Over 1.3 billion people live in China. There are three mega cities that are each home to at least 10 million people (Shanghai, Beijing, and Tianjin), and there are another fifteen cities that each contain over 3 million inhabitants. Having such a large population means that manpower is often used to solve any problem
Over 1.3 billion people live in China. There are three mega cities that are each home to at least 10 million people (Shanghai, Beijing, and Tianjin), and there are another fifteen cities that each contain over 3 million inhabitants. Having such a large population means that manpower is often used to solve any problem
I met an entrepreneur at the Four Seasons in Shanghai (where I’m staying) who runs an outdoor media company. Whenever a new mega apartment building or office structure opens up (an everyday occurrence in Shanghai), he deploys an army of foot soldiers to put posters and ads inside each elevator and outdoor outlet, such as public bathrooms. His employees are also responsible for updating these outlets with the most current cards, handouts, and posters. Because the materials are always new and up to date, both consumers and advertisers love the service, but it is an enormous undertaking and one that is possible only through the mobilization of a huge workforce.
But having such a large and available workforce in China also means that manpower can frequently overwhelm even the most mundane situation.
Yesterday, I went to a very nice salon to get my hair cut. One employee guided me into a small room where there were four more employees waiting to take care of me: one to wash my hair, one to cut it (did a great job by the way), one to use a brush and small vacuum to pick the stray hair off my face and clothing, and one to sweep the cuttings off the floor. The whole episode took about forty-five minutes and cost $12 ($20 with tip). I am very happy with the outcome, but have to admit that I don’t really see the team approach to haircutting catching on in the United States.
I live in Hong Kong and have been doing business in China for over 15 years and yes the manpower thing is very true. In fact I enjoy pointing this out to my customers when they visit. A perfect example was when one of my friends spotted an older lady cutting the grass outside of the hotel we were staying at with a pair of hand clippers. He was surprised to see this and I explained that it was cheaper to pay this women than it would be to buy a lawn mower. The woman was happy to have the job and the hotel saved money.
Sometimes efficiency isn’t the only concern.China has a very high unemployment rate in rural areas. Job generation is a huge concern. Because there is no political infrastructure (a la Social Security) to take care of the unemployed, China must do whatever it can to lower the unemployment rate. I don’t know if this applies in the case of hair salons, but it certainly applies in many rural industries where even though certain automated processes may be more efficient, for the stability of the local population (and also obviously because demand for jobs so far exceeds the supply) that it makes a lot of economic sense to hire “manpower” both because it is currently sufficiently cheap to do so, and because there are intangible positive externalities (or, if you believe the alarmists, violent consequences if not enough jobs are generated).I don’t think this has any bearing on innovation. It’s very difficult to be innovative, anyhow, when your very survival is at stake, and for the time being, it is better that more Chinese are employed, even if the positions are are somewhat redundant (and I’m certain, unfulfilling).
We used to do this in the 50′s. Think about the milk man. Home delivery of milk, today, for the average American, is preposterous. And “self service” gasoline was once a bit of a novelty. Now friendly robots do the task.Wow, what an amazing marketing engine though. I can only imagine what you guys would do with flashmobs if you had access to this many people (college kids, wink wink).
“I don’t really see the team approach to haircutting catching on in the United States.”I don’t get my hair cut often, but I definitely recall that the person who washed my hair was different than the person who cut it, and someone else in the salon was sweeping the floor. I assumed this was due to different levels of skill/training — i.e., the person sweeping was at a different level of skill than the person washing vs. the person who’s allowed to actually cut hair. I could be totally wrong about this observation/assumption, but I definitely recall three different people involved.In case this is geographical in nature, I’m in New Jersey.
Selling software to enterprises in China certainly follows some of these themes. I found it interesting that return on investment (ROI) is really invaluable to them because they can throw armies of people at a problem that software can otherwise solve.They want to know how to compete with the likes of Citibank.
A friend of mine working for Google in Beijing commented on this phenomenon as well – the fact that there are simply so *many* people there that it’s more cost-effective to hire someone to do the sorts of tasks that, in America, would make more sense to either a) do ourselves, b) automate or c) have as a secondary responsibility to another position.I wonder if that doesn’t stifle innovation on some level? if it’s so easy to hire someone to sweep the floor for you, what motivation to build a machine or a robot to perform the same tasks?