Table of Contents

Introduction

Foreword by Raymond Aaron

Introduction By Phil Richardson

To Begin With

Chapter 1

Chapter 2

Chapter 3

Chapter 4

Chapter 5

Chapter 6

Chapter 7

Chapter 8

Chapter 9

Chapter 10

Chapter 11

Chapter 12

In Closing

Hope for the future

About the Author

References

Acknowledgements

A Step Ahead Globalize To Double Your Income

60 Secrets for Success At Home And Abroad

Website: www.globalize2X.com

Author: Phil Richardson, CD, BA, CSM Publisher: The Aaron Group

A Step Ahead— Globalize To Double Your Income:

60 Secrets For Success, At Home And Abroad

Copyright 2015 © Phil Richardson philr@globalize2X.com

All Rights Reserved

No part of the work covered by the copyrights herein may be reproduced or used in any form, or by any means whether graphic, electronic, or mechanical, including photocopying, recording, videotaping or information storage and retrieval systems, without the prior written permission of the author.

ISBN: 978-1-928155-74-4

Published by: The Aaron Group info@aarongroup.com

Edited by Natalie Cross, ultimate reader@fiverr.com

Formatted and Printed by PrintingIcon.com

Cover Design by combro@fiverr.com

Cover Art by Motarola@fiverr.com

Library and Archives Cataloging in Publication

Richardson, Phil, 1947-

A Step Ahead—Globalize To Double Your Income—60 Secrets For Success, At Home And Abroad Author Phil Richardson

Issued also in electronic format

ISBN: 978-1-928155-75-1 (ebook)

Introduction

So many have inspired me to dream without limits and supported me when

I’ve reached for the stars.

In the forefront of them, I was blessed to have the most loving parents who nurtured me in every way possible, taught me their ethics and helped me to believe in myself. While they have both passed, their example and lessons continue to guide me daily in my journey.

They led me to God as a child and He has embraced me with love throughout my life. He has carried me when I was too weak to bear the burdens of life alone, and stood with me through all my trials. And He blessed me with so many precious gifts…the love of my parents, my life partner, my four sons, their partners and my seven grandchildren are absolutely the most important of them.

This book, with such an important message for so many, is dedicated to God and my family. May God bless you and yours as He has me and mine.

“It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change.”

—Charles Darwin, Evolutionary Theorist

Foreword by Raymond Aaron

I am so pleased that Phil Richardson asked me to provide a foreword for this very important book. He is an imaginative entrepreneur who succeeds in passionately sharing his exceptional international experiences and the lessons he has learned from them. You won’t be able to put the book down during your first reading and I know you’ll pick it up again and again in the future to refer to the potent secrets he wants us all to know.

I share his strong belief that internationalizing by adopting global best practices is the only way for companies and individuals to maximize their profit potential in an increasingly competitive world. No one can rely any longer on protectionist government policies or old ways of doing business to maintain their present situation, let alone to grow their prosperity.

Instead, we have to rise to meet the international competition that our rich markets increasingly attract by improving our strength and productivity. We must all learn and apply global best practices to succeed. While there are no guarantees for our success, there is an absolute certainty of failure if we do not adopt them in our strategies and operations.

And he also makes a strong case to seek out strong international partners and combine your North American knowledge and market access with their capital and vigor to capture an unfair share of your markets, both here and abroad.

Phil is one of those adventurous people who chose to work outside of his “box,” leading the development of world class property projects in the Middle East, India and China. There he learned greatly improved ways of conducting business from which we can now all benefit.

His mission is to share his knowledge with those here who want to double their income at home as well as abroad by applying his advanced knowledge and unique perspective.

He is someone who has already succeeded with this winning strategy and has helped many others to do the same. You must read his book to learn his vital secrets.

Raymond Aaron, New York Times Best Selling Author:

Double Your Income Doing What You Love

Chicken Soup For The Parent’s Soul

Introduction By Phil Richardson

I want to tell you a fascinating story that is extremely important to your future prosperity and to that of your family and friends. In fact, it’s crucial to everyone in North America.

I lived and worked outside of my home country as an expatriate (expat) for a number of years and recently returned to be closer to my family and to share the lessons I learned. I now offer my knowledge to perceptive North American executives, entrepreneurs and professionals who want to learn global best practices because they too see how urgent our need is here. While away, I worked alongside people from many different cultures whose unique knowledge and skills made all the difference in achieving our mutual goals. In this book, I share with you the key lessons of globalization that I learned while working outside of my box.

We North Americans tend to forget how dynamic and massive the other major world markets are, especially those that are developing rapidly. The competitive spirit and brilliant capabilities of their multitude of entrepreneurs and business professionals are formidable. In their cultures, simply to survive, they must continuously develop effective new strategies and deploy them rapidly in response to their robust competition. They learn and apply global best practices continuously.

It’s urgent that we learn to do the same because our rich domestic opportunities increasingly attract their best and brightest to compete with us at home. We must learn the important differences in cultural thought, strategies, and global best practices they use, just so we can survive. You will learn about them in this book and by improving your competitiveness you will increase your personal, corporate and national prosperity. And you will position yourself to partner with them to your mutual advantage, both at home and abroad.

Complacency is simply not an option for us.

If you want to dive deeper and more effectively into your rich veins of opportunity using global best practices, I am available for private consultation. I help companies and individuals formulate and deploy sophisticated action plans based on my deep cultural and professional knowledge of key world markets and their top players. And I can share with you the latest global best practices that can be applied across many industries and cultures. You can reach me at: philr@globalize2x.com

I look forward to contributing to your future success.

Phil Richardson, Globalization Specialist and Author

To Begin With

Dubai, United Arab Emirates

“Mr. Richardson, Mr. Assad?” the limo driver asked when he recognized us from our photos in the crowded reception area of the Dubai airport.

I didn’t know it then but I was about to receive my best lesson in globalization just after I landed in Dubai for the first time. Lancy, our driver, had been recommended by a friend and we couldn’t have chosen any better. He is an Indian entrepreneur from Goa, India, and has worked in Dubai for 15 years. We quickly became good friends. We soon learned that he was very experienced at touring visiting executives around the UAE. They always asked for him, he said, and we came to know why…he helped to educate them and us in globalization!

“In Dubai, there is no ‘Sorry!’” he said as he enthusiastically delivered his first of many lessons to my friend and me only a few minutes after driving off.

And Lancy was so right. Millions of expats have been hired over the years, just in the UAE, of which Dubai is a part, to work very hard, and smart, to help develop the country.

This was the beginning of my learning experience that took me to Europe, The Middle East, India and China where I became fully globalized. What a journey it has been…and so worthwhile.

Not only did I learn how to maneuver and succeed in these different cultures, but the same global best practices that promoted my success there, are now proving invaluable to my business progress at home. They differentiate me and make me much more valuable as a business professional than I was before I left. You’ll learn more about Lancy and my experiences in the UAE later in the book but let’s start in China where I put Lancy’s lessons to good use.

Chapter 1

Welcome To The Rest Of The World...By The Way, Nothing Is The Same Out Here!

“Diversification and globalization are the keys to the future.”

—Fujio Mitarai, Chairman, Canon, Japan

The Shock of Arrival

Kunming, Southwest Mainland China

Shivering and alone in my heatless apartment in Kunming, China at 4 am, I curled up under the one blanket I’d been given, wondering when the sun would come up.

‘Then I can see what’s outside...and maybe warm up as well’, I thought.

I hadn’t been able to do either since I flew in last night.

Welcome to the People’s Republic of China the sign had greeted me when I walked into the terminal, as did the suspicious stares of the customs agents and the curious smiles of my fellow travelers.

‘My bags all made it!’

I was pleasantly surprised. I found a cart and looked around the lobby for my promised ride...but no one was waving at me that I could see. At 6’ 6”, I couldn’t be missed in this crowd! No phone number to call and no Chinese mobile to do it with either…just a promise to meet me! So I stood there patiently, while everyone within eyeshot stared at me curiously.

I was beginning to feel the jet lag now...twenty hours of travel, counting the layover in Hong Kong, had worn me out more than I’d guessed!

Suddenly in a flurry of waving arms, two cute mini-skirted young women came trip-tripping towards me in impossible heels, giggling…

“Mr. Phil, Mr. Phil,” they said as they ran up to me in their curious tripping- hopping style reserved for meeting anyone they thought ranked above them.

“Dai, dai, wo shi Phil Dong,” I said in my best Rosetta Stone Mandarin. They decided right away that it was best to switch to English!

“Mr. Phil, it is so good to see you, welcome Kunming!” said the older of the two, carefully enunciating each word. “Are you hungry? Are you thirsty?”

“No, just tired...can you please take me to my apartment?” I asked.

They insisted on pushing my cart and managed to weave it through the parking lot between the tightly packed cars.

“We were late because we had an accident...crazy Chinese taxi drivers!”

This was a phrase I was going to grow used to hearing, and which effectively ended any driving temptations I had for China from that moment on. They were right, I found out very soon as we pulled into traffic! But when I noticed their smashed tail light and rear fender, it suggested “someone” tried to change lanes without a shoulder check. I thought then that maybe they were all crazy drivers.

Settling In

The young women chattered excitedly, switching between Chinese and English...and sometimes ChEnglish...as they tried to tell me what we were passing. But it was night time so not much to see except some garish lights on unlikely buildings...most notably many huge red neon ‘KTV’ signs on high rise office towers. I later learned that Karaoke is a favorite social activity. But tonight I just wanted to sleep.

We pulled up to a gate where the helmeted guard grinned as he asked whatever questions would keep us waiting longer in the hopes of getting one of my new colleagues’ mobile numbers. Unsuccessful, he finally lifted the gate and we drove through. Parked, my they politely dragged my wheeled luggage along the sidewalk, but only they knew what was coming next! They chattered away nervously in Chinese and I realized why when we arrived at the building entrance. They pointed up the stairs to my 6th floor penthouse...apartment buildings with fewer than seven levels aren’t required to have an elevator!

And Three More Flights Up, Inside! They Look As Steep As My

Learning Curve Was About To Become.

As I hoisted my bags up, breathing raggedly, in the chilly spring air, I couldn’t believe I’d managed to pack so heavily and still get them on the plane. However after a few trips, I was soon on the top floor, all bags up and inspecting my spacious apartment. They had visited earlier, stocking the fridge with Tsingtao beer and eggs… Foreigners liked those, they knew...and a few less recognizable things.

After I cooled down from my heavy lifting, I realized how cold it was inside. I asked where the thermostat was. They frowned at each other, not understanding, but then they guessed what I had asked, brought me into the bedroom and handed me my blanket!

‘This is not looking so good all of a sudden’, I thought. ‘Was heating not the standard here?’

Initial Experiences—My First 24 Hours

After looking over the apartment with them for the third time, the young women said they had to work early in the morning and giggled their way out the door. I wondered how I was going to make it through the night as I got into bed with my coat on. Not so well as it turned out!

The dawn came gray, cold and drizzly...with wet snow! My view was my neighbor’s bedroom curtains ten meters away...I realized then I hadn’t drawn mine. “Kunming, the City of Eternal Spring? I don’t think so,” I muttered to myself…

I could see my breath!

I strolled into the bathroom and looked around for a place to sit down...

‘None!’ Just a place to stand...

‘OK’, I thought, ‘I can do this...’

So I did, happily not stepping into the hole as the water flooded the big bowl… I’d used these in public washrooms in Europe before. I watched the paper swirl around and go down...big mistake that, as I was soon about to find out.

I took my clothes off quickly, stepped into the shower and turned on the taps…jumping as I felt the water. “God, it’s ice!” I yelped.

I let it run for a while and tried again...”Same...damn!”

I stood there for a few moments while I gathered my courage. Stepping into the Chinese torture device again, while remaining just outside the icicle stream, I poked my washcloth into it. Lathered up, and then, holding my breath, I stepped forward.

“Oh my God!” I exclaimed.

I jumped back again...and stood there looking pretty silly, I realized.

‘Well, I have to do this.’ I stepped forward again…

I don’t know how long my Polar Bear shower lasted...seconds I’d guess now... but I was sure awake when I got out!

I felt the cold water on the bathroom floor right away...and it was deep.

‘Now what?’ I asked myself. Then I saw water was coming from the toilet! I

  flushed it again, but that didn’t work...more water came out!

‘What do I do?’ I looked for a shut off valve...nope…none.

‘Who can I call? No one!’ I thought. I didn’t have a phone and how was I going to explain this to a neighbor anyway?

‘But I better try it now, before I flood everyone below me!’

Just then I heard a buzzer… I wasn’t even dried off! I ran to the door, towel in hand and looked out the view hole...no one there! It buzzed again. I saw the intercom and looked for the right button...but of course, all five were in Chinese! I randomly pushed them all and suddenly saw on the screen one of the young women from last night!

‘Thank God’, I thought.

Then I remembered…I was naked…and the video was two-way!

Initial Connections

My new colleague’s eyes turned very serious on the little TV screen, her smile frozen.

“Mr. Phil, are you ready for your meeting?” Not believing what she was looking at…fortunately just down to my bare chest, but that view told her all was not well!

“Dai, dai, yes, yes” I said, wanting it to be true. “I mean, no, no, I’m not! Just a minute and I’ll press some buttons to open the gate. Please come right up!”

After a few false tries, the gate opened and she disappeared from the screen.

I rushed into the bedroom, threw open a suitcase and quickly pulled out some clothes. Drying off at the same time, I kept an eye on the rising water in the bathroom as it approached the top of the doorsill.

‘I don’t have much time!’ I thought.

I opened the door at her knock but she hesitated to come in until she glanced down to confirm that I had some pants on!

“There’s an emergency,” I said and took her towards the bathroom. One look inside, and she rushed to the kitchen balcony…and turned the shut off valve there. Who knew? The drain in the bathroom floor could now do its job and the frigid water flowed slowly down it.

“Thank goodness,” I said.

She replied, “Mr. Phil…you flush paper?” I paused and thought , ‘Well yeah…’

I nodded, to which she said reproachfully, “You can’t do that in Kunming! The pipes are too small!”

‘Of course!’ I thought, sarcastically but silently.

When the plumbers had left, after frequently shaking their heads and glancing at me now and again, muttering as they worked, she drove me to the office, two hours late, saying to me helpfully every few minutes: “Remember, you can’t do that in Kunming!”

Finally, I said impatiently, “Well you can in most parts of the world that I know.”

At which point she went silent… Now I’d embarrassed her and caused her to lose face by saying her home town just didn’t measure up.

‘Oops’, I thought. I tried to back track but she wasn’t having any of it.

When we walked into the Head of HR’s office, she went into what I thought was an overly-long and animated description of what she had just been through, with several glances at me…and the audience didn’t look amused!

“Well, let’s go and see the CEO,” I said, hoping to remind them of why I was there…

They just glanced at me coldly and continued their conversation. Finally, they were done with me and the HR Head said through my new colleague’s interpretation, “Mr. Phil…you can’t flush paper here.” in Chinese and then English, I must have looked as if I hadn’t gotten it by then! I bit my tongue at this double dose of disdain as both hers and my colleague’s words dripped with it.

“OK, sorry,” I said contritely.

Then I asked about the water temperature. Well, it seemed that some “fool,” unnamed and of course, not present, had failed to notify the gas company to turn it on to heat the water!

‘Ahh,’ I thought, ‘maybe a complete solution here!’

“OK, then, is that how the apartment is heated too?”

The H.R. Head looked quizzically at me as my colleague translated, “Heat for the apartment? That’s not supplied.” came the answer.

Dumbfounded because she added, “That is your responsibility!”

“OK so how do I get it?” I shot back.

Her look told me that I was not the brightest person she had met.

“You must of course buy electric heaters and pay for the energy they consume… and that’s not included in your arrangement with the company! Your colleague will take you to where they are sold.”

Initial Effects On You

Confusion will be your likely reaction to your initial experiences, often followed by despair and sometimes an overwhelming desire to return home! Imagine how I felt waking up alone on Christmas morning for the first time in my life…my four sons and my grandchildren were at home, as was my girlfriend.

It was lonely and I felt sorry for myself, especially since I didn’t know very many people yet and hadn’t received an invitation for Christmas dinner. But my sadness passed when I heard from everyone on Skype and was able to see and hear their enjoyment.

The roles you will travel to fill are very demanding and will soon occupy all of your time. As well, in the free moments you’ll have, other expats will soon invite you to lunches and dinners and you can have a vibrant social life. In fact, so vibrant that you can succumb to its attractions to the detriment of your work, if you’re not careful! It’s hard to find the right balance for a time but most make it through this volatile probation period.

Expats are a special breed I believe. While people go abroad to work for many different reasons, a common characteristic is that they are adventuresome, something not shared by most of their countrymen. After all, it requires a lot of confidence and initiative to break out of your comfort zone and move far away from family and friends, doesn’t it? But you’ll find yourself in good company as you meet many people from around the world who are similarly adventuresome. You may eventually find more in common with them than those friends you left behind, and a significant number of expats choose to remain amongst them and never return home except for occasional visits.

Another critical component for success, while at the same time a potential source of stress, is your relationship status. If you are single, get ready for a roller coaster ride like you’ve never had before. You will meet exciting men and women who, like you, are adventuresome and that will lead to…well, adventures! If you’re attached, you will enjoy yourselves exploring together, but if you are separated from your partner for a significant time, you may find yourself tempted to enjoy yourselves individually and too much!

Having a solid relationship with both partners moving to your new home to live together, as soon as possible, is the best insurance policy against volatility that you can have. I strongly suggest you ensure you prioritize it. Maintaining close contact over a distance and several time zones is very challenging. But of equal importance is the plan you develop to avoid these difficulties. I highly recommend that each of you honestly assesses your needs and design your new life around them. For example, the long hours of work and high energy drain that will be experienced by the working partner can result in dissatisfaction for the other. He or she may find it difficult to fill their time waiting at home only to greet an exhausted partner at the end of the day. In fact, that very thing happened to my girlfriend and me and sadly led to the end of our relationship.

One strategy is to secure work for your partner as well, and earn a role for both of you before your move, is highly recommended. Expat packages secured in advance are far more lucrative and interesting than those to be found once there. That said, if a local job is all one can find, then I’d advise taking it to avoid the mismatch I noted above. Too many books have been written about non- working spouses turning to heavy drinking and other destructive recreations!

China, A Mixture Of The Ancient And The Modern

Chapter 2

Why Did I Globalize?

“Globalization means we have to re-examine some of our ideas, and look at ideas from other countries, from other cultures, and open ourselves to them.”

- Herbie Hancock, Modern Jazz Composer

Millions of expats leave their home countries annually for many reasons, mainly as economic refugees. They hope to improve their lot in life including that of their families and often their whole villages. I was no different as I had experienced the usual ups and downs of my profession as a property developer and I was eager to prosper.

http://blogs.wsj.com/expat/2015/06/21/what-makes-the-expat-lifestyle-so-addictive/

New Earnings Opportunities, at Home as Well as Abroad Personal Opportunities

Abu Dhabi, UAE

“As Salaam Alaikum,” I greeted the Director of HR in Arabic across her desk as I purposely did not extend my hand to shake hers. I had learned that most Emirati women would decline and rather than embarrass her, one should only extend a hand if the lady initiates the greeting.

“Wa Alaikum Salaam,” she replied as she waved me to sit down, her full length Abayha rustling as she did. Her outfit included a Shelagh, a head scarf, like an Hajab, that covered her hair and circled her face…all in sober black.

“It feels so good to finally arrive for my role…there is so much to be done and in a very short time,” I said.

On one of my previous prospecting visits to Dubai, I had met the just appointed CEO of her company through my contact at the embassy, a Trade Commissioner (they are great resources for anyone seeking opportunities outside of their home country). I had then sent all of my personal information to the HR Director, one of whose employees was assigned to my file.

That’s when the frustration began. I had to re-send it five times over the next two months. And each time I had to wait a week or two before receiving another email from the subordinate, denying she had gotten it and asking for it all again! I was later told this was not unusual but you can imagine how frustrating it was for an eager “Newbie” like me!

It resulted in my arriving three months later than expected. Not only did this put major pressure on the project I was to lead but it also prevented me from returning home for Christmas as I consequently only arrived at the end of November. My visa would not be available until after the holidays, in Sh’Allah! (God willing).

I spent them alone for the first time in my life, a very sad beginning I felt at the time. No matter how professional the Director or the Vice President of HR, my experience with most National companies showed they had great difficulty in training their local staff to become efficient! Their culture just didn’t synch easily with that of the West. And because of their expectations that their Government would look after them completely, many simply didn’t feel the need to work very hard.

But I was now eagerly looking forward to receiving my first TAX FREE pay check! I was about to more than double my income, not to mention upgrading my lifestyle with the generous living allowances I was to receive! I guess I made a good impression on the Director since happily, she assigned me to a different colleague than the one who had caused me such grief.

The replacement was an efficient PRO (Public Relations Officer), whose contrasting professionalism, I learned, was a welcome exception in most companies. He was well connected in all of the various agencies I had to deal with for my various licenses and permits.

He escorted me to each, marshaling me past the long lines of expat “non- professionals”, and told me what to pay at the right times. It went smoothly and soon I had my residency visa along with my driver’s license, utilities account and of course, my all-important alcohol license! But with a ‘limit’ of 5% of my monthly income, I would have had to have been a full blown alcoholic to use it up.

Most often, with Nationally-owned companies, the HR Director, and her or his Vice President, are very influential and capable locals. In Asia and the Middle East this important department is the front door for the company in its dealings with Government and the public, as well as being responsible for securing and managing employees.

But back to my expat employee package, the main reason I was there. Like many Western professionals with significant experience in areas of certain specialties, a good CV can translate into a great appointment. My credentials had earned me the role of Director of Retail and Leisure Projects on Yas Island, an ambitious collection of mega projects sponsored by the Government with a value totaling $12 Billion! Located on a man-made island of 6,000 acres, this $40 Billion world class development was planned to eventually accommodate 50,000 full time residents in condominiums and villas and millions of tourists annually in its 2,400 hotel rooms.

My job was to lead the planning and delivery of the commercial elements including the world’s first Ferrari World, the largest indoor theme park on the planet. At 2 million square feet, it was bigger than most super regional malls in the West. And there was one of those included too, at 3.5 million square feet! And a Warner Brothers theme park at 1 million square feet. And a 40 acre outdoor water park! I was pumped!

http://www.yasisland.ae/en/

Standing In The Future Concert & Event Space Of Ferrari World, With A Capacity Of 40,000 Attendees

My Annual Expat Package ($USD)

Basic Salary:      $240,000

Housing Allowance:    $80,000

Car Allowance:     $24,000

Performance Bonus    $240,000

Maximum paid annually upon review

Health Care      100% coverage internationally

Annual Home Visit    Two business class return air tickets home

Repatriation Allowance:  Six months of basic salary

And the price of gasoline was 35¢ per gallon for the three years I lived there!

Life was good!

Each nationality has a different tax regime that will determine what, if any, taxes they must pay. For example, citizens of Australia, Canada, New Zealand and the UK, through their reciprocal tax treaties, pay the income tax of the country in which they live offshore. In the case of the UAE that is ZERO as it does not levy income taxes on anyone! By comparison, Hong Kong and Singapore levy 14% and 16% respectively for individuals and 20% and 10% respectively for companies.

For US citizens, however, the Government levies a global personal tax at the usual rates.. There is a housing allowance exemption of some $85,000. However as you saw in my package, that amount can be your actual rent so it really doesn’t represent much of an advantage. It just avoids a disadvantage.   Other nationalities must remember that the National currency, the UAE Dirham, in which your contract will be denominated, is pegged to the US dollar. If your country’s currency rises or falls against it, then you’ll receive more or less than you may have expected when you signed up! Nonetheless, with an annual package potentially totaling $480,000 USD, TAX FREE, in salary and bonus, I was very buoyant when I finally arrived.

Corporate Opportunities

There are equally significant corporate opportunities. However, as always, there are hidden costs to be aware of, and some can be major unless planned for professionally. I will give a summary list for your reference but this is a complex subject with unique characteristics for each case. One part of my extensive consultancy is to guide companies through the maze for each country in which they plan to operate. There’s no better insurance policy!

In general, there is the basic market opportunity to quite profitably sell products and services to the citizens of these countries.

As we all know, developing economies are growing at a much faster rate than our own mature economies. Naturally, there is a very strong appeal for Western companies to access the many appealing opportunities to be found in them.

Secondly, there is an equally great opportunity to benefit from the low costs of goods and services for export to our home countries, further enhancing our profits.

Thirdly, lax government regulations can favor foreign investors, although they will fluctuate with evolving government attitudes and can do so quite quickly and unexpectedly.

Lastly, the favorable tax regime of many such countries can be very appealing.

Offsetting these advantages are risks that must be mitigated.

Firstly, there are very different laws and regulations that pertain to foreigners operating within dynamic markets such as China, India and South East Asia. While they may be loosely applied normally, they can suddenly be strictly enforced with devastating effect.

Secondly, the cultural differences will impact everyday life in all respects.

Thirdly, quality assurance is crucial and the cost of exercising it is significant. However, the involvement of experienced expats from the company’s home country will largely ensure no slippage is experienced due to mistranslation, misinterpretation…or misrepresentation!

Lastly, there are many glowing examples of success,  but  there  are  also many still-glowing craters in which the aspirations of companies large and small continue to burn. They can be largely avoided by adopting certain key strategies to share.

New Cultural Experiences

“Thanks so much for picking me up,” I said to Shirley, my travel agent, grateful for the guided tour she was going to give me of Shanghai and for choosing a good hotel for me.

She met me at the Shanghai airport with her girlfriend, Linda, a medical doctor. One of the gentlest and nicest people I have ever met, Shirley is a Buddhist whose other friend Lily, introduced us and is one of my Chinese friends from my Abu Dhabi days.

http://english.cntv.cn/english/special/new_vision_shanghai/city_tour/

She was very fluent in English as was Linda. We went to the hotel that she had arranged for me to stay at an international chain. Nice room, great price for a five star hotel…Shirley was looking after me very well.

“Mr. Phil, the hotel just installed its own water purification system so you’ll be safe from illness.” She said protectively.

She arrived to pick me up at 6 for supper with Linda and we went to a typical restaurant. She ordered…and it was all good…great in fact.

Shirley said, “I never take my clients to restaurants that are unreasonably priced.”

http://www.travelandleisure.com/local-experts/shanghai/best-budget-restaurants-shanghai

Dinner for three, with drinks beforehand, totaled $50 U.S. with wine included… and was very good. I also got the idea that Dr. Linda was along to check out the single foreigner. A good looking lady, it was only her smoking that kept me from becoming more interested…yep, a doctor smoking like a chimney! China has an estimated 300 million smokers…and 1 million smoking related deaths annually! Very recently, the Chinese government imposed a smoking ban in public spaces, but I’m sure it will take some time to enforce. And it doesn’t yet apply to Boardrooms or CEO’s offices!

The Cotton Club, a jazz bar where Shirley dropped us was smoky but with great music…everyone knew Linda there. That made me smile. Everywhere I go in the world, I just have to be patient and pretty soon people show me how they sin and with whom!

I was put off by her smoking and uncertain profile…too much sin is not so good…so after a few sets I offered her a taxi ride to wherever she was going, but she said she’d stay. I found one and made it back to the hotel with the help of the direction card in Chinese given to me by the front desk clerk. I brushed my teeth and hit the bed, tired and ready for a good next day.

I woke up earlier than usual, my stomach aching like hell!

‘What’s this?’ I wondered.

No breakfast but I managed to get ready and the ladies arrived. I asked how they felt…all good. ‘Hmmm, maybe not the food then.’ I thought. Then I remembered the toothbrush and glass of water from the tap, and Shirley looked unhappy when I told her.

“Damn!” she said, the strongest word I would ever hear from her…she was a very gentle Buddhist. “They assured me that their new water system was safe!”

She called someone on her mobile and even though it was in Chinese, I could tell it was not a pleasant start to their day.

She went to the desk and checked me out! “Please get your clothes packed, I am taking you somewhere else.”

I packed and we left with no money changing hands…and she checked me into another five star hotel.

”Very nice,” I said. “Thanks.”

While the venue changed, my condition didn’t and it stayed with me for the rest of the week. I sure didn’t feel well. In China it’s hard to predict from appearances or even star rating, the safety of staying in any hotel. And even with a protector like Shirley, I wasn’t immune.

I received a call to meet with a developer in Shenzhen the following week, and I committed to be there. I spent a lot of my time preparing my power point presentation and then having it translated. Then concentrated on sightseeing and having fun while it was being translated. Shanghai has everything you’d want, beautiful people, great restaurants and hot night clubs…as well as an amazing history and culture that are fascinating. Shirley made sure I saw so much for which I will be ever thankful.

New Professional Learning Opportunities

As the new Director of Development in Abu Dhabi, I had to quickly form my team and bring all of the moving parts of the organization under control. We urgently needed to create the master plan and deliver the first element of this ambitious iconic project, Ferrari World! Our company had just been formed but as it was owned by the royal family of Abu Dhabi, so its land and projects were valued in many billions of dollars.. My “small” portfolio of $12 Billion was global in visibility, with the world famous Ferrari Company as the initial major participant. The “Commercial Collection” was, in addition, to consist of a super- regional mall, the home of hundreds of world class brands, a Warner Brothers indoor theme park and a large waterpark. And it was also neighbor to the new Formula One race track and seven world class hotels that would serve to draw tourists from around the world.

“Please look over our website carefully,” the senior consultant said to me. She continued, “Achieving the designation of MRICS is very prestigious around the world.”

http://www.rics.org/ae/

She was describing how I could qualify to join the Royal Institute of Chartered Surveyors, a UK based association specializing in the education and support of real estate professionals. I had heard that their standards were very high and that they were well regarded globally. I soon learned why…they are very rigorous in evaluating the qualifications and experience of candidates and providing supplementary training in order to achieve their standards. I was impressed.

“How should I proceed?” I asked eagerly.

“We will begin by receiving a detailed application from you and then interviewing you if we feel you qualify,” she said. “Then we will place you in the right stream through which you will then pass tests certifying your knowledge. Following that, we will submit everything to the Board, along with our recommendations and they will decide on your admission. Oh yes, there will be a formal interview of a panel of your peers to finalize the recommendation.”

I was in awe of their thoroughness but my usual optimism helped me to believe I could succeed.

“When can I start?” I asked enthusiastically.

She passed me a book of requirements and examples and said, “We’ll expect your application soon then?”

Sometime later, after I had provided them with their completed exhaustive package, I received word that only the interview by a panel of my peers remains for my acceptance. I am planning to schedule it now.

Expansion of My Network of Contacts

My network of contacts, largely on LinkedIn, number more than 2,600 and all of them are extremely valuable to my business. I continue to add to my list very selectively to ensure each new contact is important to my growth.

https://www.linkedin.com/profile/view?id=6306143&trk=navresponsive_tab_profile

I grew this number over the past seven years, and I can honestly say I have gained considerably as a result. Firstly, I have secured contracts from members finding me and sending me inquiries.

Secondly, friends I have made working around the world have connected with me on it and directed me to opportunities I would not otherwise have known about.

Thirdly, I have made new friends with people I have met in person whose interests have turned out to align with mine and both they and old friends regularly exchange with me vital new information about the industries and markets we work within.

And lastly, I have learned how to directly prospect for business on LinkedIn. All of these channels have worked well for me in updating my knowledge and developing business.

Other social media I have learned to use effectively include Facebook, Twitter, Instagram, Weibo, QQ, WeChat and more. Part of my consultancy involves optimizing their use and, in the retail world, blending them with offline channels to synergize their combined effect Online to offline, O2O or Fusion Marketing, we call it. Some variation of it very likely has application in your business and I would be glad to help you to evaluate their usefulness to you.

Learning To Think Globally

Las Vegas, USA

“You’re that computer systems fellow, aren’t you?” said the well-dressed man who had approached me in the trade mall. “I want to shake your hand,” he continued. “You saved my company a lot of money, in fact, you made a lot for us.” I didn’t recognize him at first as it had been quite a few years since I had last seen him. Then I remembered he was the Texas developer who was one of the first to buy my computerized management information system for shopping centers, The Profit Edge.

“Very good to see you here,” I replied. “How are your developments going?” “Couldn’t be better!” He smiled broadly. “And yours? I remember when you wound up your computer company you wanted to develop more of your own shopping centers. I want you know I really appreciated the way you helped us even after that and then you let us have your programming code to allow us to keep developing your software for our own use. So often that doesn’t happen these days, especially in the computer business! Thanks again for being a gentleman. I wish you’all the best,” he said as he turned to move on.

This first experience with globalization came early in my career. As a property developer, I was fascinated by the potential of personal computers in improving management control of my commercial projects. Then a “convenient” recession came along and put everyone in the property development business into their fox holes hiding from 20% interest rates! No new projects were going to be developed for some time. The need to manage existing projects more effectively was pressing so I ramped up my previous efforts to develop the management information systems that would help us to weather the storm and to support our development efforts, when they resumed.

As I saw our impressive progress and shared the results with other developers, their reactions surprised me.  Most said they wanted to  have  our  system to manage their portfolios too. After demonstrating it at that year’s North American convention and receiving strong interest, I organized to offer it across the continent. I incorporated Richardson Profit Systems Corporation in Michigan, and trademarked our system as The Profit Edge.

I expanded our software development team and added a service department for customer support. We established an inbound 800 toll free phone system for marketing and support and we were on our way! We received government incentives for our ongoing research and development and international marketing to match our own investment and we launched our marketing campaign. They were exciting times for me.

We quickly sold our systems to developers large and small, and my team and I adjusted our business approach to suit the needs of clients from different regions. We learned that one size did not fit all and we managed each client very personally in order to satisfy them. I learned a lot about my industry and the wide variety of good solutions other developer colleagues had invented to meet challenges common to all of us.

Two years went by at lightning speed and we became profitable. But then I had to make a hard choice. While I really enjoyed the business and the many people I met, other good competitors had entered the market and I realized that I would have to invest another large amount of time and money to improve our system to compete with them. Earning a six figure profit paled in comparison to the seven figures we could generate by developing shopping centers, offices and hotels.

So I announced to our many loyal clients that we were exiting the computer services business to return full time to property development. Most understood, but all of them were understandably worried since they relied so heavily on our system. Now, they thought they’d have to change to another one with all the attendant expense and effort. I had already anticipated that and they were extremely happy when I also told them that we would extend their support for one year, at only a nominal cost. And at the end of that time, I promised that we would give them, free of charge, the source code for our system that would allow them to control and develop it further for their own purposes.

They appreciated that this was not the standard approach of the day. Normally firms that wished to exit usually did so instantly with their customers left floundering without support.

For many years afterwards, at industry functions I attended around the US and Canada, former clients such as the one I described above would come up to me and shake my hand.  They acknowledged that we had treated them very well. Integrity is so important to one’s business progress and no matter how far from home you may be, I believe that you must treat your clients and suppliers like you would expect to be treated yourself, in order to maintain your reputation. While doing anything else was not an option for me, you can imagine how our industry reputation would have suffered had we not done so.

Chapter 3

Preparing To Go

“If you don’t know where you are going, you’ll probably end up there.”

—Yogi Berra, American Baseball Humorist

Research, Research, Research

Today more than ever, we have powerful tools by which to source important information on any topic we are interested in. Naturally, we’ve learned to cross reference what we find since a large amount of it is incomplete or just plain wrong. But that said, we can find out a lot about where we might wish to travel to, either as a tourist or as an expat resident.

Firstly, if you’re trying to decide between destinations you cannot only access detailed information about them but you can also learn many people’s opinions as well. Participating in a blog or chat room pertaining to the country or region will often give you up to the minute information as well as local contacts for future reference.

Secondly, you can take the same approach to sourcing new opportunities using the same tools. Armed with in depth and current corporate information, you can then sort what companies or opportunities would be of greatest interest to you.

Thirdly, social media can then be a great help, and especially LinkedIn, on which you’ll be able to find and contact owners and employees of the companies in which you have an interest. Of course, solid connections gained this way can lead to a much better perspective and if you choose to pursue opportunities, then the in-house contacts you may make by these means can smooth the way for your arrival and adjustment to the company and country.

Fourthly, most recruiters are online, and most of them are on LinkedIn. When you contact them they will evaluate your suitability for various opportunities from your profile. This may then lead to a concrete opportunity for you. Once gained, it’s in the recruiter’s best interest to support you by helping with your preparation needs of all kinds…a satisfied corporate client will then pay their fee!

Lastly, you may already have friends in your network with the knowledge and contacts you are seeking.

Use all of these methods to research and action your specific interest.

Language & Cultural Lessons

Once you’ve settled on the country or region, and established an understanding of its language of business, you’re ready to reach out for opportunities there. For example, in the Middle East, it’s English.

Although native speakers will most often converse amongst themselves in Arabic, those you will interact with will all speak English very well. That is also true in India. However, in Mainland China, unlike Hong Kong where it is English, you will find Mandarin is the language of business. If you are not very fluent,, you will need the services of a translator or interpreter to manage.

There are online courses to help you to gain some basic understanding of the local language of your destination, and if for no other reason, learn what you can in advance in order to improve your everyday experiences. Such lessons also carry value since they enable you to show your respect for the nationals by greeting them and carrying on a basic conversation in their language. This will be rewarded by a positive attitude among most who you will encounter, a distinct advantage for fitting in. Of course, this applies to your new National work colleagues, with the same effect.

Beyond a facility in language, and usually in parallel to the development of your fluency, you will find cultural lessons that will be valuable to you in understanding and conducting business and everyday life.

Once you’ve arrived, your learning curve in these areas will accelerate as you will have the opportunity to exercise them every day. And in addition, you can readily find a tutor or a local language school to help you to continue to improve. However, be careful to pace yourself as I remember my Mandarin lessons that were provided at my request by one of my client companies didn’t work so well. They didn’t fit the frenetic work tempo and schedule I had to maintain!

The only time available to me for them was between 7 and 9 pm every other day. At that time a cheerful young lady, Gracie, would arrive and dutifully set to work drilling me on what I was supposed to have learned from my homework. I really wanted to learn as much as I could, but my twelve to fourteen hour work days drained my energy. More than a few times poor Gracie had to nudge me awake near the end of my lesson!

But I persevered and can now carry on a basic conversation with the right pronunciation, tones and sentences in order to be understood by the average citizen. However, what the lessons didn’t deliver was business fluency. I put it down to the large number of similar sounding words, the variety of regional dialects, and the different composition style. But the real reason, on reflection, was simply my lack of time spent in the culture as it takes quite a while to appreciate the more subtle nuances of any language.

I compensated successfully with the translation help of my two assistants as well as the use of an outside interpreter who I would engage for negotiations. But not everyone will be treated as well as I was and given this level of support. As a result, there will be frustrations for both you and your employer or partner which will add complexity to your relationships.

They may ultimately even be dangerous for you if you are left out of the information loop. It’s one of those risks that comes with working outside of your home country and you will have to assess whether the potential for gain is worth accepting those risks. But I’m happy to say that with the strategies and allies I have developed, I am confident in my ability to succeed despite the frustrations…and you can be too.

Recruitment

Attracting the attention of professional recruiters can be very influential to your outcomes if you’re seeking a good role. After you have found one or more who you feel are suitable, you must work closely with them to ensure they can represent you well. Some good examples are:

Hays    www.hays.com

Michael Page  www.michaelpage.com

Bayt    www.bayt.com

In your own best interests as well as theirs, you must be absolutely truthful with them as to both the negatives as well as positives that you can bring to an assignment. With the increased vigilance the best employers and their recruiter agents apply today, false qualifications or puffed up capabilities will likely be found out. Such, of course, will disqualify you for the immediate opportunity as well as any future ones with the same organizations.

If you are candid with them, they will likely recommend mitigating strategies for you to deploy, such as upgrading your credentials, which, while time consuming, will make the difference for you in securing the role you want. For example, if you need to improve your educational qualifications, such as completing a degree, then your willingness to do so may persuade the employer to make you a conditional offer based on your securing it.

And speaking of offers, you must be very clear with your recruiter about the details of your package. They will give you feedback as to what is likely to be accepted, however you must remember that their loyalty is very likely with the employer since it is from them that they are paid, not you! While you must listen to them and learn, there will be some “must haves” for you that must be respected by them. The recruiter is the intermediary needed to make it happen. And because their payment only comes following your successfully passing through a probation period, you must maintain his or her confidence and belief you will produce in order for everyone to succeed.

Also remember that your ongoing relationship with the HR department of the company you join, whether as employee or consultant, will be crucial to your success. As conditions change, you want to be known to them as the congenial and effective colleague who should therefore be spared any redundancies when the inevitable roller coaster slows down. So your integrity can never be in question. Of course, this applies as much to your dealings as a consultant or as a supplier to an important client. Understandably, they will have a long memory of either the positive or negative experience they had with you.

Qualifications

We often hear today the phrase “You must commit to lifelong learning.” It’s very true, we all must do so in order to keep up. World economies are evolving so rapidly, with new opportunities arising due to technological advances, that we have no choice if we want to remain relevant to our colleagues and businesses. It doesn’t take long to become obsolete if we fail to keep up. And when it comes to maintaining value as a professional, regardless of location, you must make it your business to learn about and secure upgraded certifications and academic training. You need these to continue to contribute effectively, and to be recognized by your company and clients for it.

And this fact of life reflects itself with some countries’ requirements as well as those of the companies you work with or for. A relevant university degree is almost always a requirement to take up a management role abroad. I only succeeded in convincing the UAE government of the suitability of my degree by carefully explaining the connection of consumer (industrial) psychology to the role of a shopping center executive. Fortunately, I succeeded and that box was ticked during the long drawn out process of my securing approval to go!

As well, the industry affiliations and certifications were subject to the same process of explanation, and required attestation by my government to satisfy them of their authenticity.

Finally, my visa required that I attend an interview with an official of the UAE when I delivered my attested documents. I was thoroughly vetted by the completion of the process.

I then visited Abu Dhabi on a familiarization trip to meet with company officials and tour the projects which I would oversee. I was very excited when I checked through the visa section of the airport, presenting my passport and other documents to a moderately interested customs official. But you can be sure, if my documents hadn’t all been in order, things would have not gone well. I stepped through the gate to begin learning about my new home away from home.

Residency Rules & Visas

For some countries, a visa is obtainable on arrival but for others, such as The People’s Republic of China or India, you will need to apply beforehand at their embassy or consulate in your country. Both countries’ systems are efficient and a visa should be available in short order, depending on its type. Tourist visas are processed quickly and your travel agency should be able to secure one for you without you having to show up and stand in the usual long lines.

However, if you want a business visit visa, you will need an invitation letter from a Chinese or Indian company or government organization, with the appropriate and original “chops” or company stamps. Combined with a “true” copy of their business registration, these will be enough.

But be ready to receive a time limited visa, usually good for only two visits of 30 days in length. That may not suit your purposes, however the embassy has the final say and is usually not open to an appeal…after all, how long do you need to “discuss” business with the sponsoring organization? It is a clear effort to avoid people actually working for a sustained period without going through the more complex process of securing a work or education visa enabling a longer stay.

But if it’s China, there is always a way to secure a much longer stay (or a much shorter one if you’re not careful!). Firstly, you can go to Hong Kong and apply to the Chinese Consulate for a year-long multi-visit visa enabling you to stay in country for 60-90 days at a time and to exit and reenter several times during the year to start your next stint. However, it is not certain that the Consulate will agree to issue it and you may find you are given a more restrictive edition. Here is an informative website:

http://www.saporedicina.com/english/get-a-chinese-visa-in-hong-kong/

An even more predictable route is to use one of the many visa intermediaries to secure such a visa, and even one that may not require you to exit and reenter during its term. They cost more, but the service is so efficient that you can arrive in the morning with your passport, have your picture taken and have a visa back to you that afternoon! The firm will provide its own invitation letter. In China it seems, there is always a way!

When you arrive in Hong Kong or the Mainland, the first thing you’ll need is a hotel if you haven’t arranged for one. www.hotel.com, http://www.trivago.ca/ are good internet choices to do so. Try a few of my reasonably priced favorites: the Cosmopolitan Hotel, The Harbour Grand or the Empire, Wan Chai, and then get a pay as you go mobile phone. There are several mobile providers to choose from but China Mobile www.chinamobile.cn is the largest with the biggest infrastructure, including many retail shops. The shops will give you professional help and a convenient place to pay your account.

Your passport with visa and a Chinese citizen to “sponsor” you are what is required to sign up for a permanent mobile account. I suggest you consider getting a “dual” service that gives you the least expensive call rates in both Hong Kong and the Mainland, for a somewhat higher base payment. Make sure you don’t miss your monthly payment date as you will not be notified except by your phone service being suddenly suspended!

Next you need to secure transport from Hong Kong to your Mainland destination. If you choose to fly, simply either connect with your Mainland flight when you arrive at the Hong Kong airport or if you’ve stayed over in the city, take the fast and efficient train from downtown Central to the airport. You will check your luggage at the Central station and see it next when you arrive at your ultimate destination.

Chinese Visit Visa and Border Crossing Stamps From My 48 page

Passport Which Filled Up Completely In Five Years

If you’re traveling to Shenzhen from Hong Kong and beyond by surface transport, you can either go by bus or train for a reasonable one way price of $7 USD (or if first class train car, $10 USD… I suggest it as the seats are more comfortable and there’s behind the seat storage for your luggage). Soon the long awaited high speed rail connection will be complete and the expectation is for a one stop clearance into Mainland China to reduce inconvenience to visitors.

For now, at the border, you will submit yourself and luggage for inspection… seldom have I seen foreigners checked although on one memorable occasion a vociferous German demanded his rights…and got them, including a thorough and lengthy search and interrogation. I say just smile at the border clerk, say “Ni Hao“ and then after your passport is stamped, walk confidently past the luggage inspection area after the X-ray inspection without looking at the guards to avoid an extended search by bored personnel…seems to work!

If you haven’t bought duty free items yet, do so, if not for yourself, then as   gifts for your contacts. If you’ve got an intermediate flight layover in China (or elsewhere as well), ensure you can transit onto your connecting flight with your liquor in particular. Just ask the sales associates…they’re knowledgeable.

Flying in Chinese airspace, however is not such a treat. Recently, Beijing was rated as having the worst major city record in Asia for delayed flights…and they can last for hours. It’s due to the fact that the military controls 80% of Chinese airspace and their exercises are given priority over commercial flights. Shanghai didn’t rate much higher, and lesser airports have the same knock on problems.

Once in the air, however, you’ll be well served by the young and enthusiastic bilingual flight attendants. Don’t expect a Western meal on your flight; however you will be given fork and knife to eat your palatable rice and pork.

Upon arrival, you will be processed by customs if you’re coming from outside China, including Hong Kong as noted above. You’ll collect your luggage and either wait for a prearranged ride in the terminal or find a taxi. The latter are inexpensive, however make sure you get into a registered vehicle, not one offered “cheaply” by unofficial greeters. The latter is an invitation to be ripped off by an inflated fare and sometimes, robbery! And have handy a written note with the address you’re going to along with directions in Chinese to show to the driver, supplied to you by your hosts by fax or email. Welcome to China!

Chapter 4

Education—Yours and Theirs

“Education is essential to change, for education creates both new wants and the ability to satisfy them.”

– Henry Steele Commager, American Historian

Most International Educational Systems Are Very Different From Yours

Shenzhen, Southern Mainland China

“Imagine if you had to memorize 6,500 different symbols and you’re six years old? All you want to do is go play with your friends, but you soon learn that is not a choice until you’ve memorized your ration for the day.” My partner was explaining how kids learn in China.

“If you don’t, you’re punished…and harshly.” Teachers are failures if their pupils don’t learn and so they are very serious about the memorization required. They stand over their pupils and punish them corporally if they don’t share their seriousness.

My business partner had received advanced foreign education in the US and spoke English very well.

“The difference between Chinese teaching and Western is dramatic. When I first attended classes in the US, I was amazed at how nice the teachers were, and understanding if I made a mistake! That is not the attitude of Chinese teachers for sure. Some of them beat you for making an error!”

This telling conversation speaks volumes about the thinking styles of Chinese people. Unless they are amongst the lucky (and wealthy) few who go abroad for schooling, their education shapes them to learn as adults in the same rote-based way.

And their company trainers often use the same abusive techniques that their schoolteachers did, driving whatever is being taught into their minds with repetition and fear. Do you remember the attitude and approach by my HR manager in Kunming? While that was somewhat laughable, you can imagine other scenarios that are much more serious.

http://www.shanghaiexpat.com/blog/community/education-and-learning/opinion-educational-differences-between-china-and-america-21977.html

The students are typically not taught to think independently, but rather to do so in the culturally “approved” manner. As a result, these intelligent people process their life experiences very differently than Westerners do. So when Westerners and Chinese interact, they base it on two very different thinking styles. Mere translation simply won’t do to truly communicate what is being said, much less understanding what is being thought! But the future of education in China and Asia generally looks different than this, with changes being made towards innovation and independent inquiry.

I began my first lecture to Masters level Engineering and Architectural students at the large university where I had been appointed as a guest lecturer on a part time basis. Most had a good command of English so could easily keep up with my deliberately slowed presentation. I was there to share my own training in international best practices for Project Management such as I had learned while leading the Ferrari World project.

“Wo shi Professor Phillipo,” I introduced myself.

From my first words, they realized this was going to be different. They wanted to learn how to be the best they could be, and to qualify to work with international firms in China. Those firms need their personnel to apply advanced techniques to differentiate themselves from their competitors, just like North American ones do as well.

I had the great good fortune to have led the mega projects containing some of the world’s most powerful brands, Ferrari and Warner Brothers for example. I had learned so much from those experiences and I wanted to share my learning with these students.

I was serious and persevered to secure this appointment as a guest lecturer. I was sure it would lead to heightened status, more visibility and increased business for me. It would also satisfy my real desire to help young people make their way in life, just as I had received influential mentorship when I was in the early stages of my career. And lastly, I knew I would learn as much as I would teach.

Teaching Chinese Architectural and Urban Planning Masters Level

Students in Global Best Practices And Using My Experience With Ferrari Was Very Popular

Teacher & Student Attitudes

The reaction of the students to me was very gratifying, and in retrospect, predictable. I was an exotic element parachuted into their worlds to begin with. And my differences were highly appealing to them. Firstly, my informality was refreshing compared to their traditional professors who were very formal and quite remote from them. Secondly, my Western university education was inquiry-based rather than directive and so is my teaching style.

“Thank you so much for allowing us to find new ways of learning, Professor Phil!” one student said to me.

I was holding court during one of my breaks where I stood outside the lecture room to chat with whoever wanted to spend time with me. Usually, there were twenty to thirty students who gathered around me to eagerly ask questions and to express their ideas! Their enthusiasm was so rewarding and the questions they asked pushed me to excel and try to give them the best answers I could. And it showed me something about the future of education in China and where it is being driven.

“I don’t know the answer to that Ms. Chan so I will find it out for you…in fact, why don’t we look for it together?”

This produced wide eyed silence the first time I said it…it was very unusual for a professor to admit he or she didn’t know everything, much less ask for a student’s help!

For now, the changes are coming at different rates…and some very slowly. For example, when I arrived on my first day, no one was in the faculty offices as it was noon. So I wandered around until I found their security office…and what a surveillance hub it was! CCTV camera coverage everywhere, which was nothing new to me by then as it seemed every square meter of Chinese public space was on view by someone. However, the security team was very large and I soon became aware they were on view everywhere. They had the keys to each classroom and unlocked and locked up immediately before and after classes. And the students knew they had better move along afterwards. No idle discussion was tolerated it seemed.

Showing the graduate students the absolute need to satisfy their eventual clients’ financial and marketing requirements through their design efforts, rather than to try to produce an exotic but inefficient scheme, was gratifying. My point of view is that serving the end users is the goal of Architecture with a human-suited design that yields a profit for the owner. I’ve seen too many egotistical efforts from architects of all nationalities that don’t meet these criteria.

They are failures not only for the owner but also for society, in my opinion. Now I had the chance to help the “drawers” to understand why they exist, and how to cooperate with their fellow professionals to produce a true success! Happily, their appetite to learn how to do so was palpable!

So you can see that the Chinese educational system can be an impediment to good communications and cooperation with Westerners. Until the country-wide educational reforms now underway produce results, this will not change. You must overcome this fact of life with specific strategies in order to succeed.

Qualifications

Education

I beamed proudly at my family when the large audience clapped enthusiastically as I flashed the Peace Sign onstage. I had just received my degree, forty years after I had registered for it! Those in the convocation who were of my vintage got a laugh from my throw-back gesture! It was “old school” for sure.

I had worked full time to support myself through the first three years of university, when I was young. My wife and I saved the money for me to attend full time for my last year, but when I finished it, my credits didn’t add to the total needed to graduate.

As my first son was on his way, I resumed working full time again and for some years, I didn’t take the remaining three credits to graduate. In those days, degrees weren’t as important as they are now for business success, as long as you worked hard. I worked so hard I couldn’t spare the time to take them, I rationalized.

Later in my career, a few of my professor friends urged me to “tick that box,” so I resumed my studies, and soon enough I graduated. Coincidentally, it was just in time for me to qualify to work internationally. Most importantly, it was a current degree that I earned in Psychology, with an emphasis on consumers, just what I needed to help me professionally!

Countries in the Middle East require you to hold a university degree to take a management position with any firm within their jurisdiction. The main reason for this requirement is as a quality assurance mechanism when they consider expat candidates. Because of distance and language barriers, it was difficult in the past for their companies to reliably assess a candidate’s quality upfront. However in recent years, the internet has improved this situation somewhat.

Inevitably and sadly, this requirement has also produced an industry of “degree factories” that create false credentials for those without them (mine is genuine, I hasten to add). And the deception goes beyond that in that the required “attestation” by the country in which the institution is located has also often been counterfeited!

The latest scandal involving this phenomenon was the recent revelation that “hundreds” of such fake degrees have enabled many candidates to be hired in Dubai for senior positions. Such fraud is taken very seriously there and can and will result in jail terms for the soon to be ex-CEO’s and VP’s! Hardly worth the benefit gained, it would seem, but some people have chosen that risky route. For those of them who haven’t parked their cars at the airport and left already, they will now face a very stiff penalty for having made that choice!

Experience

Inflating one’s work experience can also lead to a similar result, or at least to the loss of one’s job. A Curriculum Vitae (CV), or resume, is not subject to a formal attestation process. Because of poor auditing by some hiring firms and H.R. departments, many candidates slip past and into roles for which they are not suited. Inevitably this can lead to poor performance and a bad outcome for the hiring companies. This has led to an inherent suspicion of many expats by the companies of many countries, which are cynical about everyone as a result.

Happily, today for many aspiring countries, this is not the general case with their best companies who protect their reputations by vetting candidates diligently through their well-led HR departments.

These challenges are just some from a wide selection you may experience during hiring. There are many more which will inevitably arise as a result of the ongoing everyday interaction between those of different cultures, many of which I will deal with later on in this book.

Different Business Thinking Styles

Understandably, styles of thought and their expression vary greatly, even within each country. That is rather like North America as regional differences here can be quite pronounced, and deadly to our businesses if we fail to respect them. So approach each international encounter with an open and perceptive mind. You already saw the trouble I got into initially when I arrived in China, before I really concentrated on studying the different thought processes. And now, when dealing with international businesses operating in North America, it is just as essential for my success at home.

In most Asian and Middle Eastern countries, it is the relationship between parties that is primarily important rather than the initial prospective business transaction. Time must be spent socializing and getting to know one another to determine if any relationship can even be formed. Once this is sufficiently advanced, and it’s been decided one can be established, the discussion can turn to the business deal at hand, but even then, not too quickly.

And this characteristic is just one of the many differences that you will have to take into account when dealing with the nationals of different countries. You may say you prefer to continue to do things like you always have and not get involved in learning these new behaviors. However, if you want to continue to prosper, you are going to have to do just that. As you progress through this book, I’ll share more winning strategies that will allow you to increase your success at home as well as abroad.

Harmonizing Thinking Styles

Perhaps the deepest lesson I learned about succeeding abroad is the need to harmonize my thinking style with that of the people of the country where I am doing business… Remember, it’s the local’s home, not yours!

While you will likely never achieve full fluency (I so admire and envy the minority of expats who do), you should still continue to learn words, expressions and ultimately full paragraphs that will give you access to richer, more complete relationships. This will prepare you to evaluate and understand the needs and wants of those with whom you will negotiate. It will also give you insights into their ways of thinking which you can then better respect as you strive for their trust.

While you have heard of the very rigorous early education system in Asia, from Kindergarten to Grade 12, the results are far from bad, as is often depicted to the contrary in Western media. Their main knock is that the average Chinese student, for example, has become very conformist and unimaginative due to the rote system needed to assist their learning all of the Chinese characters. There are more than 6,500! Honestly, I don’t know how else I would learn them either! That teaching approach has generalized to all other subject matter as well, with the same effect. However, the results are generally very good, namely well-disciplined and highly motivated graduating high school students with excellent learning habits. Not such a bad outcome!

But we can’t forget that the current education system was established in China in recent times to ensure that their citizens learned to conform to the Communist Party’s ideas and ways. And this is still very visible in the post-secondary educational system, and has had the effect of holding back the development of students compared to those in international systems. Typically the leadership of universities is held by a party member and the president may rank two or three lower down in the hierarchy! This certainly doesn’t promote the learning principles we treasure in Western education, such as free inquiry-based studies rather than rote in order to stimulate innovation and creativity.

You saw earlier the hunger of my post graduate-level students to learn freely, and this is finding outlets in many ways, such as by way of the internet. As a result I believe that their system is adjusting, which will then, more likely promote the development of innovation for the country. The result will be even more formidable competition for us to face in North America as Chinese companies increase their potency and thinking styles and grow more globalized and similar to ours.

Chapter 5

Communications—How To Understand and Be Understood

“The speed of communications is wondrous to behold. It is also true that speed can multiply the distribution of information that we know to be untrue.”

—Edward R. Murrow, Communicator

We’ve all learned the crucial need to refine and apply our communications skills in everything we do and some of us become very adept at using language and delivery to our advantage. Working in an environment where all you have learned is reduced to elementary monosyllables of greeting can be confusing and demoralizing for the expat. However, there are time tested remedies which can be applied with good planning and preparation so you can be effective.

You will also make progress to that end through your good professional performance, thereby building trust progressively. It is, of course, the necessary foundation for a long term relationship that will yield the best results for all concerned.

Changes Are Happening As You Read This

Interpreters Are Essential—You Can’t Know What You Don’t Know

Kunming, Southwestern Mainland China

“Ni Hao,” I said as I walked into the strategy meeting with the CEO to which an important consultant and his team had been summoned.

They were there to report their findings on the retail mix of the major regional shopping center we were master planning. I had been in place for a month and had a good overall knowledge of the plans. The market research was now complete and today we were to learn the effect of these findings on the consultant’s recommendations. I later learned that while the Head consultant had been introduced on my arrival and he’d agreed to cooperate, he was really working with the CEO to undermine me! The latter didn’t want me contradicting him! Apparently both the consultant and the CEO felt threatened by me. The more I showed that I knew, the more uncomfortable they became.

“Ni Hao,” they replied stiffly.

We all shook hands and they began their presentation…in Chinese of course. I didn’t grasp until shortly afterwards why the CEO asked me to come alone without my translator.

“I will translate for you,” he said earlier.

While his English was clear, his intentions were not! After ten minutes of continuous Chinese, I asked the head consultant if he could pause so the CEO could summarize.

“Soon,” the CEO said. “Continue.”

The consultant continued. I did my best to understand from the floor-by- floor layouts on screen what the store mixture would be, and of course had a few questions as the screen notes were in Chinese too. After another ten minutes, I was feeling rather unnecessary.

“Could I please ask a few questions?” I interrupted. They stopped, looking irritated.

“You have not shown the department store covering all six levels of the center…it appears that there is a small one located on levels one and two. Why not expand it upwards to include more levels in order to anchor them? Then it will be a major draw to the center,” I commented.

The CEO was silent, apparently considering his words in order to control his visibly growing anger.

‘What had I done to prompt this?’ I wondered. I had simply asked a matter-of- fact and important question based on what I could see.

“The spaces on the upper level are segmented and shown as unlabeled separate small units but are really a part of the department store,” he asserted.

“Thanks for the explanation, but why are you upset by my question?” I asked in an effort to resolve the issue.

That only made him angrier!

“Do you think a famous consultant such as this would make such a foolish mistake as you are alleging? You are embarrassing him and me with such a question!”

It seems that I had accidentally caused a loss of face for the CEO, in public, and he was defending the “face” of the consultant as a proxy for himself!

“I’m sorry for that, however the drawings were not clear and no one explained them to me in this presentation,” I persisted.

The CEO then rose from his seat and walked out! The room was silent until the lead consultant said in perfect English, “That was unfortunate.” he smirked. He could have been explaining his presentation to me as he went along, but had chosen not to! I realized at that point both the CEO and the consultant had set me up to look like I didn’t know anything.

‘But why?’ I asked myself.

Learn the Language?

Everyone I know who has moved abroad has tried to learn the language of their new country, or at least enough of it to make their way in daily life. It is usually not a requirement as translators are readily available but it reflects your intention to “fit in” or to at least be polite. But don’t discount the difficulties in progressing beyond the polite stage for many people.

I’ve already described the challenges I had in combining my ultra-busy work schedule with after-hours classes.

Besides the limitations of your natural abilities and time, is the basic reality that at some point greater fluency does not yield greater dividends. I remember a story I heard on the subject in which a Westerner had lived in a community in China for some sixty years, and despite his fluency and cultural knowledge, he was still referred to as “The Old Foreigner!” So you may improve your language facility but not necessarily your business capabilities or social regard.

Ultimately, it is for you to decide how much time to invest in doing so, and I will be the first to tell you how much I admire those who learn foreign languages. But if you choose to accept the law of diminishing returns, then you can just learn to order food, ask for and understand directions and be respectful. Those steps will take you a long way in most cultures.

Learn Accepted Cultural Styles For Written And Spoken Communications

Shenzhen, Southern Mainland China

“If you don’t write the news, reporters will write it for you, and it may not resemble your story at all!” my very first boss had counseled me at the start of my career. I had taken it to heart.

The same rule definitely applies in China as well. We had convened a splashy press conference to which all media had been invited. We were announcing the restart of the high profile shopping center development I helped to redesign and I was one of the senior leaders.

No expense had been spared. We held it in a five star hotel and many public officials had been invited, along with all the business partners and associates of the owners. Hundreds were in attendance.

I bowed deeply before I introduced them through my interpreter.

“I am honored to introduce the revered executives who are responsible for our excellent project today! First, our leader, Chairman Li…President Ding is next, followed by Vice President Cheng. I ask you to join me in applauding their magnificent achievement!”  I announced.

I had learned that I had been hired for a number of reasons, and on this occasion, as window dressing…a “Foreign Expert!”

The media were all present, but I soon found out that there was much more to their cooperation and effusive articles and interviews I later saw and viewed than I had guessed. Before they would enter the room, I learned that each representative had individually visited the HR department and had been given a “red envelope” containing a “gift card,” thanking them in advance for attending, and for their good coverage.

I was told that the “thank you” was often substantial, sometimes ranging up to $1,000 US for a good reporter, but reaching much larger amounts for senior writers and their editors! No payment? Then no article or TV appearance…simple as that…or worse, a negative one!

This approach applied to virtually all marketing, including magazine articles and annual awards for excellence! This is how it’s largely done in China, with no sign of change that I can detect.

As to internal communications with colleagues, like most Western companies, track is kept of topic and content so be judicious in what you say. Of course, some of those you communicate with will not speak English and so I always had one of my assistants translate my text before sending it to them. Naturally, ensuring that your message is clearly conveyed by training your translators in your style and meaning, is vital. This naturally applies to off line written communications and reports as well.

Because less reaction time is involved in spoken communications, it is all the more important that your interpreter is in synch with your thinking style and intentions to ensure the best outcome to discussions with others.

Practice Makes Perfect

Shanghai, Eastern Mainland China

“Hello, how are you?” the young lady spoke in a friendly, if halting manner, across the aisle.

Riding on the subway, it was usual for young Chinese men and women, normally students, to initiate conversations with me in English. They were eager to practice what they were learning in school because they had been convinced that globalization was their way forward. I was always just as eager to reply in English, but I would extract a small “fee,” namely I would practice my Mandarin on them in my replies! I hoped to improve my fluency too.

I you choose to do the same through such verbal exchanges, watching television, or on your computer, it is very important that you take on as many opportunities as possible to practice the language that you are learning by speaking and listening. It’s not just about basic communication, although that is where it begins, but also about the insights you will gain through such practice. It will all contribute to your success at globalizing. While I found that reading was beyond my capabilities, others can learn the numerous Chinese word characters, further helping them to understand the basis for this important language.

Jaap Kalma, a Dutch national, was the Global Brand Director for Ferrari when I met him. Following his MBA taken at Stanford University, he rose quickly in the European corporate world. He told me about his introduction as Business Director of the Foods business unit of Unilever Italy, to which he was appointed before working at Ferrari. He moved to their head office in Italy, and his department was largely comprised of Italian nationals. Therefore, the day to day working language was Italian, in which he was not fluent…yet.

“I insisted that my staff speak only Italian to me at the office and with a little help from my dictionary and some hints, I soon developed a working fluency in Italian. Need can be a very compelling learning tool!” he told me.

Other languages can be more difficult to learn, but with the proper approach and help from colleagues, the workplace can be a learning ground for you. Of course, taking it outside to the community in which you live, will only add opportunities to practice. Soon you too can navigate successfully for your everyday needs.

Reach Out

There are many rewarding experiences that will add to your appreciation and understanding of the society you are living in. Beyond the interactions you can have at work and day to day, you must take the opportunity to travel within the country. As a tourist with an interest and basic fluency in the local language, you will find yourself in the most interesting situations.

Firstly, the people you meet will be impressed that you have taken the time to learn the basics of their language. They will be flattered and most will go out of their way to teach you about their city and country, including guiding you around to see the best parts that they are proud of! They will make sure you know the true meaning of their history and culture.

Secondly, through your local and extended research, you will learn a great deal about the cultural and societal roots of the county and its people. I suggest that you visit museums and attend cultural events like I did that will tell you so much more. Eventually you will be able to impress your hosts with the depth of your knowledge and the quality of your insights.

Thirdly, ask your business colleagues, inside and outside of your organization, whether you can attend professional development and industry gatherings that might otherwise not be accessible to you. You will find that your network will grow quickly and you will soon be treated differently than other expats.

Lastly, reach out to local institutions such as universities and colleges and offer to deliver seminars in areas of interest to them. You will likely find the same voracious curiosity from their professors and students that I witnessed every day in the streets and offices and universities, from people eager to learn. My service as a Guest Lecturer was a wonderful experience for me and my students appreciated it as well, I believe.

Chapter 6

Etiquette—Don’t Insult… Or Be Insulted

“Men cannot live without face, trees can’t live without bark.”

—Ancient Chinese proverb

Saving face is not just a social grace, it’s a way of life in Asia and the Middle East. For a Westerner, their apparent obsession with it can be both puzzling and frustrating. It plays out in obvious as well as very subtle ways but it is ever-present. And it can be deadly for your relationships if you don’t pay strict attention to it at all times. Having at least one national friend to help you to avoid problems is essential and this is a key area to focus on for you even before your arrival. This reference source will help you:

http://www.kwintessential.co.uk/resources/global-etiquette/china-country-profile.html--Kwintessential—The translation company

In the Asian business culture, the traditional executive decision making process is to hold a series of meetings during which the CEO listens to his VP’s, often without comment. He’s not building consensus as much as promoting candidates to take responsibility…and the blame! At the end of the process, a decision is reached and announced, usually attached to specific recommendations made by one of the brave VP’s, who then has ownership of it. Any face to be lost for failure will be his, not the CEO’s.

Meeting

You must prepare yourself for CEO decisions that are apparently illogical or worse, visibly damaging to the company as you saw from my description. But because of the exalted status enjoyed by CEO’s in Asia… they are not accustomed to being challenged. Your surprise and response must be very diplomatic.

To continue my experience with the CEO in China that I was describing in Chapter 4:

I left the room of the “set up” after asking for an English translation of the presentation (which never came). I was confused and upset although I hid it. When I cooled down, I remembered a conversation I had had with the CEO a few days earlier.

“I’ve just saved a huge amount of money!” He was exultant. “Our lead consultant said we only need half the parking you recommended for the retail element!”

My recommendation had followed my critical analysis of the first retail/condo offering in which he had so badly underestimated the required parking! He had allocated almost all of the parking to the condo residents and virtually none to the 300 retailers! I became aware of his tendencies from that exercise and made sure to include an adequate amount in the main retail center. It was by no means excessive; in fact it was at the low end of the standard international requirements for dense urban developments.

“We’ve now cut them in half and the City has approved it!” he said exultantly. This was very bad news since the successful leasing and operation of the center were very dependent on sufficient parking, especially in a country where so many people were buying their first cars! He was undermining the success of the center with such shortsighted thinking. I waited until his euphoria wore off overnight and the next day met with him privately to discuss it. Although I was as diplomatic as possible, he reacted very defensively.

“I told you I would ask for your opinion if I wanted it. You are wrong. I thought you knew something about developing shopping centers!” he responded.

“I know a lot about shopping centers and their customers’ needs…many in China are buying cars. They’ll use them to go shopping since their owners want to be seen as affluent. We need to be able to park them or else our competitors will!” I retorted.

“Well, we don’t do it the way you want in China,” he asserted. “Our consultant says it’s worked fine in other top Chinese shopping centers.”

That was how that conversation ended and I subsequently realized after meeting with the consultant that he really didn’t want me for my knowledge. Rather it was for my “stamp of approval” for his schemes that a compliant Foreign Expert would give him. He hadn’t counted on one that would disagree with him!

Eating

Kunming, Southwestern Mainland China

My friend, Mr. Wong and his girlfriend wanted to treat my girlfriend and me to a farewell dinner that I would remember. When we pulled up to the front door of the restaurant, the green color of the building seemed odd. However, as we walked towards the entrance, it became clearer what it was…a Bullfrog Restaurant! Mr. Wong glanced at me to see if I would hesitate, but I had already adapted my approach to such novelties in the Middle East and India. ‘Just Do It!’ was my motto and so I did. I looked unfazed.

I got the usual curious stares from the staff and guests, reserved for a foreigner, especially one who is 6’6” with a goatee. I tried my best to look like an experienced bullfrog aficionado as we made our way to our table. Pretty soon, six 1-litre bottles of Tsingtao beer arrived and the waiter poured a round for us all. I liked it, originally brewed by German expats in China a century ago, and world class.

‘Just what’s needed to make this meal go down’, I thought.

I glanced at nearby tables to see what was popular. I couldn’t really make much out except I saw some plates stacked with what looked like little bones. Yes, I concluded, they were probably from frogs. It turned out that was all that was served here!

Soon plates of veggies arrived…chopped cucumbers, bean sprouts and so on…a steel separator wall was placed in the pot dividing it into insanely hot spices on one side from just the hot ones on the other. The veggies were split between the two halves and the cooking got underway. The first appetizer arrived…crispy wontons!

‘Mmm good…but they do have a greenish hue to them…hmmm’ I mused.

Sure enough, they were frog skin wontons! The beer washed them down well. Next the main feature arrived…skinned, beheaded frog bodies on a big plate…and lots of them!

“Yesss!” I said, with false bravado.

Lean Forward Or You’ll Paint Your Shirt!

The server placed them into the boiling broth where they had their last swim, bobbing along with each other on their River Styx. More beer was poured. The young women chatted with each other without watching the cooking frogs but I couldn’t help glancing at them from time to time to see how they were doing.

The server arrived with a slotted spoon and a big smile…it looked to me like the wait staff had been taking bets on my lasting power! I smiled back, as if without a care in the world…I had my beer…and I remembered the frogs legs I’d had before were kind of like chicken. Plus I wasn’t going to ruin my image with my Chinese girlfriend as an adventurous foreigner guy. It was becoming part of my China brand that I was developing, after all!

My tools were limited to chopsticks, a beer glass…and my fingers…so I fished out a swimmer with my chopsticks and followed Mr. Wong’s lead, pulling the frog’s body apart, and started chewing the pieces.

‘This is actually pretty good! Not only does it taste like chicken, but it’s spicy too!’ I marveled in relief.

Mr. Wong was pleased…my girlfriend was smiling but watchful…maybe she’d seen some less favorable ‘foreigner guy’ reactions to eating frogs in the past!

Everything was going great until the last course. I knew it was coming, but I had put it out of my mind. But here they were…white and twisty. The intestines! The server dished them into the hotpot. I’d passed all the other “tests,” the pile of frog bones she’d taken from me attested to that. But she must have been wondering if I was going to pass this last one!

I waited until the others thought they were ready and started fishing them out, so I did the same. They were “springy” as I picked them up with my chopsticks.

They were as rubbery as they looked when I chewed them. They had no real taste, just the chilies, so I had a few, along with some good swigs of beer.

That was pretty much it…I passed the “test,” we finished the beer, Mr. Wong paid the bill, and we left. Not so dramatic after all, but another notch in my belt of “achievements” in China.

Drinking

“Ganbei!” my friend Mr. Wong exulted. “Bottoms Up!” Everyone in the room raised their shot glasses of Baijiu and fired their contents into their mouths. And so began a tsunami of the most disagreeable tasting liquor I had ever drank.

I had only been in Kunming for two weeks when my new friend and colleague, Mr. Wong, arrived one morning and proudly reported his first child, a son, had been born overnight! Our colleagues gathered around congratulating him profusely. He had won the Chinese birth lottery with the prized gender of his newborn! The smiles continued throughout the morning and his euphoria finally prompted him to advance the celebratory feast from supper to lunch!

Toasts—at virtually all dinners and at some lunches, especially those that are formal, you will be challenged to drink alcohol…you must…and a particularly lethal form of it—Baijiu!

The name translates innocuously enough as “White Spirits” but it’s not likely you have ever had this type before…in fact, I’m sure it’s different than any other liquor you’ve ever drank! It is made from distilled rice wine in Southern China or distilled wheat mash in Northern China, and you can smell its distinctive and unlovely odor from some feet away. But the taste is the most repulsive part to Westerners…it’s indescribable. I invite you to give it a try yourself and see if you agree. It’s available in specialty liquor stores in the West. And some of it is amongst the most expensive liquor you can buy…the premium versions are 30+ years old!

Your most dangerous discovery is yet to come, however. Baijiu ranges in alcohol content from 40% (wussy) to 80% (manly)! And you don’t sip it…no, no! As you just learned, you throw it back from the shooter glasses it is served in after you hear the over-familiar word “Ganbei!” You are expected to do this repeatedly, and if you either don’t drink it at all, or even fail to finish your glass, that is taken as an insult to the host!

The usual ritual followed is for the host to raise his glass in welcome initially and all follow suit. Then he comes around the table, at which those seated are arranged in order of importance—most important, opposite the host—and offers a personal toast to each individual, starting with the most honored guest. When that is done, a return visit and toast by the guest to the host is in order, to repeat the process.

The servers follow along, like some determined demons, to ensure your glass is always full. As you can imagine, by the time you start to eat, you are pretty much in the bag…and then it just continues while you eat, sometimes with Baijiu, or often times with Cognac or wine!

Late the next morning, I woke to find myself on the floor of my bathroom at home, not knowing how I got there, with my clothes still on, wrapped around the toilet bowl. The bright light of the noon hour was my wake-up call.

Cooperating

In Arabic, it’s Wasta, in Chinese, it’s Guanxi and in Hindi, it’s Prabhutv... but the meaning is the same, cooperation. You scratch my back and I’ll scratch yours.

Betsy Neidel, an American specialist in forming corporate strategy for Western companies operating in Asia sums it up well:

“With China frequently in the news these days — and not just in the business section but in fantastic front-page stories about a blind human rights activist making a nighttime dash for sanctuary in the U.S. Embassy, and the wife of a top Communist Party official poisoning a British citizen who was her business partner (and also perhaps an MI6 spy) — it is easy to ponder how different a place China can be from what we regard as “normal.”

One huge difference stands out: In China relationships and situational outlook (“it depends”) trumps law and universal agreement on what is right and wrong. And in place as both a cause and an effect of this difference is the Chinese notion of Guanxi”

http://www.texasenterprise.utexas.edu/article/dealings-china-understand-guanxi-better-and-worse#sthash.xTTLruZ7.dpuf

Of course, this is process is prevalent in our Western business culture as well, but each county has their unique characteristics, rituals…and limits. In some cultures, they unfortunately may involve deep systemic corruption. Happily, as a consultant, I have never found the need to become involved with that aspect of Guanxi, nor would I, however, I have seen it in practice.

In some cultures, you will not progress without it. We all have our own moral compasses and I am not here to judge others. However, there are consequences that you should learn about before working in those cultures. If you can’t stand the heat, don’t enter those kitchens!

One technique employed by Western companies in developing nations that have this problem, has been to partner with a regional enterprise and to delegate all “local” dealings to that partner. This permits the Western enterprise to deny any participation in corrupt activities, however, local authorities as well as those at home are well aware of this strategy, so it’s not so effective anymore.

With very active anti-corruption campaigns ongoing in China and Hong Kong, as well as elsewhere in Asia, providing a tempting foreign target to their officials by doing so would seem to be risky at best and terminal at worst. Also, remember that in the West, executives or officials of such companies that practice it are subject to fines or imprisonment under various current Foreign Corrupt Practices Statutes and Acts, and there has been more robust enforcement of them in recent years.

So how do you progress in these countries?

One strategy is to choose to only deal with other ethical local companies located there, which are usually those that operate internationally. However, it is not a given that all of their divisions will behave in accordance with their published standards and you may yet find you are put to the test. For example, corruption became so extreme in Russia that many have chosen to exit. Ikea for example, recently did so as to avoid this conundrum.

Friend Making

Shenzhen, Southern Mainland China

“You are my brother,” my new acquaintance enthused after our tenth toast, he with his Baijiu shooters and me with my large glass of Hungjiu—red wine.

We were at a special birthday dinner for a “big” landlord in Shenzhen, China. I had been invited by my friend and partner who was the MC and so I took a place of high respect at the table of the honoree, across from him. I arrived with my girlfriend who was stunning and so she occupied a lot of attention from the mainly male guests. However, I was soon thrust into the spotlight by my partner, who asked me to come forward to extend my congratulations to the Birthday Boy!

I took the microphone and said some nice things in English and in Mandarin. All the while, the landlord was beaming as he felt he was receiving an unusual honor, perhaps because my partner translated what I should have said! When I was done, the landlord took the microphone and in one of my more surreal experiences, said “F--- you very much” repeatedly until he had finished mis-expressing his appreciation ten or twelve times! My partner could hardly contain himself from laughing, but succeeded, and so did I, and quickly I sat down.

Not long afterwards, the landlord came up to me, offered me his hand, and told me repeatedly that I was his brother and that we must meet again soon. I was very pumped by all of this as it looked like some big consultancy business for us.

However, over the next few weeks, my partner’s request to meet with the landlord produced appointments that were repeatedly set and then politely postponed. Finally, we concluded that the landlord had no interest in what knowledge I might have to offer.

I don’t believe that this experience reflected a lack of sincerity, at least when the word “brother” was used. It just didn’t have the lasting power that one would have hoped for.

Chapter 7

The Importance of Brands Internationally: Yours And Theirs

Brand Power And Value

“Your premium brand had better be delivering something special, or it’s not going to get the business.”—Warren Buffet

Aspirations—Theirs

A brand is a mental short cut, a psychological abbreviation that represents the meaning and emotional essence of a person, product or service. That said, the best ones are a powerful channel into the hearts of their clients and prospects. Their influence is clear from the above list of the commercialized value of the top global brands. In the consumer world, they surround us, and are used as symbols of affluence and personal value. Using them to define yourself is a very old technique worldwide, but they’re even more potent in upwardly mobile developing countries. Each society has unique brands that are the most meaningful. But it is the international, and especially European, examples that are most powerful in Asia.

“Tonight we will have some very special wine from our Chateau.” The French representative for this famous winery in Bordeaux had invited us to have dinner with his company’s partner in China. “Johnny” was from Hong Kong and owned coal mines…and gold mines, two very popular commodities in China! He was a billionaire, but lived in Shenzhen and not Hong Kong, ironically “because it is half the cost to do so!”

His first wife and family live in Hong Kong while he lives with his second “wife” and family in Shenzhen, and he commutes back and forth between them, only a few kilometers apart!

However, the cost he was probably most attentive to, was that of “hospitality.” He had to provide a full range of it to boost his “Guangxi” (“cooperation”) with others. It was less expensive and easier to dispense in Mainland China than in Hong Kong, where the rules are much stiffer. It included a full range of activities, from sumptuous private dinners to gifts of very expensive wine to providing female company for important male officials and colleagues, which sometimes extended to 5 star trips to see his mines in other countries!

We met in the lobby of a five star hotel, and took the elevator to the private dining room where we sat on comfortable couches waiting for the rest of the guests to arrive. Johnny spoke reasonably good English and he wanted to know more about our plan to open a branch of a famous US Film Academy in Shenzhen. The purpose of this meeting was that we hoped he would invest and lend the power of his connections to help us through the approval process.

But as usual, we had to meet socially several times to raise his comfort level with us and this was our third dinner meeting. His French partner in China arrived carrying a bag with two bottles of wine. Chateau XX…a neighboring vineyard to the most famous Chateau wines in Bordeaux. He opened the two, and had them decanted.

“I love my wine now,” Johnny said. “My French partner has helped me to appreciate it.”

We had some tea while the wine breathed and chatted about many things happening in China. Johnny thought himself a genius on every subject so it was mainly him doing the talking, which was fine for me as I was doing the learning!

“Do you know that I bought the best magazine in China covering fine living? Three million subscribers, all wealthy. I intend to sell them top European brands online,” Johnny expounded enthusiastically.

I asked him how he was going to overcome the price advantage offered by Hong Kong…no sales tax and a currency advantage totaling a 38% lower cost for the same brands there. He brushed that off saying that people wanted brands delivered to their homes and offices rather than have to go to Hong Kong to buy them. I wasn’t convinced they’d pay 38% more for that privilege, while forgoing the pleasures of Hong Kong. But I didn’t show it…it was his dinner after all.

“I’m intrigued with the possibility of backing your plans for a Shenzhen-based Hollywood Cinema School!” he enthused.

Johnny thought it would raise his profile with his powerful government and business friends. Meeting aspiring young actresses was something he mentioned a few times as well!

In such a fast growing economy, people are searching for every edge they can gain in order to speed their ascent within it. Brands are a visible sign that they’ve “made it.” For many Westerners, this is now considered to be a superficial and somewhat meaningless exercise. However, the Chinese, Indians and Asians in general are true believers, so we need to be too while doing business in those countries. Mind you, many Westerners are still in that same place so those of us who are, can understand this phenomenon!

The price of the wine Johnny served us? Well the first bottle was pretty good I thought…it turned out to have a listed price of $2,500 USD. But the second one was definitely better…it should have been too…it was $5,000 USD!

Did we convince Johnny to invest? With all of the billions of US dollars he claimed he had from his gold and coal mines, we couldn’t persuade him to part with the $1 million USD we needed to seed the plan! In China, deception in deals has been the rule, so many potential investors are made very cynical by it, such that they virtually demand their return before making any investment. Trust is in short supply.

Advantages—Yours

Your image is all-important in Asia, and the rest of the world for that matter, so do everything you can to project it well. I remember when I was touring the head office of my Shenzhen client that someone said I looked like a “Foreign Expert” and many agreed. This wasn’t an accident since by then I had some experience and knew the importance of creating my own brand…and projecting it well. I was hired that day.

And since those symbols have such social value, it’s relevant that you use them yourself to communicate affluence, worth and trustworthiness to the Asian people you interact with. Already you have a set of distinctive and valuable characteristics if you are a Westerner in Asia…the whiter your skin, the greater your appeal, for example. Also, I kept the goatee I had grown in Abu Dhabi as another distinctive feature. And at 6’6”, I really stood out…I am in a lot of “fridge pictures” taken by many awe struck Asians, some of whom had never seen a foreigner, let alone a giant!

I was careful to craft my brand distinctiveness through a number of channels. I had my clothes and shoes custom tailored in Hong Kong with Italian cloth and leather for an affluent look. I wore my Rolex and gold rings conspicuously to echo the expectations my contacts have of what wealth looks like. And my degree and certifications weighed importantly on the decision of companies to do business with me. In China, I took care to register as a “Foreign Expert” with the government and displayed the certificate, with validating official chop (a stamp), on the wall of my office.

Brand Authenticity

We are told so often by marketing gurus that the authenticity of our brand, whether for a product, service or our own is vital to success. Learning how to craft a brand suited to an international market is especially challenging, but just as relevant as it is at home. And for many brands that have been developed in booming economies, they are simply false. But as a market matures, consumers become more discerning.

Shenzhen, Southern Mainland China

‘Damn’, I thought. ‘I almost bit it there!’

I had just about tripped on the small risers of the steep stairs up to the stage as my size 13 shoes just didn’t fit! The MC was my business partner and he shook my hand as I walked to the center of the stage. He turned me around to address the 1,000 workers who were seated below for their annual meeting.

It was outside and Shenzhen in winter is chilly, but that didn’t matter. We had all been given bright red scarves to warm us up. It was January 7th and the CEO of XYZ Company, a “fake” Italian Chinese fashion brand, came forward to join my partner, Tommy and me and to wave at the crowd. Tommy asked me to speak while he translated.

“I’m honored to be the only Westerner here tonight and very happy to celebrate with you the success you achieved last year. Congratulations! You have increased your productivity and the quality of your fast fashions. Their popularity and your sales are increasing too. Mr. Z just told me that your reward is that our company will be helping you to open a flagship store in Milan, Italy! We’re going to take you international!” I extolled.

Tommy and I had just launched our new company January 1st and this was our first assignment…to convert the fake brand company into the real thing. We were to make it over into a genuine Italian brand by shifting its design and manufacturing to Italy. We were to put real substance into its existing Italian incorporation before Chinese government inspectors “discovered it” and closed it down! We would be heroes when our story became known to the Chinese government and consumers, we thought. Ours was a righteous enterprise!

The Audience Of One Thousand Rose And Gave Me A Standing Ovation, Although None Of Them Spoke English. Full Credit To My Interpreter And Partner, Who Had Told Them What I Was Supposed To Say!

During my trip to Italy in October, I had researched the fashion scene in Milan, documented the major shopping areas and inventoried the best shops in all of them with our Italian partner. He was already negotiating for the best shop and manufacturing plant available in order to set XYZ up as a fully bona fide Italian company, not just one with registration there! And then we’d send the fashions back to China, the real thing, thereby legitimizing the company. The CEO would be a hero!

He came from Wenzhou in Eastern China, renowned for its entrepreneurs and its private lending system, Shadow Banking, needed to fuel their dreams! What did it matter that the interest rates approached 60% per annum or more? These millionaires were on their way to becoming billionaires! And Mr. Z was one of them! I smiled to myself whenever I saw him as he always wore one of many “XYZ” branded glasses, he used their real brand to contribute to the “authenticity” of his not so “real” one.

Onstage, we were joined by a beautiful woman, an MC partner of Tommy’s… she was a famous TV personality, just like him. Suddenly fireworks erupted from the sides of the stage as Tommy announced the awards presentation was about to begin! From offstage, three young men and one young woman stepped from behind the curtains. Trophies were brought forward and handed to Tommy and me one at a time as we presented them to the winners he announced. The crowd erupted on cue as we finished the presentation and I gingerly walked down the stairs to my front row seat.

A group of really energetic drummers and dancers were bringing the crowd to its feet in the climactic act of the evening. Everyone clapped and then quickly dispersed onto buses to take them home. It was over.

A few days later, Tommy and I arrived at the main entrance to the XYZ plant. A dozen employees, all dressed in company black suits, lined the red carpet on either side, and over the door a large LED sign greeted us in English: “Welcome Famous Ferrari World Builder.” Mr. Z was at the door to shake our hands. We quickly toured all six floors of the plant seeing every step of the fashion production by the many hundreds of employees we had seen at their annual meeting. We returned to their showroom and after viewing the latest fashions, tape measures were brought out and we were all set up for new suits…company black of course!

I looked around at the Italian furnishings in Mr. Z’s office.

‘Only Berlusconi would have such ornate stuff ’ I thought.

Tea arrived and we set to discussing our social lives, with many compliments enthusiastically exchanged. Mr. Z left for a meeting and Mr. M, his GM, took over, discussing exactly what they felt was needed…relief from the Italian and Chinese government agencies looking to out the fake brands! Thirty of such fake firms had been “discovered” the previous year and Mr. Z wanted to avoid their fate! They wanted us to make their enterprise completely legitimate, genuinely Italian! I said, “We can do it!” and Mr. M beamed. Everything looked great for our future.

I arranged with our Italian colleague to complete our research of the opportunities for the required Flagship Store, Design Studio and Showcase in  Milan. Based on this we produced a plan of action for XYZ that was top drawer in professionalism. We presented the translated copy to Mr. Z and he authorized Mr. M to fly to Milan to meet with our colleagues there and review the choices. Everything pointed to a great success.

Soon, however, the wheels came off abruptly as only they can in China. When Mr. Z stopped answering our phone calls, we realized something was wrong. It is a very Asian practice to not want to tell us first hand something was wrong. We finally got a meeting with him but when we arrived we were shifted to Mr. M.

“Too expensive,” he said.

I countered by saying, “We gave you the rental and construction costs near the beginning of our discussions! Why are you reacting this way now? The threat of the government exposing your firm as a fake brand is still very real.”

You can see the risks associated with allowing your brand to become diluted or worse, establishing one that is not authentic! Public exposure by the government or competitors would result in a meltdown in brand equity and a huge loss of business. And the prevalence of “fake brands” in such markets has the effect of putting all brands under the consumers’ microscope. Make sure you establish your brand genuinely, guard it jealously and maintain its authenticity. By doing so, you can reap the benefits of consumer or client confidence and sales.

I also learned that signed agreements and contracts in China only serve as a starting point for future discussions…no price is firm, and no commitment to pay is enforceable, especially to a foreigner! We left when he didn’t offer a way forward. A few days later we learned that Mr. M had resigned to start a competing firm to XYZ, taking four senior managers with him. The theft of secrets by Chinese entrepreneurs is not reserved for foreign firms only! We were left with all of our time and expenses unpaid, but we had received some valuable training!

Applying Our Branding Knowledge

Hong Kong/Shenzhen, Southern China

I was hired as an executive consultant by a progressive publicly traded company based in Shenzhen, a major city of 14 million people in Mainland China just across the border from Hong Kong.

“We want to have a truly international brand for our project along with a Western style website and merchandise mix,” their Vice President said excitedly. “We have been given a great opportunity to make a bold statement on the center stage of our important city.” Their largest project was a regional shopping center of seven levels, five of them underground, connected to the city’s enormous convention center.

And so began my stint for this large but mainly residential Chinese developer who wanted to expand into retail, leisure and hospitality development, which is my specialty.

I was very confident that I could help them and they appointed me as the General Manager of the public company, very unusual for a foreigner. I began by assessing the human resources already within it. Only a very few spoke English, and although the fluency of those who did was very good, I also needed to have a full time translators to help me to communicate with the rest. They quickly assigned two young ladies to help me who were both university graduates in English studies and very fluent.

Because of my approachable style, people quickly gravitated to me. They were attracted to a leader who did not show a superior or authoritarian attitude, but instead, a caring one, to his colleagues and subordinates. I interviewed each of those already on board and learned about their capabilities and goals. I shared mine with them as well.

Once we had developed a familiarity with one another, I assigned each to the role I thought they could do best, and they were pumped for the challenge. My door was always open for them to enter to discuss anything of relevance to our mission or to them. On Fridays, I had pizza and Cokes brought in for a wind down to the week. And they taught me about the value of an hour long power nap for everyone following an hour long lunch break, every day. The lights would be dimmed and everyone would put their heads down, only to awaken an hour later to soft music and a reinvigorated outlook for the rest of the afternoon. It was great.

I arranged for mandatory weekly English lessons for them and committed to Chinese lessons for myself. And they prepared to become globalized.

I interviewed several marketing agencies from Hong Kong and hired the best of the best, Base Creative, which began working with me on developing our international brand. This was a novel experience for the company’s leadership and they were very pleased with the results we achieved after only a few months of intensive work. We presented them with three great choices and after some tinkering, they selected one that we then used for the foundation of our strategy.

I had a Western-style website designed and rolled out with the best features of the most dominant shopping centers in North America and Europe. Models were selected and photographed for our fashion shots and all was readied for launch. We had created a powerful brand which strongly broadcast that their first regional shopping center was to be different and very international. Our website began receiving plenty of hits which told us we were making a noise in the market months before we were scheduled to open for business!

Maranello, Italy

Another branding opportunity arose for me while in Abu Dhabi. I travelled to the Ferrari head office in Maranello, Italy from time to time for meetings with their senior executives. After I got to know them well, I was given access to all parts of the facilities from the assembly line to their design studio and, most excitingly for an F1 fan like me, to their racing department.

“Mr. Todt will see you know,” said his friendly assistant who I saw as regularly as her boss. Jean Todt was the CEO of the company and I met with him to provide updates and share ideas. He was an F1 legend having lead the Ferrari Team to five consecutive World Championships between 2000 and 2004. And he was an excellent business leader from whom I learned much.

This day I had a special purpose in mind and as I concluded our business, I asked my question:

“Jean, I have always admired Ferrari for many reasons but especially its ability to stay at the top of the racing world and operating as a profitable business to be able to do so. Would you please share with me how you do it?”

Jean was always very friendly with me and he replied by picking up his phone and calling the company’s race director.

“Mario, I would like you to take Phil out for a long lunch and tell him everything there is to know about our business and racing success. Nothing is off limits.”

With that I began a fascinating journey through the organization that is so legendary around the world! How lucky was I? After a fascinating initial long lunch meeting with Mario, a senior executive, I successively met with several other key officials who gave me a deep look into the company’s goals and operations.

Globalizing is one of the key reasons for Ferrari’s success. Inviting top professionals from around the world into key positions in the company has resulted in creating major competitive advantages. It benefits greatly from the energy and freshness contributed by all of the passionate colleagues who apply global best practices for the success of the team and the company. I wrote an article about my experience for our company magazine that I will share with you on my website as a bonus for simply subscribing to my free Newsletter at www.Globalize2X.com

My Article About Ferrari: “Winning On And Off The Track” Subscribe To My Free Newsletter For Your Complimentary Copy

UpBranding

What better way to intensify your brand than by associating it with others of equal or greater potency? This is called “up-branding” and it is used across the spectrum, from legitimate partnerships to illegal counterfeiting.

One of the more cheeky applications of the latter was the group of fake Apple stores that operated in Kunming, China while I lived there in 2011. They looked and felt like the real thing, with knowledgeable staff (fake “Geniuses!”) in company uniforms! Had I not been tipped off I could easily have concluded that I was in the real thing when I visited them. After a lot of notoriety in the foreign press, but still only after a year of it, the authorities finally cracked down and closed them. Of course I am not advocating you using this type of initiative to bolster your brand as it could lead to a long prison sentence!

Yas Island Mega Project, Abu Dhabi, UAE

Using up-branding, I came up with a legitimate campaign that was wildly successful. With my background in major shopping center development, marketing and operations, I was very familiar with the process of combining brands for synergizing their collective performance. What else is a shopping center but a  powerful amalgam of brands, after all?

When I arrived in Abu Dhabi, Ferrari World had just been conceived and agreed in principle with Ferrari by a visionary Emirati business leader, Khaldoon Al Mubarak. He convinced the Crown Prince and Deputy Ruler of Abu Dhabi, HH Sheikh Mohammed bin Zayed al Nayan, that it would serve as a powerful tourist attraction to help diversify the economy from its carbon resource base. The concept plans were drawn and it was to be built adjacent to the F1 track that was another one of the major elements of the Yas Island Development that I described earlier.

I had been hired to lead the neighboring superregional shopping center’s master planning, design and delivery, however when I realized the importance of coordinating those processes with the iconic leisure elements, I volunteered to add them to my scope for no extra salary, but an enhanced bonus opportunity. The CEO agreed. From that point on I then also led the development of Ferrari World and Warner Brothers Theme parks as well as a massive Waterpark, all to be fully integrated with the superregional shopping center. It just made sense to have one leader for all four components, totaling over 6 million square feet!

As I looked at the concept plans for Ferrari World, I was struck by the fact that the triangular shaped building had two exciting attractions, roller coasters, in two of its corners but lacked anything in the third. A planned hotel had been relocated from there and nothing had replaced it. Because the empty corner was closest to the F1 track, only two hundred meters away, I felt the need to place something spectacular within it.

The unique building’s shape was like a giant claw, and suddenly it hit me! We had to put in an entertainment venue, a musical amphitheater! I invited the Canadian official who worked for the UAE Government to bring world class entertainment to Abu Dhabi, to visit me and asked for his opinion and help.

Yas Mall With Ferrari World Behind It, 6,000,000 Square Feet Of “Retail-tainment” Including The Warner Brothers Park!

Twenty four months later, he and I were enjoying a beer together at a break from watching Beyonce perform, the first of four concerts held in front of 40,000 people, on each consecutive night during the inaugural F1 race week in 2009.

“Phil, when you brought me out here to discuss your idea, and we were standing here with only sand to be seen for miles around, I thought you just might be nuts! But tonight shows that all of the tough convincing you had to do with your CEO, Chairman and Board to permit you to include this element, paid off! Tomorrow night it’s going to be Jamiroquai, then Kings of Leon and on the last night, Aerosmith! Congratulations, brilliant idea! I’m so glad to be a part of making it happen with you!”

While I appreciated his compliment, for me this kind of thinking comes naturally. After all, as a property developer of retail and leisure projects, I’m really in the entertainment business…we call it “retail-tainment!” And as an entrepreneur, I am accustomed to thinking laterally, trying to add strength wherever possible to a brand and its underlying business.

In this case I was using up-branding “on steroids”, combining two of the most powerful brands in the world, Ferrari and F1 Racing, with the potent entertainment brands of famous performers. The synergistic effect of that potent combination, along with the F1 race event itself, would draw customers worldwide, I reasoned.

And the strategy succeeded. A total of 160,000 people filled the 40,000 person capacity amphitheater over the four consecutive nights. But it is what followed in the succeeding years of ongoing development at Yas Island that really was helped by this innovation.

Until the superregional shopping center opened in 2014, this venue was the only major additional draw to that of Ferrari World, which had never been intended to operate by itself. The economic downturn in 2008/9 delayed the other elements from opening in the quick succession we had planned. So the many concerts held in this amphitheater until then, were very helpful in developing awareness and business for Ferrari World. They continue to do so today, the result of thinking outside the box and combining strong brands to work synergistically.

Beyonce:

https://www.youtube.com/watch?v=rhhDP1hLa74

Aerosmith:

https://www.youtube.com/watch?v=lKzdj2_wTrs

Abu Dhabi Inaugural F1 Race https://www.youtube.com/watch?v=OBMHhhW2XD4

Ferrari World Concept:

https://www.youtube.com/watch?v=LJxNLQ7UEvs

Ferrari World Abu Dhabi Under Construction:

https://www.youtube.com/watch?v=wA37I7p0_fo

Ferrari World Open

https://www.youtube.com/watch?v=fBigggu8GKk

Chapter 8

Negotiation: Can Everyone Win?

“Always be prepared to negotiate, but never negotiate without being prepared.”

—Richard M. Nixon, 37th President of the United States

Asian’s and Middle Easterner’s Goal: Mutual Success Over The Long Term…But First, Theirs, Of Course

Paris, France

The boardroom was tense as small talk about being in the World Capital of Love swirled around it amongst those who had arrived. The room is a replica of an ornate 18th  Century Gentleman’s library, but armed guards now stood outside its doors in one of the city’s most famous hotels. The surroundings couldn’t have been more opulent and suitable. This was a meeting between one of the world’s largest property development companies and one of the world’s largest movie studios.

“Very pleased to see you again” the CEO’s had exchanged greetings when they arrived an hour ago.

But the Studio’s Chairman was beginning to look more exasperated by the minute. He and his executive team had flown in from Burbank on their Gulfstream 9 only a few hours before. But our Chairman was nowhere to be seen, overdue now by 75 minutes as the antique clock on the mantle ticked away.

“I’m sure he’ll be along soon.” our British CEO offered politely to his anxious looking American opposite number. “We know our 737 is on the ground.” he added, a bit archly.

After finally agreeing to the long sought meeting with our Chairman, everyone was anxious to settle the pressing business issues we came to resolve. Everyone, it seemed, except our Chairman.

But there was a lot at stake. On the table was the establishment of the new Middle East center of excellence for cinematic production…a full blown world class studio operation from which, it was hoped, would come movies to rival those of Hollywood and Bollywood. As well, a chain of cinemas to cover the whole region was planned, and last but not least, a huge indoor theme park was to form a part of our retail and entertainment mega project.

This aspirational vision had been formed a year ago, beginning in Abu Dhabi and then moving on to Burbank, over lunches with executives and celebrities. The toasts had been made and now it was time to move ahead with concrete planning.

But the world economic crisis had intervened since then and urgent face to face talks were needed to adjust the deal. Everyone’s global brand was tailored to portray unlimited resources, but reality had intruded and the ‘party’ was at risk.

The clock continued to tick away.

Suddenly, the double doors swung open and, with a flourish of white robes and proud demeanor, our Chairman “arrived”. The room breathed a sigh of relief as he grasped the hand of the Studio Chairman and shook it vigorously.

We all stood chatting for a few minutes while more refreshments were offered and then we took our places. The finishing touch to this “movie set” was the seating arrangement of executives, each across from his opposite number, seven per side, with me half way along our row. And what a great place that was to observe what followed.

It became clear as the meeting proceeded that resolution would not occur that day. After a presentation of the latest plans of the theme park based on the large scale model at the end of the table, our leaders set out to agree what they could.

The Americans pushed aggressively for agreement on each element, occasionally referring to the “hand shake” deal that had been done a year ago. The Brits rebutted with the need to agree formally, but based on more detailed planning before proceeding. And the Arabs…well they just watched. As the discussion of each element concluded the Chairmen would eye one another speculatively.

“We must resolve the timing of each element now to preserve our Board’s support for our overall deal” the American Chairman pressed.

Our Arab Chairman deflected

”We highly value your studio’s commitment to our country and company but we must consider what is the right timing”. But at the end of it, he made no offer to settle dates.

The elephant in the room was money, of course, and the uncertainty of making it available in a timely fashion. There was never the suggestion that sufficient resources weren’t available…it was just a matter of when. But if the Americans wanted more certainty as to dates, then perhaps an adjustment to the terms might be offered by them to effect it?

After five hours of this tennis match, exhaustion began to creep in. The Studio executives resigned themselves that they would not be able to report a successful conclusion to their Board. The price of oil had stubbornly remained below $50 per Bbl in recent months and it became clear that only when it returned to a healthy level would any of these visions be made real. The meeting concluded, leaving an unsatisfied feeling for everyone. But at least it was over and our Chairman’s message delivered: The Studio was just not that important to cause his country to tap its reserves to move more quickly.

We dispersed after the usual pleasantries, and went out into the warm summer evening, ready to let Paris distract us.

The Middle Eastern point of view on negotiations is very different than that typical for the Westerner. Stretching out discussions and delaying meetings and decisions is viewed as favoring them. And always there is their inclination towards dominating the discussion through subtle and not so subtle tactics such as arriving an hour and a half late for a meeting! Their hope is always to improve a deal over time in the face of the usual impatience of Westerners to “get a deal done”.

Shenzhen, Southern Mainland China

“Since the opening of China to foreign investment, much prosperity has been gained by many. However, in achieving it, we have lost our moral compass,” he sadly stated.

I was having lunch one day with a close Chinese friend and he explained the root of the societal problem his country faces very succinctly.

We had begun by discussing the generally selfish behavior I had observed regularly, especially in crowds on the Mainland and I was comparing them to Hong Kong.

“When the elevator doors open in any building in Mainland China I step forward to get off, but those wanting to get on are already rushing to board before anyone gets a chance to move! Why is that?” I asked.

“They only care about themselves,” he replied. “And families are changing as a result, with many parents abandoned by their adult children to care for themselves when they are old. It’s not our tradition. The government even had to recently pass a regulation to force people to care for their parents!”

So what has caused these shocking changes? To be fair, many people living in Chinese cities have just recently moved there from the countryside. As farmers they lack the basic training of how to conduct themselves in the city but no one takes the time to help them to learn how to do it.

“It is the absolute fixation on making money that I believe is the underlying cause. It is the reason why people are so self-centered…they are focused only on themselves. And I despair for my country.” he lamented.

This fixation on advancing their self-interest has intensified as the entrepreneurial spirit has infused so many in China over the past three decades. And it has often come at the expense of those foreigners with whom they partner.

It is very important to take the time needed to establish the character of one’s intended partner or colleague for this reason.

I told my friend that many Westerners have suffered from the same complex but that I had hope for the future, based on forming mutually successful partnerships and promoting longer term thinking on the part of everyone concerned.

“The Chinese word for negotiation—tan pan—combines the characters meaning ‘to discuss’ and ‘to judge.’ From a Chinese perspective, negotiation exists primarily as a mechanism for building trust so that two parties can work together for the benefit of both. Trust is built through dialogue that lets each party judge or evaluate the partner and the partner’s capabilities and assess each other’s relative status. The negotiation process also enables parties to reach an understanding on a specific issue, condition, or transaction, in a way that lets each side feel that ‘a good deal’ was brokered. But the concept of negotiation hinges on creating a framework for long-term cooperation and problem-solving much more than on drafting a one-time agreement.”

Betsy Neidel—Negotiations, Chinese Style—China Business Review, November 1, 2010

http://www.chinabusinessreview.com/negotiations-chinese-style/

I found that negotiation in principle is acknowledged just as Ms. Neidel states. I also found that in practice self-interest trumped mutual interest as often as not.

Your Western Goal: You Can Both Win

“All boats float on a rising tide.”

—John F. Kennedy, 35th President of the United States.

The notion of a win-win relationship is certainly not at all foreign to Asian business people and companies. It’s just that developing one with a Western firm, in their view, is a lengthy and difficult process. The patience of each party will be severely tested during it as the respective cultures clash at times. At some point, one or the other may “blow a fuse,” likely the Westerner, and the effort abandoned. Both cultures know that a long association based on trust and mutual performance is optimal. So what frustrates these efforts the most?

Differing Negotiating Styles By Culture

The usual priority for an Asian or Middle Eastern firm is to establish a relationship through a process of the parties first socializing with and getting to know one another, without necessarily discussing the specific business that is of mutual interest. This typically includes several private dinner meetings for which the rules of etiquette noted earlier are the foundation. The hoped for outcome is a mutual understanding of how each can contribute to a relationship and, importantly, how each will conduct themselves within it.

The usual priority for the Western firm is to focus on the specific deal or opportunity that has caught their attention and to let the relationship develop after an agreement for action has been reached. Taking time for “endless” conversation and dinners might be seen as a waste of time by the Westerner and lead to frustration with the slow pace of the discussions.

“Western businesses negotiating with Chinese firms face many challenges, from initiating and smoothing communication to establishing long-lasting relationships and mutual trust, and from bargaining and drafting agreements to securing their implementation. Chinese negotiators can be at once warm hosts and friends and tough bargainers.

Unique Chinese cultural elements such as complicated local etiquette, obscured decision-making processes, and heavy reliance on interpersonal relationships instead of legal instruments all add to the complexities of Sino- foreign business negotiations, and can make the process tiresome and protracted. Besides talking past each other Chinese and western negotiators often harbor mutually unfavorable perceptions. Many westerners find Chinese negotiators to be inefficient, indirect, and even dishonest; Chinese negotiators frequently perceive their western counterparts to be aggressive, impersonal, and insincere.

The way to decipher the Chinese negotiating style and bring about mutually beneficial results is to better understand the key elements of Chinese culture to which Chinese negotiators attune their business mentality and manners.”

Cultural Notes on Chinese Negotiating Behavior James K. Sebenius (jsebenius@hbs.edu) Cheng (Jason) Qian (JQIAN@HBS.EDU ) Harvard Business School, Boston, MA USA December 24, 2008

http://www.hbs.edu/faculty/Publication%20Files/09-076.pdf

We all are aware that there are many differences between cultures and unsurprisingly, negotiating styles are included. I could write volumes about this topic, but British Linguist, Richard D. Lewis describes the challenges best, narratively and pictorially.

“By focusing on the cultural roots of national behaviour, both in society and business, we can foresee and calculate with a surprising degree of accuracy how others will react to our plans for them, and we can make certain assumptions as to how they will approach us. A working knowledge of the basic traits of other cultures (as well as our own) will minimize unpleasant surprises (culture shock), give us insights in advance, and enable us to interact successfully with nationalities with whom we previously had difficulty.”

Although cultural generalizations  can be overly reductive, Lewis, who speaks ten languages, insists it can be done fairly, writing: “Determining national characteristics is treading a minefield of inaccurate assessment and surprising exception. There is, however, such a thing as a national norm.”

Lewis, Richard D. (2010-11-26). When Cultures Collide, Third Edition: Leading Across Cultures (Kindle Locations 8-9). Nicholas Brealey Publishing. Kindle Edition. ISBN-13: 978-1-904838-02-9 ISBN-10: 1-904838-02-2 www.crossculture.com

Align Your Capabilities with your Mutual Goals…And Then, Up Your Game To Attain Them

“Opportunities multiply as they are seized.”

—Sun Tzu, Famous Ancient Chinese General

Why would you expect the Asian or Middle Easterner you are negotiating with to abandon their fundamental expectations and biases any more than you would do so yourself? That said, somehow you need to come together so your proposed mutual business can proceed.

I talked earlier about the various strategies to expect and accommodate in your dealings with Asians and Middle Easterners. They have ranged from learning the language to living the business culture to saving face, while working to lessen their suspicions arising in response to your strategies. Getting comfortable with one another is the first step and includes patiently listening much more than talking. Then aligning your commercial interests is next. All of this takes time…and patience, the latter of which will be tested frequently while the former is constantly stretched.

How can you optimize this process so it can be completed in the shortest time possible? The best answer is that you cannot accelerate the process while building the longevity and integrity of any agreement reached.

Why is this? Again, the best answer is the development of the trust needed to underpin any quality relationship that you might wish to enter. By and large, coming from a developing country will set one up to deal with the factors needed for each party to survive and prosper…the will is there for them to enter our markets as cost effectively as possible, and to prosper.

At the outset, it is very wise for you to take mental stock of what is important to you and what is not. Once you have settled that in your mind, you have to determine the importance to you and your company of arriving at your goal while risking its attendant exposures to risk, which inevitably are greater abroad than at home.

Once settled, engage your prospective partners in the style that they expect (and as stipulated by your experience and/or by your advisors).

B2B/B2G Cooperation

Cooperation is the key word to listen for when spoken by Asians. It will tell you that the speaker has decided that you could be a suitable partner in a venture, for any number of reasons, and it’s your signal to act. Whether that is to backpedal as fast as you can or to lunge forward, will be up to you and what you’ve learned up to that point about the prospective partner. What you do next will influence your outcomes in Asia and at home.

Because of the fascination of Asian companies with going global, their cooperation with you may have to do more with accessing an initiative in your home country than for one in theirs; you can add significant value to such a partnership by contributing your strong domestic brand and superior market access in North America.

In principle, that is a good thing as I’ll discuss further in the next chapters. Combining the various strengths of each party can produce a formidable collaboration that will be competitive anywhere you might choose to go together.

Sorting the intricacies of business to business cooperation, whether with partners, clients or service providers is a study in itself, and one which I am hoping to help you with in this book and through my consultancy. As well, there are many other good international business specialists whose books and direct consultancy can assist you with this process. As you have seen, I have quoted them in my book. I, like them, am available in person to support your efforts to globalize..

There is another specialty that is a combination of science and art which must be mastered in whichever country you are working. That is the crucial Business to Government connection. In many ways, B2B is easier than B2G, since the latter is so often dependent on one’s long term connections with the appropriate officials. This is something we are just as well aware of in our home countries, so it’s not a new concept. The almost universal response to this is that the local partner will handle this responsibility since their relationships are a part of the equity they bring to a deal.

That said, you can appreciate the possibility that, as the outside partner, you might become vulnerable to “unbalanced” or “inappropriate” arrangements that could be made without your knowledge. While it is difficult for you to immunize yourself completely against this risk, there are some avenues to follow.

One is to insist that, as a partner, on an early introduction to the relevant government officials in the enterprise in question. Remember to bring your interpreter to ensure you know the temperature of the room and for her/him to relay to you any signals that all might not be right. Another tactic is that you should refer to your other independent local advisors to learn about all of the officials in question. But a caution: insisting on attending all meetings along with your partner is not advisable since it would be seen as an intrusion.

That is probably all you can do so you’ll have to accept the risk that your partner will give you a fair shake. But as a last test, regular reporting from your partner, cross checked by your advisors, may at least give you fair warning of impending issues.

The Rules of the Road: Corruption and Other Hazards

The phenomenon of corruption is present in business and government worldwide. It debilitates and drains economies and is generally seen as the blight it is, both nationally and internationally. However, in some cultures it is deeply ingrained and systemic. As globalization widens, more and more nations are deciding to try to end it since it deprives them of enormous amounts of tax revenue and investment capital.

The Chinese Communist Party Leader, Premier Xi, launched an anti-corruption campaign during his first year in office in 2012, and since then many officials and business people have been arrested as a result. But expectations for its positive effects have to be tempered.

As with all organizations in China there are powerful competing factions within their leadership. It is the case that many of the ruling Politburo are billionaires, so you can rest assured that they will not damage the system that brought them their wealth. Also the loyalty of the 88 million Communist Party members is partly based on their access to opportunities to prosper, often through corruption, so disappointing them is not a good idea for the Party leaders.

The People’s Liberation Army is led by many millionaire generals whose wealth comes from their share of the commercial enterprises that the Government permits them to conduct. The Army keeps the Government in power. And of course, the people look to their leader’s actions for guidance. When they see that process continue, (the leaders response will likely be to also continue past practices, but more “gently.”) the common man will continue to do so too.

Macao, a Special Administrative Region like Hong Kong, and very close to it, has been a favourite conduit for exporting ill-gotten gains. Some $2 Trillion USD is estimated to have flowed out of China over the past twenty years! Certain Mainland Chinese companies would take cash from clients, open accounts for them at casinos in Macao, deduct a commission of 10-15%, and deposit the remainder in their name. When visiting Macao on vacation, the client would gamble some of this money but then transfer the rest to banks in other countries from his local Macao bank. There is now a crackdown on this process and Macao’s monthly gambling revenues have declined in 2015 by 40% from 2014 levels.

But corruption is still a significant fact of life in doing business in China, as well as other major nations such as India, notwithstanding their recent efforts to diminish it. The reality is that foreign companies are forced to participate in the process in order to do business. Some do so “unconsciously” by having a Chinese partner whose role in part, is to handle “commissions,” without advising or involving the foreign company.

But yet another of the dangers of doing business in China is that the “discovery” of such illegal activities by powerful competitors can result in fines or jail for their rivals, courtesy of complicit authorities. I’ve attended a number of business dinners at which one or two Police Chiefs are in attendance, as well as Party Secretaries. The former have the unilateral authority to detain people for as many as four years in “Black Jails” where people are sent for “reeducation”. Understandably they are feared, and occasionally used by various powerful people, such as Party Secretaries or successful business owners as a part of their strategies.

Deception by one’s own partner is also possible, of course, and on-the-ground vigilance is necessary to control this and other risks as best one can. They are very real and often outweigh the potential rewards of the enterprise. You must ask yourself from time to time if it’s really worth it to conduct business in China or other countries with similar attitudes.

Corruption Infographic. The Higher The Score, The Lower The Corruption

Chapter 9

Competition and How To Deal With It

“All the major videogame, technology, and media companies in North America and Europe are both fascinated and slightly nervous about the major Chinese companies entering their home markets. The only advice I can give is to learn from Tencent fast, because these guys mean business and they know what they’re doing. It is only a matter of time before they become as strong internationally as they are at home.”

--Towson, Jeffrey, Professor and Author;

They’re Survivalists

“Zhengfei, (the founder of Huawei) defined what he calls a ‘wolf spirit’ for the company. He described this as three key factors: extreme resilience in the face of failure, a strong tolerance for self-sacrifice, and a sharp predator instinct. He has said that in order for Huawei to become a global player, each member of Huawei must have such spirit.”

Towson, Jeffrey; Woetzel, Jonathan (2014-03-13). The One Hour China Book

In Chapter 4 you learned about the importance of an interpreter to your success and even survival. I later learned the significance of that statement as I recounted in my description of my interactions with the CEO!

A few weeks before that stressful meeting, I had been frustrated in my efforts to finalize the organization’s structure, job descriptions and authority levels that were part of my scope of services.

I was in a board meeting in which the delay in design progress and approvals of a major shopping element were discussed. The room was filled with smoke as usual since most people lit their cigarettes on arrival. As a nonsmoker I had a hard time breathing at times and my clothes always reeked of smoke afterwards.

The seating arrangement reflected the then-current pecking order. The CEO was at the head of the board table and I was beside him on his right, with my assistant/interpreter sitting behind me. The COO was seated to his immediate left followed by others less important down both sides.

The meeting began with the delivery of reports, in Chinese, of course. By now, my assistant and I were well practiced and she gave a smooth translation for me of what was said as the meeting went along. She then read out my report in Chinese when it was my turn.

Things were not going well. The CEO had never developed a shopping center before and he was feeling the heat for his lack of progress from the Chairman, whose family owned the company. He felt that he could simply hire professionals with relevant experience to support him. In theory, it was a workable solution, however he had traditional Chinese views as to how to best run a company that undermined that whole assumption.

He would not accept ideas that varied from his, let alone accept any criticism, and certainly he would accept neither in public! His ideas ran more to the placement of trees rather than shops! His first design effort was a mixed use project with three levels of retail and 27 levels of residential condominiums above it. It was under construction and the Chairman asked me to perform an investment analysis of it.

I had gone through a lot of effort and expended considerable personal capital with both of them by insisting that they purchase a sophisticated software package that was the gold standard for investment analysis, Argus. I was often asked if we could find a “copy” in China…but the Argus Corporation had done a good job of preventing knockoffs for which I was very glad! It probably cost more than they had spent for all their software combined up until then but we had the support that is crucial to go with it!

Then I had an incredibly hard time gathering the financial information I needed and I couldn’t understand why that was so, given the Chairman’s direction to me. I persisted and finally got it all and when I processed it, I could only conclude, as the CEO must have already, that the 30-story building would never make money!

‘So that’s why it’s been like pulling teeth to get the data!’ I realized.

The lucrative condo profits would be quickly drained by the losses I knew would come from the three levels of badly designed retail space, a sizable shopping center by itself.

This resulted from the CEO’s inexperience with retailing. To save money, he had allocated almost no parking to support the retailers! Most of the available spaces had been assigned to the residential condo owners that comprised the rest of the building, one each, and of course they weren’t going to be shared with shoppers! As well, he had been overly generous by including far too much public space in the shopping area, so that the efficiency rating of the retail element was very low.

I prepared the report and had it translated with my unavoidable conclusions, which I expressed as diplomatically as possible. I met with the CEO before the meeting and explained my findings. He was not happy and demanded that I not report it to the Chairman.

Within minutes of the conclusion of the meeting, the CEO summoned me to his office.

“I want you to stop using the Argus software system…show me how to use it instead. The Chairman wants me to control all sensitive information about the project.”

He realized the damage my report would cause him with the Chairman and so he had to suppress it.

“From now on, I will use this software.” This from a man who didn’t know how to use Word, let alone this sophisticated system!

He was deliberately depriving the Chairman of the sophistication that I was hired to bring! I was dumbfounded but reluctantly agreed to remain silent as he appeared very threatening to me. I was also told by others that the Chairman would believe whatever the CEO told him rather than what I might say as a foreigner.

Become as Impatient as They Are— Speed is Your Ally…Everywhere, All the Time, At Home and Abroad

“Chinese companies no longer just copycat business models from America and Europe. They still grab low-hanging fruit but focus more on innovation. Multinationals must adjust to increased Chinese competition, which no longer competes just with good- enough products at cheap prices but with value and innovation.”

Shaun Rein, Best Selling Author of “The End Of Copycat China” and “The End Of Cheap China”

Shenzhen, Southern Mainland China

I was sitting in my office in Shenzhen when the Vice President rushed in.

“We just got the directive,” he told me. “The CEO wants our model suite to be ready by this Friday. A reception will be held at 4 pm and he will invite all of his friends to attend.” He looked inquisitive, waiting for my reaction.

“Wow,” I said. “That’s a tall order since he just finally approved the design yesterday!”

The plans had been lying in his office for three weeks and no one apparently dared to ask him when he’d release them.

“I’ll call our contractors and make sure they’re available…but at this late date procurement is going to come at an extra cost,” I said.

The Vice President replied, “Let’s get them onsite immediately and we’ll make sure they work around the clock. And don’t worry about extra costs, they’ll do what we want without that if they want to work for us again in the future.”

The CEO’s assistant came by just then and asked us to join him in his office.

“Ni hao,” we both said to him as we entered.

He quickly made it clear that the guests he had invited must not be disappointed. He looked sternly at us and spoke in short hard bursts. My colleague’s face was paler than usual. We got up and left.

He said as we walked down the hall, “We better deliver on this or there will be big problems for both of us.”

And so, yet again, I was treated to the go-slow pre-decision making and the go-like-hell post decision making of many Chinese executives. Oddly, I soon came to like some of this approach, the go-like-hell part…but not love it…it is stressful. I compared it to the excessive amount of time generally taken in North America to deliver anything, unless incredible premiums are paid for overtime. This practice is becoming obsolete since global competition is favorably affecting pricing and delivery for virtually every commodity and service very dramatically.

Know the Strengths and Weaknesses of Your International Competitors

“China is progressing along an innovation development curve from: Copycat stage, to Innovation for China stage, where it is now mostly, and from here to Global innovation stage, where China begins innovation for the rest of the world, already partially underway in some sectors, such as mobile devices and services.”

Shaun Rein, Best Selling Author of “The End Of Copycat China” and “The End Of Cheap China”

Asia, led by China, is already a massive competitor to North American business and if that’s not the case for your enterprise yet, it will likely become so soon. You have learned some of their strengths and weaknesses from reading this book and other reliable sources. Here is a list of the more important strengths so you can reflect on where you can make gains by adopting them and avoiding the weaknesses listed next.

A Few Asian Business Cultural Strengths:

•  Hungry to prosper—entrepreneurial & opportunistic

•  Impatient with delivery delays

•  Possess plentiful well educated and inexpensive labor at all skill levels

•  Have large capital pools for domestic and international investment

A Few Asian Business Cultural Weaknesses

•  Language barriers and a tendency to select officials for fluency in their home language rather than for competence and experience.

•  Restricted imagination due to weak post-secondary educational system and the lack of need to innovate until recently…but this is changing.

•  Lengthy decision making time due to the need to create a consensus to save face and appoint responsibility in the event of failure

•  Overconfidence bred by centuries of regional dominance

•  Mistrustfulness, thereby denying themselves opportunities to partner or to learn

In addition to these more general characteristics, we must always remember that there are significant individual and regional differences to take into account that may prove to be even more important in the long run. Just as there may not be a “typical” North American, neither should we expect to find only “typical” Asians or Middle Easterners.

All the more reason to deploy the strategies and tools I’ve described so far, in your efforts to get to know the personalities, and more importantly the characters, of key individuals with whom you may cooperate and partner.

Idea Theft and How To Deal With It

China has become so notorious for the theft of ideas, processes and designs that they will have to work for a long time in a very scrupulous manner to rid themselves of this poor reputation. But the current actions of many of their entrepreneurs continue to build this poor reputation. However, there is a sincere effort in recent years growing within the Central Government to crack down on, if not eradicate, the more offensive examples of it. Very simply, it’s bad for the overall business the State wants to conduct internationally and they are trying to build the regulatory organizations needed to police their businesses.

That said, there is still significant risk of losing valuable secrets if you don’t act aggressively to protect them while in country. And as we know through the many reports we hear, especially recently, the theft of data internationally is rampant and often led by Chinese hackers.

Accordingly, the process of extending one’s innovation to be conducted in part or whole in Asia is one fraught with danger. It is still in many ways the “Wild East” and the lack of sufficient regulation or the will to apply it by the government results in big holes in protection.

Granted the patenting system is receiving more support now by the Central Government in an effort to offset its poor international image of control. And more trademarks are issued in China every year than in any other nation. However, the science and research underpinning those patents is seen often to be second rate. Undoubtedly, the system will improve and eventually there will be a rigorous and robust system of enforcement…but it doesn’t exist yet.

It is vital to protect one’s intellectual property upon which our brands and profits rest, so you need to make your own decisions about whether you conduct any innovation in China, as part of your program or all of it…all choices that have been made by Western firms operating there, with mixed results.

Justice…Only For Some, Usually… But Improving

In some cases, companies simply have chosen to exit the countries where they feel insecure. In other cases, the local partners are relied upon to ensure that the worst outcomes are avoided by using their personal contacts with officials, including jurists. And for others, signing contracts for performance in other more stable jurisdictions is the proper course of action. But in the end, no matter what “insurance” you acquire, there is not a 100% guarantee of fair treatment for their nationals, let alone for yourself!

It is a risk that can be mitigated in part by preventive actions, and insured against in part, but in the end it must be factored into the economic return to be gained. If it isn’t sufficiently lucrative, then an exit from the market has to be considered.

One must always remember that many of the developing nations are autocratically governed, and as such, politics play a big role in their justice systems. The governments of Russia, China, Vietnam and Myanmar, to name a few, certainly don’t want national adjudication that would run counter to their interests, which are often very opaque.

And even in democracies, such as India, politics is a big factor in the decisions of various levels of the justice system. It’s also clear that everywhere, businesses connected with the government are favored by officials and the relevant justice system. Given that this is the reality, what does one do?

Chapter 10

International Opportunities: Why Are You So Lucky?

“Toto, I’ve a feeling we’re not in Kansas anymore.”

—Dorothy in The Wizard Of OZ.

Nothing Is As It Appears on the Surface

On certain days when living abroad you’ll have the same feeling as Dorothy did on arrival in OZ Much of what you will see around you may at first glance look familiar, what with the prominent and plentiful memory triggers such as the signs of Western franchises.

But you will realize that you are far from home in more ways than just physical distance when you add in the rest of your surroundings and experiences. One such day for me was in India.

Asking yourself why you are so lucky to have an opportunity in a place where there are so many other very smart people is a good starting point in your analysis and decision making. You must develop a very healthy skepticism otherwise you may ignore or misinterpret key information with disastrous results. But, while opportunities may seem complicated and enigmatic, at some point you will have to decide what you want to do. Here is the advice of one well known globalized executive as to how to proceed.

“The biggest risk is not taking any risk... In a world that changing really quickly, the only strategy that is guaranteed to fail is not taking risks.”

—Mark Zuckerberg, Chairman, Facebook.

Aamby Valley Private City, Pune, India

“Watch where you step Mr. Phil,” My Indian host cautioned me as we walked through a field of tall grass in which several cows were grazing. We were there to get a better view of the 25,000 acre “New City” his company was developing near Mumbai, India.

“The cows all have bells… to warn the cobras they are near!” Suddenly, I wished I had a bell too!

“Are poisonous snakes very common?” I asked nervously.

“Oh yes, and especially in the trees…the green ones can drop on you unexpectedly!” he said casually.

Happily we soon reached a clearing and could see the spectacular green panorama that included a mountain-top ancient fortress and a large lake.

“What a gorgeous setting for your ‘New City!’” I exclaimed, now distracted from the snakes by the view.

I was touring the site of one of hundreds of the privately planned and owned new communities that are an exciting solution to the massively challenged existing Indian cities. Because they are privately owned and operated, they avoid many of the barriers to quality living of the established cities.

When I later drove through their streets it was hard not to believe I was in a European or North American upper middle class suburb, a far different experience from the chaos of nearby Mumbai with its 25 million citizens. And there wasn’t the incessant horn blowing or congested traffic that often meant a four hour transit from one end of that city to the other.

As importantly, there also wasn’t the systemic corruption amongst officials needed to navigate all of the usual hazards and inconveniences of everyday life. It looked idyllic.

This was just one of so many examples I saw of the admirable creative thinking being applied within developing nations in trying to cope with their challenges in order to progress as an economy and society. And this kind of entrepreneurial thinking is being spread by their professionals and companies as they reach out internationally.

Chennai, Southeastern India

“Ramanujan IT City is the first land plot under development along the new IT corridor!” the CEO of the 4 million square foot office project enthused one day as we toured the site. “Phase 1 is 20 kilometers long with a second phase of 26 kilometers planned when the first will be built out. It is arranged along a new six lane expressway with a Light Rail Train running down the center.”

I was in Chennai, a booming city of 5 million people in south eastern India to offer my services for the retail element of his project. The city and state have been master planning and rolling out ambitious infrastructure projects such as this one that are having powerful positive effects on their country’s international competitiveness.

This retail element was intended to serve some of the 100,000 professionals who would eventually work in it and in its neighbors, many of whom would also live nearby. As usual, I learned a lot more than I had to teach! The IT Corridor is a huge state funded project intended to attract world class IT companies to gather in a very large critical mass to synergistically give them all global reach.

In the not too distant past, Western thinking had been to “accept” and support the concept of Indian-based call centers…as if we really had a choice! Their low operating costs and the rising quality of service from their English speaking personnel offered tremendous savings for Western firms and still do. But the assumption had been that the really high value work would continue to be provided by Western firms at home.

Unfortunately, the entrepreneurial Indian businesses didn’t read the same script! They have been leveraging the enormous annual graduation rate of hundreds of thousands of well-trained Indian professionals needed to attract world class businesses to locate and operate from there…and at very attractive rates! Someday soon, the IT Corridor’s fast growing business community will have a huge impact on world business.

But every country is different and such ideas always come with issues that need to be resolved. For example, while the New City solution is elegant and highly appealing, as India is a “rambunctious” democracy, their businesses are subject to “judicially interpreted” planning approvals, which, for example, those in China are not. Competitors as well as regulators have significantly slowed the progress of approvals for the New Cities to the point where years of bureaucratic processing, including much public input, must be managed. The risk is that they will ultimately not be able to proceed, notwithstanding their private ownership. And it is not unusual for court cases to take fifteen or more years for final adjudication of appeals by their Supreme Court.

However, the development of the Chennai IT Corridor is proceeding at a good pace and must serve as a caution to the West as well as an invitation to us to partner with Indian businesses for improved market access and cost efficiencies. The process of globalization is accelerating and North Americans must embrace it along with the responsibilities of increasing their capabilities to participate.

We need to adjust to these new realities and identify them so we’re not continuously being surprised and kept off-balance. This process is continuous because of the increasing rate of general world change. You can and must help yourself through the various means I’ve already described earlier. When it comes to international business, there is a strict protocol that I’ve worked out for myself and my clients that may be helpful to you. I ask myself a few key questions, to help me to decide whether or not to proceed, and then to monitor progress if we go ahead.

I ask myself these questions:

Why am I so lucky to have this opportunity when there are so many smart locals who already know about it?

You need to slice into all the information you can gather about the opportunity and enlist the help of your local advisors to answer this fundamental question. It goes without saying that it may have a history of failure or frustration attached to it that has discouraged local interest. Or there may be future hurdles to cross that locals know will be formidable, which therefore add risk they’re unwilling to take on. Whatever those possible issues might be, you must find them out to determine whether you’re willing to take them on.

Can I profit from this opportunity? You need to apply aggressive due- diligence to reassure yourself that the odds are good for you. Bring all of your research and analytical training to bear and again, enlist the help of your local independent advisors to make sure you don’t miss something important. Prepare a comprehensive Strategic Plan that includes an Action Plan with key milestones and a range of outcomes you can live with. Make sure you have the essential resources you’ll need at the right times. And keep researching and asking questions because markets and circumstances change.

How am I doing? Every day you need to review your progress comparing it to the key milestones you included in your Action Plan. Change the plan if new information becomes available so it’s the best it can be. Keep a diary of your progress to compare it to your milestones. Maintain a Risk Register that contains a list of everything that can go wrong and a percentage rating as to the probability it will. Along with each risk will be a detailed mitigation strategy to apply in the event they manifest themselves. Keep the Register up to date to ensure you have the latest thinking available based on then current circumstances for action if required.

How did I do? Regardless if you have succeeded or failed, you need to record the outcome in detail, along with lessons learned, for future reference. No sense in having to learn them over again in the next deal, is there?

Measure Twice, Cut Once

Shekou, Southern Mainland China

“Our iconic project has been under development for over forty years,” the voice of the video presentation enthused, “and will continue for the next forty.” We were on a late night impromptu private tour of the presentation center for a major project of a large State Owned Enterprise (SOE). Their General Manager had just treated us to a sumptuous dinner, complimented by great champagne, all arranged by Tommy, my partner. Their project was very ambitious, and it had had its starts and stops from the very beginning.

The company, being owned by the government, ebbed and flowed as government leaders and policies came and went. They eventually decided it would be the centerpiece of a large marine development on reclaimed land, and so it began.

The interest of the GM was due to his desire to attract key elements to the project, to compliment the many commercial and residential elements developed to that date. It was a real mixed bag, emblematic of poor master planning, a problem that dogs many Chinese developers to this day. They start in one direction but change often whenever a “shinier” bauble either becomes available or is dreamt up by a Party Official, the developer, or sometimes, his mistress or wife. I’ve seen the latter happen when one or the other is enthralled with having an LV or Gucci store in her lover’s or husband’s shopping center!

Without exception, discussions I held with Chinese developers of all sizes, were based on my ability to bring one or more of the top retail brands into their project. Of course, those brands are very selective, or have become more so, following their appearance in some of the most unlikely shopping centers courtesy of their “past trusted local advisors.” Today, most if not all real estate decisions are taken at the European or North American head offices in reaction to this problem.

In any case, the GM wanted me to promise him several top brands, making the assumption that it would only take the right “commission” to their executives to ensure it! Based on past performance of  brands in China, and the continuing fascination of the developers in having them join their projects, this remains the number one aspiration of all but the most sophisticated developers, of whom there are only a few.

We agreed to return to meet the GM and his staff within a few days and when we did, I showed them a translated PowerPoint presentation describing for them what I had done in Abu Dhabi. They were impressed it seemed and asked that we submit a proposal for our consultancy to them. We thought we were on our way… we were, but it was out the door as it turned out!

Only after several more “social” dinners did I learn that the GM wanted us to propose a plan to secure the top brands, all to be financed up front by us! They promised that there would be a generous commission upon success. When I explained that we weren’t leasing agents and that we wanted to represent them directly in negotiations with the top brands, just as we had been saying at every meeting, only then did they stop returning our calls.

This was a common theme that recurred in our subsequent negotiations with others and we also learned on good authority that the developers often “forgot” to pay the commission. Suing a Chinese company in China, especially one owned by the government, has no chance of success, except to speed up your return home, and they know it!

This diminished our appetite to work with the SOE’s although it was fun to rub shoulders with their millionaire CEO’s who were well respected in every restaurant we dined in!

Does this mean that you shouldn’t do business with SOE’s? By no means, however the rules of engagement are fraught with heavy advantages for them. Insisting on a substantial retainer to be paid before work begins, combined with a defined scope of work and associated payment schedule, will protect you from a terminal loss, if you can secure these concessions, which we did on some occasions.. However, good luck in getting those terms usually. Remember, “Buyer Beware!”

Safety, Corporate and Personal

There are many safety issues in Asia and especially in China, which are mainly man-made. However, whether they are Environmental, Food, Traffic, or Governmental, the risks are real and you need to know what they are and how to avoid, or at least, mitigate them. Your psychological safety is at risk as well, since just knowing about these risks will raise your anxiety level and may cause negative effects on you and your performance as a result.

Environmental Safety

Shanghai, Eastern Mainland China

“Brushing your teeth with bottled water is a laughable ‘protection’ when you consider the soup of toxins we all swim through in China! That ‘pure’ water is most likely filled from the taps fed by polluted rivers,” my doctor friend said when I told him my story about my Shanghai Five Star Hotel water sickness experience. “Everything from millions of tons of pollution such as cyanide to thousands of diseased dead pigs, are thrown into rivers, the water supply for our cities. All of these factors pose a threat to everyone’s well-being. And the dense smog is caused by coal being burned for power and heat; fuel supplied by Canada and the United States to name just two nations that then receive it back on the winds flowing from China! Such practices are simply not controlled…corruption ensures that they continue. And cancer rates among the young are skyrocketing.”

Why is this happening? Why is it allowed? The first question is answered easily. Of course, there are many decent Chinese people, but the intense struggle to rise into the middle class has caused many to give up any semblance of concern for their fellow man. This behavior has also been reflected in their leader’s behaviors and it’s natural for people to follow their role models’ example, of course!

View “Under The Dome”—An Environmental Documentary on China

https://www.youtube.com/watch?v=PjHyAl0h4t8&list=PLxU79dQZwwJ PkEaR1jM8iJQS0L9iMopog

Corruption is so rampant because of the almost universal drive to get rich as soon as possible, and, for many, by whatever means are necessary. Their recent history as a developing country has taught them that they need personal wealth to guard themselves against the next disaster the Government or Nature might visit upon them.

In every Province, there is unrest, with the people gathering more confidence from online blogging coverage. They now protest more openly against the government for reasons ranging from corrupt officials taking their land and homes illegally to the suppression of their speech and religion. With headlines like this one concerning the horrific explosions in Tianjin, the suspicions about the Government collusion with private firms are front and center.

http://news.asiaone.com/news/asia/china-blast-warehouse-execs-used-connections-get-safety-approvals-xinhua

Food Safety

Shenzhen, Southern Mainland China

“Gutter Grease Skimmers? Who the hell are they?” I asked.

“These are people who work illegally at night in the city’s sewers. They look for fat floating on the surface of the water and collect it by skimming it off,” my doctor friend described.

“So what do they do with it?” I asked, not anticipating the answer…I wish now.

I hadn’t asked.

He smiled thinly. “They heat it up, deodorize it with chemicals, pour it into plastic containers …and sell it back to restaurants cheaply for use in cooking!”

Honestly, my stomach turned when I heard those words. “So how can you tell who uses it?”

“You can’t,” he replied, “but we estimate between ten and twenty percent of all restaurants do.”

I could feel the bile rising in my throat “You mean it’s likely I have eaten some of this?”

“No doubt,” he said.

Yet another example of entrepreneurship of the wrong kind in China! How many more examples of this type of opportunism exist? All you have to do to get a glimpse of reality is to think about the proven and regular use of cancer-inducing chemicals to “improve” the leanness of pork, to “convert” it into more expensive “beef,” or rat meat into “lamb” and to fatten chickens for KFC.

Many Westerners swear by eating great “street food” in Asia. I have eaten it too, but usually late at night after some socializing involving alcohol that relaxed my caution, but not anymore. The information from my Doctor friend helped me to forget trying those “lamb” shish kabobs that might easily have been chemically treated rat! That’s right, aficionados, it’s Asia where food safety is not well regulated (or at all in many places). Street vendors are struggling to survive…and willing to do whatever is needed to save costs.

With that in mind, buy your food for home consumption at Western style supermarkets such as City Super in Hong Kong, which have higher standards of meat and produce selection than average, although frozen foreign meat and fresh milk is the only way of guaranteeing safety. And understandably, I recommend you patronize only the best restaurants because too many others share the street vendors’ credo!

Safety…from Officials

Guangzhou, Southern Mainland China

“We’re sorry, he died,” read the press release.

My British friend said, “Bollix! He was just in Shenzhen last Monday!” He knew someone in touch with the African businessman casually, who had spoken with him by phone when he was in town.

“They knew he was taking a taxi to Guangzhou…the release says he had a dispute with the driver, over the fare I guess, and they were both taken to the Police Station.”

Sadly, the attitude that led to this is not that uncommon for foreigners…many Chinese have never seen a visible minority member, living on farms as half of them still do. Also, most are very nationalistic, because of government education, and unfortunately, are also racist as a result.

The Police can act very independently. If an argument had ensued, it is probable that they took the side of the Chinese taxi driver and if the African had become physical, they would have retaliated. In this case it was apparently done with deadly force. And within twenty-four hours, they would have cremated the body. Regardless of which nationality you are, what would your Embassy say, when asked “Where shall we deliver the ashes?” And whose are they, really?

“Make sure to develop a thick skin immune to shame or guilt, and a Black Heart, hardened to hurting others for your own gain,” goes the direction in Houheixue—Thick Black Theory, the basic book of how to behave, recommended reading by the Communist Party for its new members.  “Do not concern yourself with loyalty to your fellow citizens because the day may come when you must turn against them for your own advancement.”

There are many different security forces in China. The People’s Liberation Army, (PLA) is large, but the members of the local and national police forces are even more numerous. And there are different ones for different purposes. The type most often seen are the closest in appearance to Western police…they are uniformed and armed with holstered pistols. There are also plain-clothes police who rank above them and are more often used for dealing with business crime… and of course, with foreigners.

But there is a large, lower level street police force in every city, the Chengguan, The Urban Administrative and Law Enforcement Bureau. They are armed with sticks, and patrol the streets day or night in groups of as many as twenty or more. They are there to intimidate and control both Chinese citizens and foreigners…and they will simply grab people randomly and take them away for a beating, for no particular reason other than that they can.

They have been involved with recently publicized incidents which have involved the deaths of some of their victims. Make sure you carry your passport containing a current visa since that is the first thing you will be asked for by them.

Safety…from the Average Person

Rio Di Janeiro, Brazil

The beaches glowed in the sunshine with thousands of colored parasols giving a party atmosphere to the scene along the gorgeous South Atlantic Ocean as we approached for our landing. And so they should…it was the first day of Carnival the world famous celebration held just before Lent begins each year in every village, town and city in Brazil. I was sure this business trip was going to be a success.

“We say that the day after Carnival is the first day of business in the New Year” my host told me soon after I arrived. I had flown in from Dubai to Sao Paulo, transferred planes and here I was ready for business. But first I had to experience Carnival, my host commanded.

“Wear casual clothes and no jewelry” he had told me on the phone before I left Dubai.

I assumed it was because of the possibility of robbery but when I asked him over my first authentic Brazilian BBQ lunch that he took me to on arrival, his answer was more chilling.

“No, it’s the kidnappers. They look for prosperous Gringos at the airport, follow them to the hotels, bribe the concierge for personal information, and often pick them up off the street if they’re not careful. It’s just part of the economy. My brother in law, the President of a bank, has been kidnapped twice despite his security measures!” he explained.

“But don’t worry, during Carnival the kidnappers are busy partying so not many “events” happen during this week. But to make sure, I’m giving you an armored BMW and your driver is well trained to protect you. He’ll take you where it’s safe” he reassured me.

Sure enough, I had a great week, going to terrific restaurants and parties, and even attending the last night of the Sambadromo parade, the national dance ‘Super Bowl”, in a private box, where everyone did the Samba, non-stop it seemed, until 3 in the morning. But when I was away from my hotel room, I was never out of the sight of my body guard. I knew he was serious when I saw that he carried a Glock 9mm wherever he went.

https://www.youtube.com/watch?v=Rjr8SkrKpqo

Looking Relaxed With My Driver/Body Guard and Armored BMW

Attention to your personal security is necessary if you want to limit the risk of robbery or kidnapping when you visit many cities of the world. You can’t just assume you are safe. Regardless of whether you arrange for the kind of protection I enjoyed, or something more modest, it has to be part of your planning and daily thinking.

The week of business that followed was very successful as I travelled to other cities and met with executives and senior governments officials to learn more about investment opportunities there for my Emirati client.

How do you deal with the average person and their behaviors which may affect you negatively? Firstly, remember, for many, their only concern is for themselves, and possibly their families and close friends. Everything from their stampeding on to elevators before anyone has a chance to exit, up to and including drivers of electric scooters and cars hitting pedestrians on sidewalks and leaving without checking on their condition, goes on all the time. Because the electric scooters are so numerous and operate silently, they are a real hazard!

Apart from the average citizen there are many examples of foreigners being robbed or beaten, especially in cities like Shenzhen which is home to so many poor unemployed migrants looking for work. While the police are vigilant, there are bizarre killings by thieves of such things as Gucci purses, so looking affluent can be dangerous for you, especially if you’re in the wrong part of tow.

General Anxiety Everywhere

As expats, our anxiety level was generally higher than normal for these reasons, although we got used to the controls that were so visible. Wherever you go in public in China, you will be watched and recorded by CCTV cameras. The number of police is large and also very visible on the street. And they are ready to interrupt you in whatever you are doing to demand to see your documents. It was reported to me by my clients that my apartment was likely bugged for voice, phone and internet since that was standard practice.

Of course, this is a fact of life that we must all adjust to there, because even though we are simply going about our business, we can still run afoul of the arbitrary rules authorities apply. But in addition, you must try to take into account your own personality and character. As honestly as possible, size up whether you have what it takes to endure these stresses.

They can be devastating to those emotionally unsuited to tolerating them, and lead to deep unhappiness and depression. So it’s very important that you not only get a professional assessment ahead of time but also keep a watch on your own reactions when there. While there are very few psychologists and psychiatrists in China, many in Hong Kong are available in the event you need their help. I had a deep assessment done before I went abroad to Abu Dhabi, where I worked first and checked in with a professional from time to time while there, which helped me to cope.

Needless to say, I always carried my passport with me since to be found without one would lead to jail for a few days while your friends retrieved it from wherever you stored it for authentication of your visa. As importantly, I always carried enough money to pay for airfare and had my briefcase of important documents with me at all times. This would allow me to leave on very short notice if I felt threatened. Many of my expat friends took similar steps.

Partnering: Trust…But Verify Initial

My partner was telling yet another amusing story over lunch and we all laughed. We were dining with the CEO of a large Chinese Bank, arranged to discuss how we could provide executive level consultancy to improve his control and profitability over the bank’s property loan portfolio. It was going well as he seemed very interested in the idea. He knew how exposed he was in the volatile market and he didn’t have the quality assurance program yet to deal with this large risk. We brought the resources he needed to conduct it, using best international practices.

He had worked in the west and so was reasonably fluent in English and with the help of my partner, was able to understand what we could do for him. I thought we were nearing a successful conclusion when it happened…he proposed that we cooperate with his business partner to form a new enterprise to deliver our services.

He made it very clear that a profitable relationship could develop. However, my personal policy concerning corruption, namely that I refuse to participate in it, compelled me to ignore the invitation and our relationship went nowhere.

Some may have simply carried forward to form the joint company. However, one can readily see today that the crackdown by the Central Government is extending to just these types of relationships involving the leaders of State Owned Enterprises. That would have added considerable risk to the partnership with consequences including possible jail time in one’s home country as well as in China. It’s hardly worth risking all the effort needed to form and operate such a partnership when it could come apart so easily with devastating results.

Ongoing

Once a legitimate partnership has been formed, it is necessary to apply ongoing vigilance. The list of failures for such enterprises is extremely long largely because the Western partner failed to perform ongoing due diligence.

One of the many stories I was told, this by an American manufacturer, concerned a factory that was producing container loads of product and it seemed to the Western partner that the numbers were not adding up. Through one of the contacts he hired a watermelon seller (they are everywhere), to set up outside the factory gates and count truckloads of materials arriving and containers leaving. By this simple means, it was quickly established that the number of containers leaving were far more than those reported by the local partner! They were destined for other unreported customers from whom the local partner was profiting alone by bringing in extra material.

Other foreign manufacturers told me that they only succeeded in keeping such incidents under control by placing quality and quantity assurance people throughout the factories during all operating hours. And they had to make sure that their inspectors were from their home countries to reduce the risk of payoffs going to them.

Prepare to Divorce Before You Marry

I can’t think of a better way to avoid the frequent drama of splitting from a relationship, whether personal or business, than to have a prior written agreement guiding how it will be done. Emotions play such a powerful role in our everyday conduct that we should work to avoid having them damage our partners or ourselves, when our relationships change or come to an end.

We’ve all heard about “prenuptial agreements” for marriages and the main knock against them is that they’re “not very romantic.” Well, the same objection is often made in the business realm, but that doesn’t lessen their relevance and importance in either forum. Surprisingly, in the exuberance of forming a new partnership of either kind, so many of us forget the value of such an agreement for later.

I contend that including one as an essential part of any joint venture or partnership arrangement is crucial. This is not only about how you end such an agreement but also how you can conduct the ongoing relationship in the more relaxed manner by not fretting about the issue. Your lawyers will be prepared to help create one for you, dispassionately.

What should it contain? Well, the first and most obvious terms cover how to divide the assets, both those brought into the relationship initially as well as those produced during it. By earmarking the expected assets when created, a later discussion will be avoided when various disappointments arise that might play into it.

Secondly, the process of winding up the operation of the partnership needs to be determined.

And lastly, there is the public handshake with mutual congratulations that will become the basis for the public narrative that must be agreed and will be issued subsequently. It should be well planned so that no damage is created for the partners as a result of the split. Do you see how simple that is when considered ahead of time, but how problematic it can be if left until the end?

Chapter 11

Home Opportunities: Why are Those at Home So Lucky to Have You Back?

“New ideas pass through three periods: 1) It can’t be done. 2) It probably can be done, but it’s not worth doing. 3) I knew it was a good idea all along!”

—Arthur C. Clarke, Futurist

Your colleagues and partners at home are very lucky to know you as you now have gained powerful “secret weapons” with which to help them prosper, as well as yourself, of course. Most people in your home country are unaware of the competitive advantages that you have developed while working outside of your usual box.

The global best practices you will have learned work just as well at home as they do abroad, and deploying them gives you a substantial edge wherever you go. Remember, your competitors don’t know what they don’t know, so adjusting to your increased potency will not be easy for them…use that fact to prosper quickly.

Many North Americans Are Complacent…If You Are, You Can’t Afford To Be Any Longer, Knowing What You Now Know!

Remember Lancy’s words, “In Dubai, there is no ‘Sorry’!” I’ve learned that applies in all parts of the world, including at home. However, because of our long term prosperity in North America, most of us have been insulated from the harshness of survivalism  In contrast, many living outside have had to practice it just to live, let alone to prosper, and have developed potent competitive strategies to succeed. Your awareness of this represents a great advantage for you and those who you share your lessons with, because you’ll see there’s no way to avoid making this adjustment if you want to continue to prosper at home in the future.

For example, as you read earlier, you will find among Asians and Middle Easterners an incredible impatience for action once decisions have been taken, even though they may have been a long time coming. Impossible delivery times often accompany the decrees you will receive from CEO’s of employers and clients. However, you are just wasting your time if you argue against them. Instead, find ways to deliver on their timetable, even if it means working 24/7 in bursts. And while this will set you up for future assignments with similarly “impossible” delivery dates, it will gain you respect and business. Remember, your competitors will gladly take that business away from you on those terms if you hesitate.

Their hard working nature that was developed in primary grade education is very visible in the workplace at all levels. To compete, you and your team must be just as diligent.

Chinese North American Investment Doubled in 2013

Apply Your Lessons—Overcome Challenges by Learning and Using Global Best Practices.

Abu Dhabi, UAE

“This morning, the major problem challenging our delivery date is still unsolved,” I said to my Senior Project Managers for Ferrari World.

I was leading a team of creative professionals from around the world in the design and delivery of this iconic project. We were gathered as usual in the War Room that I had set up for our every-morning status and action meetings. Its walls were covered in detailed, up to the day before, drawings and Gantt Charts. They revealed the cause of the worry we were all feeling.

“We all know we have to complete on time for our first Formula One race. But we’ve seen from our daily schedule and budget tracking reports over the past several days that we may not make it!” I stated urgently.

This would be especially bad news considering 400 million television viewers would witness our failure, not the least of which would be His Highness Sheikh Mohamed bin Zayed al Nahyan, Crown Prince of Abu Dhabi, our ultimate boss! He would not be amused!

Fortunately, we had implemented sophisticated systems and procedures when we began the project, recommended by our British and Belgian colleagues who had had very favorable experiences developing and applying them previously. After an initial detailed demonstration, we were convinced and we set to work to put them in place. They required that we use a sophisticated computerized project management system, Primavera P6, and then using other computerized tools, apply the imagination and discipline needed to squeeze the best out of it.

The result was that every morning I had a current report on my desktop with the cost and quantities shown of all commodities placed and work conducted to date, and at worst, to the end of the previous week. It also updated our forecast schedule and budget to show when we would finish and the projected cost. It highlighted problems as they arose and allowed us to immediately tackle them! Following our morning meeting, my management team and I went to the site and walked through it to see our progress first hand along with the flash points and to discuss their solutions. We then gave ourselves until the next morning to research solutions for prompt decision making to follow.

The problem we were facing had been spotted quickly and we were now considering different solutions to see which would work best.

“Let’s contact our roller coaster supplier in Europe today and see if they can further accelerate the delivery of their cars to meet our schedule,” I concluded.

The next day, our Senior Project Manager, Vikram Chopra, confirmed the supplier could meet our request and had committed to the new delivery date in time to fit out this key ride. The fastest roller coaster on the planet with a speed of over 150 miles per hour was a signature attraction and had to be ready on time!

By using these advanced planning and tracking tools as part of our best global practices, we would deliver this massive project on time and on budget. Accordingly, it could begin earning income for the owner as soon as possible, and much more quickly than if we hadn’t done so.

After I returned home, I offered my new knowledge to the Senior Vice President of a very large North American commercial developer. I shared this story with him and he acknowledged that his company didn’t use this approach, much like many others do not here. I showed him concrete evidence in the form of reports, budgets and videos to support my offer to help him to benefit, but the last email I have from him was so telling of the attitude of many businesses in North America:

“Last year, our firm increased our holdings by $2 billion and earned a return of 19% from our existing investments. We don’t need to apply your recommendations as we are already doing very well.”

Really?

With that, he brushed off the opportunity to significantly increase his firm’s profitability! I was dumbfounded. This very large and highly regarded firm was making quite enough profit already, thank you!  Naturally I didn’t share the email with anyone else as it was sent confidentially, but can you imagine what his CEO or Chairman would have said if they had seen it?

I have found since then that most of the resistance to such “radical” or “unnecessary” solutions usually comes from one or two levels down from the top. Those who would have the demanding job of implementing these systems and practices are usually the resistors It’s just too much trouble for some and “unnecessary” for others, but the futures of their companies are so much less certain without them in the face of growing foreign competition in our home countries.

To be fair, there is a growing number of world class North American developers who do use global best systems and practices, but it is typically those which work internationally who need to do so in order to compete. Now everyone needs to urgently use them here at home!

You might conclude that it’s just a matter of time before the rest of our companies join in. However, that is not happening because of the inertia in our business systems. This is an artifact of how well we succeeded in the past without having to adopt them. Trouble is, we are out of time to be able to preserve that attitude, and our future prosperity.

Most of us have already seen successful foreign competitors enter our domestic markets, sometimes in partnership with our existing domestic competitors, and they have taken a significant market share. Many of our colleagues have complained to our politicians as a result, some of whom have attempted to pass restrictive legislation to protect us. But it’s simply not working except to delay the inevitable, however briefly. New international trade agreements made with blocks of Asian and European nations will take away such tariffs that have temporarily insulated many of us in the past.

The only solution we have is for all of us to change by adopting best global practices, not just to venture into foreign markets but to survive at home! And those who haven’t begun, don’t have much time left to react. If you’d like to learn how to do it, please contact me and we can work together to help you identify, adopt and implement the current best global practices in your industry or business sector in order for you to continue to prosper and to go on to double your income!

Grow Your Expertise, Reinforce Your Brand…and Increase Your Chances for Continuing Prosperity

You know that just by preparing a good Strategic Plan with a complimentary Action Plan is far from enough to achieve your goals. You must resource up your team with the best professionals available and then commit to continuous improvement as you proceed.

Let me share with you what that looked like in the case of Ferrari World, for your guidance in the planning and execution of your own key project or enterprise.

As I mentioned earlier, when I was hired, it was initially to lead the development of a 3.5 million square foot super regional shopping center. But I was almost immediately promoted to lead the Leisure projects as well when the urgent need to do so became apparent to the CEO. Careful consideration was given to my qualifications and experience in North America, where I had successfully led major commercial developments previously.

The fact that I was willing to voluntarily leave the comforts of my home to do so was also very influential on their choice too. But they did have the global industry from which to draw and I compared very well to the most senior of their choices from around the world. This was a testament, I believe, to my past dedication to adopting global best practices.

I then went about using the same approach for the selection of my team…I found the best by casting my net internationally. And I convinced them to join us with a combination of the world class professional challenge as well as the generous compensation I was able to offer. And we proceeded like this throughout the project as new resources were needed or some of our existing colleagues chose to move on…or demonstrated through poor performance that they didn’t belong on our team. We made sure that the whole team had the latest and most advanced tools to support them, everything from Primavera P6, the gold standard in project management for complex developments to the Argus Investment Planning system to Acconex, the superb document control system needed to keep up to the formidable record-keeping complexities involved.

By ensuring we had these tools and that we were all well trained to use them and collateral systems, we optimized the contribution that each of us made.

And then, I led from the front. Every team needs a strong leader and I believe to be effective, he or she must be highly visible and accessible. For my large team of professionals, I denied everyone, including myself, the use of a private office, to minimize barriers to communication. Furthermore, I insisted that everyone be called by their first name, regardless of their position in the hierarchy, to promote easy and direct interaction.

And lastly, I always involved all of the key people in decision making in our daily group meetings. When I made the final decisions, they were viewed as collective, even though I bore the ultimate responsibility for them.

Naturally, my decisions greatly benefited from the input of such talented and switched on people from a number of nations. I was very fortunate to have other strong minded and ethical colleagues join me in my deliberations. People such as:

•   Sameer Barakat, our Bahraini Vice-Development Director who knew where all of the local levers were to ensure we maintained the respect and support of our Emirati seniors;

•   David Bland, our Scottish quantity surveyor, who ensured we knew exactly what we needed in manpower and resources and when;

•   Vikram Chopra, our American Senior Project Manager, born in India and educated in the US, who has a very knowledgeable but quiet style that makes a huge difference;

•   Rob Coetzee, our South African Asset Director, who knew everything there is to know about running properties and more importantly, could be relied on to go to the wall for you;

•  Rachid Ghamraoui, our Belgique/Lebanese Director of Construction, who so smoothly managed all of the domestic and international contractors, suppliers and sub-contractors to bring the project into reality  Russell Gonzaga, our Philippino document controller who kept meticulous records with his colleagues to ensure we always knew where we were.

•  Craig Jungworth, our very bright American Mechanical Engineer from MIT who knew how to cool buildings, large and small, a critical skill in the Middle East.

•   Ian Mackie, our New Zealander Planner who worked patiently (very patiently) with the Emirati authorities to secure our approvals;

•   John Savidge, our clever and diplomatic English Information Director who ensured we were provided with the most current data available;

•  Jeff Smith, our savvy American rides engineer who’s practical approach kept us on track.

•   Francis Stokkel, our Dutch rides manager with many years of hands on experience helped us to avoid wishful thinking and bad choices.

•   Mike Tod, our Australian Architect who controlled the interface between his idealistic concept architect colleagues and the realities of the “coal face”;

And last but far from least,

•   Steve Worrell, our American Island Project Director to whom I reported and whose vast patience, knowledge and quiet mentorship carried all of us through to success.

•  As well, we had the great benefit of many other professionals working with us, particularly those provided by our partner, Ferrari. Led by Luca Di Montezemolo, Chairman, and Jean Todt, CEO, key executives such as Jaap Kalma, Global Brand Director, Michele Pugnatti, Global Business Development Director, and Weibke Bauer, Retail Development Director all were very influential in our success.

This rich mix of nationalities and international experience contributed hugely to the strength and success of our team. We should all consider this approach in our North American organizations since we need the innovative and energetic input from as many globalized sources as possible.

Ferrari World And Yas Super Regional Mall Under Construction

Invite Foreign Partners and Investors to Join With You in Your Projects in Your Home Country

While this idea may sound like it’s full of risk and inconvenience, it has many virtues that recommend it. Please remember everything I have described to you so far and put yourself in the place of the foreign business people you’ve heard me talk about. They obviously saw advantages in dealing with a Westerner in their home markets, and sometimes the joint ventures they arranged worked extremely well. Why was that? Well, it’s simple; we Westerners had something special to offer that made the locals more competitive. Similarly, foreign investors and partners can do the same for you in your home market.

Firstly, there are far more businesses than you may think wanting access to North American markets. Secondly, the right potential partners bring with them intellectual and financial capital that will help you to differentiate your business from that of others. And lastly, they also bring new energy and an appetite to learn and deploy their experience in support of your planned joint initiative.

So how can you meet the “right” candidate for such a venture?

There is no shortage of choice as North America is the number one destination for many prospects from abroad. The key issue is the quality and fit of the candidates you choose to consider. The very best way forward is to develop and regularly use a potent network of international contacts and ask them for recommendations and references.

Then it’s down to you to follow up with them, using your research, intellect and chemistry to make the right selection. While you may not guess right every time, don’t use that risk as an excuse to pass on taking up this extraordinary opportunity.

Now Broaden Your Network Even More

But don’t leave it at just that. You must continue to reach out to make new international contacts to enrich your life in every way. Yes, it takes time and determination to pursue this plan, but the dividends are so great that you must do it. I have made many international contacts over the years through a variety of means. Of course, first hand meetings and subsequent dealings are the best. You will apply all of the lessons you’ve learned in your career about developing your network but now also use social media and other electronic means to do so. For example, I have over 2.600 contacts on LinkedIn, developed over seven years. A number of them have led me into profitable business dealings I would otherwise never have known about.

Then use your network creatively by approaching its members with the request that they re-share some of your key marketing posts. If you have 400 contacts on LinkedIn and half of them re-share your post, and those 200 also have 400 contacts, then your post will be seen by 8,000 business people almost instantly. And many of them will likely be in the same industry as you. With concentrated development of your network, you will equal or exceed my 2,600 contacts, which, using the above example’s percentages, means you can reach an amazing 520,000 contacts! If your post is motivating, imagine the visits you will generate to your profile and the business opportunities that can arise from them?

Reach out to organizations and associations that are set up to promote international business within your industry. Make connections online and then visit them to witness the best each culture has to offer. In my business, I’ve seen the absolute best and worst shopping centers in the world, in China! The lessons I’ve learned from touring them has helped me to become much better at what I do at home.

Where are Asians and Middle Easterners not going to travel to invest? Answer: Nowhere…you’ll find them involved in every industry in every region of the world so look for dynamic prospective partners who are interested in your market.

Every Sector In Your Home Economy Is Of Interest

Chapter 12

Future: Where Do You Go From Here?

“Think Globally, Act Locally.”

—Patrick Geddes, Scottish Town Planner

Your Business Advantages—You’ll Bring Great Ideas Home

Most readers will not choose to become expats, so you must learn from those who did, and apply their lessons at home for your future success.

I have seen the application of the strategies I am recommending in North America, many of which have been incredibly successful…with a few failures thrown in for good measure. We can all gain from seeing them in action and understanding their inside story. And we shouldn’t hesitate to consider using them in our home markets. But to fully understand them takes more than a whirlwind tour. I found living in these cultures allowed me to breathe these ideas in, to observe their long term effects and to understand how they might be used in other countries, as well as my own.

I’ve already described the great benefits of my ongoing professional connections and personal friendships, and I’m sure you’re convinced of their positive effects.

I hadn’t fully understood the effect globalizing would have on my future earnings opportunities when I first returned home. Because of these incredible lessons, I gained perspective and knowledge that I would never have gotten had I remained in North America. This is one of the great advantages that became visible to me as I re-integrated at home.

In addition to being able to teach other executives the new techniques that I have learned, I am now in demand by companies who want to use me as a guide to use my knowledge as an insurance policy for them, at home and abroad. I am also asked to speak to audiences wanting to hear of my adventures. Now they, like you, can read about them as well!

Your Experience Has Developed Your Character

Mumbai, India

It was near the end of my first visit to Mumbai and our stretch limousine suddenly stopped at the curb of the noisy street. I turned from my conversation with the Vice President of one of India’s most successful companies to look out the window onto the chaotic streets. And right into the eyes of a man crouched in the entranceway of his home, a large cardboard box, one of many in a long row of  them.

He was disheveled, wearing shorts, no top…we were two meters apart…but it felt like a light year. My eyes widened…I was shocked…my thoughts first going to what he was seeing, the extremes of our existences seemed to be so starkly defined.

‘But were we so different?’ I thought next. ‘Was I somehow better than this man simply because of my affluence and his poverty?’

Then came the answer.

‘Of course I’m not!’ My Western sense of “equality” asserted itself.

Yes, I had won the birth lottery…and he had not…but was that a difference between our respective “worths?”

‘Absolutely not!’

We have all seen this man on television, and his countless brothers and sisters, sons and daughters, barely existing on the knife edge of life and death…emaciated, but living…for what purpose and for how long?

At that moment, when he was within touching distance, I finally got it…he is truly my brother and I am no better than him. I could suddenly and clearly see the urgent need for me to reach out to help him…to help to lift him from his box.

While I had always practiced charity in the past, this experience changed my basic view of sharing to be much more than it had ever been. I believe we all need to do more.

Your Opportunities at Home Have Become More Visible to You

There are so many that I now see that they’re impossible to count. But for you to see all of them, requires you to expand your horizons by reaching out into the world for experiences that are very different from what you are used to. To ease your way, look for market space that is not crowded, very much like Cirque de Soleil, Ikea and many other perceptive entrepreneurs did. Their path is obvious to us now, but certainly it wasn’t when their founders conceived their way forward.

You are more likely to find those opportunities based on the international experience and perceptions I am urging you to develop. Look into your home market through the eyes of an insider and outsider simultaneously to see the rich veins that exist to exploit that have been overlooked by others. Looking at your home market through a different set of eyes is a vital advantage because we can all become blind to what is right in front of us if we stare at it too long.

In my property investment business, I have experienced this gain. I am able to communicate much more effectively with prospective foreign clients and to successfully interpret for them the possible gains that they can make through approaching opportunities here in special ways.

Conduct Robust and Ongoing Research and Planning to Earn an Unfair Share of Your Market

“Before anything else, preparation is the key to success.”

—Alexander Graham Bell

Once you’ve seen the possibilities, draw on your international experience and resources to form a dynamic plan of action. This will include adding to your knowledge through ongoing inquiry and education. Prepare yourself with fresh knowledge of your market and expand your tool chest for maximum advantage. Reach out for the top quality human resources and intellectual and financial capital you’ll need to fuel your plans. Cement the long term agreements you will need to sustain a concerted effort, particularly during the hard times of start-up and your initial year’s efforts.

While these steps are clear, they can all send you in the opposite direction to which you want to go if you don’t create a robust, ongoing research program. How else are you going to reliably assess your target market’s needs without asking its members what they want? And because they will inevitably change quickly in this fast moving world, you must continue to ask on a frequent basis to follow them and cater to their real wants and needs. The most professional and successful organizations in the world all invest heavily in research. Why wouldn’t you do so too?

And those results will inform your branding and marketing programs so that when they converge, and you advertise your products or services, you will be speaking right to the hearts of your consumers! If your messaging is well crafted, delivered effectively both online and offline, as suits your market, they won’t be able to resist your call to action. That is how you will earn an unfair share of your market and continue to do so because the system I’ve described will keep you well connected with your consumer and your competition will find it difficult to follow suit.

Please ask for my help and together we can shape a strategy that will give you a significant edge over your competition. Write to me at philr@iglobalize2x. com and I’ll be glad to make an arrangement to help you.

Designing an effective program for you and your business is another aspect of my consultancy and I would be glad to discuss working with you.

Now that you are ready for prime time, be decisive and launch or re-launch your enterprise. Remember that if you don’t follow this path, there are many others who will, especially now that the world is a much smaller place. Global best practices are available to all who care to employ them.

Execution

“A new world’s record was claimed today by a Chinese company that has successfully erected a 57 level office tower…in 19 days.” http://www.theguardian.com/world/video/2015/apr/30/china-build-57-storey-skyscraper-19-days-timelapse-video.

You don’t have to be a property developer to be stunned by this claim.

At first, I thought, ‘How good is the quality of that project? It might fall down. In fact, I have seen a few tall buildings in China lying on their sides…maybe it’s going to happen to this one too?’

But then I realized that we should instead, applaud those developers who have learned from their past failures and may have succeeded in revolutionizing the construction industry. Time will tell, of course, but full marks for innovation and courage!

If so, it’s not magic, they’ve simply found a new way to proceed to the same goal that all developers strive for, namely to build in the shortest time possible to begin generating income and crystallizing profits. This developer seems to have found the formula needed to greatly compress construction time, and to potentially increase his profitability significantly.

Appreciate that a willingness to experiment led to this discovery…the developer was not afraid to take the risk. And that is a great lesson to take from the globalization process. At some point, you have to pull the trigger…and take the risk. This hallmark of international development is often lost on North American developers who continue to produce the “same old, same old” of a tired out formula yielding look-alike shopping centers and other projects. And they are encouraged to do so by their lenders who don’t want more risk added to their business models.

However, the Asian, European, Latin and Middle Eastern developers, who have been arriving in force in North America, have different ideas. Bringing their adventuresome nature and good past experiences with them, along with plentiful investment capital, the fox is now amongst the chickens, and we are the latter! In a few years, the uniquely designed office buildings, shopping centers and hotels you’ve seen in pictures of Dubai, Hong Kong, Singapore and Shanghai will be a usual part of the North American landscape, and owned by foreign enterprises.

Their Asian and Gulf State developers will be risking the acceptance of their offerings by North American consumers, but honestly, what’s not to like about them? I believe their concepts, once executed, will revolutionize North American development, and it’s high time that it does.

Why should our consumers have to accept second best to what the rest of the world enjoys? And don’t forget, these developers aren’t shooting in the dark. They’re very thoroughly researching their target markets and arranging their communications with them before they start. Many of them apply global best practices in all that they do from concept to completion.

Their willingness to take risks and use imaginative designs and strategies will challenge many developers here. Those who are willing to also take the risks and even partner with knowledgeable Asian and Gulf State developers, will be the wise beneficiaries of this phenomenon. Those who don’t will fall by the wayside. Success goes to the bold and brave.

In Closing

Play the Long Game, But Act Now

Pressure is mounting on businesses in developed countries from those based in fast developing countries that want to access our rich markets. Given their competitive advantages, they can be viewed as a threat or an opportunity. As you have read in this book, I strongly favor the latter approach since I believe it is the only long term success strategy we have available to us in North America.

But to partner in some form with the most desirable foreign companies, one must commit to significant ongoing internal change, beginning with the adoption of best global practices. This commitment will position you to contribute strongly and effectively to such a partnership and keep up with the standards needed for both partners to prosper.

This is not a solitary exercise, since acting alone will not give our economy the momentum it needs to restore our prosperity. We all need to do this and helping as many as we can to understand this is Job #1. We need to pull together and soon. I  hope you will join in this noble collective effort. Please refer other business owners and employees to read my book so that they can also learn the urgent need to globalize.

Appreciate that there are very likely better ways of achieving results than the ones you may be using. And remember, if you choose not to take these essential actions, others gladly will…with potentially devastating effects on your business and on North America.

To achieve this simply means to make the decision to do so…it’s not more complicated than that. The resources to draw upon are readily available. There are plentiful sources online and you can easily find consultants such as myself by way of your usual networking systems such as LinkedIn. You’ll be able to find the right people, who are of the same culture as you are but who have had the benefit of seeing new and fascinating ideas tried in international markets. As a result, those lessons are available for you to learn too, without going there.

With that done, you can conduct a long term relationship with consultants and partners based on providing knowledgeable and local access to our lucrative markets. What you will receive in return are the skilled, cost effective and customer- centric efforts of your foreign partner. And above all, their enthusiasm and hard work to help carry you to your goal together.

This enormous challenge isn’t just a minor threat to us, I believe that it’s existential! Our economy has been badly weakened by the excesses of greed that led to the global recession from which we are still trying to emerge.

The below pictures depict what I think could be the results of ignoring what our North American economy faces. While it may seem overly dramatic, I really don’t think it is when you consider what‘s at stake. Whether it is tomorrow or ten years from now, if we continue to follow the path of complacency and , in some cases, outright arrogance, the chances of accelerating the deterioration of our economy increase greatly. If we take no action individually, we will suffer collectively. Your personal prosperity will be caught in the avalanche. We must all act now for the sake of ourselves, our families and our countries.

And what if I’m wrong? The worst that will happen is that we will all prosper more…not a bad outcome!

Mount St. Helens, Before And After, Another Global Event That Had Given Many Warning Signs But Still Surprised A Lot Of People!

Hope for the future

“You may say I’m a dreamer

But I’m not the only one

I hope someday you’ll join us

And the world will be as one.”

—John Lennon, Songwriter & Humanist

About the Author

Phil Richardson, CD, BA, CSM

Born into a loving family, I was an only child who had the most wonderful upbringing. My father was in the Royal Canadian Air Force and we moved every few years from base to base, forcing me to learn how to adapt to new places and to make new friends easily. We lived in various parts of Canada, the US and Europe during his career while I sharpened my curiosity and adaptability. I didn’t realize then that I was practicing how to become and expat!

Later, my father retired from the military, and subsequently introduced me to my next career, the same one he took up: property management and development, and I was hired by the developer he had joined.

After six years of learning, I left to form my own development company and after I was well established, my father joined me. We had a wonderful professional partnership that lasted fifteen more years until his final retirement and subsequent passing. During that time, I was appointed as an Honorary Colonel in the Royal Canadian Air Force and served for fourteen years in the Reserves as a bridge between the military and civilian communities, continuing my family’s proud military service.

I have four sons who have all prospered in their respective areas of expertise.

With their partners they have given our close and loving family seven beautiful grandchildren.

I involved myself in developing commercial property as well as managing it, and formed a company specializing in planning and delivering regional shopping centers, office towers and hotels. I learned global best practices and I was well trained to compete with other professionals so I was successful in most of what I did. However, I learned as much, if not more, from the occasional failure that I suffered. Fortunately they weren’t devastating so I continued to progress.

I was deeply involved with my community of North Bay, Ontario, Canada, serving on the boards of Nipissing University, Habitat For Humanity and Black Inc., to name just a few.

In my business, I bought land for development, redeveloped existing properties, and built new and interesting projects. Eventually, I created a valuable portfolio, most of which I divested in 2005. But I didn’t want to retire, so when my last son graduated from College, I left home! Dubai was my first stop and that is where my book begins.

Today, for my clients, I apply the deep multi-cultural professional and personal knowledge I’ve gained through having led the investment, planning, development and operation of major commercial mixed use projects in Asia, The Middle East and North America.

My colleagues and I now provide best in class advisory in Property Asset, Development, and Investment Management for clients operating in Asia, the Middle East and North America.

I deliver executive education, teaching best international practices in Asset, Development and Investment Management to senior property professionals in locations around the world including Dubai, Hong Kong, Kuala Lumpur, Manila and Toronto. I support international executive learning initiatives in Canada, China and Greater Asia for Canadore College, Ontario, Canada as Professor, International Development, Asia.

I can look back on an exciting and meaningful life. I have four sons and seven grandchildren, who, along with my partner and my sons’ partners, comprise my most important blessing, my family. As well, I have many friends, old and new, and a rich community and professional life. “Why?” you may ask, “do you continue to pursue your professional dreams? Don’t you want to retire?” I would answer this way:

“I’ve enjoyed the many blessings with which God has graced my family and me, and I have tried to show my appreciation through charitable work and mentorship. But the society that has nurtured me, my family, and friends is now under great threat from increasingly competitive international professionals and businesses. I’ve resolved that I will try to make my small contribution towards nurturing a better understanding by North Americans about what we have to do to revive our growth and to helping them to do it.”

That is why I’ve written this book and have committed to make every effort towards achieving that goal. This includes speaking out publicly and honestly about our problems, and more importantly, about the solutions that I believe will help us to succeed. I offer my professional services to companies large and small to help them develop effective action plans and to deploy them. I am very happy to say that people have embraced my message and are implementing great solutions.

But make no mistake, the solutions I offer are the opposite of those past protectionist policies that only succeeded in adding great costs to doing business in North America and have drained our wealth rather than added to it. As you have read in this book, my solution is to adopt global best practices to advance whatever we do and to partner whenever possible with the multitude of high quality international people and companies wanting access to our rich markets. We must blend our strengths with theirs in order to succeed both at home and abroad. I hope you will join me in this crucial effort.

Good luck!

Phil Richardson, Globalization Specialist & Author philr@globalize2x.com

References

Chapter 1

Space (2013, December 5). How China’s Chang’e-3 Moon Rover Yutu Works (Infographic). Retrieved July 30 2015 from http://www.space.com/23855-how-china-change3-moon-rover-works-infographic.html.

Chapter 2

Wall Street Journal (2015, June 21). What Makes the Expat Lifestyle So Addictive. Retrieved July 17 2015 from http://blogs.wsj.com/expat/2015/06/21/ what-makes-the-expat-lifestyle-so-addictive

Yas Island (2015, July 17). Yas Island. Retrieved July 17 2015 from www.yasisland.ae/en/.

CNTV English (2015, July 17). New Vision Shanghai. Retrieved July 17 2015 from .

Travel and Leisure (2015, July 17). Best Budget Restaurants: Shanghai. Retrieved July 17 2015 from http://www.travelandleisure.com/local-experts/ shanghai/best-budget-restaurants-shanghai

Rics (2015, July 17). Rics.org. Retrieved July 17 2015 from LinkedIn (2015, July 17). Phil Richardson CD, CSM-Senior Vice President. Retrieved July 17 2015 from https://www.linkedin.com/profile/ view?id=6306143&trk=nav_responsive_tab_profile

Chapter 3

Hays (2015, July 17). Hays.com. Retrieved July 17, 2015 from www.hays.com . Michael Page (2015, July 17). Jobs and Recruitment. Retrieved July 17, 2015 from www.michaelpage.com .

Bayt (2015, July 17). Bayt.com. Retrieved July 17, 2015 from www.bayt.com . Sapporo di China (2013, November 4). How to get a Chinese VISA in Hong Kong. Retrieved July 17, 2015 from http://www.saporedicina.com/english/ get-a-chinese-visa-in-hong-kong

Hotel.com (2015, July 17). Hotel.com. Retrieved July 17, 2015 from www.hotel.com

Trivago (2015, July 17). The World’s #1 Hotel Search. Retrieved July 17, 2015 from http://www.trivago.ca/

China Mobile (2015, July 17). Chinamobile.cn. Retrieved July 17, 2015 from www.chinamobile.cn.

Shanghai Expat (2015, July 17). Educational Differences Between China and America. Retrieved July 17, 2015 from http://www.shanghaiexpat.com/ blog/community/education-and-learning/opinion-educational-differences- between-china-and-america-21977.html

Chapter 5

Fair Languages (2012, September 11). What are the Top 5 World Languages in 2050? Retrieved July 30, 2015 from http://fairlanguages.com/what-are-the-top-5-world-languages-in-2050/.

Chapter 6

Kwintessential (2015, July 17). China - Language, Culture, Customs and Etiquette. Retrieved July 17 2015 from http://www.kwintessential.co.uk/ resources/global-etiquette/china-country-profile.html

China Highlights (2015, July 17). Eating and Drinking in China. Retrieved July 17 2015 from http://www.chinahighlights.com/travelguide/chinese-food/eating-and-drinking-in-china.htm https://www.bcg.com/documents/file15454.pdf

Dealings in China: Understand Guanxi, for Better AND Worse by Betsy Neidel CONTRIBUTING WRITER May 14, 2012- Retrieved July 17, 2015 from http://www.texasenterprise.utexas.edu/article/dealings-china- understand-guanxi-better-and-worse#sthash.xTTLruZ7.dpuf

Chapter 7

The Statistics Portal (2014, May 21). Google Dethrones Apple as Most Valuable Brand. Retrieved July 30 2015 from http://www.statista.com/chart/2276/most-valuable-brands-2014/.

YouTube (2009, October 29). Beyonce Live Concert at Yas Marina Island. Retrieved July 17 2015 from https://www.youtube.com/watch?v=rhhDP1hLa74

YouTube (2009, November 1). Dream On - Aerosmith Life in Abu Dhabi. Retrieved July 17 2015 from https://www.youtube.com/watch?v=lKzdj2_wTrs

YouTube (2009, November 4). Abu Dhabi Grand Prix 2009 Highlights. Retrieved July 17 2015 from https://www.youtube.com/ watch?v=OBMHhhW2XD4

YouTube (2010, June 6). Ferrari World Abu Dhabi Fly-Through Virtual Tour Preview. Retrieved July 17 2015 from https://www.youtube.com/ watch?v=LJxNLQ7UEvs

YouTube (2009, April 26). Yas Island Construction Progress. Retrieved July 17 2015 from https://www.youtube.com/watch?v=wA37I7p0_fo

YouTube (2012, April 17). Ferrari World Abu Dhabi. Retrieved July 17 2015 from https://www.youtube.com/watch?v=fBigggu8GKk

Chapter 8

China Business Review (2010, November 1). Betsy Neidel—Negotiations, Chinese Style. Retrieved July 17 2015 from http://www.chinabusinessreview. com/negotiations-chinese-style/

Lewis, Richard D. (2010-11-26). When Cultures Collide, Third Edition: Leading Across Cultures (Kindle Locations 8-9). Nicholas Brealey Publishing. Kindle Edition. ISBN-13: 978-1-904838-02-9 ISBN-10: 1-904838-02-2  www.crossculture.com

Sebenius, J.K. & Qian, Cheng (Jason). 2008. Cultural Notes on Chinese Negotiating Behavior. Harvard Business School, Boston, MA, USA. http://www.hbs.edu/faculty/Publication%20Files/09-076.pdf.

Transparency International. 2014. Visualising the Corruption Perceptions Index 2014. Retrieved July 30 2015 from http://www.transparency.org/cpi2014/infographic/compareCorruptioninfographic—TransparencyInternational

Chapter 9

Towson, J. & Woetzel, J. 2014. The One Hour China Book: Two Peking University Professors Explain All of China Business in Six Short Stories (Kindle Locations 1493-1495). Towson Group LLC (Cayman Islands). Kindle Edition.

Rein, S. 2014. The End of Copycat China: The Rise of Creativity, Innovation, and Individualism in Asia (pp. xv-xvi). Wiley. Kindle Edition.

Chapter 10

YouTube (2015, March 2). Under The Dome. Retrieved July 17 2015 from https://www.youtube.com/watch?v=PjHyAl0h4t8&list=PLxU79dQZwwJPk EaR1jM8iJQS0L9iMopog

YouTube (2010, February 23), Rio Carnival, Carnival 2010. Retrieved August 2, 2015 from https://www.youtube.com/watch?v=Rjr8SkrKpqo.

China blast warehouse execs used connections to get safety approvals -Xinhua -Retrieved August 19th, 2015 from http://news.asiaone.com/news/asia/china-blast-warehouse-execs-used-connections-get-safety-approvals-xinhua

Chapter 11

Chinese Investment in the US (2015). Ups and Downs, but Mostly Ups. Retrieved July 30 from https://www.aei.org/wp-content/uploads/2015/01/chinese_investments_in_us_2015_handout.pdf

Chapter 12

The Guardian (2015, April 30). Chinese Build 57-Storey Skyscraper in 19 Days - Time-lapse Video. Retrieved July 17 2015 from http://www.theguardian.com/world/video/2015/apr/30/china-build-57-storey-skyscraper-19-days-timelapse-video.

Acknowledgements

With my deepest thanks to these very important people in my life:

My Wonderful Loving Family

Danielle Papillon, life partner and corporate SuperTrainer, whose love, joie de vive, emotional intelligence and belief in me, have added so much to my life.

Craig Richardson, son, expat, and global IT executive, whose steady effort and love characterize the warm and successful man he is in both his personal and business lives as he nurtures his children, Carter and Olivia.

Carrie Weeks, Craig’s partner and blossoming business executive, whose love and support for him and his children has strengthened him richly in his life, as well as our whole family.

Geoff Richardson, son, property developer, thespian and entrepreneur, whose incredible sense of humor and warm-heartedness inspires the admiration of all who know him.

Tracy Sloan Richardson, Geoff’s wife, partner, thespian and determined entrepreneur whose love and support for him has helped make possible his growth and success and that of our whole family.

Dave Richardson, son, brilliant electrical engineer and devoted father whose visible love of family balances with his dedication and fast rise as a leader in his international profession.

Meredith Richardson, Dave’s wife, brilliant environmental engineering and health and safety consultant, and loving mother of Dave’s children, Molly, Brenna and Annie, who has been so instrumental in his personal and professional successes and those of our whole family.

Tom Richardson, son, property developer, and life enthusiast, whose amazing risk taking and matching capabilities have led him to experience and appreciate the highs of life, and most importantly, his wonderful family.

Sarah Jane Valiquette, Tom’s partner, entrepreneur and loving mother of Tom’s children, Sierra June and Emery, whose exceptional strength and love have added so much to his life and success and that of our whole family.

My Great Friends and Colleagues

Howard  Meyer,  businessman  and  philanthropist,  who  has  inspired  and supported me so unwaveringly through much of my business life.

Nick Assad, retail property executive and humanist, who has through his example and guidance, influenced me profoundly to be a more humble and grateful man.

Dale Neily, hotel developer, realtor and great father, whose steady and calm leadership, sometimes under extreme stress, is full of grace, inspired by his strong Christian beliefs.

Don Milliken, international property developer and world traveler, whose vision, intelligence and drive inspired me to think big and work hard for success from the beginning of my career.

Mike Harrower, ethical businessman, Christian community leader and global adventurer, whose unwavering faith in God and exemplary life, living to HIS principles, inspired me to try to live the same way.

Bill Ross, international lawyer and business negotiator, whose guidance over our 35-year friendship has always kept me safely between the road margins, while he has so kindly supported my moving forward.

Jimmy Kolios, international restauranteur and entrepreneur, whose kind support and good example throughout my career lifted my spirits and kept my hope alive when times were tough.

John Ranger, a passionate international musician and website entrepreneur whose patient and creative efforts have allowed me to reach out to the world with my message.

Bill Deering, property operations expert and outdoorsman, whose loyalty over our 35-year professional and personal friendship made our team look good and allowed me to grow outside of my box.

Sheri Loyer, superb property administrator and loyal executive assistant, whose superb support made our team and me look good and be good!

Gary Shaw, International entrepreneur and savvy investor whose example of success in the world outside of his small town origins inspired me to try to do the same.

Sheldon Kennegeiser, NHL hockey player and poet, whose amazing creativity and steadfast faith in God inspired my writing muse and my faith.

Bob Surtees, history professor and tennis partner, whose persistent encouragement to complete my degree opened life avenues I would not have pursued otherwise.

Matti Sari, Psychology professor and mentor, who opened my eyes to the power of the principles of Psychology in business.

Rachid Ghamraoui, mega project construction executive and bon vivant, who took me under his wing and taught me the fundamentals I needed to perform successfully in Abu Dhabi.

Rob Coetzee, property professional and stalwart ally, whose steadfast support for me through thick and thin as a personal and professional friend, made me look better than I was to the Arab and British masters we served in Abu Dhabi.

Sameer Barakat, my Deputy Development Director and Arab mentor, whose kind tutelage ranged from language to culture and who made doing the impossible look easy.

Steve Worrell, mega Project Director and practical psychologist, whose very kind and patient tutelage helped me to lead my team to success in Abu Dhabi.

Ronald Barrott, CEO and mentor, who gave me the opportunity to join Aldar and opened up my world. He taught me the big vision needed to make one’s mark in developing global markets.

John Bullough, COO (later CEO) and mentor, led Aldar Properties through challenging times to deliver iconic projects for the UAE and expanded my original opportunity to lead several of them.

Vikram Chopra, Senior Project Manager, Ferrari World, global development professional and sensitive leader, whose loyal support and intelligent work made Ferrari World excellent.

Philip Vaughan, Corporate Retail Director, Aldar Properties, who shared his advanced knowledge with me and encouraged me to learn more.

Luca di Montezemolo, CEO, Ferrari and inspiration, who led Ferrari through its most glorious F1 campaigns in recent history and drove its brand to become number one in the world.

Jean Todt, CEO, Ferrari and later CEO, FIA, and gentleman, who worked tirelessly to ensure the Ferrari team measured up to its exemplary global vision and brand.

Jaap Kalma, Global Branding Director, Ferrari and kind gentleman, who worked tirelessly to ensure Ferrari’s brand was always treated as the exemplary vision it was and is today.

Michele Pignatti Morano, Head of New Business, Ferrari and perceptive guide, who helped me to learn and contribute to the Ferrari Experience.

Mario Almondo, COO Ferrari, who so kindly guided me through all of the facets of the company as a world class business enterprise and racing team to give me deep insights to their perennial success over many decades.

Shane Eldstrom, inspired development COO and voracious traveler, whose kind friendship in the UAE helped me in so many ways to maneuver successfully there.

Phil McArthur, high quality development professional who greeted my friend and me on our first trip to Dubai and served as a knowledgeable guide over the years I spent in the UAE and since.

Mike Tod, real world architect and inspirational leader, whose inspired teamwork on iconic projects is only matched by his commitment to social and healthy living causes.

James Ferrier, international health care executive and gastronome, whose neighborly friendship made my life in Abu Dhabi exceptional.

Ian Mackie, creative master planner and fellow traveler who helped me to maneuver the bureaucratic system of the Abu Dhabi Government.

Steve Burton, master marina developer, colleague and expat author who inspired me to write about my own experiences in the Middle East and beyond.

Devangshu Dutta, perceptive Asian commentator and respected Indian retail expert, whose kind teaching has broadened and deepened my global vision to be more inclusive of the views and feelings of other cultures.

Lancy Menzies, full-on entrepreneur who taught me my first lesson in Globalization when I arrived in Dubai and helped me to adjust to living in the UAE.

Benny Cheng, property developer and lover of life, whose kind support has made such a difference to my experience in China.

Pohkit Goh, architect, property executive and wingman, whose kind support and guidance steered my China education in all aspects, in the right direction.

Jimmy Yi, celebrity and man about town, who guides me so successfully through the various social and business minefields of China.

Matthew Kinsman, branding guru and marketing expert whose superlative work and inspired creativity showed me so much about motivating Asian consumers.

Dr. Li Ding, international physician and ethical guide, who helped me to understand some of the deep social challenges facing the Chinese people today.

Brian Dineen, Communications Executive and Christian Missionary in Asia, whose quiet, resolute faith leads to his countless charitable acts for others to follow.

Waldo Dueck, international lawyer and immigration expert whose kind assistance in China kept many of the wolves at bay.

Shirley Xuan, a gentle and helpful spirit and experienced travel agent who ensures my safety when travelling in Asia.

George Burton, CEO of Canadore College and inspired community leader whose exemplary vision of attracting and educating Asian students has benefited his college and city so much.

Ken Nixon, Department Store Vice President and mentor, whose kind Christian guidance and support helped me to mature as a property executive and a person.

Bob Lucenti, Lawyer and Co-investor in several of my North American projects, whose steady friendship and support over many years has always been so reassuring.

Ken Peake, Chartered Accountant and fellow cyclist, whose quiet Christian beliefs permeated his character and embraced all around him.

Glen Weckworth, Chartered Accountant and corporate/personal advisor who guided my companies wisely and successfully for many years.

Greg Ducharme, Chartered Accountant and international lawyer who guided me through the complexities of working offshore.

Joanne Diggles, international human resources executive and bonne vivante whose joie de vivre and humanity are always visible in her professional and personal life.

Victor Fedeli, Member of Parliament and former Mayor of North Bay, Ontario, Canada, my home town, whose constant encouragement and concrete assistance inspired and helped me to contribute to our community in many ways.

Colin Ross, CEO, DTZ Canada and understanding leader, for his kind support in helping me to reestablish myself when I returned home by entrusting me with a senior executive role in DTZ, a world class organization.

Bob Poline, savvy recruiter and fellow traveler, who helped me to keep on an even keel during some of my more challenging times abroad.

Doug Edgelow, Property Developer and Yogi, whose optimistic determination has carried so many through tough times to success, including me.

Geoff Goss, lifelong friend and international business guru, who guided me well in focusing on the important story behind this book.

Barry Spilchuck, International author and motivational speaker whose commitment to creative writing and generous spirit with all around him, inspired me to add heart to my book.

Raymond Aaron, genius author and publisher whose focus and drive are infectious. He inspired me to write my book and gave me the road map by which to do it.

And to the many other supporters and friends in my life who have all made such a positive difference for me in my journey…thank you all.