Many JIT-solutions

Just-too-late, the Chinese management concept – The WTO-column

(later also at Chinabiz)
My earlier comparison of the Japanese and Chinese management style triggered off some reactions, despite the ongoing holidays. Some people thought I was far too harsh on the – lack of – Chinese management culture. This column does not offer enough room to really go into the issue much deeper, but I do think it makes sense to recall how profound the influence of Japanese management styles has been on companies worldwide.
The now so familiar concept of outsourcing non-core activities and the formula of just-in-time logistics were triggered off by the fierce competition by Japanese companies. Those concepts in some of the Japanese industries were initially used by Japanese companies in Europe and the US, but after an initially wave of fear other global businesses adopted similar methods. Suppliers and retailers were forced to fit into this new style of managing companies by their multinational clients.

That system allowed Japanese companies, operating from one of the most expensive countries in terms of wages and other costs, to produce for example cars against competing prices. These heavily-studied features have changed the way how companies operate compared to the 1960s and early 1970s in a most profound way.
Compared to that change, I wonder whether China is going to trigger off a similar change, allowing European and US companies to compete with the flood of Chinese products that are submerging the global markets.
While Chinese companies have a distinct ways of operating, it is not that easy to copy by the outside world compared to the military style Japanese drive to efficiency. What makes most Chinese companies different is their profound lack of systems. Let me illustrate how this works.
My Shanghainese wife has started last month a job with a US company and has been traveling much of her time through Europe. Very little time was left to pick the new lease car she got as a part of her compensation package. Can you call the fleet manager and arrange it, she asked me. The fleet manager reacted shocked when I called him a day later. “This is the first time in 25 years I have to deal with a partner of an employee and not the employee,” he said. Welcome to the Chinese management style, I almost grinned, but I could restrain myself.
Nothing is sacred, not the 25-year experience of a fleet manager, no business plan, no rule, no appointment, no payment, no contract, no tradition, nothing. Everything is negotiable, every moment of the day. When well-regulated developed countries want to compete with China Chinese-style, it will be a very different struggle from the earlier fight with the Japanese. For the time being, I will baptize the Chinese system the ‘just-too-late’ system, a nice variation on the Japanese ‘just-in-time’.
Introducing the concept of outsourcing and just-in-time caused a decade’s long struggle in changing established European and American companies that were almost in an advanced state of rigor mortis. Too adopt the Chinese style might be tougher, as it throws out much of the advantages gained with the introduction of Japanese management styles.

Fons Tuinstra