Comments

Hi Tom,
It's nice to read about your thoughts on this. Thanks. Be it Chinese hegemony or not. What I can be sure is that on this side of my world, times are changing more than ever.

A shift of trends and perspectives seems to be happening as more and more people recognize the need to immerse in the Chinese cultures.

No matter what, changes happens. We, as citizens of the world, must strive to excel at all times.

Wishes from, Wekie

Posted by Wekie at August 20, 2007 1:06 PM

I recently had the privilege of providing seven days of workshops on leadership, communications, decision making and enhancing performance to 10 senior Chinese leaders in a government organization of China. It was a great learning experience. I found that these people were focused on making life better for their families and themselves. I didn't see the worldly attitude of being better than everyone else. If they become number 1 on their way to a better life...so be it. They definitely will be competition for the American economic engine, but I prefer we focus on creating benefits for all instead of some win-lose competition. It's a great and very huge market. Let's not hamper our chances to compete.

Posted by Phil Clark at August 20, 2007 3:31 PM

Tom, this is the first time I comment on your blog, but I read it regularly. I have spent a decent amount of time in China with banking and retail executives. The last comment from Phil Clark is exactly correct. In China, you don't hear many people talking about competing with the rest of the world, you hear people energized and excited about improving their own lives, confident of the country's internal growth. In fact, it all struck home while at a dinner in India with a group of Indian banking and retail executives, who spent the whole evening talking about China and asking me questions about how China's credit and debit card market is developing (my area of expertise). At the end, I pointed out to them that I had never had a dinner in China where everyone spent all evening talking about India. China is still very internally focused, whereas India clearly is looking at the outer world.

Posted by Aneace at August 20, 2007 9:47 PM

Two points that make the post seem un-Peters-esque. Firstly, and foundationally, even if China is wildly misunderstood today, the pace of change in our world makes a hundred year prediction (at least in this context) an absurdity. Secondly, trying to gauge where China is in terms of "productivity" seems a narrow slice at best. In a Tom Peters world, productivity is far more relevant to manufacturing, whereas we have no idea what China's potential may be in services. Tying the two together what happens when the generation being born in China today, grows up in the English leaning higher education climate in China, plus the English and Western culture dominated Internet? Will it take them 100 years to exploit the demographic enormity of China in the business world particularly when we know that the real competitive challenge is in the continued growth in importance of services?

Coincidentally, Gartner used the very phrase above in San Fransisco at their World Conference a few months ago: Wake up American IT pros China (and India) are "Eating your Lunch". The point was made to highlight the fact that it is not simply low end/low margin functions that are being handled offshore in IT (as many dismissively maintain) but high end functions including innovation where they are proving competitive right now. In fact, I recall a podcast from you Maestro at Logan airport referring to this very phenomenon highlighted in a WSJ article.

Growth. Smart Humans. Technological convergence. Manufacturing as a commodity, and services as playing field where leaders will be distinguished (anyone arguing we will compete with China in manufacturing?) 100 years off? Sounds like placating nonsense to me. 20 maybe. After that...all bets are off.

Posted by michael at August 21, 2007 9:38 AM

Tom – there is an excellent book titled “The Chinese Century” – it is probably the most thoughtful book I have read on the emergence of the Chinese economy. Check it out, when you have a free moment. It’s a though provoking read.

Posted by Manny at August 21, 2007 10:06 AM

Here is the link to the Amazon's book page:

http://www.amazon.com/Chinese-Century-Rising-Economy-Balance/dp/0131467484

Posted by Manny at August 21, 2007 10:07 AM

Chinese savings rate amazes at 50% of GDP vs. England, France & other places of massive consumer/home & socialist debt - real estate values shall drop in Europe. Time for China to start paying their way world-wide to enhance free enterprise & similar cultural freedoms.

Posted by John at August 21, 2007 11:34 AM

What's going on in China is amazing. They have rapidly transformed from an above average agrarian state into a manufacturing giant. They also have great potential to challenge the rest of the world in knowledge work, but it seems like some have missed Thurow's point:

He takes exception to the quoted 33% rate of growth and then examines a number of different benchmarks using generally accepted economic methods to concludes that due to their huge population and current low per capita income, it will take more than a hundred years to match the US (even if the US economy never grew another percent).

He says nothing about how China will influence the world economy in untold ways, how many of us may lose our jobs because of Chinese competition or how China may rise to be a real superpower opponent to the US.

I think it's very important that we all be aware of China as an economic competitor, but we engage in scaremongering when we make them out to be giant superhumans. They have great potential, but the recent toxic ingredient problem and insane crash results of the Cherry automobile shows us that their economy still has some developing to do.

Posted by kurt at August 21, 2007 5:41 PM

Not sure who you meant, but to be sure, I didn't miss his point, I just disagree with it. I countered with the fact that to me "benchmarks using generally accepted economic methods" means about as much to me as a typical sentence in Mandarin. Are these generally accepted methods like the ones that used to tout Enron as the top company in the world for 6 or 7 years? Are these generally accepted methods like the ones that failed to avert the near collapse (at least domestically) of GM and Ford? Are these generally accepted methods like those that enable this government to spend 10 generations into the future while their own comptroller screams at the top of his lungs that Rome is falling and falling fast? One of the reasons I am a TP disciple is that he got and taught me the thesis of the Black Swan long before it was written and he knows far deeper in his DNA than me that most "experts" are really just masters of the status quo which (like him) I find to be behemoth monster as often as not unwilling to embrace change as it protects the turf of its often overpaid white collar gatekeepers. Thurow may have a point that hype cycles are real and there is a ton of unknowns based on whatever measures we can use to prognosticate, but extrapolating that to a 100 year prediction is nonsense. I could just as easily highlight the hunger of both Chinese and Indian professionals riding their respective booms and compare it to the widespread disengagement of Western workers well documented by Gallup Management polls and argue that the Western workforce is going to get creamed as Chindia and the microchip continue to level the playing field. As for toxic ingredients and deadly products from the automotive sector, I am certain citing things as harbingers of major shortcomings ignores glaring similarities in our own rise to global dominance here in the US. We've got our Pintos and DDTs and I would argue we still have our Phen Phens and Dioxins and Oleans that are as toxic as lead albeit less accepted as such. A final note and I shall shut up for a spell: our per capita income that he highlights has been heading like a tidal wave to the very very top of the heap for 25 plus years. Of course this information is not as often cited in "benchmarks using generally accepted methods" because these methods studiously ignore reality in favor of spin designed for Wall Street. Back dating options, insider trading, ballooning executive compensation just to name a few. My point is that we have at least as many Achilles heels as China while they are anxious to compete and we are anxious to hold on to something. A security mindset versus an country aspiring to generate a middle class beachhead. Tons of variables, and I would never count out the US, but I repeat, all bets are off.

Posted by michael at August 21, 2007 7:58 PM

On a related note, the US economy might grow, but per capita incomes would need to grow or at least remain constant to align with Thurow's argument. On the contrary, there is a multi year decline (the first since WWII):

http://www.crooksandliars.com/2007/08/21/why-so-many-are-unsatisfied-with-the-economy/

Posted by michael at August 22, 2007 9:00 AM

I too am a disciple of Tom and don't for a minute think anyone should take their eyes off of China, but think that there's alot of hype in the reporting of their economy. One of our biggest problems with China is that as a developing economy, credible reporting systems may or may exist to provide data to compare. Michael-Your point about Enron is excellent. We have a hard time getting credible data in our own country, let alone China.

As to your linked story about declining income, that story discussed a decrease in personal income while Thurow's article was about per capita income (which is up)

Posted by kurt at August 23, 2007 12:25 PM

Since there ain't even political or cultural hegemony within China, there ain't much chance of an Asian-wide or world-wide Chinese hegemony. There are marked parallels to the Japanese economic miracle, but there are marked differences, too. Yes, it's a new world, but it still functions on the same foundations as the old one.

Posted by Red Island Rhodes at August 24, 2007 6:18 AM

I have worked in Taiwan and China for more than 12 years. China's growth has been astronomical and will carry on "indefinitely." The Chinese I feel are the only ones that know how long they can keep going at such a frenetic pace (maybe the rates are not totally accurate, but I would say they are frenetic!), and what sort of things can hurt/slowdown this continuing rise. I agree with one comment that Chinese people think about China mostly. In addition, like anyone, they want to improve their lives. This brings me to several points.

On recent trips to Shanghai and Guangzhou, what really struck me was the air and water quality with power/oil/coal always in mind. The air made me sick. I live in Taiwan, so I thought I was used to it! They can have all the growth they want, but if it creates an ecological disaster, what is the point? I think many people are overlooking this.

Another thing I see is the astronomical amount of men smoking cigarettes. Damn, it is incredible. (http://news.bbc.co.uk/1/hi/health/466401.stm) There is literally a cigarette hanging out of the corner of almost every man's mouth (at least it seems that way). When you walk outside, you get the equivalent of 2 packs a day just breathing the air!

Sorry to go off business Tom, I love to read about your pristine Vermont farm and bushwhacking, it is so special. Being close to the earth makes you think about ecology, the environment, and healthcare (and good health). People should go to the heart of China's manufacturing belt, stay for a week, and breathe that air. It will give them a better understanding of the side effects of such growth.

Posted by JJS in Taiwan at August 25, 2007 11:05 PM

My God! I am putting comments on Mr.Tom Peters' blog, whose books (and slides/ quotes) have inspired me so much.

Ok. I am from India. My people are eating your lunches. Lunches of the IT and service personnel. That is about it.

Now, look what I am eating right now. I am eating McBurger. I am drinking Cokacola and Pepsi. I am driving GM car. My country's Air Force fly F-16s. I am using an IBM PC right now. I use American personal care products on a large scale. I am using Window OS.....the list is endless and meaningless...and the trend to use American products in urban India is increasing fast.

While you are concerned with outsourcing services to India we are never worried about outsourcing products, knowhow, patents for which we are paying heavily in the form of royalties.

A lot of American companies are coming to India to expand their business. In the end some of them not only eat their lunches; they even end their existence. (e.g. when Pepsi came to India in 1990s, the local leader of beverages "Parle foods Products" sold their business to Pepsi fearing they can not sustain competition)

In an imaginary situation wherein you end all outsourcing to India and India banning all American products, partnerships, joint projects, (and consultancy invitations to Great gurus such as Mr.Peters, ;-) he he); I think it will be a "lose lose" situation. We have reached that stage.

"Eating someone's lunches" phrase should be banned (as a pre-requisite) if any country goes for globalisation.

PS: I am not a management guru or any strategist. I am a student of management and an ordinary employee in a manufacturing co. Take my comments in that respect.

Posted by Milind at August 27, 2007 12:39 AM

Milind, before you enthusiastically post on this blog, please get your facts right.
Since when has the Indian Air Force started flying F-16s? They do not. The Defence Ministry has just yesterday put out a tender for vendors to supply fighter jets. If Lockheed Martin/General Dynamics win it, only then will you see the Indian Air Force flying F-16s in India.
Secondly, Parle Food Products sold some of their beverage brands , Thums-Up, Fanta and Limca, not to Pepsi, but to Coca-Cola, that too at an astronomical price. The owner, Ramesh Chauhan went laughing all the way to the bank. BTW his other "beverage" brand Bisleri Mineral water is far far ahead of the Pepsi & Coca Cola water brands (Aquafina and Kinley)in terms of volumes and market penetration, as also profitability.

Posted by Mandar at August 29, 2007 7:04 AM

China in my eyes. It is peaceful!
From the long this history and culture, we also can find she is not aggressive. AS the tech progress, i think human will be one family.
It is a trend, but i think there also a lot difficult for many bad guy Hegemony thoughts!
I think human need to find the theory to maintain all culture and all history. All people all human, if you want one government to control other, you also will be controlled by others.

Posted by Tom.Gu at August 29, 2007 11:41 PM

In the face of China’s nascent world order, Weber et al describe some coping options ranging from disruption to accommodation. The most advisable and plausible scenario is for the US to “compete for the allegiance of states that are ‘in play’”. This means remaking our liberal international order more appealing and, and perhaps accommodating, to states who have not fully integrated into our global order over the last half century. (The US-India nuclear deal, regardless of its failings, appears to be such an effort to make global non-proliferation architecture more malleable in order to bring such “swing states” in). But without revitalizing and effectively deploying our soft-power—by bringing the concept of trade back into the strategic fold and boosting our civilian role in global outreach—the odds against us mount considerably.
Trade is so important to our globally-integrated economy. The U.S. is the number one trading country in the world, and China is our third largest trading partner.
The United States, China and the world economy stand to benefit tremendously from China's accession to the World Trade Organization, according to the Chamber. Increasing the business contacts between the two countries through trade missions will help U.S. firms to get better market information, increased access to potential Chinese partners, and the technical help to close profitable business deals.
Welcome to AmeriChinaB2B( http://www.acb2b.com/ ) to begin your business trip of China.

Posted by Demi at August 30, 2007 12:26 PM

Can you explain this a bit further:

"(The US-India nuclear deal, regardless of its failings, appears to be such an effort to make global non-proliferation architecture more malleable in order to bring such “swing states” in)."

Posted by michael at August 31, 2007 1:22 AM

michael -- it means that the US is no longer strictly adhering across the board to a policy of "if you don't already have them, you aren't getting them, and if you have them, you aren't getting any more of them." This is in order to play the Great Game with China that we played (and won) in the world with the old Soviet Union. You have no chance of getting a reply from 'Demi' because that post is merely a thinly veiled advertisement for a service. I love it when companies and "entrepreneurs" co-opt blog comments for free advertising. Makes me want to go right out and buy their products and services, (NOT!).

Posted by Red Island Rhodes at August 31, 2007 6:29 AM