It is all about the lure of quick-fix technology, new markets and a tyre company in need of a major capital injection to survive in the harsh international environment. The pitfalls should have been obvious, but the need was great and the opportunity seemingly too good to miss. This is a tale about differing expectations, misplaced attitudes and insensitivity to cultural differences and just how they can so easily conspire to snatch failure from the jaws of success.
To protect all of the players involved their names and personalities have been changed.
This salutary tale is all about a (shall we say) Western manufacturer we will call Big Tyre who decides it is time to expand overseas and invest in a country named Shangri-La, where, to its delight, it seems to have found just the right partner. The attractions for Big Tyre were obvious. Very low labour costs compared to the home base, a foothold in a rapidly expanding market and the opportunity for global dominance.
In Shangri-La, the Government is no longer willing to prop up dinosaur companies like local tyre producer Happy Tyre Co., and many like them are now seeking overseas ‘partners’ just to survive. They are all bureaucratic and overstaffed. They are also proud, have a strong sense of nationality and feel very insecure. To Happy Tyre, a deal with a cash-rich foreign partner seems like a worthwhile sacrifice to keep the plant alive and jobs in town. A JV is signed amid much ceremony, and Big Tyre moves in almost immediately.
Change is swift. A Big Tyre management team arrives, and it is quickly decided that the existing managing director should be ‘re-assigned’ to other duties, as he seemed to be resisting important parts of the Big Tyre strategy. Transitional product lines are to be eliminated, and production realigned to the exclusive needs of Big Tyre; long-standing customers will be ‘let go’ if their needs no longer fit the limited production objectives of the new regime.
For the workforce, this is a worrying and confusing time. Who is in authority? Who will approve the order for desperately needed fax paper, floor cleaner or even raw materials, now those once in authority have been stripped of most of their former power? How to overcome the language barrier, or to even approach these new foreigners for permission to do these everyday things?
Big Tyre is oblivious to the gathering storm of ill will towards it and has little idea of the cultural sensitivities being trod upon. The 10-member-strong management team is getting down to sorting out the local management and introducing a raft of new ways to do familiar old tasks. ‘Change plus’ they neatly term it, but change is proving a bit of a one-way street. (Actually, this is not a traffic concept Shangri-La is familiar with, since the traffic volumes in most of its cities have not yet necessitated this form of vehicle management).
The new team is also finding life in this provincial city just, dare we say, a little basic? This has led them to insist on the necessity to relocate each evening to a nearby metropolis blessed with more suitable accommodation of the international kind.
Fortunately however, a fleet of cars has been mustered to perform the necessary transfers each morning and evening to the satisfaction of the new crew. Then there are the weekends. While the work ethic boosted by a few evening beers help in passing the weekdays, Saturdays and Sundays when the gweilos don’t usually work, can prove a bit of a drag. Fortunately, a solution is found.
A short flight away lays a half-amusing resort town where the team soon discovered it could conveniently relocate at really quite modest cost at weekends and other slack periods. Just the solution and absolutely necessary to their well being in this remote corner of Shangri-La.
Of course, the Happy Tyre Co. grapevine is quick to pick up on this as the bills flow in to be processed by increasingly scandalised office clerks. However, the sullen anger of the locals is nothing compared to the increasing frustration of the expats, who see attempts to garner the support of the workforce in achieving essential productivity improvements/headcount reduction, profit improvements were proving inexplicably difficult. Yet another problem lies in explaining the slow pace of ‘progress’ to Big Tyre, for which this is a much-publicised key project in its plans to enhance shareholder value by re-assigning ‘non-core’ production to lower cost locations.
The Big Tyre board views these setbacks very seriously and decides that its Shangri-La team needs to be urgently strengthened with a more delivery-minded task force determined to bring the project back on track. The arrival of this second team charged with ‘kicking ass’ adds fuel to growing local resentment. Furthermore, the much-needed fax paper has still not been ordered. Other sorts of paper are also in short supply, but as this is only used by the ex-pats, no one much cares. The enormity of this particular impending shortage is yet to be revealed to the new masters.
Meanwhile, production continues its downward drift for reasons that are hard for the new team to figure. There is a shortage of containers, certain essential raw materials are slow to arrive and, quite inexplicably, the Friday night rest and relaxation flights are too often overbooked. It is almost as if the wheels of the business are not as well greased as they once were in the good old bad old days.
It is crisis time.
As I said at the start, this tale is based on a true story, the outcome to which I still await with interest. If you have enjoyed it, tell the editor of Rubber Asia how you think it ought to end. I will craft a sequel based on the best (or worst!) of your suggestions.
