As I mentioned previously, I just got back from a trip to China. The trip was a tour sponsored by the business school, so as a part of this we got to visit a variety of companies, both Chinese and multi-national.
One of the most interesting visits was to Lenovo, the Chinese computer manufacturer who recently purchased IBM's PC division. They showed us around their new manufacturing facility, including a completely automated warehouse. The warehouse was stacked several floors up, and had aisles just wide enough to accomodate the tracks the robotic forklifts ran on, as they zipped back and forth to pick up the parts needed to fill orders for computers.
The most interesting part came with the explanation from our guide, that when the warehouse was built, they reduced the number of workers required from 100, to just 5. This is in China, the country that built the Great Wall with cheap labor, and has only added to its reputation since. But for them, the way to compete was still to become more efficient, to do more with less, smarter.
Another company that we visited, which will remain nameless, specialized in outsourcing certain data processing activities to China. They recruited a bunch of college graduates, because they needed people who could speak foreign languages, to sit in front of monitors and type in data all day. One of the managers grumbled to us that their only advantage, cheap labor, was being challenged, because wage rates were going up, and so other companies in lesser developed regions of China. The competition for skilled labor in their city was so great it was pushing up wages.
Even in China, you cannot fool with the laws of supply and demand.
Between which of those two companies will succeed, I will put my money on Lenovo.
“Writing a book is an adventure. To begin with it is a toy and an amusement. Then it becomes a mistress, then it becomes a master, then it becomes a tyrant. The last phase is that just as you are about to be reconciled to your servitude, you kill the monster and fling him to the public.” -Winston Churchill-
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About Me
- James B.
- Chief is a combination software geek from Washington State, aspiring novelist, and retired Chief Warrant Officer from the Army National Guard (thus the clever name). A recipient of a BA in Russian and East European studies and an MBA from the University of Washington, his interests include foreign affairs, economics, politics, technology and languages. Polite inquiries and job offers will be answered at chiefb-at-gmail.com. Check out my writing oriented site at www.jamesfbennett.com.