This is China! BLOG

Innovation in China: No Joke

“An American, a Swiss, a Belgian and an Englishman were all having a drink in a bar, when the American asked…”

It sounds like the beginning of a bad joke, but it is actually what happened a couple weeks ago at a recent mixer in Shanghai at the Manifesto Bar, upstairs from the Mesa Restaurant on Julu Lu, a chic and relaxed establishment. I was the American in the group. I asked a group of engineers with years of experience in China and in Asia in general their thinking about the root of the innovation bottleneck in China. I had already had two glasses of red wine, and figured what the heck, if they think I’m a nerd then so be it. But I’ve been intrigued of late with the contradiction the Chinese leadership has set up for itself of announcing to the world its desire to be a technology leader and global innovator while simultaneously clamping down in the time-honored fashion on dissent, original thinking and censoring information dissemination, whether in the press or through newer technology channels like the internet.

Phil, a tall Englishman in his mid-sixties with a great white Saint Nicholas beard and a shock of white hair immediately responded, “Chinese employees dare not come up with a new idea to present to their boss, especially in a meeting.”

“Because they’re afraid the boss will take the idea?” I asked, starting on my third glass of wine. It was an Australian Cabernet Sauvignon-Shiraz varietal. Dry and fruity, just the way I like it.

“No,” he said resolutely, “because they are afraid they would make the boss look bad. And, of course, the boss doesn’t want to appear ignorant.”

“The man with the plan,” I chimed in.

“Sure. The boss and the other employees may also think the guy with the idea wants the boss’s job. In China, you cut off the head that pokes out.” I think the Japanese version is, “you hammer down the nail that sticks up.”

I interjected, “But Japan works the same way, by all accounts, yet they’re the second most innovative country in the world, if you look at the number of patents they file each year.” The United States is first.

The Swiss, Rene, a towering, freckled fellow in his mid-forties, said, “Kaizen. The system of continuous improvement. The Japanese came to believe through its adoption of Total Quality that innovation comes incrementally, from the bottom up.” Total quality in manufacturing production and assembly allows for the entire work flow to be shut down when an operator finds a defect. A team is then put on the defect to understand where in the process the defect occurred, correct the process, and modify the process if necessary so that future results are even better than past ones. “Also, Japan has historically had a culture of refinement, in which ‘how’ you do something is as important as the result,” Rene added. “Kaizen was natural for them to adopt.”

Phil, the Englishman, said excitedly, “The Japanese go to the laziest guy on the assembly line. He’s the one who works the least because he knows his job and machine the best. The managers ask him, ‘What do we need to do to improve the process. He’s the one who’s had the most time to think about it, so he tells them, and they accept it. He is the master of his machine; he knows the best.”

“But what about the Koreans? They’re pretty innovative?” I slurred.

“The Koreans never dismantled their chaebol,” the Swiss said. The Englishman nodded agreement. The Belgian remained interested, but seemed uncommitted to a stance. “The chaebol are family owned conglomerates with close ties to the government. Change – unless it’s within their best interest – is not necessarily encouraged in the corporate culture.” I gathered the presumption was that the Japanese keiretsu – which pre-date the Korean chaebol as conglomerates with close ties to government – were less family-owned fiefdoms than great national economic and bureaucratic fixtures, as the Japanese firms seemed to me.

“But getting back to the Chinese,” I re-directed the flow of the conversation.

Rene picked up the thread immediately. “The Chinese historically never generalized application of what they invented. Like the Bible: when Interesting post, as always. However, the guy with the movable letter press was Gutenberg printed the first Bible with his printing press, people said, ‘Well look, we can also print this and that and that over there. The Chinese simply never felt the pressure to apply their inventions to change their lives.”

“They were comfortable. Number one in the world,” I concluded, “no need really to refine basic research to improve their society through technology or to defeat enemies they really didn’t have.” The Englishman and the Swiss looked satisfied.

The Belgian remained divided.

Bill Dodson
SUZHOU, China