Why is China Important?

China’s top ranking today on a number of global scales indicates its importance to US manufacturers:

#1 in population (nearly 1.3 billion people)
#1 “middle class” urban consumers, estimated over 200 million
#1 destination for foreign investment (over $60 billion in 2004)
#1 exporter to the US
#4 world’s largest economy (will surpass Japan in next 5 years, the US in next 15)
#1 consumer of steel and oil, soon to be the largest manufacturer in the world

The past 20 years of foreign investment in China has seen some success but many more failures, particularly in the early years. Bad market assumptions, changing government policies and an often un-level playing field certainly contributed to many of these early failed China initiatives. However, equally damaging has been the absence of a clear understanding and awareness of the cost, stress and risk to a company’s organization that will likely occur when doing business in China.

The China Readiness Assessment gives attention to this area of risk as companies prepare to enter or expand into China by answering several key questions:

What have we learned from these past 20 years of doing business in China?
How can the painful lessons learned be applied to companies entering or expanding within China today?
Are there core characteristics and competences that a company needs to have to be successful in China?
If so, is there a way we can identify and nurture these success factors in our companies before we invest in China, providing a solid foundation for what will be a comparatively risky venture?