The Endless Comparison: China vs. India

In a month I’ll be visiting both China and India.

In the meantime I continue to be amused by the endless stream of articles comparing the rises of China and India. When heralding China as the Next Big Country becomes too trendy, the media switches sides and says China’s political system will fail it, and India’s service sector is too mighty, and thus India will be the Next Big Country. But then the pendulum swings back once again — no no, China has more people (at least until 2050), a more relentless entrepreneurial attitude, and better physical infrastructure. The NYT and Fortune are on the side of India, at the moment.

I don’t know or care which country will out-muscle the other. What I DO know is that all of us non-Indians and non-Chinese should support their economic growth. We should applaud their drive to improve their futures with important qualifications such as: poverty in India is still too rampant, the political system in China is still too oppressive, and the environment is still being screwed too much amidst all of this.

Global Economic Integration: What's New and What's Not?

U.S. Fed Chairman Ben Bernanke gave a speech in Wyoming yesterday on globalization. It’s a good piece that provides some historical context, draws contrasts between the stunning pace of change now from economic and social interpenetration of the past, and concludes that, while we need to be sure the gains of globalization are spread around, the potential benefits of a smaller, more integrated world are significant.

The Mighty Micro-Multinational

Globalization, in the business context, is not just about seeing a McDonald’s on every street or a small start-up outsourcing their programming to India.

For start-ups it can mean: a) realizing the potential of a global customer base and, b) the potential of a global employee base.

Business 2.0 had a great article a few days ago on the mighty micro-multinational. When the fascinating trend of micro-businesses — ideas which require little capital and target niches — meets globalization, you get micro-multinationals.

The benefits for a small company becoming globalized are not limited to cheap labor in developing countries. Instead, it’s about finding the best talent, period. The risks of a more decentralized, impersonal workplace are meaningful but with diligent focus on processes and collaboration technology, it can work. This also means individuals armed with cultural and linguistic skills, and contacts, are going to be in high demand.

Thanks to Shantanu Bhagwat for the link, who writes a great blog on globalization and European VC.

Comparing U.S. and French Culture: Observations from the Ground

I couldn’t wait to experience French culture myself: Is the food really that good? Are the government policies really that backwards? Is it really anti-business? Are the women really all skinny? Are they really not friendly to tourists? Are the cafes really as central to the Parisian street as they say? Are the people as intellectual and artistically gifted as some say? Are their French Fries as tasty as America’s Freedom Fries? The French like to think of themselves as exceptional. Because of the extraordinary people I was fortunate to meet and stay with, even for a short period of time, I believe I can paint some reasonably accurate observations and contrasts about the French mentality and culture.

In Loire Valley I stayed at the home of a businessperson, psychologist, author of a book on U.S./France differences, and owner of a successful consulting company which sends executives from large companies from all over the world to visit companies and cultures all over the world. His wife is an academic. They both have spent 20+ years living in America, despite both being born in France. So combined they posses tremendous insight on the differences. In Versailles I stayed with the former President of Vivendi International Games division and his family. He’s an executive who’s worked around the world. In Paris I stayed with an experienced management executive and his family, who’s worked with international colleagues inside his multinational corporation. Obviously there is selection bias in this sample so I am not saying it’s representative. But it’s what I heard.

Big Conclusion #1: France has a rich culture and history. It’s a physically and intellectually beautiful place: home to hills and castles, philosophers and art.

Big Conclusion #2: Absent a revolution or major reform, France will not have a relevant future. Thus, there will be a revolution in the next 15 years.

Characteristics of French culture that may hinder future growth:

  • Culture of “being” and not “doing.” Work is not seen as more admirable than not working.

  • Implicit over explicit. Context is important. Part of the intellectual workout is figuring out hidden meanings. This may be “fun” but wreaks chaos in a business environment. (Not only in French; Irish language built like this too)

  • Ideas can be more important than facts. The problem can be more interesting than finding a solution. (French business meetings 3/4 time on problem, US/UK business meetings 3/4 time on solution.)

  • “Win-win” doesn’t exist. If you win, it’s at somebody else’s expense.

  • Socialism: entitlement spending out of control, young people feel entitled to government services without giving back anything, centralized state-run universities are low quality, state-controlled labor system perverts incentives for employers, high wealth taxes drives out rich people and employers, and so forth.

  • Community and society – government tentacles are so ubiquitous that “society” never really starts. The idea of “community” doesn’t exist in French culture. The word “community” translated has a negative connotation.

  • The epistemology of the word “work” in French is “torture”

  • Young people don’t think about success as much. In a survey, 70% of French youth said they’d like to work for the government, ie a job for life with little risktaking.

  • The high bar to be considered a true French citizen and unemployment makes successful immigration integration a challenge.

  • Confrontation (frank feedback) and intellectual diversity discouraged. Most boardrooms and executive suites filled with people with similar degrees from same schools who think the same way.

  • Loss of faith in political system. Many told me, “We need a hero who can reform this. It will take a real hero. A Margret Thatcher.”

Elements of French culture that may help it survive:

  • Intellectual vigor and creativity – both held in high esteem

  • The world “entrepreneur” is French – so they have to understand the concept…somewhere

  • Lesson of humility: young people grow up surrounded by Renaissance art and see their challenger. American young people create cheap pop culture whereas French youth surrounded by higher aesthetic standard.

  • Immense history: can learn from its past

  • Design: a fine eye for aesthetic and culinary standard.

France is a great place to visit – indeed, a must visit – and would be a great place to retire. But right now I wouldn’t want to study or work in France. I hope the French people — who, contrary to what I was told, struck me as friendly and helpful even to an English speaking tourist — will debate the potentially perilous future of their country. And I hope during reform, they work to maintain the best of French culture while modernizing their economic and political instruments.

Japan's $2.5 Million Travel Theme Parks

If I was only living in Japan, I could have visited Holland, Italy, and Spain by walking across the street. Responding to a desire for citizens to taste different cultures, Japan has set up massive cultural theme parks that attempt to replicate tourist attractions, food, and the landscape of certain European countries. I’m a fan: people who really care and are blessed to have the shrinking but still sizable resources needed to travel will visit Italy in-person, but for people who wouldn’t otherwise get a sample, now they have that option.

Skillfully inverting a few essential principles of travel, the parks offer a stress-free and decidedly postmodern way of seeing the world — a sort of abridged Grand Tour for the fast-food generation

“People want to taste different cultures,” says Akira Fujiwara, a representative of the Italian Village in Nagoya. “But they don’t necessarily have the time, or the money to go abroad. This place is a convenient way for people to get a taste of something different.”

Specializing in the importation of culture, the parks package and present foreign countries like the Netherlands or Spain as a plethora of architectural reproductions, educational attractions, shops and restaurants, with the odd roller coaster or two thrown in for good measure. The most popular attraction at the Italian Village, for instance, is the gondola ride. The boats (imported from Italy) are manned by a youthful crew of Italian boatmen. As they steer passengers along the faux Venetian canals, they smile for the cameras, shouting ‘Buon giorno!’ at irregular intervals.