Business philosophies influence each other

Hong Tai Li has capitalized on America’s employment opportunities.

This year marks the China native’s 10th as an employee of Pellham Phillips Architects, where he works as a project architect and as liaison between Pellham Phillips and the Chinese firms with which the Springfield-based company does business.

Pellham Phillips’ major project in China right now is the Nine Dragon Lake Hotel, a $13 million, 400,000-square-foot resort hotel in Guangzhou, China. Li was an architect and manager at a Guangzhou firm before moving to Kansas for family reasons, then to Springfield, in 1995.

Banta Foods Accounts Manager Lee Zhang also is a native of China. He came to Springfield to attend Missouri State University in 1988.

Li and Zhang have differing perspectives of Chinese and American business practices.

“The differences are in the language and the culture, but the ways they do business – especially in building – are basically the same,” architect Li said. “I don’t see any problems for American business who want to do business in China … other than the language and the culture.”

Zhang offered this view: “The business concepts are the same – we’re all in business to make money. But the Chinese way is that it doesn’t matter what way you go to reach your goal.

“Here there are rules,” he added. “You need to follow the rules, and they will lead you to success. Over there, they don’t pay too much attention to the rules; they try to get there by any means.”

Such cultural perspectives are just what Springfield business leaders are after in their quest to tap a vast Chinese economy.

“The main thing for us is to just learn about those differences – that’s the phase we’re in right now in making connections there,” said Brad Bodenhausen, Springfield Area Chamber of Commerce executive vice president, who was part of a delegation of area business leaders that traveled to China earlier this year.

“You need to have a contact there that looks out for your interest – someone who speaks Chinese, knows the culture and represents your interests,” he added.

Getting past the differences

Several area manufacturers have operations on the ground in China.

Tuthill Pneumatics Group, 4840 W. Kearney, is part of two joint ventures in China, one each for its vacuum pumps and blowers, through its parent company, Tuthill Corp. of Burr Ridge, Ill.

Tuthill Pneumatics President John Ermold said differences in attitudes toward efficiency can create issues between American and Chinese firms.

“For example, we may have one person doing two operations here, whereas they would have one person doing each operation,” he said. “Changing their mindset – showing that this can be done with one person – can be challenging at times as well.”

Management styles also can differ, according to Bob Ringgenberg. He’s the director of China supply chain operations for 3M and formerly worked in 3M’s Springfield office.

“I would say typically the China management style is a more top-down approach rather than the participative style you find in many Western cultures,” he said via e-mail. “But this is changing as China changes.”

The opportunities for cross-Pacific employment, however, do have drawbacks.

Rita Needham, director of the Southwest Area Manufacturers Association, said the U.S. manufacturing industry has been fighting for years to try and keep up with the availability of cheaper labor overseas.

“Sometimes that involves automating more, maybe buying products or component parts from China and using that in your product, and sometimes that’s going to involve doing business over there, whether through a joint venture or setting up a company,” she said.

“(American manufacturers) are constantly having to adjust to market pressures to stay in business. Manufacturing, unfortunately, is like doing business in shifting sand. Everything is continually changing,” Needham added.

She pointed to the results of a study conducted in mid-2004, which stated that U.S. companies have a 22 percent cost disadvantage over companies from other countries, due to the impact of energy, health care costs and “overburdensome regulations.”

Needham said that despite the challenges of keeping up globally, doing business overseas can present opportunities for expansion at home.

“It allows them to be competitive with pricing here,” she said, “but I think it also allows them to keep the jobs that they have here in the United States.”

Architect Li said he feels that if a company is willing to work around the cultural and stylistic differences, there is opportunity for success.

“China really wants the American influence, because they want to put themselves in the global market,” he said. “The ordinary Chinese person wants to enjoy and buy things like an ordinary American here can. That’s a big opportunity for American business.”

Click below for more in the series on business opportunities in China:

Tapping the China market

Universities help build bridge across Pacific

Local companies searching for trade options in China