Wednesday, June 27, 2012

Competing On Design: How China Is Winning

I teach that if you want your product to sell in USA, it must be designed in USA, by USA designers.  China has opened a design center in USA so they can sell their cars in USA.

One particular complaint about auto repair is we are at the mercy of the mechanics.  The Chinese cars will have a system in which all owners of their cars will know by diagnostic equipment what the problem is before they enter a repair shop.  They will have access to DIY solutions.  They will share their knowledge with all other owners of cars.

In USA, automakers buy ratings from JD Powers, scam the repair reporting system to gain higher rankings, and bail-out failed companies.  In the meantime, the Chinese simply listen to the consumer.  It is a disgrace that USA has not come up with such a system.  But then why should they?  They know they will always be bailed out.

China has announced they do not intend to make shoes for Nike, they intend ot be Nike.


I teach cheap labor is not a factor in international trade. What matters is management.  USA management competes with foreign management.  China has offered to rebuild USA infrastructure.   

Over the past 10 years, China Construction America has grown from about a dozen employees to today's 1,000 in the US. Ninety percent of the staff, according to Yuan, are local hires.
...
"We only employ union workers at our New York job sites," said Yuan, adding the company agreed to follow the "Buy America" rule for the Alexandra Hamilton Bridge project as one condition prior to the bid.

What to make of this?  if the 900 are USA citizens and 100 are Chinese, we can imagine the 100 are managers.  The Chinese buy “America” and hire union labor. What matters is management.  USA management competes with foreign management. 

The Chinese no doubt lost a bundle getting to this point, but so does USA getting to the point where Boeing jets sell well overseas.  What sustains them is competence.


Not all Chinese have gotten the message.  Heavy ad dollars are going into this new brand:





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