Western companies can learn in China

SHANGHAI -- I was just reading remarks by Phil Martens, president of Light Vehicle Systems at ArvinMeritor Inc., at the Management Briefing Seminars this month in Michigan.

He praised the ability of Chinese companies to complete things - new plants, new contracts, new products - faster and less expensively than in the West. He urged companies in the West to set aside their existing development models and learn from the Chinese.

For example, Martens said building a light-vehicle assembly plant in China takes six months or less, compared with 18 months in the West - and at a quarter of the cost.

"We need to use as our models the other industries that have already embraced Asian practices, such as retail, electronics, durable goods and consumer products," he said. "We can't look at the traditional automotive industry as our model anymore."

Martens doesn't mean the West should learn from the Chinese habit of cutting corners to save time and money. But that also is an ingrained part of Chinese society. Mattel can tell you about that. It is recalling 1.5 million toys because a contract manufacturer in China used an unapproved paint with lead in it.

Or take bridge collapses in China. One just fell in Hunan province, and it is not the first. Collapses have been caused by poor-quality materials purchased by subcontractors to save money.

Yes, companies in the West can learn from the Chinese example. Engineering changes here take a fraction of the time they do in more developed markets. That's good.

But be aware that if a low price seems almost too good to be true, it probably is.

As old China hand Dan Collins, Asia Pacific sales director at wiper systems producer Trico Products, says: Be careful how Chinese companies meet your low price.