Tom Peters, who presumably found it in this piece, reports:
This banner, in Chinese, hangs in each room of the Hua Xin Li Dress Co., Ltd., amidst the Rongcheng Industry Zone, 100 miles from Beijing:
“THE CUSTOMER IS GOD AND THE MARKET DECIDES EVERYTHING”
People say things like this from time to time, but they seldom mean them, and they never mean them when at all severely challenged
I mean, suppose you were to ring up the Hua Xin Li Dress Co., Ltd. and to say: “Hello, God speaking. I want you to design my daughter’s wedding dress. It must be genuine silk, with genuine gold fiddly bits sewn into it, with miniature iPods for buttons, and must win numerous design awards. However, being God, I don’t want to pay more than 50 pence. Got that did you? Fine. Tomorrow morning then. The wedding’s tomorrow afternoon.” I know, I know, God has no daughter, and if He did have a daughter, she would probably not get married. She would do altogether more dramatic things than that. Not my point. Which is: would the Hua Xin Li Dress Co., Ltd. knuckle under to such a demand? Would they obey God, the customer, you, and supply an expensive product at less than it costs them to produce it? I think not. They would surely respond instead with something more along the lines of: “Not quite our kind of job. If you want lots of cheap dresses to sell in your shop, maybe we can do business. Take a look at our website, and see if there is anything there that you like.” God might not be satisfied with an answer like that, but you, a mere customer, would have to settle for that, or something like it.
Or to put all of the above another way, “the market” includes everyone, and everyone’s desires and plans, consumers and producers. Customers are indeed sovereign, over themselves and what is rightfully theirs, but so are producers. Customers do not have to pay for things they do not want, and producers do not have to produce things they do not want to produce. The market is not some ghastly new tyrant who tells you what you must do, regardless of your rights or wishes. The market is not some hideous and only slightly nicer collective reincarnation of Chairman Mao. The market is the outcome of everyone’s rights counting for something, and nobody’s rights counting for everything.
So yes, the market does decide a lot of things, but the customer is not God.
This is an exaggeration for the sake of effect. The effect may, in a business sense, be good, but it is still an exaggeration, and that is putting mildly.
Considering qualities of some Chinese products I must say that atheism has taken deep roots in the Chinese society.
Maybe the shop owner’s idea of God is of a just entity that would not make unreasonable demands 🙂 ?
The Chinese are the most commercially brilliant people in the world. I don’t think I would have the temerity to mock anything they did to make money.
Since most Chinese factories manufacture to specifications given them by customers outside of China, this banner would have more application to the Chinese than to us.
Verity:
“The Chinese are the most commercially brilliant people in the world.”
I went to a lecture by a Harvard professor who studied Chinese operated businesses in Hong Kong. He said that the Chinese hate being in service industries because they can’t imagine anyone going to an outsider for help.
Having traveled in China, I would say they don’t like service industries either.
Jake, I don’t know what your Harvard professor meant, but obviously, you do have experience of the Chinese and you must admit, they have commercial astuteness coming out their toenails. And Chinese women are just brilliant at business. They just all seem to know how to become a success. And do they ever treat themselves well! I mean you go shopping with a self-made Chinese woman and it’s Katy-bar-the-door.
But plenty of Chinese run service industries. Ever heard of “No tickee no laundly”? They run restaurants. They run TV repair businesses. They run garages. I don’t follow this professor’s thinking.
Verity you may have met a different variety of Chinese than I have. I’m not saying you’re wrong but I have some Chinese friends and some I have worked with that were less than brilliant business wise.
It may be that some of them learnt about business from practical experience and if so I would expect those to be the better ones. But there seem to be a bunch of them that appear to have learnt about business from the communist point of view. ie Business people are liars, cheaters and ruthless. Then when they attempt a business they figure they ought to lie and cheat to be successful. So they over promise in sales and deliver less than what is expected.
This isn’t limited to China. There are lots of people in the UK that seem to think like this. Most of them have never been in business so their fixed ideas are never challenged.
Bernie, I was speaking based on my experience of the Chinese in SE Asia and they are bloody brilliant. I can see the Chinese in China might easily have a different mindset, which is a tragedy because the Chinese I have known are very efficient wealth creators and as PJ reminds us, when the water rises, all our boats go up.
Verity:
The professor would agree with you except for service industries.
“The customer” in the sign mentioned clearly refers to the amalgam, the collective assortment, of customers, rather than each and every individual customer. It’s not an uncommon usage (singular in place of a generalized plural); for example “the voter”, “the Guardian reader”, “the discerning listener” etc.
How is the customer god? Not because some individual schmoe can walk into the shop and demand goods at below cost, but because the collective desire for different features (brighter fabrics, more durability, lower price) are the driving force behind business decisions. That is, customer preference over producer preference, obviously subject to the normal limitations of the possible.
I think it is a commendable sentiment, and great news that it comes from a shop in China.
Bombadil – I couldn’t agree more. I felt quite cheerful on reading it.
I have to agree with Verity. Most Chinese folk I have met are natural entrepreneurs.
There is something else I admire about the Chinese, Johnathan, and that is, they apply themselves. Obviously, I am generalising, but they do seem to be brought up to pay close attention to detail, and to master the details, which is why they are such good, realistic, business planners. They don’t get fed up and goof off. They stick with it.
Ever heard of “No tickee no laundly”?
Cartoon in the New Yorker decades back, done in Chinese brush style showing a landscape with a business building near the middle. “It is with great regret that I must inform honorable customer that without a ticket I cannot return to you your laundered items.”
triticale – I hope it was obvious that my point was the Chinese have been running service businesses in the US and elsewhere for around a hundred years. In other words, these are entrpreneurial people, and when they see a need, they address it and make money. I think this is entrepreneurial.
From my perceptions, the Chinese are good at some kinds of entrepreneurial activities (esp things that don’t need so much start up capital but require quick wits and intensive/skilled labor) and not so great at others, especially those that require the entrepreneur to be kind to strangers (who goes to a Chinese restaurant for the service? compare that with Japanese determination to make the customer feel wanted and honored).
Their achilles heel is their devotion in business to the blood family and Chinese family businesses have a high going-under rate. If number one son isn’t as bright or driven as dad and/or mom (or grandad/grandma), then business goes south very quickly as there’s no question of anyone else being able to take over the helm (the Japanese are a lot less sentimental in this regard and will find a diplomatic way of retiring number one son and getting someone more competent to take his place).
Two things maybe exaggerate Chinese business acumen:
1. The sheer number of Chinese means that there’s a large number of very rich and the much larger poorer end of the spectrum remains more or less invisible outside of the PRC.
2. In SE Asia Chinese economic virtues stand out not so much on their own, but in contrast with non-Chinese ones. Many native SE Asia peoples (Thai, Malay, various Indonesians) were cursed with an easy life and couldn’t compete with industrious, driven Chinese.
Malays etc were more concerned with worldly pleasures and spiritual redemption than storing up riches. The Chinese are perhaps the least religiously inclined ethnic group in existence and unapologetically love money for its own sake.
With all the supposed Chinese business brilliance, how do you explain the huge amounts of bad loans in Chinese banks? And no, those are not all loans to SOEs.
Truth is that in many SE Asian countries, it’s the Chinese who are drivers of the economy: Singapore, Malaysia, Indonesia, even Burma. Interestingly, China herself is home to the most pathetic commercial banks in the continent if not the world. Chinese manufacturing industries have persistent problems with QC. The Chinese are able to make excellent goods, but they usually need an outsider to check the quality. Somebody with code name “God”.
I am surprised by some of the comments above.
I work alot with Chinese and I must disagree with
the notion that they have some brilliant grasp of commercialism.
They are playing catch up economics and most of their population is effectively unemployed. They’re not brilliant…they’re just (at this stage) cheap (Russians earn more per capita)…as are their interest rates.
Their legal system needs to be totally reworked if China is going into the next stage. Contracts are
something the Chinese have little notion of.
Profits is often something that companies often don’t have to officially achieve (they’re culture is used to producing stuff without official profit).
I always thought the Chinese nick stuff from the West and then sell it back to us.Is there a Chinese Bill Gates ?
70 years of Communism have made them robotic serfs – which is now being utilised in a more free market-ish environ.
Also don’t they still have Gulags for ‘politicals’ used as slave labour or did that end a while ago?
(but I could just be talking off the top of my head)…
The Chinese in China have been browbeaten, one way or another, for over 5,000 years.
The Chinese in SE Asia have not, and a very high percentage of them are rich. They work incredibly hard. They are the last ones to leave the office at night and first in in the morning. And they’re thinking every minute. In Singapore and Malaysia, they even out perform the Indians. And my god – look at Hong Kong – a hive of industry and the smell of money.
Where they do not do well is in the creative arts. Their minds run along certain lines. I do know one Chinese playwright and his plays are very interesting – Kee Thuan Chye. But in the main, they paint by numbers. Most of them are not skilled at words. (Save the marvellous Martin Lee!) I would not, for example, retain a Chinese barrister – especially if there were Indian barristers to choose from.
It’s silly to generalise, of course. But it will be very interesting to see how China plays out now that they are opening up to the world. And as far as being poor at service is concerned, have you ever flown Singapore Airlines?
Am I to understand then, that the growth of Hong Kong into a financial superpower in the 1950s, 60s and 70s was all done by Westerners?
Hmph.
Yes, Chinese are excellent businessmen. They’re also unprincipled (by Western standards) and think nothing of deception, fraud and copyright infringement.
But hey… was it Balzac who said that “behind every great fortune lies a crime”?
Yes, Kim, they are unprincipled if they can get away with it. I wouldn’t argue with you.
For a comment thread that includes the phrase “It’s silly to generalise, of course”, there’s a lot of generalisation here – especially for a site which usually has a tendency to look at individuals as, well, individuals (as opposed to compounds of various identities).
I think we can all acknowledge that different Chinese individuals have different capacities and skills and that these are influenced by something more than them being Chinese (national culture, family, etc). We should also avoid conflation of Chinese ethnicity with Chinese nationality. 3rd generation Canadian Chinese are, on the whole, rather different than those born and raised in China itself.
In general, less generalisation about ‘Chinese are good at business’ would lead to a more productive conversation.