Title: Reflections on Doing Business in China: A Case Study
Abstract: Developing efficient and effective supply chain networks with Chinese partners has become a critical source of strategic competitiveness for both large and small business firms. current study describes the 'journey' of the CEO of a small business in the United States and its implications for future small business ventures in China, making the case that there is a good fit Western entrepreneurial businesses and the current business climate in China. Introduction As China's economy continues to integrate with the global market and supply chain networks, many U.S. firms have directed their attention to manufacturing bases in as an integral part of their global supply chain networks (Naughton, 2006; Powell, 2002). For example, between 1990 and 1996, the number of foreign firms in Shanghai increased from 300 to 16,000 (Chen, 2001). However, the issue of developing small business ventures and supply chain networks with Chinese partners remains one of the least understood aspects of international business (Sanyal and Guvenli, 2001 ; Walsh, Wang, and Xin, 1999). This study fills the void in understanding how to develop successful small business ventures and supply chain networks in China, describing the current business culture in which such businesses must operate from a Western point of view. Long-Stanton Manufacturing was founded by John Stanton in 1862. As one of Ohio's oldest manufacturers, the company began by making stamped metal currency and currently serves customers in metal stamping and precision sheet metal parts and assemblies. As the sixth-generation president and CEO, Mr. Daniel Cunningham has spent the last few years going through the proverbial learning curve with regard to doing business in China. Responding to a rapidly changing competition picture, Long-Stanton Manufacturing spent several years exploring the available options and in early 2005 established its first foreign manufacturing facility, Long-Stanton Asia, in Changzhou, China. Meanwhile, in late 2004 Long-Stanton Manufacturing also formed a partnership with a Chinese partner, James Lee of Lee World. new entity, Long-Stanton and Lee, added rubber and plastic manufacturing capabilities as well as engineering and design services. current study describes an American small business executive's Doing Business in China journey and provides practical implications for future small entrepreneurial business ventures in China. In particular, the study is structured by reflections of both Mr. Cunningham and his spouse, who is a business faculty member at Xavier University and serves the Long-Stanton group of companies as an informal advisor on Operations Management issues as well as being a board member of Long-Stanton Asia.. Reflection 1: China's Growing Economy One of the first things that an American notices upon arrival in China, especially in and around Shanghai or Beijing but also in other places, is the large number of construction projects and their vast scale. As described in The Chinese Economy' (Naughton, 2006), this first impression that the economy is booming is reinforced in many ways. For us, the most striking contrast to our own home region, the rust belt of the American Midwest, is the degree to which manufacturing businesses seem to be thriving and growing. Obviously new industrial parks are in evidence everywhere with others under construction. Vast.new facilities are opening every day, and existing factories are expanding their capacity. However, growth is not confined to the manufacturing sector. New hotels, restaurants and retail stores are opening everywhere. Of course there are problems associated with such rapid growth. Sometimes the infrastructure needed to support all of these new businesses is not fully in place immediately. It cannot be assumed, for example, that electrical service in new industrial parks will be reliable. And in spite of China's vast labor pool, there are some industries, locations, and job categories turnover is rampant and jobs are hard to fill because of all of the new opportunities available to the workforce. …
Publication Year: 2008
Publication Date: 2008-03-01
Language: en
Type: article
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Cited By Count: 1
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