American style management does not work in China

I was just thinking tonight about the post I wrote yesterday, specifically what could the owner of the US medical supplies company have done that would have helped him avoid the situation where he was held hostage and forced to pay out $ 500,000 in what effectively amounted to ransom ? I don’t know the details of the situation but it sounds like there was not much planning as far as how the decision to eliminate jobs at the plant was going to sit with workers, many of whom, according to some accounts, did not even know the plant was shutting down. This obviously should have been discussed in depth with the plant’s Chinese manager (s) and local officials who may have then been able to offer their suggestions about how best to do this. It sounds however that this was a typical American style downsizing – where employees are given no notice about their termination, have ten minutes to clean out their offices and are shown the door. When American companies do the same thing in China it just engenders a tremendous ill will and is sometimes very costly as it was in this case. One of the companies I used to work for in China – an American textile company – closed their China operation a few years ago the same way and it was a complete shock to the employess who worked there, some of them for upwards of 20 years. They went to work as usual one morning and at the end of the day they were jobless and wondering how they would provide for their families. This is just another example of how American style management often does not work in China.

I would add that the owner of the medical supplies company said he plans to continue to manufacture in China. But I am sure that after this high-profile incident he will not have an easy time of it.


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