Agilent: Old Dog Learns New Tricks in Chengdu

Travelling the Silicon RoadCHENGDU, China – Being in the right place at the right time — a cliché, except perhaps in business, where timing and geography can often mean the difference between success and failure.

Especially for a U.S. technology company looking to take advantage of the booming market here.

So when Palo Alto, Calif.-based Agilent Technologies Inc. announced a joint venture (JV) 10 months ago with a fellow test and measurement instrument maker based here, Chengdu Qianfeng Electronics Ltd. Corp., it raised a few eyebrows in the West. Why form this JV now? After all, Agilent, and before that its progenitor company Hewlett-Packard Co., have a long history in China.

HP was one of the first U.S. tech companies courted by China; in 1977 Dave Packard was one of a select group of non-governmental Americans invited to visit China. He returned in 1979 when joint venture talks began. The Hewlett-Packard Representative Office in China began selling HP products in the country in 1981; then China Hewlett-Packard came along in 1985, becoming the first Sino/U.S. high tech JV.

And why choose land-locked Chengdu, in the Sichuan province of central China? Why not a more obvious place, say Shanghai or Beijing?

The decision to form a JV with an indigenous test and measurement company all came down to speed and access to the local Chinese market, according to Agilent and HP veteran Max Yang. Yang is VP and GM of the JV, dubbed, Agilent-Qianfeng Electronic Technologies (Chengdu) Co.; he’s been with Agilent/HP since 1981. Born in mainland China and raised in Taiwan, he lived and worked in the United States for more than 20 years before returning to Asia to work for China Hewlett-Packard.

While the nearly $2.5 billion Chinese electronics industry and consequently the whole supply chain is booming, the primary value that China brings to the global industry is low cost manufacturing. Thus one of the principal demands of the Chinese electronics manufacturer – as well as those in other parts of Asia – and consequently one of the principal drivers of the test and measurement market here, has been cost effectiveness.

“Low-cost solutions are critical to the Chinese market; that is what they [are] needed locally,” Yang observed. “The areas we’re focused on here are things like inspection and maintenance, education and bench repair.” But Agilent historically has concentrated more on lucrative high-end markets in test and measurement, such as high-speed oscilloscopes.

Yang is quick to note that low cost doesn’t mean low quality, an issue that Agilent is obviously sensitive too, setting up manufacturing in China. “In my mind, the quality has to be of Agilent standard or even better,” he said. Low quality means a high failure rate, and that means rising manufacturing costs – “the customer has to see our Chinese product as good or better.”

So all these things indicate the necessity to establish a local Chinese production facility, one that could serve the needs of the local Chinese market, but other parts of Asia as well, such as South Korean and Taiwan.

But building from scratch would take two to three years, and Agilent, once it decided it needed local production capacity, wanted to act quickly. Indeed, in terms of the rapidly developing electronics market here – the forecast annual growth rate for China’s electronics industry is around 16 percent for the next three years — two or three years is an epochal period of time.

So going the JV route was an obvious choice. “The whole purpose was speed,” Yang said. As for its choice of partner and location, one of the principal drivers in the Chinese domestic electronics market is telecoms and RF applications, and that’s not likely to change soon. This is a country where half of the 1.3 billion population doesn’t have access to a phone, either land-line or mobile, and the central government plans to continue rapidly expanding the country’s communications infrastructure.

Qianfeng, a privately owned Chinese test and measurement company that has been around for nearly as long as Agilent/HP, happens to make communications test equipment. After researching the market players in China, there were two or three good candidates for a JV partner, but Qianfeng was an obvious choice, Yang said.

The fact that it is not a state-owned company was an important aspect. “Our experience is, it’s very hard to cooperate with state-owned companies,” he explained. There is a level of bureaucracy involved in state-owned corporations that one doesn’t find in privately owned companies, which can get things done more quickly and efficiently.

Chengdu: A Well-Kept High-Tech Secret

As for Chengdu, why put your electronics manufacturing business in a land-locked city in central China? This capital of Sichuan province is more likely to evoke thoughts of wonderfully spice cuisine in the Western visitor’s mind, rather than the high-tech lust inspired by the gleaming new towers of Shanghai, or the blossoming special economic zone of Shenzhen.

For one thing, it is one of many other growing technology/manufacturing centers outside of Shanghai, like Xiamen or Xi’an. Much like Portland, Ore., or Austin have become alternatives in the United States to Silicon Valley, places like Chengdu offer many of the benefits without some of the problems of Shanghai.

In the past the Chinese central government, with a nod to national defense, put key technology areas well inland, where they could not be easily attacked; Chengdu was home at one time to China’s national aerospace efforts; much of the electronics industry here today can be traced to those roots.

As for the Agilent JV, Qianfeng has substantial facilities in Chengdu, as well as a pretty good RF team, Yang explained.

“As a side benefit, it’s a very cost effective location,” Yang said, noting that housing costs are about 30 percent of what they are in Beijing and Shanghai. And because there are fewer large multinational firms here, it is easier to retain talent.

A lot of that talent comes out of the University of Electronic Science and Technology of China (UESTC), which traces its roots back to the creation of the Chengdu Institute of Radio Engineering in 1956, the first electrical engineering college in China. Today a multidisciplinary university and still one of the top electrical engineering schools in China, it graduates several thousand EE undergrads a year, a thousand or more graduate students, and a few hundred PhDs.

In the past, graduates of UESTC often had to go elsewhere in China to find jobs. “Our experience in the last few months has been that we’ve attracted a lot of good engineers, experienced engineers, because they want to come home,” Yang noted. “I don’t think we have a concern … about sourcing the talent locally.”

Employee retention isn’t a big issue either, as there aren’t many multinational companies competing for engineering talent here. As Agilent-Qianfeng closes in on its first year of operation it currently employs nearly 170 employees – some 60 dedicated to R&D – and the attrition rate has been near zero for the company, Yang said.

But there are other high-tech concerns to be found in Chengdu though; Qianfeng is hardly isolated. There is a lot of semiconductor packaging business in Chengdu. In fact Intel Corp. recently built a huge packaging factory here, and Chinese foundry Semiconductor Manufacturing International Co. plans to build a packaging foundry here, as well. Another U.S. tech company with an early presence in China, Motorola Inc., has facilities in the city.

There are drawbacks to being located in this inland city of some 4.1 million people. Far from a major port, the city does have a river running through it, but it doesn’t serve as an artery for shipping traffic.

For an electronics company that sells a lot of low-cost consumer electronics that depends on high-volume sales, the transportation infrastructure would be an issue, Yang conceded. But for an instrument maker like Agilent-Qianfeng, it’s not a significant issue. In fact, being a smaller, inland city, the English language skills of the workforce are not what one would find in Shanghai or Beijing, he noted, and being a multinational in China, having a multilingual workforce is essential.

Like many Chinese cities, the government here is working hard to court high-tech industry. Yang came back to Asia in 1985 to serve as HP’s controller and administration manager, responsible for the negotiation and formation of China Hewlett-Packard.

Electronic News Travels to China“The difference between now and then is unbelievable,” Yang said. “The difference in attitude is day and night.” Twenty years ago, getting a business license meant jumping through a series of bureaucratic government hoops, a process that took more than a year and half, he recalled. Agilent and Qianfeng inked their agreement in November of last year; they had their business license by the end of January, when they officially launched the joint venture.

By the time the company will be celebrating its year anniversary at the end of next January, it should be readying the launch of its first test and measurement instrument specifically geared for the Chinese market.

Editor’s Note: As explained at length elsewhere on this site, this is a news story written by me that originally appeared on the now-defunct Electronic News’ website, which is long gone. It’s former sister pub Electronic Design News (EDN) currently holds the copyright to all Electronic News copy (to the best of my knowledge). You can still see a copy of this story at EDN.

Grasping at Straws … er, Spicy Noodles

Travelling the Silicon RoadCHENGDU, China — It is with a somewhat heavy heart — and a very depressed palate — that I find myself in the Chengdu airport waiting to catch a flight to Shenzhen.

There are a number of reasons for this; I’m acutely aware that my trip is more than three-quarters over; in less than a week I’ll be back in the States. And yet I feel like I’ve only just begun to scratch the surface of China, much less gain an acute understanding.

Not that I expected to develop an innate understanding of an ancient culture in a matter of weeks, but I feel like I’ve only just begun my task, and soon it will be over — but not finished.

Plus, I’ve had to say goodbye to Zhike, my interpreter, who has been an invaluable asset these past three weeks — not to mention a new but nevertheless trusted and valued friend. I would not have guessed that I could grow so fond of someone that is twelve years younger than me and from a different culture so quickly.

I find myself not really wanting to leave Chengdu, either. Its food has been fantastic, some of the best I’ve eaten ever; I could happily eat genuine Sichuan food once a day for the rest of my life. Plus the women here in Chengdu seem to be nearly as spicy as the food. Maybe too spicy, says Zhike, both about the food and the girls, but on that score I have to disagree with my new-found friend.

But beyond the spice the Sichuan lifestyle seems more in tune with my own lifestyle — Xiamen tugged at my heart strings, and Beijing stimulated my mind, and I firmly believe that home is wherever I put my head down at night. But Chengdu almost feels like it could indeed be home for awhile.

I think this also has to do with the fact that after three weeks straight of business class hotels, cabs and conference rooms, interviews and airplanes, we actually got out in the countryside this past weekend, and I saw aspects of China that many Western business travels don’t see. You’ll read more about that later on, I promise.

But the green mountains outside Chengdu reminded me of my new home in West Virginia, and it didn ‘ make me homesick, exactly — part of me really would like to remain here in China for awhile — but it reminded me just how tired I am of business travel and hotels, and all the attendant hassle. Someday I will return here for a month, maybe longer, perhaps, with nothing but time and a backpack.

Most important of all though, I find myself with mixed emotions because I feel like I’m getting close to understanding something important about Chinese culture, but I’m not sure yet what that quite is. I’ve gone from thinking Chinese culture is really different, to thinking that’s it’s not that different, to realizing that below the surface it is very different from my own culture. And I feel like I’m getting close to being able to grasp that difference and understand it, but I haven’t got there yet.

And I’m not talking about the mundane differences, like the way traffic works here or what there is too eat, or the status of China’s economic and technological development. I guess I’m talking about what makes me a Westerner, specifically American, and what makes the Chinese … well, Chinese. Of course if I could articulate what I’m trying to grasp, I would have grasped it.

It suddenly strikes me that these words sound familiar.

Electronic News Travels to ChinaAnyway, I had a long talk with Zhike today, about why certain things are the way they are in China — not because I’m annoyed that they aren’t like in the States, or any silly thing like that, but because I feel like there’s something I’m missing, something I can’t understand, and I’m not sure what it is yet. I fear that I’ll be on a plane back to the States before I can grasp that epiphany.

Ah well, my plane is boarding soon. The mundane duties of life intrude. …

Jeff

P.S. Actually, the data function on my cell phone’s smart card wasn’t working for some reason when I was at the Chengdu airport earlier, so this was technically filed from Shenzhen at 2 a.m. the next day, but that’s neither here nor there.

Editor’s Note: As explained at length elsewhere on this site, this is a blog entry of mine that originally appeared on the now-defunct Electronic News’ website, which is long gone. While its former sister pub Electronic Design News (EDN) currently holds the copyright to all Electronic News copy (to the best of my knowledge), as far as I know, this blog content isn’t hosted anywhere else on the Internet, hence my reproduction here.

Original Comments

at 10/31/2005 12:02:21 PM, yours truly, reader said:

I found you are a passionate person. When I read your article, tear running in my eyes. I am not sure why I got that feeling..

at 11/1/2005 1:51:13 PM, Sonia Harrison said:

Jeff, I have to say that I’ve really enjoyed reading your Blog the last few weeks. Thanks for letting me visit China with you–even if only through your stories.

at 11/1/2005 3:31:45 PM, Jim H. said:

It’s been fun reading about your journey, both geographically and mentally. I see parallels to my experience with marrying into a Chinese family after growing up in a typical midwestern family. I too went from thinking that they were really different from us, to thinking that they are the same but just talk a different language, to realizing that there are some differences that I will never comprehend and there are things that they will never comprehend about me.

One difference I see is the American desire to be self-sufficient, to be able to repair things oneself, to be able to take care of oneself, to even survive in the wild if one needed to (our recreation of camping). The Chinese see a virtue in relying on ones family and reciprocating by helping ones family. The first is useful if you are in a frontier environment (which we no longer are), the latter is useful if you are in a fully settled country of a billion people.

The Chinese also cannot comprehend why anyone would ever want to be alone, and I cannot comprehend why they always want to be in large noisy groups. Of course these are generalizations, not all Americans or Chinese fit these stereotypes. I will be interested to see what you come up with.

at 11/1/2005 4:45:32 PM, Jane said:

Shenzhen is a very young city. The average age of the population is only 27. A lovely place you sure will have a good time there.

at 11/3/2005 10:23:44 PM, Jeff Chappell said: Thank you all for the kind comments. Jim H: you are dead-on in that observation about self-sufficiency. This is the only place I’ve been where people seemed shocked and bewildered that I would want to carry my own luggage. I didn’t understand why at first. … It was a foreign concept for Zhike and other new friends that if I needed or wanted help, I would ask for it; otherwise I did not want it or need it — that I appreciated the show of respect and friendship, but was quite capable of managing on my own.

I fear I’ve inadvertently insulted hotel bell staff from one end of China to the other. And I confess, as much as I have truly loved China, I think I’m ready for some quiet solitude in the middle of nowhere 🙂

at 11/4/2005 2:10:38 PM, Bill in Mpls said:

Having spent a very short time in Korea, I also searched for some way to explain differences in culture from my own. I see in the Koreans a sense of ethnicity over nationality which is almost opposite of our upbringing. Their history (their “people’s” history) – what they all have in common – goes so far back beyond whatever the current government is that they identify more with their family and neighbors than any larger-scale institution. Our history in the U.S. is focused on what we have in common – our government, local, and national institutions. We don’t have a common ethnicity or history with most of our neighbors. Thanks for the blog.

Startup Vies for Opto Market with Homegrown IP

Travelling the Silicon RoadXIAMEN, China – Startups and entrepreneurs are popping up all over China and this southern coastal city, which is also a center of the optoelectronics industry in China, is no exception.

Chinese optoelectronics has a bit of a head start over its silicon semiconductor device industry; one of Xiamen’s opto device companies was founded more than two decades ago. But then it also plays host to Xiamen UX High-Speed IC Co. Ltd.

UX was founded less than three years ago by a handful of engineers, including Chinese — one of them local — as well as a couple of natives form the United States and Canada. They put in some time at familiar names: Cypress, ON Semi, Epson and Texas Instruments.

It is somewhat familiar story by now in China: UX’s founders felt they had learned all they could learn abroad in business, so they returned to China to start the company because the time seemed ripe, according to company president and Chinese native Xu Ping, who put in six years in Silicon Valley himself before returning to China.

He espoused the same logic many do here: China’s chip market is booming, in part because of domestic demand and in part because of the government’s encouragement to develop a semiconductor manufacturing base. Even if China’s domestic chip production capacity grows exponentially, it will be decades before that capacity comes anywhere close to fulfilling the domestic consumption.

“It does need a lot of technology and people,” Xu remarked of his native country. “Right now, most Chinese companies can only do simple chip designs,” he continued. “We feel like we have more growing room in China. After two-and-a-half years, we feel we can continue to do well.”

Xu estimates that to start UX, which now has a team of 18 people, most of whom are dedicated to R&D, the start up cost in China was about one-fifth to one-tenth of what it would have been in the United States.

The company right now is looking for second-round funding; like many startups here, it is looking to foreign venture capital (VC), namely that in the United States, to find it. While UX enjoys support from the local Xiamen government, and just closed the terms on a low-rate loan, the domestic Chinese VC scene is still nascent, that’s why so many companies like UX seek out foreign VC firms.

As for products, UX right now concentrates on high-end mixed-signal/RF IC chips, transceiver chips for front-tend fiber optic network communications applications, such as transimpedance amplifier, limiting amplifier and laser diode driver chips. Like many startups in China, the company is concentrating on high-end applications, where it has a chance of capturing some market share, rather than the crowded market for high-volume, low-end applications, such as consumer — a particularly crowded domestic market in China right now.

While the company originally set out to develop 10gigabit per second (Gbps) chips, it decided to focus in the short-term on the mainstream market for fiber communications, meaning 155megabit per second (Mbps) chips. It already is in production with IBM/Chartered Semi as its foundry partner with two 155Mbps chips, which it has begun selling, garnering interest outside of China as well, Xu said. The market for 1.5Gbps and 2Gbps is also developing rapidly, he noted.

Xu suggested that his company has an advantage over its competitors, in that while many of them are moving their fiber module manufacturing to China, most of their chips are still being exported out of China. As a domestic fabless company whose foundry partner is in nearby Singapore, and whose chips are packaged by a backend company here in China, UX is poised to grab market share in China, and in the future go head to head with its competitors beyond the country’s borders.

He noted that one of the chips that it has in production right now, a 155Mbps laser driver, can attain speeds up to 311Mbps, and is manufactured with standard low-cost CMOS, rather than BiCMOS or bi-polar technology, more commonly found in optoelectronic apps.

But the company is nevertheless still pursuing advanced technology and its own intellectual property (IP), according to Xu. It has developed and produced chips with 0.13-micron designs, as well as silicon germanium (SiGe) BiCMOS technology, in addition to standard CMOS.

“We’re one of the first companies to use SiGe in a BiCMOS process,” Xu noted. UX has also garnered two patents concerning indium phosphide technology, and has two other patents in the final stages of examination, while it has applied for three additional ones.

He agreed that developing domestic IP is an important issue for China right now. With so many engineers coming back to China, and so many other positive factors in place to foster startups, there is no real reason why China can’t foster its own IP, Xu suggested.

Electronic News Travels to China“I think in China, at least some of these [new] companies should have their own IP,” he said. “I think it’s important to come up with a good product.” Up until recently, China has relied mostly on modifying designs from foreign companies for the domestic market, meaning much of the profit leaves China; this has been one of the significant barriers to IP development in China, he acknowledged.

“First you have to have the people, and then you have to have the technology. If you don’t have these, you won’t get money,” he continued, either in the form of profit or investment capital. “Right now, the engineers are the most important things.”

Editor’s Note: As explained at length elsewhere on this site, this is a news story written by me that originally appeared on the now-defunct Electronic News’ website, which is long gone. It’s former sister pub Electronic Design News (EDN) currently holds the copyright to all Electronic News copy (to the best of my knowledge). You can still see a copy of this story at EDN.

The Old Journalist and the Sea

Travelling the Silicon RoadXIAMEN, China — One thing always happens to me on every extensive trip — and sometimes the quick ones — to places I haven’t been before: I find some spot to which I’m instantly ready to move.

On this month-long trip, that moment, the first one, anyway, came in Xiamen.

Now if there is one thing I’ve learned about traveling and moving relatively frequently, being a somewhat restless soul, it’s that falling in love with people and places share the same pitfalls — and I’ve been known to fall at the drop of a hat. Just because you fall in love with a person/place initially, the relationship may not have what it takes to keep you happy in the long term. Just because you had fun on vacation, or the place you arrive at/person you meet is unexpectedly charming and beautiful, doesn’t mean you will like living there/with them.

Sedona, Ariz., taught me that, in more ways that one. But that’s another two or three stories for some other time.

Xiamen, in its own way, is just as Chinese as the other cities I’ve been to so far: Beijing, Shenyang and Shanghai. It has an important place in Chinese history, plays a current role in its nascent technology industry, has a thriving university culture, and was a key part of its Western colonial era. Like seemingly every other urban area in China, there is a ridiculous amount of construction, and traffic scares the living bejesus out of me.

And yet Xiamen is something different. It’s China, yes, but it certainly doesn’t fit the stereotype.

I could say that about the other three cities I’ve been too in China, of course. But Xiamen really is not what Westerners frequently associate with China, at least not the ones I know, and as such, is a pleasant surprise. This coastal island city that sits across from Taiwan, amidst other surrounding islands, at first glance reminds one of either Southern California or South Florida, or perhaps the Gulf Coast of the United States.

There are the palm trees and the sand, the balmy near-tropical climate (welcome after Shenyang’s chilly autumn days), and clean air (welcome after Beijing’s and Shanghai’s dreadful smog). And then there are the fishing boats and seaside shops — not only can you pick your own lobster here, but your own crab, fish, shrimp and sea life that I couldn’t begin to identify. Then there are all manner of places designed to separate cash from tourists, from upscale, trendy clothiers to vendors of cheap flashy trinkets, and all of them seemingly inundated with trendy, well-dressed hipster kids.

And my interpreter and I agree; Xiamen girls seem to be the prettiest of our travels so far in China. All afternoon I kept singing that annoying Beach Boys tune in my head, only I would change the words to “Wish they all could be Xiamen, China girls … ”

The Great American Novel Awaits on Gulangyu Islet

But really I think Xiamen is more akin to the south of France, perhaps, or somewhere else on the Mediterranean, given the European architecture scattered throughout the city, particularly the closer one gets to the water.

In fact, there is a neighboring island, Gulangyu Islet, that seems more akin to some South Pacific volcanic island, or perhaps the Caribbean, rather than coastal mainland China; it’s narrow, windy streets (cars are apparently not allowed and certainly not needed) and historical architecture reflect the many European powers that made attempts to colonize this port city in the past — some successful, some not.

And in temperament, Xiamen definitely seems to be more laid back; the pace of life is slower here. Rush hour traffic is nothing like Shanghai or Beijing, but then it’s a small Chinese city, if indeed it can be said there is such a thing, with only 1.24 million people here.

Particularly on Gulangyu Islet, life is lived at a leisurely, island pace.

Even though the sea to the south is clogged with cargo and tanker traffic — there is an oil refinery on a nearby island — on Gulangyu, musicians play traditional instruments in public squares, their instrument cases open for the yuan of appreciative passersby. Since there are no automobiles here, everything from garbage to construction supplies to the day’s catch is hauled in big wheelbarrows around the island. Tourists stroll the narrow boulevards, and the shop keepers hawk their wares, and the three island policemen tool around in electric carts.

Everywhere you look is colonial-era architecture, some of it well maintained, others crumbling with age. These buildings are interspersed with new ones that sometimes mesh well with the old neighborhoods around them, such as the Xiamen University college dedicated to the arts, and some new apartment buildings that hopelessly clash with their older and more dignified neighbors.

Stairs climb through thickets of bamboo and around ancient trees, winding through hillside neighborhoods that must surely once have housed colonial administrators. From some vantage points on the island you can see the skyscrapers of Xiamen, about half a kilometer from Gulangyu. And yet when you are on this little islet they might as well be miles and years away — you can just smell the history here, mingled with the odors of cooking seafood, sea breezes and the fragrance of tropical fauna.

It is here that I could see setting down for awhile, enjoying a slow-paced, island lifestyle. The crumbling old European buildings call to a hopeless romantic like myself; it would be easy on Gulangyu to pick up where Hemingway left off, typing away in some dusty old room, while ocean sea breezes flutter the curtains at the open window, where the cries of the island’s elementary school children can be heard, mingled with the occasional foghorn.

Electronic News Travels to ChinaPerhaps someday my travels will bring me back to Gulangyu; perhaps I will take a job as a correspondent in China, and I’ll be able to settle here for awhile, until I grow restless once more.

But in the meantime, alas, I’m ensconced on the sixth floor of the generic, hygienic Crowne Plaza hotel, and tomorrow I will not be contemplating the themes of man vs. man or man and nature for a forthcoming novel, but meeting with members of China’s optoelectronics industry.

What the hell, I never really liked Hemingway anyway.

Editor’s Note: As explained at length elsewhere on this site, this is a blog entry of mine that originally appeared on the now-defunct Electronic News’ website, which is long gone. While its former sister pub Electronic Design News (EDN) currently holds the copyright to all Electronic News copy (to the best of my knowledge), as far as I know, this blog content isn’t hosted anywhere else on the Internet, hence my reproduction here.

Original Comments

at 10/25/2005 7:18:07 AM, Paul said:

Something for you to contemplate as you admire the old houses on Gulangyu; Until the Cultural Revolution most of those beautiful old builds were single family homes. Sadly, during the revolution they were carved up into 3 meter square family apartments. In this case the beauty truly is only skin deep, as the insides of these building now are mostly a mess.

at 10/25/2005 1:25:23 PM, Bob said: And just when I was looking for the idyllic place to settle down. Perhaps I’ll have to go and see but one day the missiles flying over-head to and fro Taiwan might upset this tranquil picture you paint.

at 10/25/2005 10:45:23 PM, Jeff Chappell said:

Despite the public political bluster and military bravado, I honestly think the Chinese are much too practical to get into an armed conflict with Taiwan; the island is quickly becoming an economic ally, and Chinese government officials look at its rapid development as a model for China. In fact, the recently retired leader of the Kuomintang government in Taiwan was just here in China on a state visit — he was touring the Forbidden City in Shenyang at the same time we were, a week before last.

at 10/25/2005 10:51:10 PM, Jeff Chappell said:

As for what happened to the houses on Gulangyu during the Cultural Revolution, yes, it is indeed a shame. But then it is an important aspect of history, if not a happy one. And it’s no justification, but “progress” is often the fate of many old and beautiful buildings everywhere, not just China; such is life. But then the real attraction for me to this islet is its geography, climate and its people and their culture — and the seafood — not the buildings.

at 10/26/2005 11:21:17 AM, Goose Hosage said: Jeff, road warriors such as yourself need to get more sleep. When you find yourself rambling with multiple paragraphs regarding a topic, which in fact should have been covered in a few sentences, readers really begin to wonder. “Wildly Inarticulate Ponderinngs of The Jet Lagged” perhaps would have been a better title.

at 10/27/2005 4:24:40 AM, Jeff Chappell said: LOL, Goose, dude … it’s a blog, not my entry for this year’s Pulitzer. Get over it. And I’ve said it before, and I’ll say it again: folks, what’s with the dis’n me, as the kids say, and not putting your real name to it? C’mon … if I’m not afraid to put my raw and un-copyedited emotional ponderings out there for all the world to see, at least have the decency to use your real name. I do, after all. And it’s not like I’m going to hunt you down or anything. I’ll just laugh and say at least I can spell “pondering.” Of course, if your name really is Goose Hosage, I look pretty stupid right about now. 😉

at 10/29/2005 11:57:28 PM, fred in seattle said:

everyone is a critic…too bad most dont have anything positive to say. Jeff, Thank you for your insight into a city I love. Maybe others with narrow views will stay at home and watch the latest reality show with their microwave dinners as we travel the world…zaijian

at 10/30/2005 11:02:20 PM, Jon said: Hi. I’m an American who has been living in Xiamen for three years and am now married with a 2 year old. This is a great place to live! And my wife and I are going to set up tours and give relocation help to people who want to come here. My life has progressed in every aspect in the 3 years here on this comfortable island in China than the last 30 years in the States. Welcome to Xiamen! jon@jonruby.com

TI China Engineers Straddle Two Different Cultures (part 1)

Travelling the Silicon RoadSHANGHAI – Editor’s Note: At the behest of Texas Instruments Corp.’s Jeff Smith, deputy director of Asia Semiconductor Communications, as well as worldwide manager for analog media/analyst relations, four TI China engineers sat down with Electronic News Senior Editor Jeff Chappell to talk for an afternoon, but not about TI or its latest products. Rather, they discussed the experience of being an engineer and working for a U.S.-based, global company doing business in China.

The four engineers — three of them Chinese — are a microcosm of what you find in a large foreign tech company doing business here. One, Tan Hui, has only been out of graduate school six years, and has worked for TI in China since graduation. He is currently a member of the technical staff and an application manager in the industrial and home appliance semiconductor group here.

Another, Michael Wang, grew up in a city not far from Shanghai, and is currently a system engineering manager in the portable power management semiconductor group here. While he has worked for TI for several years, he came back to China a year ago after spending two years at TI headquarters in Dallas.

Eric Braddom is director of DLP products for TI’s Asia semiconductor group. A U.S native, he has spent the last two years in Beijing with TI; prior to that he was with the company and also stationed in Dallas.

The fourth member of the group was Yu Zhen Yu, a senior member of the tech staff and director of the industrial and home appliance group and China application and development center in TI’s semiconductor group here in Shanghai. He came back to China two and a half years ago after living some 14 years in the United States; prior that he was based in Houston, Texas.

During the afternoon, the four provided insights that can only come from living and working in China, and in some cases only having been a native who has lived abroad and come back. The following are excerpts from the conversation.

Chappell: First off, tell me what is it like working for a large American chip company here in Shanghai?

Tan: I have no experience working with a domestic company, but one big difference I’ve noticed, since I started with the company in technical support … I think working for a large international company enhances our ability with teamwork. If you want to be successful, you have to have technical expertise, but it’s not the only thing. You need a team, a system to support you. TI has done a good job along these lines. I’ve talked with friends I went to school with who work for domestic companies, and they say it’s not like that. Domestic engineers concentrate on their own work. It’s a big difference.

Braddom: It’s definitely a challenge working with and managing Chinese employees also. They have many strengths and are very strong technically, but cooperation is often a weakness. In the U.S. we’re taught early, we’re forced to do things as a team. That is a management challenge. Chinese students just haven’t had that [teamwork] experience.

Wang: China produces more engineering graduates than the United States or Germany, but the pool accessible to a large international company like TI is relatively very small. They are often not qualified because of one, language, and two, teamwork. Language is a big thing, I think. Just look at the way I work in TI — we have almost daily contact with the mother team back in the United States, and knowing English is essential.

Chappell: What’s the converse? What’s it like for the large American company to come here?

Braddom: One thing about the Chinese workforce, is it produces a real good chance to have diversity. China is a very diverse country, and it’s really nice to have engineers that can converse with customers in their own local dialects. Furthermore, in China I get a lot of strong resumes from women. I’d say about half of our staff are women; in the U.S. it would be a much lower number. There are many opportunities to achieve diversity in China, from a management perspective. I’m not sure it’s valued by everyone, but it’s a good opportunity for us.

Yu: One big problem, however, for Western companies doing business here is motivation of local, native employees. There is often a historical and cultural gap between them and management, who tend to be expatriates, or from Hong Kong and Taiwan. Often employees come to work here or at other large international companies to get exposure, but after a couple of years they get fed up and leave. They don’t have the same feeling the U.S. and European employees have with regard to how they feel about the company.

Braddom: I’ve found that some Chinese employees though do respond to Western style management — it’s an opportunity to achieve that closeness on the staff.

Yu: I think the problem is that companies fall into the same cycle; there are so many managers that are not local — they miss the opportunity to groom local employees for management and leadership positions.

Braddom: Teamwork is not taught in schools here, but there is a strong focus on family and relationships. Even on my team, some of the employees use the [familiar Chinese titles] of older sister or younger brother. Then there is the concept of face. It’s kind of like a bank account. I’ve seen it both demonstrated and used in business here, and it can be quite effective. It really does exist and it’s important to understand. Companies here are just now learning the concepts behind intellectual property laws and merger laws. They recognize that it is important if China is going to do business globally. But it’s more important to have the relationships in place when dealing with Chinese people in business, not just the signed legal documents. You have to know the concept of guan xi.

Yu: That’s very true. After 14 years in the U.S., it is something I had to adjust to again. In the U.S., if you dealt with a colleague and had met each other’s business needs, you were done. But here in China, it’s much more than that. Sometimes, even though you both realize that it’s not a personal relationship, you have to make it feel like a personal relationship.

Braddom: It’s really nothing more different than realizing that people have personal and professional objectives, and can use your help to achieve them. It’s not just going out do dinner together or having drinks together, it’s actually helping one another.

Wang: In my mind, though, I would like to emphasize that compared to other Asian countries, China and the U.S. are not all that dissimilar. Taiwan and China are much more open to Western culture.

Yu: That’s very true. We’re much more open to Western ways of doing business and Western ways of thinking.

Tan: You have to remember, when an Eastern businessman looks at a business deal or opportunity, he sees that there are always reasons for and against it. That’s why the relationship beyond the deal is so important.

Electronic News Travels to ChinaYu: People do emphasize relationships a lot. Let’s say you are trying to gain 10 different customers, in the end, it’s the ones that really benefit from what you have to offer that become successful. And that’s when, in turn, the relationship becomes stronger. But fundamentally, you do have to bring value to the table. It’s not just guan xi.

Wang: I think this idea that relationships are so important originates from dealing with the government. I don’t always see it at my level.

Braddom: For my part, I’ve have seen it used it myself.

Return to Traveling the Silicon Road tomorrow for the second part of this article.

Editor’s Note: As explained at length elsewhere on this site, this is a news story written by me that originally appeared on the now-defunct Electronic News’ website, which is long gone. It’s former sister pub Electronic Design News (EDN) currently holds the copyright to all Electronic News copy (to the best of my knowledge). You can still see a copy of this story at EDN.