Poorly made in China – Poorly managed at the US

"Poorly Made in China – An Insider’s Account of the Tactics Behind China’s Production Game" by Paul Midler is an interesting look into the personal experiences of an American manufacturing middle-man consultant working in Pearl River Delta. The book was sent to me for review and I must say that although I’ve read quite a few books on China, this one was slightly different and that made it much more pleasant than some of the rest. Surprisingly, it was a bit like reading Paul’s personal blog that included long details of his personal experiences, his personal life and his personal perceptions of modern China. The fact that Paul and I have a few things in common made it especially funny at times. If you think you might enjoy reading a hard-copy full-length blog-like account of personal encounters in China, as I do, you’d probably like this one.

Still, having fun with the way the stories are told was strongly contrasted by what I thought about what Paul’s add-on comments suggested about China. "Poorly Made in China" is a title begging popularity among China-bashing foreigners  looking to reinforce their negative stereotypes about China. It’s what the west wants to read to drive the China fear forward. "Sister", the manufacturing plant boss who is one of the dominant characters in the book is the ultimate Chinese "Witch of the East" that will do everything to stop little Kansas Dorothy from returning back home to the US from over-the-rainbow-land-of-Oz-China happy and rich. She’s all that the Chinese stereotype has been built up to in order to describe the cost war in China, she is the ultimate evil – she’s smart, stupid, clever, fast, slow, manipulative, innocent, exploiting, and unaware, in an extrapolation of opposites that makes it impossible for anyone, even a Chinese speaking business masters graduate western consultant like Paul, to understand how she thinks. And so, we’re left to conclude one main motivator – money. With every chapter Paul tries to figure out what makes her tick and every chapter comes back to the same extreme negative conclusions regarding Chinese culture, Chinese ethics, Chinese morals and Chinese way of life. Sister and the Chinese manufacturers are money sucking materialistic animals that would sell their souls and the world to make an extra buck, while the American companies are portrayed as innocent victims who are mostly forced to play along. Sure, there are moments of sympathy with the local Chinese and some criticism against the fast-money Americans that go along with the Chinese mind-games without understanding what they’re doing, but all in all this is a book criticizing China.

The peak of the book, I believe, is when Paul is so overwhelmed with his personal experiences of manufacturing in China that he stops using Chinese made products and resolves to looking for the product’s country of origin to determine whether he should use a product or not. One can not help but feel sorry for Paul for his loss of faith in the system he is trying to work with in a country it’s obvious he has some emotional connection to. Reading this, one can also not feel anything but sad for all the ignorant foreigners who keep using the Chinese products not knowing how bad things can get. Yeah, that’s us. "If only everything was made in the US", we hear ourselves thinking, "If only that… the world would be so much better". Our problem, we are led to believe, is that we let the Chinese do this, we let them take over the world with their inferior products, IP infringing, health hazardous, and cost driven malpractices.

Obviously, I’m uncomfortable with this message. It’s more than that, I’m deeply bothered by this attitude. While raising a smile when reading some of the cultural descriptions it often happened that the smile turned into shock and discomfort with Paul’s conclusions. In some of the texts I thought – if this was written about Jewish people (a common background both Paul and I share) or African-Americans this way, there’s a strong chance it would not be as well accepted. But when it comes to discussing China and the Chinese – everything goes.

I admit it, I’ve never worked in manufacturing and I know very little about that world and the Chinese context of how business are conducted in this industry, but there is something that I would like to share from my professional life on the topic. Working in IT with some of the world’s largest American based IT companies in multi-million US$ long term contracts I should point out that the cost-cutting and contract redefining behavior leading to reduced quality, inadequate design, lacking quality assurance, and a much inferior product than was originally agreed upon is a global business phenomenon that transcends industry, nationality or culture. If you think the American legal system and reputation sensitive companies don’t play rough in business, you’re either naive or blind. A nice related quote on that comes from the blockbuster movie Armageddon :

"You know we’re sitting on 4 million pounds of fuel, one nuclear weapon, and a thing that has 270,000 moving parts built by the lowest bidder, makes you feel good, doesn’t it?"

Though this doesn’t justify or clarify any of what’s described in the book, the point I’m making is that discussing this as if this is about Chinese or a unique Chinese phenomenon is at times misleading. In the Mattel case, which Paul mentions every now and again about the poisonous  toys produced in China, the case actually includes two aspects – one is the painted poisonous lead somehow used in Chinese manufacturing process and the second is a flawed magnet design at the US. The fact that such incidents occurred in the past elsewhere with the company and that they started occurring in China after all manufacturing was moved to China only suggests that while manufacturing is to blame there are some managerial responsibilities and general project management chaos that leads to those issues. Stats my professors like to throw around is that 80% of the world manufacturing is now in China, it would make sense that 80% of the manufacturing scandals would be China related. Mattel finally forced into apologizing to China had to do, ofcourse, with the fact that China can put pressure on Mattel to crawl back, but also that it was wrong for Mattel to throw all responsibility over to China in the usual western practice, it was a somewhat unfair too-easy uncalled for scapegoat strategy.

The book does a fairly good job of showing the fallacies in American thinking about the opportunities in China. Paul knows something is wrong and smells trouble when the American businessman can’t figure out how the Chinese factory is going to make money. The game that’s been played throughout the book by the foreign importers is pushing for the lowest prices, assuming but not demanding a certain standard when contract is signed. They focus on the price and assume quality which is rarely explicitly stated, articulated or elaborated, and often actively turn a blind eye when they do know how things are done. Paul accuses the importers of playing along with these games, but seems pretty sympathetic towards their crushed-in-the-middle situation between the Chinese manufacturers and the American retailers, pointing the blame at law-less China. While there might be truth there, I think that whether manufactured in China, Taiwan, Japan or the states, this will all be the same anywhere if management or contractors push for this dangerous game. One thing to be said about the successful Chinese is that they will do an excellent job of adjusting to what ever it is that you want them to adjust to, even if it’s flawed contracts and dubious business practices. What ever wrong is taking place in China when it comes to western businesses, I disagree with Paul that this is mainly about China but agree with Paul that we need to take a much closer look at how we do business in China and what morals, conduct and ethics we bring in to the game.

Before another hot-headed commenter explodes at my non-mainstream comments I will repeat what I answered in a previous comment :

[I'm not] suggesting cutting slack for China or not exercising morals and ethics when doing business in China. Quite the contrary, I would like to see more of that on a global scale. We, the foreigners, [...] simply don’t do that. This is where I’m feeling uncomfortable.

The other point was that when it comes to judging a culture different than our own which we’re not familiar with we should approach with extreme caution. Especially when we decide for others how they should live and what they should do. Applying general stereotypes to a culture or a country suggesting that we know better is a very problematic attitude. We, the foreigners, simply do that ALL the time.

Stories should be told, observations should be shared, [Paul] has my greatest appreciation for the work [he's] done in bringing those stories out into the open, but when it comes to judgment and criticism we are to try and realize that the situation might be a bit more complex – as [he] does at times try and point out. Reinforcing stereotypes is easy, trying to see things objectively is far more difficult.

Bottom line – I recommend you have a look and make up your own mind, it is worth your time. Do let me know what you thought about the book – I’m interested.