CHINA TRIP Day 22: Sustainability's the word.

Tuesday, June 8

We were visiting our first foreign company in Shanghai today, Geberit Plumbing Technology. I thought this visit would be interesting because although their profile says they’ve contributed significantly to the growth of the Chinese sanitation industry, we’ve seen and experienced things that would undermine their claim. While so far our experience with plumbing in Shanghai has far surpassed Beijing’s, I’m still a little disappointed in Geberit’s claim to providing innovative solutions. From the presentation, it seemed as though rather than finding ways of working on the plumbing and sanitation systems that already exist and working with the government on improving those systems throughout China, Geberit seems to be focusing on the systems being implemented in new buildings and projects. They mentioned working with various developers, such as real estate firm Vanke, to install their “strong brand” plumbing technology but I wished that their technology could be installed in other places such as Beijing, where you can’t even flush toilet paper down the toilets.

I did appreciate Geberit’s honesty about the challenges they face. After visiting with a law firm in Beijing and experiencing the counterfeit market ourselves, I wasn’t surprised when Geberit mentioned people as one of their challenges. They pride themselves on being “innovative” but with aggressive competitors who can easily steal technology because of the lack of law and order to protect intellectual property. I was actually impressed with how Geberit handles its partnerships and the ethical problems that arise when working in China. As unfortunate as it is, the “partner today, competitor tomorrow” motto that Geberit essentially adopts is probably a good one for all firms in China to abide by. I think it’s unfortunate that the corporate system in China is based on who you know but not necessarily who you trust. In a country where ethical business is a new concept, a company trying to be ethical, such as Geberit, would need to be suspicious of both its partners and its competitors. It’s unfortunate, but it can’t be helped until the government takes a more active and ethical stand on business. I thought we might see more of this development in Shanghai, especially with the Expo, but our speaker at Geberit only reinforced my doubts with their story of how many merchants just hide illegal DVDs in a back room so their stores appear to have only legal items in the front.

I liked our following corporate visit to Haworth as well, mainly because we really had a feel for the company as a whole. We visited the factory, talked to the managers at the factory branch, and got to visit the headquarters as well. Sitting in the meeting room and listening to the managers talk about Haworth gave me a sense of how unique Haworth was, at least compared to most of our corporate visits so far. When I thought about it, all they really produce are tables, chairs, and storage-related products, yet the chairs we were sitting in and the table in front of us were more than just pieces of office furniture. The factory tour they gave us afterward reinforced my thoughts. The office and the factory screamed that Haworth was all about “sustainability.” There were banners hanging behind the front desk, over the entryway into the factory, and hanging from the ceilings throughout the factory as well. It was good to know their products weren’t just nice to look at, but that they followed through on their philosophy of “designing for the environment.” It was interesting to see their manufacturing process and see the boxes of items being shipped all over the world. They did say their products were fairly expensive, and with the research that goes into maximizing function and comfort as well as sustainable, I wasn’t surprised. However, after walking through the factory I couldn’t help but think that they probably earned a very large profit off their sales since they were using Chinese labor.

The visit afterward to the Headquarters did change my thinking a little. I didn’t really think that Shanghai would become such an international hotspot for businesses. I knew Hong Kong for the most part had been, and still mostly is, the location for Asia-Pacific offices, especially while China was still in the process of opening up economically. However, I was intrigued by our speaker’s explanation of Haworth’s decision to move its Asia-Pacific headquarters from Hong Kong to Shanghai and expand operations to make it the regional headquarters for Latin America and the Middle East as well. I find it very ambitious that they are running operations in Latin America from Shanghai instead of somewhere closer. That doesn’t mean they’re necessarily opening more factories, because they did say that they try to be very mindful of capacity. It’s easy to expand when business is doing well and the economy is flourishing but the true test is how well a company can use up its capacity when the economy takes a downturn.

Similar to our visit to Geberit, the topic of innovation and ethical business practices popped up. Whereas the opportunities for sanitary solutions are abundant in China, I’m not sure how long Haworth will be able to sustain its business of making tables and chairs even with constant innovation. People generally don’t replace their tables and chairs as long as they function properly, and Haworth’s innovative designs make their products comfortable and long lasting. I wondered how they stay on top of the market, especially when there is a clear lack of ethics among their competitors. It would be difficult for Haworth since its products are on the pricier side, but their strategy of emphasizing quality and sustainability made sense to me and I could appreciate it.

We headed to I <3 Shanghai later that night. There were quite a few reviews online and it was Ladies' Night. I basically spent forty minutes looking at a map and following street signs since we didn't exactly know our way around nor did we really know what exit to take out of the subway. It was a learning experience, except we knew we wouldn't come back. It was cute but it was out of the way, there was nothing else open, and it was like a house party full of foreigners :P.