Tag Archives: Taiwan

Funerals in Taiwan

Check out this article in the Taiwan Journal for an interesting look at how the funeral business in Taiwan is changing, and how that is reflective of the changing beliefs in Taiwan society.

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Culture Shock For Chinese Tourists And Taiwanese Hosts

I’ll borrow the title of the article for this post.

Basically, mainland Chinese tourists have begun to visit Taiwan, and are expected to do so in greater numbers in the months and years to come. Predictably, there are some biases and prejudices on both sides and like most biases and prejudices, they are largely without logical foundation.

The article doesn’t go into any kind of depth on the political, cultural, and socio-economic differences between the Chinese-speaking peoples living on either side of the Taiwan Strait, but it makes for a light, fun read.

It will be fascinating to see how things play out. I’ll be watching with interest.

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Hakka Dreams

Some years ago at a popular restaurant in Xinzhu in the north of Taiwan, I joined a gathering of twelve business owners, all local Rotarians, for a feast featuring the local Hakka fare. Shortly after the first bottle of whiskey was opened, the backslapping and the joshing began. “True, this is Mr. Gao. We call him “Hotel”. He’s the richest man in our Rotary Club.”Mr. Gao replied: “Nonsense! Chemical, you are the richest man in Rotary, and you know it!”

Over the course of the meal, the sequence repeated itself several times. By the end of the evening, it became clear that Car, Bank, Manpower, DM, Medicine, and Well—each man nicknamed according to his industry or, in the case of Well, legendary drinking ability—were all wealthy yet unwilling to admit it too openly.

What I also remember about that evening, and dozens of similar evenings over the years, are the frequent observations made by these Hakka businessmen about their cultural identity. Things like: “We all came from farms up in the mountains. Our parents had to go to the river and catch a fish if we wanted to eat meat” or “Hakka people are careful with their money,” or “We Hakkas tend to be more conservative than your average Taiwanese.” One the most memorable of these remarks came from a Hakka businessman who often trades with the Japanese. He told me: “A Taiwanese Hakka businessman can best three typical Taiwanese businessmen, and a typical Taiwanese businessman can best three Japanese businessmen. These poor Japanese don’t stand a chance!”

Ask a non-Hakka Taiwanese to describe Hakkas, and he’ll often cluck his tongue and say something like “Hakkas can be really generous, but only when they need something from you,” or “Hakka people tend to be very clannish,” or “Hakkas are really tight with a dollar.”

Some 15% of Taiwan’s population is Hakka. The Mandarin word for Hakka is 客家人 (kèjiārén), or “guest person”, though this appellation is fairly recent. It describes the traditionally migratory nature of the Hakka people, who originated in northern China around 2,700 years ago. After a series of resettlements aimed at escaping war and social unrest, most Hakkas settled in southern China, with large concentrations in Guangdong and southwestern Fujian Province. It was from these southern outposts that Taiwanese Hakkas departed in their last migration southward, across the Taiwan Strait.

Today, there are four major concentrations of Hakka people in Taiwan. Most people in Taiwan recognize the corridor stretching from Taoyuan to Miaoli County as the location of most of the Hakka population in Taiwan. About 50% of Zhongli City, and 80% of the residents of Taoyuan, Xinzhu, and Miaoli Counties are ethnically Hakka.

The settlement pattern of these areas has much to do with the earlier arrival in Taiwan of Hoklo immigrants from Fujian Province, starting from the period of Dutch occupation in the mid-17th century. By the time most Hakkas arrived in Taiwan, the most fertile of Taiwan’s farmland, particularly in the south, was already occupied by larger populations of well-established Hoklo people. The only option left for most Hakkas was the hills and mountains of northern and central Taiwan.

A number of my Hakka friends have narrated oral histories of long-ago battles between Hoklo and Hakka peoples, explaining that the Hakka preference for mountain and hill living was really the result of having been pushed, by force, out of the lowlands. Ironically, as the Hakkas moved further inland, they in turn displaced, and sometimes assimilated, the aboriginal peoples living the mountain areas they settled in.

There are also significant populations of Hakka peoples in Taidong and Hualian Counties. Most of the Hakka immigrants who settled there arrived too late to settle in the hills of north-central Taiwan, traveling to the East coast looking for other lands to settle.

In Pingdong County’s Liugui and Meinong, there are also high concentrations of Hakka people. These were among the first Hakkas in Taiwan, having arrived as soldiers with Koxinga in 1661.

Finally, there are large groups of ethnically Hakka Taiwanese in the Dongshi area in Taichung County, as well as in surrounding towns and villages.

Politically, Hakkas are known for their support of the nationalist (KMT) party in Taiwan. Most Hakkas will proudly tell you that Sun Yat Sen and Lee Teng-hui are part of a long list of prominent Hakka politicians, and many of today’s politicians, from both sides of the political fence, claim Hakka ethnicity.

In researching this article, I kept coming back to a fundamental question about Hakkas. That is, do they define themselves as Taiwanese or as Hakka? Certainly, there are distinctive cultural characteristics—preferred foods, religious practices, architectural styles, language dialects, social customs, etc.—that are identified with Hakka peoples. When I asked my Hakka friends this question, they invariably told me that they considered themselves both Taiwanese and Hakka. Perhaps one of them explained it best when he said: “I think of myself as Taiwanese, but I’m Hakka first. I grew up speaking Hakka, follow Hakka customs, and tend to think more like a Hakka than a typical Hoklo Taiwanese.”

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Negotiating with the Chinese: Lesson One

You’re sitting across the negotiating table with your Chinese supplier. Your agenda? (1) Lower your cost per unit by 8%, (2) Speed up production time per 40′ container by one week and (3) Get them to accept more favorable payment terms (e.g. 30% down, Net 90 on the balance).

His agenda? To make as much money as possible and (this is very important), to gain as much face as possible. Hence, your request for lower cost per unit, despite quantity increases, isn’t going to go over very well if you ask for it directly. Secondly, your request for increased production speed will reduce his flexibility in scheduling his jobs. Finally, your request for better payment terms means he’s got to pay more in interest on his operating capital.

Note: If you’re Nike, GM, or Wal-mart, none of this applies. If you’re a medium or small enterprise, read on.

If you say something like “We’ve increased our quantity to nearly three times what it was last year, so we’ll need you to cut your costs by 8% per unit,” you’re going to get this response: The boss will furrow his brow, scratch his chin, and say “That will be very difficult” or alternatively, “That is very inconvenient for us.” What that means, in plain English, is…..NO!

The boss will then explain the fact that his own costs have increased over time. Labor, materials, equipment, rent. Everything has gone up. He was thinking about asking you for a price increase! Also, you don’t do things very efficiently. You send POs, then make changes to them. Some of your preferred suppliers are difficult to work with. Etcetera.

Why did you get this response? Perhaps the more cogent question is, how do you get the response you want?

If you’re a typical American, you won’t really like the answer.

You’re going to have to throw yourself at his mercy, and in doing so, appeal to his social obligation to save your face and to his desire to increase his face.

This is why saying to a Chinese supplier “You know, there are several other factories we could work with here?” will only stall and complicate negotiations. You’ll just irritate them by saying this.

So what do you say? You give him the opportunity to help your business as a bona fide partner by saying something like this: “I’m facing serious competitive pressure in my market. You are my partner–without you, I couldn’t get anything done. If I don’t find a way to decrease my costs by 8%, I don’t see how I can stay in business long-term. Please, Mr. Wang, can you take a closer look at your production costs and find a way to lower my cost per unit?” If you can manage to tear up and let your voice shake a bit, even better.

I know it seems counterintuitive for a Westerner to talk like this (it seems like butt-kissing to most of us), but this is what works in China. You aren’t butt-kissing. You are appealing to a very powerful sociological force: The obligation to give face to a customer who has humbled himself before you, and the desire to increase one’s own face by playing the traditional role of the hero. In this case, the damsel in distress is your company.

One of my consulting clients was a company whose boss refused to adapt to local communication styles. He comes from an aristocratic family, and could never understand or countenance the need to humble oneself and ask for help. He treated his Asian suppliers the way he treated his American suppliers: You work for me, so get in line, or else. His Chinese suppliers felt insulted and unappreciated, and after a time, did everything they could to rip him off. I had all ten fingers and all ten toes in the dam, trying to keep the relationship from breaking, but after a few years, it did indeed break. The relationship ended messily, with threats of lawsuits back and forth.

Do you want to do your manufacturing work in China? Then you’d better learn to communicate with the Chinese. You’ll be leaps and bounds ahead of your competition, who are thinking “Culture? Schmulture! A supplier who won’t do what I ask can kiss my red, white, and blue butt!” Meanwhile, you’re getting the unit pricing, delivery schedule, and payment terms you want.

Now, do you want to sell your products in China? I’ll write about that in Lesson Two.

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Building Taiwanese Brands and Offshoring to Asia

I’ve got little time to comment on it, but there was in interesting article in Business Week a few weeks ago about Taiwanese firms who are building their brand names.

Yes, guys, that’s exactly what you ought to be doing, since manufacturing has been moving to China for the past ten years. Sure, a large percentage of the really profitable factories in China are owned by Taiwanese companies, but you’re going to have to emulate South Korea, Japan, and Hong Kong in building global brands if you hope to grow the economy in the future. Right now we’ve got what, Acer, BenQ, Giant bicycle, and a few specialty market brands going? As they say in China and Taiwan, Jia You (General cheer, go for it, etc.).

The magazine issue had a little side bar about how US manufacturers aren’t really profitable anymore. I’d hate to be one of those guys, hate to see what’s happened to them, even though I understand the inevitability of it all.

In my experience, the big manufacturers have already relocated to Asia or sold out to Asian companies. The medium-sized companies have either already moved, are investigating a move, or will soon start investigating a move. It is the little manufacturers in the US, with a few hundred employees, who worry me. Here’s what I think:

Let’s say you’re a US manufacturer with 300 employees. You’re getting killed on price due to imports from overseas. Your business is shrinking. You don’t have the money to a build or strengthen your brand or develop a new product line.

You’ve got two choices.

Choice A: Continue to fight it out in the USA and risk the loss of 300 jobs.

Choice B: Move your factory to China, India, Vietnam, or a SE Asian country and keep 120 jobs (i.e. the engineers, accountants, sales and marketing people, management staff).

Don’t get me wrong. I fully support the growth and development of American businesses. I’m also a pragmatist. If your company is dying, you have to find a way to keep it alive, even if it means losing some people you care about. Hell, I cut myself out of a plum job some years back because the company had a financial crisis and I was the highest paid guy there, after the boss. I landed on my feet, and others will too, especially if they get a little help. If you’ve got the resources, you can help those people get some training or into jobs that have some kind of future. I’d do that if I were the boss, even at the expense of my BMW and eight bedroom home.

If you’re thinking about moving some of your manufacturing work to Asia, drop me a note. I’ll give you some guidance that may just save you a lot of headaches (and money).

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