We're here getting ready to embark on our China excursion. Our graduate students have spent the past month preparing for company visits and gaining a perspective on life in China from leading journalists. Now it’s time for them see it for themselves! Our journey will begin in Hong Kong—a city with a never-ending skyline, teeming with hustle and bustle of a leading port for goods and services exported around the world. From the sophistication of Hong Kong, we will drive across the border and enter Shenzhen, once a quiet fishing village and now a city of 15 million people best known for its exploding electronics and high-tech companies and factories. From the center of Cantonese culture, we will wing our way to Beijing, the Northern Capital, where a blend of cultural treasures such as the Great Wall and the Forbidden City will balance our visits to both Chinese and multi-national companies. All of our students are venturing to China for the first time, so enjoy the stories of their visit!
Monday, May 14
Alexandra Nalevenko, MBA '13
After traversing over the North Pole and more importantly triumphing over Canadian transit visas we are finally here in Hong Kong. Monday, May 16th was our first day of company visits and we were extremely appreciative of Lacoste and ImportNow for starting off our trip. At Lacoste we were hosted by AU alum, Emmanuel Labi, who introduced us to the intricacies of supply chain analysis and supplier-buyer relations. It was great to see a class we just took in the spring, ITEC-618 Applied Production and Operations Management, be applied in the real world. The company’s CEO also gave his own opinions on fashion, consumer preferences, and dealings in Asia.
After a group lunch to discuss our thoughts and dig into another great dim sum meal, we were let loose in the IFC building which is part mall, part office building. Some people walked around to look at familiar luxury brands, others investigated the grocery store oddities Myself and my roommate were looking to get a great view only to stumble upon the informative Hong Kong Monetary Authority on the 55th floor.
Our afternoon visit had us joining with the undergraduates to meet with ImportNow, a promising company in its infancy with a focus on helping US companies import their goods into the Chinese market. Consumption of goods is growing at a rapid pace here, but there are many soft barriers of entry to overcome.
For our night activity, some of us went across the harbor to see the Hong Kong laser show. Massive groups of people crowd the waterfront to see the various buildings of across the city light up in sync with music. It was definitely an interesting experience!
Tuesday, May 15
Andrew Olson, MBA '13
Today, we had the pleasure of visiting China Asset Management. We were greeted in their wonderful Hong Kong Office and made feel welcome by their staff before meeting with their head of mission, a well-respected woman that established this office only a few years before. Her intelligence and genuine sense of purpose were immediately apparent.
The organization handles retail asset management accounts on behalf of those who are investing in the Chinese markets. The limitation to retail accounts was primarily due to issues which resulted from quotas related to maximum volumes of foreign exchange on behalf of non-Chinese parties. As such institutional accounts are handled through special relationships with the Chinese government.
Her outlook on the future was optimistic and insightful. Her perspective was that investment in China would continue to grow and that the opportunity it affords to the global financial community should not be overlooked.
For lunch, we visited a traditional Chinese restaurant. The food was well prepared in the local fashion and we all learned that the best shrimp in China are served whole, just as you should eat it.
Our second visit of the day was to the Hong Kong Chamber of Commerce. Due to the rich history of the city, the business community actually holds voting rights in the local government. The business influence in policy is apparent. Only profits are taxable and at 16.5 percent, the city has one of the most educated and mobile workforces in the country. As a result Hong Kong is and will most likely continue to be the eastern financial hub of the world.
The chamber has a simple perspective on the world of business: if we cannot do it better someone else should do it. This perspective has shaped the city’s economy, which is now entirely dependent on trade and built to service trade with China.
Then there was the nightlife, and true to form, the international city did not disappoint as we visited the highest bar in the world. Rooftop bars and upper level patio bars are everywhere and well worth the quick elevator ride—the view was amazing.
After visiting this high paced international hub it is easily apparent that it is not only on par with London and New York for finance and international commerce but also for the lights, sights, and nights. Best of wishes and I hope you all have a chance to visit.
Wednesday, May 16
Meredith Kirchheimer, MPA '12
The atmosphere of the city was considerably different than Hong Kong—with fewer English speakers and a city perimeter stretching much farther. That said, like Hong Kong, Shenzhen's architecture was incredibly impressive. The majority of development in this densely packed city has taken place over the past 30 years but it was clear the population has proven capable of running it like their historic urban counterparts (i.e. Shanghai or Beijing).
Our first meeting was with the telecommunications company, ZTE. We visited their main Shenzhen headquarters that works in conjunction with a larger R&D focused campus. A company representative walked us through an exhibit that contained their firm's history, product line, partnerships, and future plans. There we learned that ZTE ranks high in most segments. For example, they are fourth in smartphone market share—just recently passing Apple. Our guide explained that the retail consumers of ZTE phones tend to be those interested in a simpler or more cost effective version of the iPhone. Unfortunately, an impromptu arrival of visiting executives prevented us from the planned discussion with ZTE's CEO but I think most of us still left with a much more informed perspective of China's telecommunication space.
The canceled meeting left us with time to visit Shenzhen's main university before lunch. After walking around their version of the “quad” surrounded by two libraries and a plethora of bikes and palm tress, Professor Klein remarked how similar it seemed to the University of Miami. Maybe some experiences are universal after all.
After another family style lunch, we took our Kung Pao chicken and rice filled bellies back to our hotel to meet with AU alum, Michael Bellamy. An AU study abroad experience in Asia fueled his interest with China and eventual establishment of the company Passage Maker. After becoming familiar with the culture, Mr. Bellamy recognized a niche in the manufacturing market and created Passage Maker to give clients a physical tool to protect their ideas and intellectual property through non-China assembly centers. He is also a member of the China Sourcing Information Center, a network of foreign buyers who work to protect each other's interests in China.
The theme of Mr. Bellamy's presentation was “getting out of the comfort zone” and he encouraged us to leverage our networks and skill sets if we are interested in a career path like his. His experience in China has been guided by Wayne Gretzy’s famous, "You miss 100 percent of the shots you don’t take” motto. The discussion revealed that such persistence is necessary when dealing with intellectual property. Mr. Bellamy explained that in China there isn't a sense of being embarrassed for stealing ideas; this presents unique challenges for international manufactures that want to protect the sustainability of their products and services. All in all, Mr. Bellamy's presentation was eye opening and left us impressed with his entrepreneurial spirit.
We stopped by a Chinese Wal-Mart in route to the airport and found ourselves surrounded by an interesting mix of familiar consumer goods and eclectic cuisine offerings. Our favorite aisle find—aside from the net-your-own-sea creature and pig’s feet—was hot & sour fish soup flavored potato chips. After filling up on Chinese snack foods we headed to the airport for what would be a painful trip to Beijing. Our scheduled 8:30 p.m. flight was first supposedly delayed due to scheduling problems, after we boarded the AC deprived plane (with a Kenny G & Auld Lang Syne soundtrack) and taxied, the pilot then shared that the flight had been removed from Beijing's control tower arrivals. Upon returning to the gate he then announced that we were actually just low on fuel and needed to refill. With or without the pilot's honesty, we arrived safely in Beijing at approximately 1:30 a.m. and collapsed into our hotel beds around 3:00 am.
Just another day in China?
Thursday, May 17
Kevin Coyne, MSRE '12
We spent Thursday morning touring the manufacturing facility for Mercedes. The first warehouse was the workshop where the Mercedes C class and Mercedes CRZ are produced. We were escorted around the entire facility and were amazed that there were approximately 4,000 workers on the assembly line. Our tour guide stated that higher end vehicles such Mercedes require more skilled workers than automated machines. The workshop assembles on average 12 C-class and 8 CRZ per hour. My favorite part of the tour was watching the body and engine being meshed together. This was referred to as the marriage center.
We spent the afternoon visiting China’s leading web-based media company, Phoenix New Media. The CFO provided insight into the company. It went public on May 12, 2011 and is now traded on the NYSE. Phoenix has unique roots. It founded a leading Chinese language TV network in 1996, established a new media subsidiary in 1998, China Mobile the second largest shareholder of Phoenix TV in 2006, ifeng.com was a spun off and established converged tech platform in 2007, and finally an IPO in 2011. Ifeng is now the fastest growing media portal in the country.