Managing change in China

I write regarding the current debate on whether countries around the world should boycott the Olympic Games in China, or protest, as we have seen today, by trying to stop the Olympic Torch. 

But I know China about as well as I do my neighbour at number 12, which is well enough to say hi if she is outside, but beyond that, not at all: so what is my perspective?

My experience lies in the management of organisations and in the management of change.

Taking from Jim Collins must-read book Good to Great, organisations that are successful over a long run often have a strong yet humble leader (as opposed to brash know-it-all), a culture of discipline (rather than of bureaucracy) and a spirit of entrepreneurship.  This latter manifests itself in the ability to flex given new challenges and for all strata within the organisation to think creatively within the framework.

This all sounds pretty simple and as you know, I love simple.  But even SME’s struggle to create environments where these things come together and the complexity of the task multiplies the larger the organisation.  Imagine, for a moment, sitting at the head of a widget manufacturing organisation employing, say, 1,300 people and coming to the realisation that your existing structure, incentives and culture do not support the current strategy for the company, let alone the forward strategy.  You can’t very well sack your whole workforce and hire afresh, so where do you start? 

The process needs to be carefully managed so that you don’t alienate sections of your workforce, your customers or hand your commercial advantage to your competitors.  And employees are funny about being told what to think, so you have to help them to discover for themselves why changes are required and work with them so that they gain some ownership of the change process.  This is useful to know in advance, because if you rile or embarrass staff at an early stage, they could just dig their heels in and stand in the way of progress, jeopardising your plans.

In their book Corporate Turnaround, Stuart Slatter & David Lovett put forward a framework for implementing a successful turnaround, expecting it to take between six months and two years to implement successfully.  That’s after the analysis & planning stages which together could easily be a further two to seven months.

So, to manage a change process in our mid-sized organisation, we may be looking at a process taking a year or two, involving complex scenario planning and the kind of seamless internal and external communications that requires total focus.  Which might not be too bad except that we still need to produce widgets, compete in a dynamic industry and innovate.

China is roughly the same size as the United States of America, but it has more than four times the people, equating to a fifth of the world population.  This is one million times larger than our imaginary organisation and unlike the relatively simple challenges of our widget factory, it has simply staggering environmental challenges (if you’re interested in a neat overview, read Jared Diamond’s book Collapse), is undergoing massive economic and structural change and is learning to compete on a global stage.

From what I have read and from attending the recent Centre for Creative Business Creative Exchange with China conference, I have no doubt as to the genuine appetite for positive change. 

To my mind, to boycott the Olympic Games, the shining egalitarian beacon of world friendship, is to completely misunderstand the complexity of the task that the Chinese face.  A proud China shunned by world leaders and vilified by the popular press will lose face, be embarrassed, will dig their heels in, close down communication channels and will ultimately be unsuccessful in implementing the change that they and we desire.

This may well suit the Machiavellian aims of competing world governments, but if we truly want to help China change, and the incentives to do this are clearly there from an environmental perspective alone, we need to embrace it openly and show forgiveness. 

With 1.3 billion people to manage, change will not, cannot, happen overnight.  Sure, we need to be persistent in our disapproval of human rights violations going forward, yet this must be in a measured way.  And we should also be quick to applaud their successes, showing patience and understanding.

Even simple change is difficult and stressful, but complex change is exponentially so.  It is going to be difficult enough to help China through the next decade or two, but if we seek to teach them an embarrassing lesson for having the strength to try, it could make the task almost impossible.

Postscript.

If you feel that I’m being alarmist, consider what happened in 1919 when the Western-centric Treaty of Versailles sparked the May Fourth Movement, precipitating an intellectual turning point in China.  The previously appealing ideas of western-style democracy were shunned by Chinese intellectuals and a period of radicalised inward-facing thought was ushered in.

2 comments to Managing change in China

  • mike ashworth

    I read your post with interest David.

    To show forgiveness to a person or entity who has done wrong is a very good thing however to embrace and show forgiveness whilst human rights abuses are still taking place can never be the correct stance to take.

    Asking governments / sports teams to boycott the Olympics is a pointless exercise as everything the Olympics used to stand for was corrupted many years ago (read “New Lord of The Rings” for more info on this).

    Many Companies are becoming nervous about their brands being aligned with such a large event taking place in a country whose government has committed abuses of people’s human rights. In all likelihood many Brands will withdraw, which is the correct thing to do to maintain / manage their reputation.

    A brand could (or most possibly will) be destroyed by the conversations that take place around it by supporting such an event.

    Mike

  • David

    Thanks Mike.

    And yet people buy goods and services from China on a daily basis. Global brands are falling over themselves to invest there. Neither of these groups show their concern in an overt way.

    If our desire is to foment change, then developing closer links, friendships, within the country is a far more likely strategy for success.

    So what is different about the Games? Look at the rhetoric in the news: talk of the Games as Pro-China propaganda; their complicity in Darfur; human rights abuses; brutality in Tibet; bloody tyranny; seeking recognition of the region as legitimate; the worlds greatest dictatorship; totalitarian.

    Are we so squeaky clean that we have the right to unleash this tirade of anti-Chinese propaganda? What of our complicity in Iraq, or any number of other illegal regime changes and ‘social engineering’ projects? Our human rights abuses in Guantanamo Bay, water boarding etc.

    I’m not standing on one side or the other, but merely seeking to make the point that governments, whether democratic or dictator, face major challenges in managing their countries and some of the methods they adopt are necessarily expedient.

    By the way, I don’t concur that dictatorships are inherently bad things: Voltaire believed that an enlightened dictatorship was a much better force for positive societal change. I see this borne out by the most successful companies of the last hundred years.

    Over time, idealists might hope that we can eradicate suffering, and we should surely try; But our collective history, of thousands of years, suggests that this is a futile cause.

    One last thing. When Mitterrand said he would boycott the opening ceremony of the Games, my clear recollection is that Brown said he would not. To then claim that he was never scheduled to attend the opening, smacks of duplicity. Politicians try too hard to be popular and lose credibility every time they do.

    So in my view, brands could now seek to distance themselves from what a more radical minority (relatively on both counts) are hoping is a metaphorical sinking ship; but they will be the ultimate losers. Along with the more genuine supporters of change within China.