Woche 10

• Ageing society becomes a big challenge for china
• Middle class is getting richer and they want to show it
• Problem:s Income GAP / Health Care is not guaranteed (people are worried)

• Foreign FDI's use the cheap local ressources and export from china (f.e: Novartis)
• Transnational strategys (f.e Tesla) in China: Cheap Production in China / product adapting as necessary on local market

• China on the other hand does a global intergration strategy (Standardization/Geocentric) 

• 1980: First factory in China; Start Joint Venture with local chinses companies
• Many local competitiors in china: only 4.6% market share but make 60% of their revenue in china
• R&D in CH
• Advantages: Global product platrofrm, economies of scale

External Challenges:

1. Fierce competition
2. Rising labor and other costs 
3. Governmetn policies, regulatory environment&barriers
4. Economy slowdown
5. IP Infringements / Trade conflict with the US

Internal Challenges:

1. Finding and retaining the right human resources
2. Lack of innovation capability 
3. Corporate Governance (Maintaining Standarts in the compamy)
4. Lack of support HQ
5. Distribution difficulties

Challenges dealing with HQ:

1. Communication with HQ too slow to follow market trends
2. China Product development is managed too much from HQ
3. HQ understanding of market is low / Expectations are unrealistic

Government is Dircetor, Controller, Regulator, Investor

• Retaining controll on major areas (energy, transportation etc)
• Liberalization (Freigabe von Märkten) of private industries 
• Indluence in others (aerospace, telecoms etc)

SEZ: Special Economic Zone: (Freihandelszonen) Trade policy advantages

An area in which the business and trade laws are different from the rest of the country

FTZ: Free Trade Zone (f.ex. the Hainan Free Trade Port): Taxfree import and lower tarrifs (Zoll)

• 124 from the 500 biggest companys coming from China
• 3 of the Top 5 aswell from China

• Failure to localize: Cultural differences - A lot of foreign management, little local manage involved (no relationship building)
• High Fees: Contrasting with Taobao's free model (Tabobao the local competitor knew the chinese customer more than ebay)
• Technology problems / No payment solution (Chinese dont like credit cards-they switched to digital payment
• Regulatory Issues: Hurdles/struggles with compliance
• Chinese people dont like secondhand (cheap image, "not clean", they want to show wealth)
• Taobao implemented a direct messenger on their plattform - personell interaction (Guanxi)

• Communication problems
• Cultural Barriers
• Long start-up time
• Increased management complexity
• Fightiung for talents
• Fierce competitors
• Increasiung Localization

• Business and private network
• Interpersonal relationship
• Diverse social resources
• Mutual Trust
• Friendship

• "Face" is mark of personal pride and forms the basis of an individual reputation and social status
• Keep "face" for yourself and for others
• Keep face means: Positiv Image in business relationsships and society
• Give Face: Respect the elders and people higher in hierarchie, dont critizies in public (Consider twice before any wor or action)

• Chinese thougts/actions are firstly based on emotional factors (intuitiv), and later rationales 
• No analytical, linear approach
• Information is processed differently - holistically (ganzheitlich)
• Improvisation - Let thins happen.trust and you will get answer

Confuziuism: The creation of ORDER, PEACE and HARMONY (Loyalty, respect of hierarchy, self-regulation)

Taoism (path): Natural processes, balance power that flow troough all things