Lean Solutions – Idea and book review

Womack and Jones are back with another book on Lean Thinking. They changed the world when they published the book “The Machine that Changed the World” about lean production and the Toyota Production System. Also their “Lean Thinking” was a masterpiece on how to apply the same principles in other businesses. Of course my expectations were high when I grabbed a volume of “Lean Solutions”…

The book is ok.
What is good is that they introduce a way to talk about consumer/provider relationships and how to analyze the hidden costs of consumption. They take everyday frustrations and convert them into suggestions for how to change the value offering to make the customer more satisfied at a lower cost.
When we buy something, like a car or a computer, it is not the ownership that makes us happy, but the enabling function. Having this thing enables me to do things that I like.
In a time of wealth and abundance, many people have more than enough things and too little time.

The main points of the book are old truisms: Capital goods cost time and energy once we have them, in terms of maintenance and services. A house is a hobby, a sailing boat is a drain.
And yes, it is crucial to look at the whole purchasing experience – make it easy to buy and I will buy more. That is a key insight in the last fifty years of retailing and is well shown in the iPhone AppStore. There is already a sea of research and examples that are not referred to in this book.

Another weak point of the book is that it feels less solid than the previous Womack&Jones’es. There are two real world examples, from Tesco and a car repair shop, but most of it is anecdotical.

If you have a choice – go for “Lean Thinking” instead.

Factory Girls – Book Review

At the job-market in Dongguan

This is an extended reportage book about the migrant population in south China. Leslie Cheng ventures south on business from Wall Street Journal writing articles and collecting memories which are later used to build the story of this book. It is a compelling mix of autobiography, where Cheng searches for her own Chinese-American roots, modern history account and intimate portraits of the lives of some random individuals turning friends over the years.

It is hard enough to understand the staggering numbers of migrant workers: Each year 10 million move from the countryside into the hundreds of swelling million-count cities across the coastal provinces of China. The last 30 years it adds up to 300 million. Even more difficult is to imagine what it means to the individuals in such a malstroem of new jobs, houses, foods, purchase possibilities.
The timescale of a career is measured in years, not decades. Education and specific professional training is hard currency and payback time is counted in months. The teachers today were novices a year ago. The building where the training is held did not exist last year.

Chang shares her encounters and reflections upon what it means both for the individual and for society. The incidental individual experiences are recounted with a backdrop of research about the bigger picture. It is deeply enjoyable to read, I could not help but laughing out loud while reading the chapter about the English-teaching machine. At the same time I learned a lot about contemporary China. One of the books that Chang describes, “Square and Round”, was referenced yesterday by a Chinese colleague, and it helped me a lot to understand some office politics thanks to the introduction given in this book.

The lemming trek from the Chinese rural plains into the exploding mega-cities will continue for years, so the book is likely to stay relevant for a long time.

One Billion Customers – Book and Idea review

The wet dream of every retailer – a single market with one billion craving customers – is shredded to pieces by McGregor in his witty account of his own adventures during twenty years as journalist and business leader in China. The concept of a “market” as it is traditionally used implies that it is easy to move goods around at a low cost and that the customers are a somewhat homogeneous group. China is more like a continent with vast cultural, legal and physical differences which makes the unity of the market an illusion – a fata morgana luring at the horizon with uncountable riches.

McGregor experienced from the frontier the intense power struggle between government agencies, the party, market actors and local chiefs. All scrambling to get ahead and to increase their influence. His accounts of his own experiences are the most hilarious and warmhearted parts of the book. However, the many likely hiccups are not explored in great detail. I think it is a difficult dilemma while writing a book like this. On the one hand, including personal weaknesses and failures makes the book more interesting. On the other hand, the author wants to look like a leading expert and resourceful adviser – the book serves as advertisement for his own consultancy services. We all want to believe that the advisers we hire are fault-free and perfect, after all the fees are substantial…

I wonder what I would choose to present in an account of my own adventures near and far? Would I dare to include the intimate shameful moments of my own weaknesses? The mistakes and fiasco’s? Wasted money and time and naivety? I am not so sure. Probably I would pretend that everything was well planned and went smoothly.

One million Chinese visitors at the World Expo in Shanghai the same day as we went.

McGregor weaves into the story the larger sweeps of modern China and a handful of illustrious examples of winners and losers in the wild-east era of the last decades. The story behind famous (in China) brands like Wahaha and Unicom gives a wonderful account how government relations can help and hinder but that the market pull is the real force today. It also shows that the organizational maturity of most companies today are in a similar position as the companies in the west were fifty years ago – completey dependent on the founder/leader. It is a lean and fast way of running a company, but with a single-point-of-failure, it is not robust. It is the startup-model.

An inspiring book and I am excited to experience first hand collisions with bureaucracy and government activities in Shanghai!

Book Review: Poorly Made in China

“Made in China” is transforming the world as we know it. When I walk into a hardware store, computer shop or shoeshack anywhere in Europe, more than half of the items are made in China. This was not the case when I was a kid! The export from China to the west is 100 times larger today than when I was a child (http://www.fas.org/sgp/crs/row/RL33536.pdf). Most my toys and clothes were made in Europe. I believe that this shift of production power and knowledge is one of the major events in modern history.

Paul Midler is one of the numerous players who have been enabling China to export their goods in the last decade, and he wrote an entertaining account of his experiences. Speaking Chinese and with an American business degree, he worked on the ground to help American importers to find manufacturers for their various goods. Midler shares hilarious anecdotes and sobering reality checks from encounters with the human traits of greed, naivety, disrespect and short-term thinking, both with the Chinese as well as the foreign partners. The book is written in an unusually open style, exposing the author’s personal impressions, which makes the story stronger and it is a joy to read.

From my own experience, I know that not everything in China is poorly made, so I have my reservations for the title of the book. However, there are structural problems related to short-term thinking due to e.g. unpredictability in the legal system and lack of transparency, which make the temptation to take shortcuts almost irresistible. There is still a lot to do before “Made in China” gets similar connotations as “Made in Japan” has today.

Book review: … business in China

How to Manage a Successful Business in China
by Johan Björksten and Anders Hägglund

Despite the pretentious title, this book is a well-researched low-key introduction to one way of building businesses in mainland China. Maybe it is the Swedish-Chinese way. Both the authors have first hand experience from what they are talking about, which they generously share through examples and anecdotes. Both of them have been very successful in building profitable organizations, one from scratch and one as a dependence of a multinational corporation.

One of the authors is a renowned expert on Chinese, and teaching Chinese to foreigners. Therefore, it comes as no surprise that one of the main recommendations is to learn Chinese if you want to be successful in China. Still today, most foreigners coming to work in China do not learn more than a handful phrases and a most basic vocabulary. Chinese is considered impossible to learn. On the other hand, imagine going to the US without speaking English – what is the probability of establishing a successful business? It is almost ridiculous.
I am sure that Chinese is a “learnable skill”.

The most startling part of the book talks about guanxi – “connections”. The authors demystify this concept and show the equivalent concepts in the Western business tradition. Sometimes the cultural differences are smaller than we imagine.

Another myth of the one-billion-customer-dream that is debunked by the authors is that China is one homogeneous market. It is not. The vast area, the poor communications and logistics and the cultural differences makes China a difficult terrain to conquer. In many ways, China is like the European Union, with the same legal basis but different consumer preferences and with bureaucratic and practical problems for each sub-market to penetrate. Shanghai is as different from Kashgar as Paris is different from Vilnius.

The book is written in a classic schoolbook manner, which makes it slow to read and slightly boring at times. Nevertheless, it is a good counterweight to the abundant extatic China Fever literature.

After a Beijing brunch with one of the authors, I start to get the feeling that China is not so easy to describe in a book because of all the paradoxes. Speed is one example; some things are extremely fast in China, but other things are excruciatingly slow. They can build a house in a week, but it can take months to get the right stamp. How can I ever “understand” this? Maybe it is like quantum physics – you can never understand, only “get used to” how things work.

China is a worthy challenge!

The Long Tail – book and idea review

Cover of the Dutch version of the book

I just finished reading Chris Anderson’s classic “The Long Tail” from 2006. (also blogged at http://www.thelongtail.com).

The main idea is that different people actually like different things. Not so controversial, perhaps, but the clue is that internet helps buyers to find producers in a better way. Interest (and money) will move away from the Top Ten Blockbusters and away in all different directions.

I recognize this clearly from my experiences in the Magic arts community. In the end of the nineties, I was part of the Gothenburg magic scene as an upcoming young part-time magician. I was devouring all books, VHS tapes and bundles about new magic tricks. But they were really hard to find.
Once a year, on the congress in Lund, the Dealers showed up with meters of books from mainly American magicians. Once a year, I had the opportunity to browse through the material and select a handful of quite expensive works. Unfortunately, most of the books dealt with aspects of magic that were not very interesting to me.
Most of the books on Magic, I had never seen. Until I came to Dresden in 1997 for the FISM World Congress on Magic. I was overwhelmed by the width and depth of the genre.

Tommy Wonder's classic. Now available at Amazon.com.

Now there are online catalogs and an unparalleled availability which will help passionate wannabe customers to find what they look for, even at Amazon.com. (And not just buy the book that happened to be available.) The niche is thriving!

I think that the Magic community is similar to other kinds of subcultures. I am convinced that there are harmonica players, pole dancers and macramé knitters who now get connected to hitherto unknown suppliers and can purchase/license what they need at much less effort than previously.

The book has a funny side in a sense that I did not expect, and that is the short half-time of the Internet examples. It was written only five years ago, but that was before Bit-Torrent, PirateBay and Facebook hit hard, and Bing was not launched. Google Maps was really new and yet to become as useful as it is today. Therefore, the book seems oddly outdated, even though it tells of a revolution still in unfolding.

Recommendation – read it right away!