5 Major Lessons Companies Should Learn From China | A Q&A with George Yip
An expert in global strategy and business communication, George Yip delivers insightful and engaging keynote speeches on international affairs and global marketing strategies. Based in London, Shanghai and Maine, he is the Professor of Management and co-director at the Centre of China Innovation at China Europe International Business School, as well as an acclaimed business author whose books include 'Strategic Transformation: Managing Global Customers' and 'Total Global Strategy'.
We wanted to hear more about what CEOs can learn from the strategies of Chinese companies, which technologies truly lend a competitive advantage, and how businesses can manage global customers effectively in an increasingly globalised world. Find out the 5 major lessons companies should learn from China in his interview below.
You have held numerous academic as well as business positions throughout your career. What can the world of business learn from the world of academia? And vice versa?
The world of business can learn the rigorous thinking of academia. For example, many executives fall for rules of thumb such as “never have more than three layers of management” or “stick to the knitting”. But all such rules depend on the situation. Academia is good at understanding contingencies. On the other hand, academia is overly concerned with finding universal truths that are statistically validated. Executives are far more interested in pattern recognition. Does this configuration of external circumstances mesh with my particular configuration of strategies and actions to produce a successful outcome for my company?
You’ve authored several books, including ‘China’s Next Strategic Advantage: From Imitation to Innovation’ (2016). What can Western CEOs learn from Chinese companies that have placed themselves at the forefront of technological innovation? Why is this an advantage?
How should companies exploit the unique characteristics of China? There are five major lessons that companies should learn from China and implement as strategies:
1. Bold experimentation and rapid iteration – to identify and create innovation opportunities and ensure agility.
2. Innovation through creative adaptation – innovate by focusing on local market needs.
3. New category creation – develop the ability to find and rapidly exploit opportunities for new categories.
4. ‘Lean value’ focus – design simple products that target a need very specifically, avoiding anything superfluous and providing only what is critical.
5. Development of mixed teams and global leaders – China’s current business environment presents a great setting for companies to manage mixed teams with diverse backgrounds, and to cultivate future global leaders.
In an increasingly globalised world, what advice would you offer to multinational businesses looking to manage global customers?
Most multinational companies no longer buy on a country-by-country basis, but increasingly on a global basis. These customers seek global contracts, standardised terms and conditions, and uniform products, services and prices. Managing these customers places new demands on multinational suppliers. Having an effective global customer management program is now a major source of competitive advantage for multinational companies.
What are you most in-demand speaking topics on the corporate circuit, and how does your background provide you with key insights into these areas?
My current most in demand topic is innovation in China both because China is moving from imitation to innovation as its next source of competitive advantage and because I have recently published a book on this topic based on five years of research in China studying both Chinese and multinational companies.
My other topic that is regularly in demand is strategic transformation and execution because the three biggest strategic challenges facing companies are:
1. Formulating the right strategy
2. Executing the formulated strategy
3. Recognising when to change the strategy and making that strategic transformation
I recently published a book about strategic transformation based on a multi-year research programme, and I also spent the last several years teaching an MBA elective about strategy execution.
What are the key takeaways that you aim for an audience to leave with?
I always leave an audience with ideas of what they should do in their own companies to improve performance.
What’s next for you?
I am co-authoring a follow-up book on innovation in China, focusing on hidden champions and other lesser-known innovators. This book will have significant implications for Western companies.
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