Archive for August, 2008

Liu Xiang and Transparency

I was flipping through NBC Olympics last night, and managed to catch a glimpse of Liu Xiang before he withdrew.  He was grimmacing so much before the start I couldn’t help but wonder: shouldn’t he have withdrawn before the match?  I see several rationale for him to make his brief appearance… To be very cynical, it can be a commercial decision.  Liu has obligations to Nike, for example.  Or, perhaps it is image control – to show that Liu is really committing above and beyond.  Whatever it is, he didn’t show up because he thought he could be competitive.  He knew for a long time that he won’t be.

Which brings up the topic of transparency.  If Liu have been injured for months and knew he wasn’t going to be competitive before the race, wouldn’t it be better for him to brief the press ahead of time?  The higher the expectations, the higher the disappointment.  Transparency and honestly plays well towards public opinion.


Read Full Post »

I first came across this topic while reading the China Law Blog, which I respect greatly.   Here’s Businessweek’s version titled: Li Ning Pulls off Olympic-sized Marketing Ambush.

My first reaction to this was… are you serious?!  First, let me just say that I grew up watching Li Ning performing at the Olympics.  If you ask me who I think is the greatest Olympian of all time in China, Li Ning will be in my top 3, if not the top.  When Li Ning flew around the Olympic Stadium, all I could think of was his career as a gymnast (including a few embarassing falls towards the end of his career).  I also start to worry he might drop that flame while “running” around…

Dan from China Law Blog writes:
Adidas pays around $80 million to be a sponsor of the Olympics and Li Ning gets to carry in the torch, figuratively burning much of that $80 million. This is just so analogous to the legal treatment of foreign companies in China.
China laws/rules are generally the same and for both foreign and domestic companies (at least with respect to those industries where foreign companies are allowed to participate as Wholly Foreign Owned Enterprises, or WFOEs), but when push comes to shove, it certainly helps to be Chinese.

In other words, since Adidas paid up $80mn to sponsor the Olympics, Li Ning carrying the torch is a slap in the face.  He implies also that this is a planned “ambush” by Li Ning (the brand).  Perhaps Dan and others did not grow up with Li Ning and are not familiar with his significance.  Or perhaps we have grown so cynical of China business practices that we think of everything as a conspiracy theory.

I generally agree with Dan that it helps to be Chinese when getting into business legal disputes in China.  I do not think, however, that this is illustrative of such a case.  It is, however, an illustration of the generalization that the Chinese are out there to rip us off.

Read Full Post »

A year ago, I wrote this piece, concluding that Danone will never win the fight.  And here we are, one year later, Danone just lost an arbitration case in Sweden.  Wahaha has won the fight and there’s nothing Danone can do about it.

Dan’s post titled “Wahaha and why you need a real lawyer in China” in the China Law Review gives a wonderful analysis.   What’s surprising about this chain of event is that Danone doesn’t even have all its legal documents in place.  You would think a global corporation like that will have protected itself.  This gives me a couple of warnings, on top of Dan’s suggestion on getting a good lawyer:

1) Don’t be lazy.  Legal process in China is long and painful and arbitrary.   But never give up or cut corners.  Limit your risk exposure while you wait (and wait you will…).

2) Understand what’s enforceable in China.  You can put all kinds of terms on the agreement, but if they’re not enforecable according to Chinese laws, they might as well not exist.

3) If you think this event is a total loss for Danone, or that his Chinese partner is evil… then you probably should not do any business in China.  China is an emerging market.  Play at your own risk!

Read Full Post »

Customer Service

Customer service is certainly not one of China’s strong points.  I have a new view on service, however, after a few trips to Beijing.  If you define customer service as a proactive behavior, then China scores terribly.  If you define customer serice by what you can get done, it’s actually not bad at all.  You just need to ask.  Sometimes not once, not twice, but multiple times.  Actually, I mispoke – asking is a bad idea.  Demand, otherwise you will set yourself up for a rejection.

This seems to be the same in India as well.  In a CNBC speicla called “India Rising”, a call center staff made a comment that Americans are very polite.  Even if they’re really upset about something, they’d ask (rather than demand) certain things. 

Point to self: do as the Romans do!

Read Full Post »