Chinese saying: 天道酬勤?

Monday, February 9, 2015

Alibaba and the Proverbial Thieves

Just a few months ago, Alibaba’s record setting $25 billion IPO was seeing upward bounds trading at around $120 per share. That’s close to doubling its $68 per share IPO price. These days, Alibaba is facing class action lawsuit in the United States for allegedly violating the U.S. Securities laws, criticism from China’s own regulators at the State Administration for Industry and Commerce (SAIC), and backlash from customers for the abundance of fake products. This started with the release of a “secret white-paper” from SAIC stating that over 60% of sampled goods on the Taobao website are “not genuine”  and also evidenced secret meetings between Alibaba and Chinese government officials not previously disclosed in its IPO filings.

Jack Ma quickly maneuvered on the PR offense in China and put up legal defense in the United States, but are these enough to solve Alibaba’s problems? Not likely. First, the Chinese government is no sleeping cat. There is a serious brand control problem with Alibaba that is drawing domestic and international attention. Even though Alibaba allegedly spent $160 million since 2013 trying to tackle the fake products listed on its online stores and has a 2,000 strong employee force actively curbing the problem, but the SAIC did not just now release the “secret white-paper” accidently. It is meant to get Alibaba’s attention that it wants more done. SAIC making this public is more interesting and I can only speculate that it was meant to “杀鸡给猴看”. Speculation aside, even if Alibaba can take the lashes now and spend its way out of the close scrutiny Chinese regulators are imposing, it still has to face the likelihood that regulators will come out with more stringent rules and regulations to tighten the market’s operating freedom. Increasing compliance requirements means increasing cost to do business and add the prime legal fees Alibaba is paying to defend itself in New York, one can only guess how much profitability Alibaba shareholders are really seeing.

But the regulatory challenge is just one facet of Alibaba’s problems. The worse Alibaba will have to overcome is the public opinion that are outcome determinative. The recent “secret white-paper” publicity probably contributed to a loss of US investor confidence and loss of domestic favorability making Alibaba more vulnerable to market volatility. But Jack Ma is no fool and the recent news of state-backed Ant Financial’s $30 billion valuation is either meant to be a distraction or a hint of something else at play with Ma and the Chinese government. I wonder what that may be but anything I say now is again pure speculation. I leave that to your wild imaginations.

Irrespective the conspiracy theory in Ant Financial and Alibaba’s interplay, Alibaba’s longevity is probably not in the regulator or the public’s hands in the sense as we see them. Rather, the inherent integrity of the ecosystem Jack Ma has created and attested to in Alibaba’s F-1 filings is one that will test the character of China. Does the government have the will to really crack down and does the once teacher billionaire boss Jack Ma have what it takes to enforce a reputable infrastructure of the world’s largest e-commerce network are both irrelevant. The more interesting question is whether the Chinese people using Taobo understands the right way of using it? The kind of micro-innovation ecosystem on Taobo is meant for the people to be more entrepreneurial, not meant for the platform be a training ground for counterfeiting the country to an inflated e-commerce economy doomed to bust in front of the whole world's watchful eyes. 

The Right Thing To Do - by Lauren Campbell-Kong

Since moving to a new city I have really gotten involved in the professional world. From working for a small marketing firm, to working on projects with local municipalities, and to joining the boards of different organizations, I hoped somehow I would make a difference in my community and ultimately a difference in the environment we share as a whole.

But as I learn to operate the "professional" sphere, I found that the discussion of money and the single bottom line are more prevalent than any other aspect of the professional culture. Even in the non-profit organizations that I volunteer for, money is the main focus. We do have to stay within budget after all, that I understand. But is money really what professionalism is about? Hoping there would be more to being a professional than just making a few dollars, I try to bring a bit of unconnected happiness to the office (donuts for the office is my crowning moment perhaps). I could babble on about my experiences, my issues with the corporate world, my emotions, and the kind of donuts I brought to folks at work, but instead I want to share a video: this gentleman said what I wanted to say and can possible write here in a much more eloquent manner.

Thursday, December 18, 2014

Tacit Knowledge-The Map is not the Territory

When I first learned how to drive in Cincinnati, there were no gadget gizmos like Google Map or OnStar. This was back in the mid-1990s’ and if you wanted to get somewhere unknown, you had to plot it on a map—which I found on the back of a phone book—and figure out the major streets and a sense of direction. From there, you just have to get on the road, and test it out. Cincinnati is also a bit strange. Streets will cut off in one part of the city and pick up in another. Most often, streets will change names as you proceed through from one part of the city to another. This made driving fun and difficult, but it forced me to learn landmarks and develop a topographic understanding of the city’s throughways.

More than ten years later, my wife and I moved back to Cincinnati and now it’s her turn to figure out the streets. She, of course, has the handy-dandy smart phone with the not so helpful Siri. She also has OnStar and those people will bend over backwards to do your bidding. My wife heavily relies on the technology and plotted routes. I get very frustrated when I try to tell her not to go a certain way because instinctively I knew that would be a bad way to go. She often refuses to listen and trusts the formal institutional knowledge Google and OnStar have put together on their servers. Sure, my brain may have less memory and horse-power; but I am much better at predicting the traffic flow and knowing just how long it will take the car to get from point A to point B. My wife, on the other hand, refuses to acknowledge my intimate familiarity with this city’s landscape.

What I have in my brain about the city’s driving ecosystem is a sort of “tacit knowledge” It’s earned through driving countless times and being lost in the city’s maze . . . again, and again, and again. It’s tacit in the sense that I don’t know the street names or which street connects to which. Instead, I know the feel of the neighborhoods, the old buildings that have been there for decades, the empty parking lot that once was a dwindling shopping center. This is not really knowledge in a formal sense since I don’t categorize it by north vs. south, left-turns vs. right turns. Instead, I rely on a judgment on how far I’ve gone in which direction and what’s around that seems right and what seems wrong. The details are voluminous and often mundane; I taken them for granted.

This phenomenon also occurs in organizations and companies. Often referred to as “organizational knowledge,” most people think it can be categorized and transferred. But in part I believe it should not if the objective is organizational growth. Instead of transferring it, your organization or company should really think about permeating it into your organizational culture and to innovate with it.

Think about it, "tacit knowledge" resides with the people who live and breathe your organization or company. They are information or practices that would make a difference in an stakeholder collaborative innovation process because they give you a sense or feel of what’s right and what’s wrong. That’s why when companies innovate, they should rarely rely on outsiders to do the job. Leaving it to strangers to create means leaving them with a map and letting them find the formal path that you would’ve found anyway if you weren’t so lazy. Internal innovation means stakeholder involvement and getting comfortable with the way things will come together in a group setting. When tacit knowledge of a group of internal stakeholders is put together, you will find they inherently find a pattern and a path forward.

This is an intuitive way of moving forward. It's much better than the institutionalized methods of paying for a boxed thinking. Out of the box I say.

Wednesday, December 17, 2014

Think Well of Us and Judge Us Not Too Harshly

“Tomorrow, without doubt, you will be leaving us. When you arrive at your destination, think well of us and judge us not too harshly.” - The doum tree of Wad Hamid.

My wife recently said that she would cry if and when the Dali Lama passes from this world. She, and I, find solace in his words and his laughter; we could not bear the thought that he would eventually leave this corporeal place.

“Would there be another Dali Lama?” My wife asks. “What would happen to the Tibetan people?”

The Tibetan people would live just as they did before and after; the spiritual presence of the Dali Lama would persist. No government could dictate the presence of a religion before religions; Buddhism would be as it always has: detached from this worldly madness.

Its songs would be righteous. Your mind tricks would not take its place. History would kindly remind us that you have run afoul with your words; enemies of mankind would be in their proper place.

I’m a man, I listen, I am not afraid to die; or else I’d be hiding in my place, listening to your lies, quietly carving my soul away to your duplicities.

Through the round of many births I roamed

without reward,
without rest,
seeking the house-builder.
Painful is birth
again & again.

House-builder, you're seen!
You will not build a house again.
All your rafters broken,
the ridge pole destroyed,
gone to the Unformed, the mind
has come to the end of craving.

Thanissaro Bhikkhu, Commentary to the Dhammapada, Verses 153-154

But the young would be reborn in your image. They would go away to schools, learn the modern Jedi mind tricks. They would return to Tibet as many young have returned to their roots in Africa and the Middle-east; they would cut down the doum tree, drill the precious riches, sully the saints, spit on the graves of the once sacred journeys. You would buckle them down to your riches; let them do your dirty work. You would teach them the deconstructive ways.

"Why are you trying to build something spiritual when you can build something material?"

The young would fall to your guiles.

“What all these people have overlooked is that there’s plenty of room for all these things: the doum tree, the tomb, the water-pump, and the steamer’s stopping-place.”
- The doum tree of Wad Hamid.
辋川集 | 宫槐陌 



This narrow path beneath the great trees
is edged darkly with thick greening moss.

We keep it swept clean before the gate, in
expectation of wandering mountain monks.

          Wang Wei, (701 - 761 AD)                                               

"With a selfish attitude, oneself is important, and others are not so important. According to Shantideva's advice, a technique to help in turning this attitude around is to imagine- in front of yourself as an unbiased observer- your own selfish self on one side and a limited number of other beings on the other side- ten, fifty, or a hundred. On one side is your proud, selfish self, and on the other side is a group of poor, needy people. You are, in effect, in the middle- as an unbiased, third person. Now, judge. Is this one, single, selfish person more important? Or is the group of people more important? Think. Will you join this side or that side? Naturally, if you are a real human being, your heart will go with the group because the number is greater and they are more needy. The other one is just a single person, proud and stupid. Your feeling naturally goes with the group. By thinking in this way, selfishness gradually decreases, and respect of others grows. This is is the way to practice."

"If there is love, there is hope to have real families, real brotherhood, real equanimity, real peace. If the love within your mind is lost, if you continue to see other beings as enemies, then no matter how much knowledge or education you have, no matter how much material progress is made, only suffering and confusion will ensue.

"Human beings will continue to deceive and overpower one another. Basically, everyone exists in the very nature of suffering, so to abuse or mistreat each other is futile. The foundation of all spiritual practice is love. That you practice this well is my only request."

-- His Holiness the Dalai Lama, from "The Path to Tranquility: Daily Wisdom."

Tuesday, December 9, 2014

Efficient Governance or Good Governance

I recently found my way to Matthew Andrews’ blog – The Limits of Institutional Reform in Development. I must say, the guy is pretty intense. I put his blog's link on my site here so you can check it out. If you don't know who Matt Andrews is, well, get to know him. He happens to be one of the brains behind the Doing Development Differently and the Problem-Driven Iterative Adaptation (PDIA), to which we recently signed on to the cooperation.

PDIA is a research working paper series co-authored by Matthew Andrews of Harvard Kennedy School, Lant Pritchett of Center for Global Development and Harvard Kennedy School, and Michael Woolcock of the World Bank. The paper series is aimed to develop a process of sustained global development efforts focused on real sustainable progress, not just lip-service. As any process-based approach, it involves defining the ecosystem of a problem and arrives at a sharpened scope of the process to be controlled. It then creates an environment where development can get the buy-ins of stakeholders (an “authorizing environment” as the Harvard guys called it). Following a process control loop-back system, the process concludes with re-emphasis on stakeholder engagement. This slight deviation and final emphasis on stakeholder engagement differs from a traditional process improvement approach of define, measure, analyze, design and control. It must be noted since it is there to anticipate the problems of multi-variables that exist in a human environment (as opposed to a machine instruction context in industrial 6 Sigma). Simply put, if you are dealing with humans, you must double your effort to get buy-ins so all parts must work together.

I enjoy reading his blog. Matt Andrews’ voice fills a void in the sustainability conversation. Where most people find human rights the default topic to discuss and some even attempts at attaching environmental issues to the conversation of the poor, Matt Andrews focuses on good governance and development in the world without the cliché of throwing money at the problem. He is much more involved from a governance point of view and seems to focus on indicators of good governance to distil the best practices that he warns us to instinctively repulse.

Yet I think he sometimes gets the message distilled too much. For example, his most recent blog post on energy consumption as a good indicator on good governance misses an important point about development in sustainable ways. He made the point that more light is an effective measure of good governance because: governments are the ones authorized and required to make electricity accessible; a healthy regulatory framework and public interest of production and distribution of electricity means the government is doing a good job.

Well, partly yes. I agree more access to electricity means more efficient governance, but efficient governance doesn’t necessarily mean good governance. For example, US and Europe are the two most electricity accessible regions and look at how much energy demand we put on the world as an ecosystem? Look at China and see how bright it is in where pollution is at its worst? Put it simply, to you Harvard guys, let’s distinguish between efficient and capable governance with actually good sense governance in terms of sustainability.

Saturday, December 6, 2014

The 3D Manifesto

I followed a cookie trail today to PDIA (Problem Driven Iterative Adaptation). At its core, it’s a process based governance development theory that’s also focused on engagement and influence. Intrinsically it recognizes the bifurcation between people and society, the fact that complexity demands systematically factored and analyzed steps or iterations, and encourages learning from positive deviance or good disruptive thinking in an attempt to get people to think and “do development differently.”

It is the exact same thing my wife and I have been doing for a while now. We just don’t have the fancy acronyms and the prestige of “Harvard” to stand behind. We call our little project “BrainBox.”Although our work is slow to gain traction, but at this exciting discovery of the 3D Manifesto we are validated. Yup, that makes a pretty good day

The DDD Manifesto – the BrainBox abridged version.

“Ask, think, create and do; with your ecosystem of empowered stakeholders.” 

 Developments with real results usually involve many players – governments, civil society, international agencies and the private sector – working together to deliver real progress in complex situations and despite strong resistance. In practice, successful initiatives reflect common principles. 
 • They focus on solving local problems that are debated, defined and refined by local people in an ongoing process. 
• They are legitimised at all levels (political, managerial and social), building ownership and momentum throughout the process to be ‘locally owned’ in reality (not just on paper).

• They work through local conveners who mobilise all those with a stake in progress (in both formal and informal coalitions and teams) to tackle common problems and introduce relevant change.

• They blend design and implementation through rapid cycles of planning, action, reflection and revision (drawing on local knowledge, feedback and energy) to foster learning from both success and failure.

• They manage risks by making ‘small bets’: pursuing activities with promise and dropping others.

• They foster real results – real solutions to real problems that have real impact: they build trust, empower people and promote sustainability. 

You can look at the 3D Manifesto here.There’s a pretty impressive list of people who have signed on to the Manifesto and as of today, we have also signed.

the green elephant Headline Animator