Last Word

Tough sail

Updated: 2011-06-24 11:08

By Andrew Moody (China Daily European Weekly)

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Tough sail
Joe Fuller believes it will take decades for China to overtake the West in terms of business thinking and management. Feng Yongbin / China Daily 

Consultant Joe Fuller says China's transformation from an exporter is an endeavor never seen

Joe Fuller, a leading international management consultant, says many Chinese companies are still looking for a "safe harbor" after surviving the maelstrom of the economic crisis.

"It is hard to change direction in a typhoon. The first challenge of a captain is not to let the ship founder and most of the export companies' strategies have been about not foundering," he says.

The 53-year-old co-founder of and chief executive officer at the Monitor Group, a global management consultancy, is given to nautical metaphors as befits someone whose ancestor was the only doctor on The Mayflower that took the Pilgrim Fathers to New England in 1620.

He says he is aware how difficult it has been for some of China's companies, particularly those in the Guangdong manufacturing heartland that lost one-third of their export sales weeks after Lehman Brothers collapsed.

"Many Chinese companies have lived through the economic crisis but are not entirely clear where there is a safe harbor to put into," he says.

Fuller was speaking in his company's offices in the Twin Towers office complex at Jianguomenwai Avenue in Beijing.

He was in China to moderate a debate at the Boao Forum for Asia in South China's Hainan province about how companies can build risk management strategies to deal with so-called "unknown unknowns", of which the financial crisis was certainly one. The term is associated with former US defense secretary Donald Rumsfeld's comment about Iraq.

"I am not sure where the phrase originally comes from. It does sound like a Rumsfeldism. He was given to prognostications like that. I have actually known him in a couple of commercial contexts," he says.

Fuller, who speaks with a measured New England accent, says that being able to deal with "unknown unknowns" is a vital part of business strategy, not just for commercial organizations but for governments, too.

"You are looking at whether a company has a strategy that is so robust it can hold up in the face of something that is unexpected such as an economic crisis, political crisis, major earthquake or act of God," he says. "Often our work here involves working on things like scenario planning, using various war gaming or game theory techniques to help decision-makers understand the implications of different patterns of outcomes."

Fuller says it is still not clear where the China economy stands nearly three years after the events on Wall Street triggered a financial tsunami.

"What the (Chinese) government has done has flooded the market with liquidity, produced a massive stimulus and created massive spending on an unprecedented scale, and as a result has papered over some of the problems. The law of unintended consequences of what the government has done is yet to be understood," he says.

Fuller co-founded Monitor in 1983 shortly after leaving Harvard Business School. He says he has spent his entire life in more or less the same place.

"I was born in Cambridge, Massachusetts, both my parents were Harvard professors, I went to university and business school there and I set up a business that was originally headquartered in Harvard Square," he says.

The management consultant says if things had been only slightly different he might have had a long career in China instead.

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