107. Why Companies Fail...
1) Think ‘Cost Cutting’ instead of ‘Investment’
2) Do not have the right/experienced designers
3) Takes too long to build own internal
marketing/design capability
4) Market changes too quickly to adapt anymore
We license product ideas to manufacturers who have distribution channels
- Manufacturing low end of the stick
- How MNCs does it?
- How Developing for China Market is different?
- How You Can Do it too? Misnomers
- Take Action
Create ideas for companies, who has plan to develop successful products for China market
- Mid-size
- Invest and has need
for budgets for half million - 2 Million
- License product ideas for manufacturers
who does not have marketing/design capabilities
and are not able to develop breakthrough ideas on time
- Manufacturers
- Looking for innovation, strategic design
- Licensing
If you’re above 30 years old
My family was in OEM business
Grandfather in Textiles manufacturing
Father in Transistor Radio manufacturing in 70’s, my Dad manufactured for export for US/Philips
I’m the 3rd generation since HK economic take off
Father retired 20 years ago before 1997
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Your OEM fate will follow HK’s footsteps unless you transform your business
Even if do not think for yourself,
need to think for your kids (my Dad retired, so I do not have to be in OEM biz)
Many of my own HK friends are 3rd generation OEM, in a sunset industry.
in Christmas lighting, garment, toys, even for big brand international brand names:
lingerie Nieman Marcus, hair dryers Vidal Sasoon, vacuum cleaners for Hoover/Black & Decker, wallets Hugo Boss
What is their fate?
Vidal Sasson OEM friend last year bankrupted within a few months
INTRO: (5 mins)
- Ask questions: OEMs, 2nd generation
- How much OEM makes, how much brand makes
- Market/People driven v.s. Hardware driven
- Kaizor bkg (front end define products)
- Misnomer:
Expensive to do R&D
Expensive to do Brand
Flights are downed
Iceland bankrupt, Portugal, Spain
Protectionism, protect local jobs
Even Mid-size U.S. companies come over for China market
阿根廷立案中国电气反倾销案
欧盟可能会对中国鞋征收30%至40%的反倾销税
中国鞋企开打欧盟鞋业反倾销调查保卫战 2005年7月5日9时8分
Heavy smoke billows from a wharehouse of a Chinese shoe shop in Elche, Spain, on September 16, 2004.
（http://www.chinadaily.com.cn/english/doc/2004-09/24/content_377260.htm）
Photo source:
http://image.yahoo.com.cn/searchdtl_v3.html?srcp=%B7%B4%C7%E3%CF%FA&chntotal=468&entotal=-1&b=4&lang=chn&mip=all&miw=all&msgttl=0&allCurPage=4&chnTtlPages=39&allTtlPages=49&pid=yisou&coop=yisou&sel=7
http://info.shoes.hc360.com/zt/fanqingxiao/index.shtml
http://www.ce.cn/ztpd/cjzt/jiadian/2004/2004jd/
===============
Threats:
(1) Burn Shoes
(2) fire-lighter
===============
三次“烧鞋”的不同含义 (http://bbs4.news.163.com/board/index.html?url=http%3A//bbs4.news.163.com/board/rep.jsp%3Fb%3Dzhejiang%26i%3D19856)
从默默无闻到温州模式再到新温州模式的更迭中，穿插着3次“烧鞋事件”。而在浙江省经济学会理事、温州市经济学会副会长谢健眼里，“3次烧鞋，含义完全不同”。 第一次是在1987年8月8日
愤怒的杭州人将5000多双劣质的温州鞋集中在杭州武林门广场，当众焚烧。一时间，温州“星期鞋”成为千夫所指，劣质货的帽子，也被扣到了所有“温州造”产品上。 - “这是温州民营经济小商品、大市场模式发展前期，因为市场不规范、企业短视行为过多积累下来的一个恶果，也是急于对外扩张的一个必然阶段。
第二次是在 1999年12月15日
又是武林门广场，又是烧鞋。不同的是，这次的主角却是温州的制鞋大户以及温州市和浙江皮革协会的领导，所烧对象是那些假冒温州名牌的劣质鞋。当时的《经济日报》曾这样报道：“12年前一把火，烧温州人的劣质鞋；12年后的火一把，温州人烧仿冒温州鞋的劣质鞋。”强烈的反差下的事实是，“温州造”已经完成了以注重品牌、质量和信誉为核心的形象重塑，温州货再次在全国叫响。
第三次烧鞋事件，地点转移到了国外 -- 2004年9月17日
西班牙东部小城埃尔切的中国鞋城突然遭遇数百名不明身份的西班牙人的袭击，他们烧毁了一辆载有温州鞋集装箱的卡车和一个温州鞋商的仓库，造成直接经济损失800万元人民币。这是西班牙有史以来最严重的一次侵犯华商权益的暴力事件，整个世界为之震惊。 　　“这次不是因为质量问题，却是因为温州货物美价廉。”谢健说，尽管这是一个不好的消息，但抛开民族感情讲，西班牙事件只是温州鞋开拓海外市场中的一个插曲，它代表的含义是，温商和温州货走出中国，在国际市场上攻城拔寨的趋势已经不可阻挡。
2001年8月至2002年1月，在俄罗斯发生的查扣事件中，整个浙商损失大约3亿元人民币，个别企业损失达千万元以上。
（http://info.finance.hc360.com/2004/12/08081818853.shtml）
=============================
Fire-lighter
温州拥有打火机企业500多家，年产金属外壳打火机6亿多只，销量占国内市场份额95%以上，世界市场份额80%以上。2001年9月间，欧盟根据欧洲一些打火机制造商提出的要求，制定了抵制中国打火机的贸易技术壁垒CR法案。
2002年6月28日，欧盟又宣布对产自中国的打火机进行反倾销立案。
Source: 反倾销，温州行业协会挑大梁 http://www.snweb.com/gb/sdc/2003/20/a2001011.htm
iPhone 600,000 in China, not including fake ones,
not available yet
U.S. iPhone sells on average 21 iPhones each day each Apple store
AT&T sells average 21 per week
7 times sales
- What does Apple do? Design
Who makes iPhone?
more than 30 companies on 3 continents work together (symphony conductor)
- How many designers do you think Apple has? a dozen (12+)
- Apple investments in R&D 3.8%: Microsoft/IBM/Sony spends 10 times more
Anyone heard of User Experience?
iphone use Quad-band GSM and EDGE
iPhone 600,000 in China, not including fake ones,
not available yet
U.S. iPhone sells on average 21 iPhones each day each Apple store
AT&T sells average 21 per week
7 times sales
- What does Apple do? Design
Who makes iPhone?
more than 30 companies on 3 continents work together (symphony conductor)
- How many designers do you think Apple has? a dozen (12+)
- Apple investments in R&D 3.8%: Microsoft/IBM/Sony spends 10 times more
Anyone heard of User Experience?
iphone use Quad-band GSM and EDGE
Top 20: 13
Why?
Is this a good thing for China?
We help both Western, China and HK companies
From HP, P&G, BMW Designworks USA to
Asia/China companies: OSIM, Changhong, OEM Manufacturing
We also recently work with HKPC
thank you for inviting us here to speak
Group students into provinces (color coded)
Group different disciplines and genders together
Teams of 5 (12 teams = 60 people)
Introduce themselves to each other (if do not already know)
Each get a China map
Exercise 1:
Identify as a team provincial advantages in National and Global context
Each team use creative way to “design city’s policies” to attract investments
taking advantage of local advantages.
Expressive space like in a fashion magazine
In Shenzhen
DSC01757
Lam Mao
Oct 25 (Sat)
no sofa, just sit on the floor
Temporary furniture in the homes of job seekers moving from other China provinces
Disinfectant cabinet to sterilize dishes after hand-washing
Housing not designed for installing for split-unit air-conditioners as shown by the exposed duct
Wow Wow Product
China Insights -- cloth cover to prevent dust -- translate into product form
INTRO: (5 mins)
- Ask questions: OEMs, 2nd generation
- How much OEM makes, how much brand makes
- Market/People driven v.s. Hardware driven
- Kaizor bkg (front end define products)
- Misnomer:
Expensive to do R&D
Expensive to do Brand
China
China
China
Client’s logo
Propose new ways of design innovation
Presentation for Nokia Connection https://www.nokiaconnection2007.com/, Singapore, 18th to 19th June, 2007.
This and related research can be downloaded from http://www.janchipchase.com/publications.
Thanks to the extended research team who helped make all this happen: Cui Yanqing, Younghee Jung, Sachi Mizobuchi, Fumiko Ichikawa, Raphael Grignani, Indri Tulusan, Julius Matovu, Lokesh Bitra, Zeenath Hasan, Thomas Stovicek, Ken Anderson, Wendy March, Per Persson, Petri Piippo, Liu Ying and Tetsuya Yamamoto.
Photo: A space to send a text message and make a call. Protester under a Turkish flag at a pro-secular rally. Jan Chipchase, Istanbul, 2007.
One method is shadowing, which is quite simply following someone (with their permission). It’s a fast way to understand their context, and the range of things that they do over the course of the day.
Photo: Jan Chipchase, Chongqing, 2007.
Photo: Indri Tulusan: Chongqing, 2007.
Photo: Cui Yanqing: Ji Lin, 2005.
Photo: Jan Chipchase, Berlin 2002
Photo: Mobile TV study, South Korea, Jan Chipchase, 2005.
Tokyo male N=61
Milan male N=56
Los Angelesmale N=66
Beijing male N=111
Ji Lin City male N=104
More popular amongst older males.
Photo: Atypical belt mounted phone, Beijing, China, 2005.
Photo: Where’s the Phone, Tokyo, 2005.
INTRO: (5 mins)
- Ask questions: OEMs, 2nd generation
- How much OEM makes, how much brand makes
- Market/People driven v.s. Hardware driven
- Kaizor bkg (front end define products)
- Misnomer:
Expensive to do R&D
Expensive to do Brand
We help both Western, China and HK companies
From HP, P&G, BMW Designworks USA to
Asia/China companies: OSIM, Changhong, OEM Manufacturing
We also recently work with HKPC
thank you for inviting us here to speak
Nespresso: HK$3000
Nespresso: HK$3000
Nespresso: HK$3000
Nespresso: HK$3000
We help both Western, China and HK companies
From HP, P&G, BMW Designworks USA to
Asia/China companies: OSIM, Changhong, OEM Manufacturing
We also recently work with HKPC
thank you for inviting us here to speak
We help both Western, China and HK companies
From HP, P&G, BMW Designworks USA to
Asia/China companies: OSIM, Changhong, OEM Manufacturing
We also recently work with HKPC
thank you for inviting us here to speak
We help both Western, China and HK companies
From HP, P&G, BMW Designworks USA to
Asia/China companies: OSIM, Changhong, OEM Manufacturing
We also recently work with HKPC
thank you for inviting us here to speak
We help both Western, China and HK companies
From HP, P&G, BMW Designworks USA to
Asia/China companies: OSIM, Changhong, OEM Manufacturing
We also recently work with HKPC
thank you for inviting us here to speak
We help both Western, China and HK companies
From HP, P&G, BMW Designworks USA to
Asia/China companies: OSIM, Changhong, OEM Manufacturing
We also recently work with HKPC
thank you for inviting us here to speak
Government policies in recent 20 years have shaped:
Economic development
Urbanization and migration
Growing environmental concerns
Home ownership
Family size
Tim Fletcher, IDSA’s Chapter VP
China and U.S. is like
Siamese Twins
One can’t live without the other
Bruce Claxton also said that
Interconnected economy
- Go over training schedule
- Today’s schedule
- Attendance taking
- Roles and responsibilities: GZMY documentation, design
- Yong Xin is half the designer
- Go over training schedule
- Today’s schedule
- Attendance taking
- Roles and responsibilities: GZMY documentation, design
- Yong Xin is half the designer
- Go over training schedule
- Today’s schedule
- Attendance taking
- Roles and responsibilities: GZMY documentation, design
- Yong Xin is half the designer
- Go over training schedule
- Today’s schedule
- Attendance taking
- Roles and responsibilities: GZMY documentation, design
- Yong Xin is half the designer
- Can use same material and color of old furniture
INTRO: (5 mins)
- Ask questions: OEMs, 2nd generation
- How much OEM makes, how much brand makes
- Market/People driven v.s. Hardware driven
- Kaizor bkg (front end define products)
- Misnomer:
Expensive to do R&D
Expensive to do Brand
Short term
7剩不做研发
====
http://emba.gsm.pku.edu.cn/News/050902-4.htm
- 中国企业R＆D支出：500大企业只占销售收入的1.05％
- 国际上公认企业研发费用不低于销售额4％
中国企业：广告上支出= R＆D 数倍我
在吃喝玩乐上的花费远远高于我们在职工的培训和教育上的花费
值得我们企业、企业家真正去思考的问题。
=====
Short term
7剩不做研发
====
http://emba.gsm.pku.edu.cn/News/050902-4.htm
- 中国企业R＆D支出：500大企业只占销售收入的1.05％
- 国际上公认企业研发费用不低于销售额4％
中国企业：广告上支出= R＆D 数倍我
在吃喝玩乐上的花费远远高于我们在职工的培训和教育上的花费
值得我们企业、企业家真正去思考的问题。
=====
Short term
7剩不做研发
====
http://emba.gsm.pku.edu.cn/News/050902-4.htm
- 中国企业R＆D支出：500大企业只占销售收入的1.05％
- 国际上公认企业研发费用不低于销售额4％
中国企业：广告上支出= R＆D 数倍我
在吃喝玩乐上的花费远远高于我们在职工的培训和教育上的花费
值得我们企业、企业家真正去思考的问题。
=====
Short term
7剩不做研发
====
http://emba.gsm.pku.edu.cn/News/050902-4.htm
- 中国企业R＆D支出：500大企业只占销售收入的1.05％
- 国际上公认企业研发费用不低于销售额4％
中国企业：广告上支出= R＆D 数倍我
在吃喝玩乐上的花费远远高于我们在职工的培训和教育上的花费
值得我们企业、企业家真正去思考的问题。
=====
Short term
7剩不做研发
====
http://emba.gsm.pku.edu.cn/News/050902-4.htm
- 中国企业R＆D支出：500大企业只占销售收入的1.05％
- 国际上公认企业研发费用不低于销售额4％
中国企业：广告上支出= R＆D 数倍我
在吃喝玩乐上的花费远远高于我们在职工的培训和教育上的花费
值得我们企业、企业家真正去思考的问题。
=====
Short term
7剩不做研发
====
http://emba.gsm.pku.edu.cn/News/050902-4.htm
- 中国企业R＆D支出：500大企业只占销售收入的1.05％
- 国际上公认企业研发费用不低于销售额4％
中国企业：广告上支出= R＆D 数倍我
在吃喝玩乐上的花费远远高于我们在职工的培训和教育上的花费
值得我们企业、企业家真正去思考的问题。
=====
Short term
7剩不做研发
====
http://emba.gsm.pku.edu.cn/News/050902-4.htm
- 中国企业R＆D支出：500大企业只占销售收入的1.05％
- 国际上公认企业研发费用不低于销售额4％
中国企业：广告上支出= R＆D 数倍我
在吃喝玩乐上的花费远远高于我们在职工的培训和教育上的花费
值得我们企业、企业家真正去思考的问题。
=====
Western companies more worried:
- No manufacturing
- Cheaper
INTRO: (5 mins)
- Ask questions: OEMs, 2nd generation
- How much OEM makes, how much brand makes
- Market/People driven v.s. Hardware driven
- Kaizor bkg (front end define products)
- Misnomer:
Expensive to do R&D
Expensive to do Brand
Hire Western designers?
Hire HK designers?
Hire schools?
----------------------------------
Hire advertising or design firms? What is design? “packaging”???
How to hire, when to hire? Hire students?? 20 years
Who to hire?
How to use design?
Design is very confusing!!!!!
Decode, increase value
Chinese medicine
approach
Hire Western designers?
Hire HK designers?
Hire schools?
----------------------------------
Hire advertising or design firms? What is design? “packaging”???
How to hire, when to hire? Hire students?? 20 years
Who to hire?
How to use design?
Design is very confusing!!!!!
Decode, increase value
Chinese medicine
approach
Change thinking 思维转变
Solve problem
Like Chinese medicine治标治本
短视
U.S. – thinking 多文化
Wenzhou, also 合拚股份 - 14个开放城市之一
改变结构
关停并转
Deng Xiao Peng
4 letter word (Chinese) fishing not fish
互补
HK-Mainland - Kaizor
Change thinking 思维转变
Solve problem
Like Chinese medicine治标治本
短视
U.S. – thinking 多文化
Wenzhou, also 合拚股份 - 14个开放城市之一
改变结构
关停并转
Deng Xiao Peng
4 letter word (Chinese) fishing not fish
互补
HK-Mainland - Kaizor
Many companies aware they need to do this, but they fail because of:
• Take too long to build own internal marketing/design capability
• Market changes quickly
• Need someone who has in depth experience in China market and professional creative process
• Collaborative formats
Everybody who is interested to know more about this:
Come to talk after this talk about Fri invited meeting
Preparing sth new: sign in
Contact you to come on Fri
Many companies aware they need to do this, but they fail because of:
• Take too long to build own internal marketing/design capability
• Market changes quickly
• Need someone who has in depth experience in China market and professional creative process
• Collaborative formats
Everybody who is interested to know more about this:
Come to talk after this talk about Fri invited meeting
Preparing sth new: sign in
Contact you to come on Fri
