Thirty Days in China

Peace Hotel

Late in the evening a long way from home, in many respects, I ponder: how did I get here? Yes, I know my spouse drove me to the airport in San Jose and American and JAL flew me to Beijing. The taxi from the airport was without incident...last year my companion and I did not know the routine and haggled so well for a taxi that the driver would not turn on the AC from the airport to the hotel. So, we wheezed and teared for an hour before we arrived at our hotel, after a traffic jam at 11:00pm at the second ring in Beijing.

Arriving late in the evening again this time, I was met with more courtesy by the hotel clerks remembering me from last summer and knowing that I brought them at least a dozen or more booked rooms for at least a week. I had in tow twenty MBA students from Silicon Valley’s Jesuit University, Santa Clara University (SCU), to study entrepreneurship in Beijing and, later, in Shanghai.

I was born and raised by parents who were high school graduates. They were literate. My mother, after some time as a secretary, was a housewife. My father was a small businessman. I have a younger brother who is an attorney in San Francisco. My life growing up was ordinary; I was, however, a nerd who also played on my highschool football team, which for circumstances beyond our control was not very good.

Wamfujing, where the Peace Hotel is located, is one of the most popular shopping districts in Beijing. Beggars are also prominent there. China’s restrictive movement policies and the paucity of opportunity in the rural areas force people into the populace centers to look for sustenance. Unable to register, they cannot legally work, so, they beg.

On the fifteenth floor my room faces a rooftop configuration nearby that is ironic. Side-by-side on it are a religious totem and a satellite dish. Souls go in and out in various ways. Last year we watched a storm though the window showing a rain that was ferocious and that was so severe the sky turned black. My wife e-mailed me worried the flood caused by the storm might have endangered me as it had several who were trapped in the waters that rose in low lying areas. I tried to call a contact at one of the companies we were scheduled to visit. He answered on his cell phone as he was driving home and told me the rain was so heavy that he could not drive and talk.

I rig my computer and go online to let my wife know that a day after she dropped me off at departure I am in my assigned room tired, ready to sleep and OK...a bit dazed from twenty-four hours of travel with little (on purpose, so, I could do so on arrival) sleep. As I doze off, after a few stiff drinks to induce sleep, I hazily wonder: how did I get here?

Background

My business school Dean, Barry Posner, approached me four years earlier to do a planned educational experiment: would our evening MBA student body (eighty percent full-time employed) sign up in enough numbers to support leaving the area for up to two weeks to study abroad based on courses we would teach on campus prior to departure and using a destination of my choosing as a "lab" to examine the course concepts? Because of some previous fortuitous events in the EMBA program and my own background I chose China as our lab. I have traveled extensively in Asia (military and consulting) but had never been to China. So, since it was my choice, China it was.

One of the school’s administrators, Leanna Christie, also, because of her own experience living abroad in Africa with her husband and children, had a keen interest in having our MBA students formally and informally experience another country’s business environment. By a very circuitous route we contracted with an organization in Prague, headed by a British national, to provide the logistical support for our trip to China (after the first year we decided we do this ourselves). As part of their service, they also find organizations for schools to visit. I decided we could do that mostly by ourselves, drawing on local contacts. So, we divided the tasks: she would oversee logistics; I would oversee the lab. This turned out to be in itself an educational process for me.

First, I and the other faculty involved, Martin Calkins, had to set our course themes and foci. We decided to study the entrepreneurial environment and focus of the roles of leadership and culture. Now the challenge was to find organizations to visit that would illustrate these--entrepreneurship, leadership, and culture--in a country I had neither visited or formally studied. Luckily, there were Chinese nationals affiliated with the university who agreed to support this effort. But, I needed a crash course in China. Some scholars take a life-time to do this as their profession. I had less than a year, while fulfilling my school, family, and volunteer duties and activities. Sort of like what our MBA students do for three to four year as they work towards their graduate degrees.

Working with two key people, Arthur Wei, educated in Beijing and Chang Xu, educated in Shanghai, and an expanding of networks of contacts, I put togther a varied, complex and aggressive roster of organizations to visit. When I showed it to Martin, he was concerned about the volume of work we would be placing on the students. So, we arranged a meeting with Arthur and Chang. Their advice was that, if we were going that far with the expense involved, we might as well get our money’s worth. It turned our to be very sound, Chinese advise. We added some cultural "time off" and, though Martin was skeptical, he was satisfied.

I have a participant observers’ knowledge of how organizations work–that’s what I teach and consult about. Also, the government and recent history of China was familiar to me from my graduate studies and my natural curiosity. But, how China developed from the loess to the beginning of the twentieth century was a black hole. Being practical we ordered up-to-date maps and travel guides for Beijing and Shanghai and a comprehensive travel guide for China, Periplus and Frommer’s for the former and Lets Go for the latter. This turns out to be immediately satisfying and extremely perplexing. I can read the place names and see the layout of the cities, but how did they develop and why? And the thirty-eight pages of history and culture in Lets Go was thin to say the least. However, just as we begin to notice similar models of cars when we buy a new-to-us-one for ourselves, China became highlighted on my radar. This phenomenon was manifested in colleagues who came to know of the China experiment and I was sent many articles and links to topical issues about China. And, as students signed up for the courses and trip, they, like cats who bring dead varmints to their minders with pride, too, began to send me articles and links of interest on the site we set up for communication about and before the trip. All this would suffice for the first year I thought. I was wrong.

One student, Jack, sent me several dire articles about the economy that were almost macabre. Finally, I asked him who it was who were issuing these analyses. He replied they were former Soviet military analysts. Nothing more needs to be added.

When we entered Beijing, knowing beforehand no one of the trip had been there before, we were at the mercy of strangers and Nancy, the guide Prague had contracted for us. Later when we--the two faculty and one administrator--traveled on to Shanghai sans students and guide, we were on our own. I decided the second year I would not be as ignorant as I had come to find myself the first year. Consequently, I contacted a few knowledgeable faculty for recommendations on comprehensive histories of China. I picked and read five and, as I was telling my department chair of this fete, he opened a cabinet in his office and loaned me thirty-six half-hour tapes on Chinese history. I rode up and down 101 between home and school absorbing the tapes. This both cemented what I was trying to learn and, by listening to what I had just read, I learned the way I was pronouncing personal and place names in my mind was not the way many were actually pronounced as they are spoken.

It must be noted here that exposing our MBA students to another country’s business environment is a bit ironic. Before each quarter begins I get class lists ahead of time. The timing is essential; I must call roll the first class meeting. If I were unable to practice on most names, I would be even less able to pronounce them , than I in fact do after practicing. Our MBA student body is a virtual United Nations. I decided we could use this diversity to enrich the learning experience.

Exposing a culturally diverse student group to another country’s business environment would be even richer because each would see it through his or her own personal and cultural lenses. And processing all the different perspectives would be a real-time experience of working in and analyzing a multi cultural work environment that, though most work in one, is not consciously analyzed and understood. I underestimated the power of this component of the design. The first group of students were four Chinese, two Indian, one Russian, one Israeli, and five motley Americans, combined with American staff and faculty. There was also a reasonable gender balance.

In one class we go around the room to reveal the extent of our international experience. No one is surprised much by those born outside the US. Theirs was to be expected. The US born, however, are revealing. For example, John at one point in his early adult life, lamenting his parochialism, picked up and moved to France for an extended period of time. Wilson mentioned among other experiences a trip five years previous to Shanghai in part to play trombone in swing jazz bands.

Off We Go
On the first trip I was up before the alarm went off one day before the official trip begins. The faculty and staff are here as are some of the students. Although there are some logistic and lab issues to resolve, we are all on our own. Head out to sightsee, but where and what configurations? We divide on natural lines; the students go off on their own. The Summer Palace is intriguing. It is not on our official itinerary, so the three of us got a cab and destination instructions with the assistance of the bell captain. Second adventure in a Beijing taxi. Hell-bent to get us where we are going. Time is money. The sooner we are dropped off at this popular spot, the sooner he (saw no female cabbies in over a month over a two year period in China) could pick up another fare to get another fee. No tipping. Get out of the cab avoiding being hit by another. Pay the driver, get the receipt, and go.

The Beijing government is planning to tame their cabbies’ aggressive driving tendencies in time for the summer 2008 Olympics. Highly dubious undertaking. Most cabs have multiple driver-owners and keep the cabs on the road most hours of the day and night in order to amass enough fares to make the payments, fees, and tolls and to leave enough left over to provide the drivers with their meager incomes. Being courteous, patient, orderly cabbies does not fit the economic equation.

The Summer Palace is an immense internal city built for the summer lives of the emperors, their retinues, and staff on rolling hills off of the artificial Kunming Lake. July is hot and muggy and external and internal tourist time for popular spots like this. We were on our own, none of us speaking or reading Mandarin; frustrating, but none the less, a liberating experience. With some of the signage in English we were free to fill in the Mandarin blanks of what we could not read or understand.

I had purchased small (could be carried easily in my pocket) and powerful digital camera. Picture taking from my previous experience is an Asian big-time pastime. I and the rest in the larger group we had brought to China became infected with the picture-taking bug. We took among us so many pictures we crashed the Dean’s e-mail and hard drive when upon our return he asked us to send him our pictures.

At the palace I was the only one of the three who had a camera, so, my job was to record this experience for the three of us. The detail of the architecture and engravings was the most intricate I had ever encountered and capturing representative samples of them became my goal. Of course, we had way more than our share of "take my picture in front of this Hall" pictures. And we were like Chinese tourists at Disneyland, although I am almost certain that Chinese tourists at Disneyland understood more about what they were seeing there than we did at the palace. Palace is a misnomer there are innumerable halls, temples, gardens, ponds, lakes and the like. To see and understand it all would take weeks, if not years. The most intriguing to me was a marble boat "docked" at the edge of Kunming Lake.

In my later reading it is revealed that the infamous Empress Dowager had the Summer Palace and the especially infamous marble boat built with money siphoned off the official navy budget. This misuse of funds has an extremely deleterious impact on the Empire itself. In the decades after construction, China’s revenue-starved navy lost two crucial and weakening battles with Japan. These losses hastened the fall of the Chinese Empire and the subsequent suborning of Chinese interests to foreign and Western influence and dominance. We could change the old doggerel "for want of a nail" to "because of a boat." I have asked myself why the Empress Dowager could squander crucial funds on the Summer Palace and a bauble like the Marble Boat. The Chinese revere the boat, leaving on display at the palace. We encountered a miniature replica in one of the famous Forest of Lions Garden in Suzhou. My conclusion is that she had it and the Summer Palace built simply because she could. Egregious opulence compared to fiscal solvency.

We caught a cab back to the hotel by showing the driver our hotel card with the address in Mandarin. I have a relatively good since of direction and understood the basic layout of Beijing from my frustrating attempts to use the map we had ordered. As we chatted on the way back ( I was in the front seat), the driver made hand gestures to me indicating the jammed traffic in front of us and showing that he was going another route to avoid them. After nodding "yes" to the cabby, I began to notice we were going in a wide arc back to the hotel. Having been taken for a ride much earlier in my life as a midshipman 4th class in Richmond, VA, I was alerted that it was happening here. I asked Martin if he had the receipt for the trip out and, if so, to have it handy. When we finally arrived at the hotel the meter showed twice the amount of the trip out. The cabby did not pull into the hotel drive, a telltale that he was up to no good. I got out of the cab to fetch the bell captain to tell the driver we knew what he was up to. When I got back to the cab, my companions were outside the cab pointing to the meter and to the receipt for the trip out and indicating that we would only pay an amount similar to the earlier receipt. The cabby was arguing, but, when he saw I had the bell captain in tow, he appeared to relent. As the bell captain began to reprimand him, he quickly took the reduced fee to the amount offered and drove away. Damn Yankees!

We gathered in my room to check e-mail (I was the only one of us who brought a laptop, even if it is one I had checked out--an older two-ton model--from Media Services) after which we are going out again to Silk Alley, a vast outdoor market a few subway stops away, where silk goods of a wide variety and price and often dubious origin , authenticity, and quality were hawked. Alas, we never made it. The monstrous rain storm mentioned earlier darkened the sky, blew violently at my hotel window, and pounded the window with seemingly thousands of little rain bullets. We were a little cowed and called off our trip to Silk Alley. Alas, again, I never got there at all and now it has been torn down for housing, a not uncommon phenomenon through all major metropolitan areas in China. So many are immigrating from the countryside, many unregistered, that the housing stock in Beijing in particular is woefully inadequate. Combine this with the shrinking size and dispersal of the Chinese nuclear family and older, less dense areas cannot be rebuilt quickly enough. New housing and dispersal of local residents is a story we encounter the following day.

Sunday morning and the official lab work begins. The rules were simple. We are guests in this country and guests, though quite inquisitive, at the organizations are to visit. So, be inquisitive and polite. If we ask a questions that is out of bounds, there will most likely be no answer. If so, let it go. Also, among ourselves we expect courtesy and mutual respect. We were going to be up close and personal with each other several hours a day for several days in a row. To facilitate our movement around the area we had a guide, Nancy, a bus, and a bus driver. To use those resources wisely we were all to be on the bus at the appointed time, dressed appropriately (business dress), and alert (which meant for some of the pub crawlers, sober). To avoid stranding anyone and to prevent any missed visits we all had the itinerary in English and Mandarin. If you miss the bus, and to keep on schedule in a sprawling metropolis like Beijing, we had to keep a very tight schedule, simply show your itinerary to a cab driver and meet us at the next stop. No one missed the bus, but the first morning we had to send a student back into the hotel to find a straggler, an alum, we had regrettably allowed to be part of the trip.

We arrived at Tiannamen Square mid-morning with overcast skies, warm (not hot) and muggy weather, and occasional drizzle. This presented a challenge to hold an umbrella, camera, and camera instruction book trying to find the page that would tell me how to change the setting for such a grey day. Doing all this while staying close enough to Nancy to take in her tour-guide patter was difficult. It didn’t work. While maneuvering to take a picture of Martin with the famous Chairman Mao portrait in the background, the instruction booklet was christened by a puddle at my feet. Now, when I thumb through its crinkled pages, I am reminded of its clumsy christening.

I try to imagine the mass of people on the square almost fifteen years ago protesting the corruption in opening up the country to outside investment (some of the early deals were fraught with huge payoffs to party officials) and demanding a place at the table and an level playing field for the common citizen. The demand for democracy must be understood in context of the opening of the economy. When the demonstrators were crushed, the party leaders were saying you can participate in this growing economy, but we will keep sole control of and access to the levers of power. On our second trip a student ask our guide, Kelly, a fairly recent college graduate about the events in ‘89 on the square. She professed ignorance. Later we learn her parents are communist officials in the province where she grew up. Interesting non-answer; let it go.

To get to the Forbidden City we go through an underpass. A student asks me about the relationship of the Communist Party to the formal government. An interesting question as we are about to enter the seat of power of many dynasties to which no commoner (unless in the employ of the Emperor or his staff) was allowed. I try to explain that there is not a one-to-one relationship between the party and the government, but it proves to be to confusing talking about holding power when you don’t actually hold power. Maybe I should have used the imagery of the Forbidden City. Common people do not have access to power or an understanding of power. Just yield to it when is applied; you have no choice. It is just there; you can only see the outside.

We stop as Nancy buys our tickets and we are about to enter the hallowed ground that I had only experienced before in "The Last Emperor". But first we stop so Nancy can brief us. Being stationary as a group of apparently affluent Americans and others, we were sitting targets for beggars and peddlers and they were very aggressive, much more so than on the streets outside our hotel, and many of us noted our aversion to them. At home we are more isolated from the poor and desperate. This was eye-opening and an indicator that outside an area in China that represented the ornate wealth of the old empire and probably the most expensive large plot of land in all of China beggars abound. You don’t see this on the Mall in DC; the poor are hidden only a few blocks away.

Inside as we gawk our way through this large, elegant, marvelous city, I engaged a student of Irish extraction who was most persistent about making this experiment work in a conversation that perplexes him. Several years ago when I was on the faculty of the University of San Francisco (USF), we were presented the opportunity, because a major hiccup in their finances, to purchase Lone Mountain College, a gorgeous set of structures on a hill that overlooks the Pacific Ocean, Golden Gate Bridge, San Francisco Bay, the East Bay with its hills and the Campanile, the Bay Bridge, the Marin headlands, Sutro Tower, downtown San Francisco, and Alcatraz. We made the purchase. I was detailed to decide what to do with the faculty and programs we did not fold in to USF. Later we learned the EST had bid more for the land and structures than USF, but the Sisters of Mercy sold to us. A study had been conducted by them that showed that the most valuable use of the land would be to build medium density housing. They sold to USF.

I proposed to the student that the most opportune use of the land the Forbidden City was on was the same: medium density housing with a model of this city replicating it on a smaller scale. He was horrified, as most of our host Chinese would be. I counter that with all the needs the populace had, housing and a model Forbidden City would be much more humane and valuable. The government holds title to all property and leases land to residents and businesses for long terms. So, why not bring in all that revenue to shore up all the social programs the government-party has abandoned as they focus on what many mistakenly call a market economy. That China’s is not a market economy becomes more evident as the lab work proceeds.

Next stop was the Hutong, a traditional neighborhood behind the Forbidden City, an area where historically those commoners who served the emperors lived. Hutong actually means "little alley", strangely from the Mongolian hotong, "water well". Hence, little alley to the water well. The streets were more suited to pedicabs and scooters, but intrepid residents in their vehicles and cabs still negotiate them, at the peril of pedestrians and cart pushers. We were to experience a village-like life of commoners. It turned to be much more.

We faced a mini-revolt. Three student opted out and stayed with the bus. They felt the pedicab rides were exploitive and the home visit was invasive and insensitive. The pedicab issue was familiar to me. I have an aversion for shopping at Safeway; they have consistently had poor labor relations. My wife counters, if we don’t shop, then they make less money and cannot raise wages for workers. In reverse of my position on Safeway I try to persuade the three students that, if they don’t go on the pedicab rides, the drivers whose time we have reserved will lose the piece rate they earn for taking the students on the ride. They still resist and we decide to make up the money for the idle drivers. At certain point on the ride we are instructed to give the drivers a gratuity. I am awkward at it; the driver is embarrassed. No tipping in China.

After the ride, we walk down one of the streets learning about the meaning various markings and shapes of entry ways into the residences. Since all one can see from the outside is the wall of the residence, the markings and shapes tell the status of the families inside. I do not remember the shape or markings on the door of the residence we enter, but if there is one for it, it would be "cottage industry entrepreneur". The man shows off the decorations and artifacts in his living room, offers us tea and cakes, and shows us the vegetables and plants cultivated in the courtyard that the man and his wife share with other members of their extended family. His wife sits quietly in the room. He then launches into stories and demonstrations about his crickets and their fighting routines, a sort of genteel cock fight. Then, something that makes me and Martin uncomfortable happens; he invites us to tour whole the house, including the bedrooms and bathrooms. Some go, some reluctantly. Martin and I decline.

On the walk back to the bus Martin and I wonder why this middle-aged, articulate man is not employed and why he welcomed us so crassly (from our perspective) into his home. He did mention he had a government pension. As we talked, it occurred to us that, given his age and some items we saw in his living room, he must be part of the lost generation resulting from the time when peoples’ lives were permanently sidetracked by Mao’s ill-conceived and disruptive Cultural Revolution. Many of those who were denounced and whose lives were disrupted simply did not later find a place in mainstream society and were lost. And as we were about to board the bus a local thrust what looked like a throwaway newspaper into my hand. In a clear photo on the first page was our recent host showing his crickets.

We cut the Hutong out of this year’s trip. However, we had a disruption in our schedule and suddenly had a half-day free. Some students before the lab started had happened on to the Hutong tour and told others about it. So, on our newly-found time off several others headed off for the Hutong. The accounts we got from all of them were almost step-by-step and word-for-word what Martin and I had encountered on the first trip. Hence, cottage industry entrepreneur.

Peking Duck Dinner. Down Wamfujing Road, around a corner and a short elevator ride up is a famous restaurant that touts itself as "Nixon ate here," complete with official photo (sure, official in copy-anything China). This is where our Prague group had booked our welcome dinner. It was our first formal meal together. My participation was hampered because I had in tow a professor from a local university who I agreed to meet because he was referred by one of the people who helped put this first trip together. He was eager to form an alliance between his university and mine. We were less sure because of our novice status in China.

Regardless, the meal was notable despite the fact that I did not encounter any food items I had not already had back home. It was notable because many of the dishes were exceptionally greasy. Two notes: when stopping for lunch during our upcoming days, sit with someone who speaks Chinese and ask for steamed dishes; and next year don’t use the Prague group to plan a formal meal in Beijing.

The Lab Begins
Early the next morning we are off to the US Embassy to meet with a Commercial Attache in the Commerce Department. We had assigned students beforehand, while in classroom mode, to study the organizations, develop a set of questions (which I sent ahead), and brief us in class and before our actual visit. No one had been assigned for the embassy or our next stop, the Beijing Foreign Investment Support Center (BFISC). One of the students asked who we were seeing at each stop. My answer was some functionaries, a guess. It turned out to be true. There was a snafu getting into the embassy briefing room. We had to show our passports and Martin had forgotten his. After some wrangling , he was allowed to enter.

We got an overview of the Chinese macro economy that was quite revealing. There has been massive and ever increasing foreign investment; the controls on those investments are decreasing; and the Chinese banking industry is underwater with forty percent of their loans under- or non-performing. Recent entry into the World Trade Organization (WTO), several years in the making, was causing some significant reform in China. In particular in 2006 financial institutions based outside China can compete fully in China and are forcing Chinese banks who have no experience in retail banking and whose practices in commercial banking were suspect at best to shape up. At the time we first visited foreign banks could not deal in the local currency. Since then, substantial foreign investments, US and other, have been made in Chinese banks to get a toehold. If I were an investor in any of the banks who have investments now in Chinese banks, I would be worried. The major Chinese banks are publicly traded organizations. But the major stakeholder in each is the Chinese government and the government oversees and sets policies for the banks, and it often has a hand in where the banks invest their monies...and how much! Just recently the relevant government ministry rotated, ring-around-the-rosie-like, all the heads of each bank to other banks.

Our embassy briefer was reluctant to answer some of our rough-around-the-edges questions and his silences were as revealing as a real answer. He did try to charm us by identifying himself as a San Jose State University (SJSU) grad and as a former batboy for the SCU baseball team as a kid. But this was not a substitute for candor. However, in answer to a question about foreign investment in general, he spoke of a newly created category, wholly owned foreign enterprise, or WOFE, pronounced wooffy. This was one of the most intriguing discovery to date and one that would be used throughout the rest of the trip and in the students’ analyses of their experiences. And later in the trip one of the people we met with suggested that WOFEs were accounting for almost all the recent economic expansion in China, i.e., foreign investment, in foreign organizations, located physically in China, using foreign managers and local Chinese labor, to make and take the money out of the country. Some economic expansion.

A quick ride in the Haidian district the to the BFISC took us inside a converted mansion and into a conference room. Many employees of the center were present and business cards were exchanged ritually all around. After these pleasantries, we were greeted by an official, a native of the Netherlands who had been educated at a Jesuit university there. He would be in charge and would preside over the session. That was the end of any interaction. We saw a slick video of the physical and economic growth of Beijing, ending with a flourish about the upcoming 2008 Olympics. Then, he launched into a monologue about investing in Beijing (well, that’s what they do), taking no questions and leaving no time for questions. End of presentation, out the door, on the bus, and cross them off the list for next year’s trip. Shortly after this visit one of the students quipped that the 2008 Olympics would be China’s coming out party.

Still in the Haidian we motor to Citibank which is building a huge presence in China. For this year’s trip we could not met with them in Beijing because all those eligible to brief us (yes, only certain employees were allowed to brief foreign groups) were in Shanghai for the opening of a large facility there. That’s fitting because Shanghai is China’s financial center. It is also interesting that Citibank is currently building such a massive presence in China because they have been in China since the 1920s only to be booted out in 1949 when Mao’s communists reclaimed China from the evil Westerners and kicked out almost all capitalist organizations. This turned out to be a monumental mistake, as many of Mao’s policies were, because the economy was highly dependent on those institutions and China had little of their own to rely on.

Our briefer at Citibank was a Canadian (OK, so far an SJSU grad, Netherlands’ native, and a Canadian, none of Chinese extraction). This cultural oddity was highlighted by something that happened at lunch before our Citibank visit. The three staff had lunch with one of the students in a restaurant in the Chang-an Building where the Beijing Citibank operation is. This student is relatively tall and muscular with blonde hair and blue eyes. The young woman who waited on us focused on the student and barely acknowledged the three of us. Then we noticed her point our table out to her giggling sister servers with particular attention paid to the proto-typical American. Oh, well.

One of the peculiarities of Citibank’s building a presence in China is Citibank’s heavy emphasis on the retail side in revenue from credit cards. Credit, that is incurring debt to buy goods, especially consumer goods, is not in the DNA of almost all Chinese. See it, want it, find the cash, buy it. No cash, don’t buy it. It is that simple. We are told that some institution distributed credit cards in another time. The recipients used them and when the bills came due, simply, did not pay. Dumb banks. Note: this may be an urban myth; but, I could imagine it happening. Credit card usage is beginning to catch on with the newly affluent, and the banks hope there will be a trickle down. There is an ancillary downside to having no credit system: for new-styled startups who are trying for Sand-Hill-Road-like funding there is not an accepted mode of valuation.

On the way back to the hotel where we were to have dinner with a Beijing-based American venture capitalist, we began what we soon labeled "bus discuss". Our original plan had been to hold some early evening debrief sessions. We did not bother to tell the students until just before the lab began in Beijing. Having had evenings to themselves up to that point, the students were not pleased as we announced that we were now claiming them for class time. They objected strenuously. What you learn in a degree program peopled with working adults is to pick your battles and this is not one we wanted to join. So, we made a deal. Begin a discussion after the day’s last visit of what was learned and, when the bus reached the hotel move straight to a conference room (no going to your room, no getting a drink) and continue the debrief. This worked the first year with thirteen students, not the next year with twenty. And that lead to a culturally revealing incident to be told later.

Our VC, a man I have gotten to know better over time, is very observant, thoughtful, and opinionated. I was in the audience in fall, 2003 of a conference put on by the Center for Innovation and Entrepreneurship (CIE) where my office is and the VC was one of the panelists. The conference was on foreign investing and he spoke of the perils of investing in China. I met him backstage, told him of the planed summer MBA trip to China, and invited him to breakfast the next day. Breakfast was interesting. He is a midwesterner and a graduate of Michigan State University with a BA in Political Science and masters in Far Eastern Studies. He went to China after graduation and has worked in telecommunications and satellite technology there for over twenty years.

The VC was very informative about his investments and investment strategies based on his knowledge of telephony and satellite technology. He also revealed that most of his working capital came from high worth individuals outside China. A story began with him that built over the remainder of the trip and led to an in formal research study on my part in the months after the trip. Some venture money comes into China from Sand Hill Road and like institutions, much money comes in from Japan, Taiwan, Singapore, Hong Kong, and much of the money is from Chinese wealth outside China, money is invested by investment firms with major presence in China. The various levels of Chinese governments invest with some level of coherence and competence in new ventures. And they try to use these investments to spur growth in particular geographies and business sectors. There is, however, almost no Peoples Republic of China (PRC) funds invested in China by PRC-based venture capital firms in Chinese organizations. Much PRC-based money is invested in China by guanxi (roughly "family and friends") but not managed by professional venture capital managers.

On the bus the following day two of the Chinese students talked about their experience with guanxi venture investment and helped us understand why it is the prevalent in-country venture investment mode. You know your family and they know you; you don’t know the investment managers and they don’t know you. Relationship trumps knowledge and expertise.

All this led me to my informal research: with a lot of wealth in China why is there such a paltry homegrown venture capital industry. My VC came through northern California shortly after the trip; I talked to two SCU faculty members (marketing and finance) at the business school; I talked to my contacts (partners) at two prestigious VC firms literally on Sand Hill Road; I interviewed the director of Hambrecht & Quist Asia Pacific(H&QAP). With all this a coherent picture began to appear. The primary reason for the lack is, outside government entities, there are no institutions which have accumulated significantly large enough pools of funds to allocate some of the funds to venture investment. Second, the significant wealth is still intrusted to the guanxi mode of investment. A cousin is more entrusted than a professional venture capital manager. However, the director of H&QAP made an analogy to VC investments drawing upon funds of high wealth individuals in Taiwan. He first started making investments in Taiwan in the early 1980s and the high wealth individuals there had the attitude similar to current high wealth individuals in the PRC. Cousins trumped professional managers. Over time as individuals in Taiwan began to see the returns on investment from professional management of their funds, most cousins were abandoned. Better returns on investment (more money) trump guanxi. The director predicts in a decade or so the same thing will happen in China. My VC friend has another riff on this theme. He speculates that we might see a de Medici-like (think Florence) method of venture investing occur in China. All this knowledge helped me be a better guide to students the second year. Study abroad was developing faculty competence.

Long day; students are drooping as the VC speaks, not because what he is saying is boring, but because we are not all on China time yet and some of the long nights on the town before the lab began. We call it a day; we have had them going for fourteen hours and there is very little discussion about going out that night.

Next morning on the bus we get a briefing from the students who studied the public relations firm we will visit in less than an hour. The bus driver has trouble finding the building, as will next year’s driver, which is a converted manufacturing facility. I notice a uniformed person outside the entrance as we find and enter the PR firm’s building. It is an occurrence that takes me back to Tiannamen Square and the many men present in various kinds of uniforms. I readily recognize the soldiers of the People’s Liberation Army (PLA), but the others are puzzling.
The question about uniforms takes me back to a time as a child that two or three of my young grade school buddies and I got permission to go on our own to downtown Oklahoma City to watch a holiday parade of some kind. We got a place at a window in the second story of a building. We had no idea who the participants in the parade were. We only thought we knew that they were probably various branches of the military. We spent over an hour naming each marching band as a representative of some service. It was not until I was in junior high in the marching band that I realized we had been seeing junior and high school bands not military. In the bus I sit up front with Marin and Leanna, with the driver and our tour guide. I decide to start asking Nancy about the various uniforms we encounter as we drive and walk around. It turns out those outside the renovated facility are what we would call private security guards.

Our meeting with the head of the PR firm was one I was not sure of. He is of the generation of college graduates who are facile in English, he had studied political science in Beijing University, yet he had requested a translator, as did one other older CEO at a visit later in the trip. As we introduced ourselves to each other, the translator was handy. This was the first place where we could give our cards to a Chinese presenter. Martin, Leanna, and I had an MBA student who is from Chengdu transliterate our names and titles into Mandarin on the back of our regular business cards. When he turned our cards over and discovered the Mandarin, he smiled. The three of us quietly congratulated ourselves for being internationally correct. We find out later that his smile may be only possibly related to our correctness. In Shanghai we are entertained one night by two MBA grads who live and work in there. When we meet, we exchange cards. Alan, one of the students, looks at the Mandarin and tells us that in China you are expected to take a Chinese name and use that in your formal exchanges, like business cards. That may not be the full story about Allen’s comment, He is sophisticated Shanghainese; our translator is from the interior, whose language skills Allen may doubt. Regionalism and social status consciousness are supremely at work in China.

The presentation with the translator as the intermediary went well when the CEO was giving the standard company dog and pony show with an occasional question from a student. However, after students began to ask more organizationally complex questions and the CEO would reply, one of the Chinese students began to notice, as she would tell us afterwards, that the translations both ways were not accurate because of the kinds of concepts in use. She, as tactfully as one can in such a situation, began to inject herself in the exchange process. I looked around at the three other Chinese speaking students (even the one who was fluent in Cantonese) and they seem to be smiling and nodding in approval at the intervention. The three-way process was working. We were now in the presence of the real thing, a Chinese executive, the curiosity of the students picked up, and the CEO was obviously enjoying it.

At one point near the end of our allotted time I asked a set of questions I had developed with Arthur much earlier: what were the challenges that lay ahead for the organization and for him as a leader; were there any dangers as a new organization in a realm where political and social power was so centralized. I knew it was a touchy question and it was the first time I asked it, so, I was not certain whether I would get an answer at all or, if I got an answer, whether it would be revealing and useful. Leanna and a few of the students winced when I asked the questions, so, I knew they thought I was on shaky ground.

The CEO’s response was abundant and advanced a line of inquiry we would use for the rest of the trip. What he worried about was growing the organization while keeping it governable and rewarding and retaining high performers. In naivete, someone asked about stock options as a tool to reward and retain. We knew it was a privately held organization and our assumption was a very culturally-bound one. Go public and use options as a carrot and anchor. The CEO’s response shocked us (in hindsight it should not have). The government decides what organizational categories could go public and PR was not one of them. This is one more indicator that there is not a market economy in China. It is more aptly labeled an economy that is managed at the macro level by the central government.

While on the topic of taking companies public, the process in China, especially on the Shanghai market, is suspect, depressed, and a gamble for investors. Many of the organizations listed on the Shanghai board represent the former state owned enterprises (SOEs) that the government has taken public, but which are still mostly run much like they were when they were pure SOEs, that is, as bureaucracies run as fiefdoms by Party officials and their cronies, not by professional managers. One might say that the government is running organizations that are wolves in sheep’s clothing. Professional investors avoid the issues on the Shanghai board; it is a preying mantis for the public, the citizen-investors. Coincidentally, Mary Meeker (yes, that one and she is still around) published a recent study of the top 200 (by dollars) publicly traded Chinese companies. For my eyes the most damning observation in her study was that the bench strength of professional management is weak at best.

Our next visit was a joint venture between Yahoo and Sina called 1pai which has since been subsumed into a larger enterprise. We met with a Taiwanese-born Chinese who was raised and educated in the US and came to China to work as a senior manager at 1pai and was not much older than most of our MBA students. After his dog and pony show presentation, the question period proceeded as expected until student asked a question about what we had come to know as Big Mamas, which are literal and figurative monitors of the Internet to prevent the mention and/or transmission of topics which the government has forbidden. Theses would be topics such as democracy, Tiannamen Square massacre, rebellion, and any group forbidden to assemble (think Fulan Gong), even peacefully, in China. As is widely known, international TV broadcasts are actively monitored and censored in China. Later in Shanghai I came to the lobby of our hotel to meet with Leanna. When she came down, she asked me if I had just seen what happened on CNN. I did not; I was watching CCTV. She said some one from another country was being interviewed and was saying that China was not as open as they...... The screen went to snow for a while. The TV censors at work.

The reply to the student’s Big Mama question has been open to interpretation by those who heard the answer, which was we know the limits and we do not want to be called on by any of the government ministries. Afterwards, several students offered his response as evidence that government does not interfere with enterprise within limits. I thought that was naive. My interpretation was that it was a limit on freedom of expression and a serious one. They countered that at least 1pai was still in business and providing a good living for its employees. Unfortunately, from my perspective, it is possible that this may become the conclusion of many Chinese as they continue their bargain with the government: you can control the polity and society as long as our economic opportunities expand and personal wealth grows.

After our bus discuss as we arrive back at the hotel with no evening work, I alert the students to the next day’s schedule. It will be somewhat long and it will be strenuous. We will be up and leave early so we can be at the Great Wall at Badaling by 8:30 when it opens and when is it relatively cooler and less crowded. After that we will swing by the Ming Tombs, have lunch at a Friendship Store, one of many state-owned co-ops for arts and crafts vendors, return to the hotel to shower and change clothes, and then bus to HP, China for a late afternoon visit. This warning did not prevent our intrepid explorers from plunging into the Beijing night for exotic food and drink. A reader may wonder why I have no personal tales of nightly exploits. I warned the students before we left Santa Clara that come the end of the official day, as an introvert, I will have had reached my limit of interaction with others and would withdraw to my room. No reflection on how charming they are; I know my limits. When I made a similar pronouncement to one of the older students on the second trip, he reproachfully commented that I might want to change my methods.

I checked our breakfast area carefully the next morning to make certain all were up and getting food fuel for our morning climb. Our hotel offered a very sumptuous and varied breakfast cooked to order either western and Chinese. I often had two servings one health (fruit and croissant) and one unhealthy (bacon and eggs). And I would take a banana from the fruit bar for my lunch.

Everyone was up and accounted for and fueling up. I reminded them about toilet tissues, not to be counted on in public restrooms, and sun block. As we boarded the bus, some showed signs of the previous night’s exploits. We all settled in for the hour or so ride to this particular section of the wall. I since learned that the Badaling section was begun in 200 B.C.E. and completed in the sixteenth century. So, this was an historic and very touristy journey. Many slept to repair damage, some talked quietly, some, including me, listened to Nancy’s patter about the history of the area and the wall. Even getting up early the lower parking lot seemed already crowded, but our bus parked close to the lower entrance area.

I did not have a hat and engaged in bartering with a person in a stall. My choices were limited and I wound up paying 40 yuan for what looked like a woman’s gardening hat (I offered it to my grand-daughter upon my return; she took it) to an apparently miffed shop worker. As we walked on up towards the official entrance, I discovered there were many more shops with much more variety and watched students get better looking hats for much lower prices. My shop worker was probably not miffed, rather smirking at my poor negotiating skills and poor taste. We emerged from the shop area a headed up a paved road to the official entrance.

On the road almost simultaneously Martin I notice something notable in the foliage growing apparently uncultivated next to the road: several tall, mature marijuana plants. Exclaiming to the others what we saw, we were immediately charged for knowing what they were. I walked over, broke off a stem, rubbed it, smelled it and declare that indeed it was marijuana and ignored the jeers about my ascertaining that it was what Martin and I had thought it was. Then, one of the students reached out to duplicate what I had done and surprisingly pulled up a whole plant from the roadside soils. Others of us hooted and hollered and a few snapped pictures to commemorate the event. Some of us implored him to put it down fearing the headlines of a US MBA student being arrested for possessing marijuana outside the entrance to the Great Wall. He tossed it aside and we walked on.

At the entrance Nancy bought our tickets and we caucused to agree when we should be down to board the bus for the Ming Tombs. Through the gate we could go left for a shorter, steeper climb or right for a longer less steep climb. I and several of the others chose left and we all set out at our own pace. It is hard to hold a conversation while climbing. Our serial, solitary climbs fit the environment. I climbed resolutely with some limitations. I have mild, chronic asthma and in the still slightly polluted thin air even in this rural and elevated place, I was having trouble pulling in and processing oxygen. I stopped often. When I was near a student, I was urged on and up. At a certain point I could see the end of this segment and calculated how much more I had to climb and opted to stop. I sat on a step in the middle on the stairway, leaning for support on a handrail. One of the Chinese students came up and sat with me, congratulating me for how far I had come. I responded that while I was sixty-four, I was not dead. She smiled in sympathy. I looked down at the parking lot and our bus was the size of a postage stamp. I had come far enough.

As we sat, I could see our bus below in the lot. In perspective it was the size of a postage stamp. A teenage girl from a small group of her peers who were just below us approach the student and asked her, as she told me later, if she and her friends could have their picture taken with me whom she referred to as Grandfather. I am a grandfather and that it what my grandchildren call me. I agreed, not knowing I had been referred to as grandfather, and, as I was surrounded by several groups of giggling teeny boppers, each gave the student one of their cameras to get pictures with Grandfather in it.

When we got down, the student told the others the story and I was stuck with a teasing name now and then for the rest of the trip. Especially, Leanna and Martin who are not all that much younger than I am. I was not the only one who had been singled out for notice. One student whose ex-wife is Chinese and knows some Mandarin had young girls swirling around him as did another student who is of Irish descent. Each was reveling in the admiration accorded. Alas, we had to board the bus for the Ming Tombs. Sweaty and tired, we chatted quietly or slept; most slept.

See the Ming Tombs in half an hour. I ambled around taking in a few sites. One was a statue of the first Ming emperor, a powerful and menacing countenance. One of the histories I read said that this image was in fact how his subjects experienced him: big and ugly. Next was a kiln-like structure where people tossed in money for blessings and good fortune. Back on the bus. Thirty minutes was inadequate. Find more time or drop it. I dropped it.

At the Friendship Store Nancy gave each of us a chit for what I thought was for our lunchtime meal. I found out later it was a discounting tool to be used in purchasing arts or crafts. I left mine next to my eating place. We hustled the students out of the store to the bus. No time to shop for goods that seemed to be of better quality than we saw at a typical display of goods. Plan more time next year. Very quiet on the bus. Exercise them strenuously in the morning, feed them lunch, and they all slept.

Shower and change quickly; off to HP, the earliest entrant into the Chinese arena after Kissinger signed the agreement with the Chinese government recognizing China and dissing Taiwan. I tell the students that Packard was a Republican, a very conservative one at that, and a traditional conservative. He had been an undersecretary of defense in a Republican regime and could be reasonably expected to encourage an agreement with China to open up its market to US firms.
The presentation at HP did not go well. A group of SJSU EE undergrad students had been there earlier and they treated us similarly. We had some discovery in spite of their misunderstanding. One of the student belatedly wanted to know about their distribution system. I e-mailed that ahead the night before our visit. One of the people in charge of that was there and went through a lengthy presentation. The same student (who was Hong Kong Chinese) stated that payoffs were sometimes necessary to do business in the provinces and asked, since HP is known to be a virtuous organization, whether they or their distributors complied with such requests. The response was something like, of course we don’t do that, but we do not tell our distributors how to run their businesses. Neatly parsed and slipperily stated. Not good. Note for next year: communicate clearly who we are and what we want.

Thursday was to be a good day, that took a strange turn. We were off to visit a Microsoft R&D facility Prague arranged and in the afternoon to Tsinghua University and an incubator they ran which was modeled on Silicon Valley incubators. Microsoft is a Silicon Valley punching bag and we were suspicious as we entered. We were briefed by a Chinese woman, the manager of technology strategy, educated in China, the US, and England, who had been with Microsoft for under a year. One of the things we were looking at was how do north American companies’ strategies interact with the culture in China. HP said let’s blend in. Microsoft says here we are conform to us to which China has said shove off. The government has mandated Linux as the operating system of choice for computers they buy and support; pirated copies of Windows are ubiquitous; and Chinese disdain for paying for software, especially, at the prices Microsoft insists on in China.

Our briefer points out that one of Microsoft’s strategy is to hire university faculty and to offer internships to students in most of its facilities in China. Seems like a slow drip method to me. They also have chosen to more or less ignore piracy, but to sell upgrades and service contracts so that, once the Chinese get to use the real thing, they will be impressed and no longer buy the poor quality knock offs. Trouble is some of the knock offs are relatively good and Microsoft still insists on standard pricing in the Chinese market place where almost nothing sells for list price. Shortly after we left after the first visit Microsoft introduced a Windows-lite version in south Asia for a much reduced price. Whether something like that is in the works for as mass a market as China is questionable. We left not learning anything notable except for reaffirmation of Microsoft’s corporate arrogance. Drop them for next year.

Tsinghua University visit was off kilter from the start. The bus driver had trouble finding the right building even with the correct address in Mandarin and English I had obtained (and double checked) from the admin of the person I thought was scheduled to address us, the head of their venture capital operation. The driver dropped us off where he thought we were supposed to be, we asked people in English and Mandarin where the building we were seeking was located. Normally this would be no big deal but this was during the hottest part of the day and we were all in business attire. After we found the right building, we were met by a lively young Chinese woman who spotted me and called me by name. How she knew who I was is still a mystery to me and began a period of confusion that did not sort itself for an hour and a half.

Grace, her English name, guided us into a small theater-like room where what we found out later were Tsinghua MBA students, introduced herself as a member of the Tsinghua Science Park Venture Capital staff, and launched into a briefing about the park, their name for their incubator. It was followed by two promotional video presentation. During one of these I located the onsite university person I had been negotiating to ask where Grace’s boss was. I was told he would be in shortly and that Grace was the opening act. After ninety minutes the opening act was still in motion and our MBA students were asking Grace questions that she referred to the Tsinghua MBA students. At this point one of our Chinese students suggested we break up into MBA to MBA groups and proceed that way. Seemed better than where the meeting was going, so I said OK. Turned to be a good step to take.

We moved into an area that was a scale model of the University and the science parks, current and under development. It was an impressive indication of the amount of money the government is pouring into higher education, especially science and engineering. The US is at this moment falling significantly and rapidly behind China (and India) in science and engineering graduates and policy.

As the students were talking to each other, I went back to the main contact, Jodie H. You, and asked where the managing director was. She said he had decided not to come. I was irritated, but tried not to show it. The student to student conversations were energetic and animated, so I let it slide for the time being. As we left, we lined up for what had become our traditional group picture in front of a logo that demonstrated where we had visited. After our picture, the Tsinghua MBAs came in for a joint group picture. As we were driving away, the Tsinghua students stood on the steps and waived. Dodged a bullet. I told Leanna and Martin that what had happened was not what I thought had been agreed to, but the students seemed satisfied.
But I was still irritated. When we returned to the hotel I got on line and sent an e-mail to SCU to the faculty who had suggested this visit and the person who was a no show. After several weeks of back and forth on e-mail and in person, we determined that the managing director got a better offer just before we arrived. I want to come back next year and do not want another no show.

A six degrees of separation event occurred at Tsinghua that impacted the second year’s trip. Leanna met after the visit an executive who gave her a package describing his startup company, SinoVoice. Leanna’s husband is a minister in the south bay and a member of his congregation is the Director of Business Development for SinoVoice who is in the Bay Area getting an MBA. She meets with us after the trip at the university to tell us more about the company. We decide to visit SinoVoice the second trip and she, surprisingly, assigns herself to accompany us on most of the Beijing part of that trip.

The last day, year one. We are off to a privately-held, guanxi-financed company that makes a PDA-based dictionary that translates Mandarin to English orally and visually. They see it as a vocabulary development tool. We, for the second time, need a translator: very ironic and we learn later on that the company/product came into existence from the leader’s school day difficulties learning English. And again the translator is not up to the task, given the technical (business and product) language involved. The Chinese students stepped in again to facilitate the situation.

We are shown a second generation product which translates phrases and short sentences from Mandarin and English, again, orally and visually. This one they call a language development tool. I ask what are the challenges moving ahead. His response was that they needed an infusion of capital to expand distribution. I in turn asked if he knew that outside money would lead to giving up some control. I could tell as I spoke the words that he understood my English; he was the one who had trouble with translating, then speaking English. That evening back at the hotel I e-mail the VC we met earlier with contact info about the "PDA" company. He keeps periodic contact, but nothing has come of it yet.

We take an extended lunch today at a faux marketplace that Nancy knows of. I wander through bargaining here and there, not intending to buy anything until we are in Shanghai; one less time to try to close overpacked luggage. There are some interesting shops outside the market and by accident I get the answer to a question that has been bothering me since early in the trip. Why are all the bikes we see in use simple one sprocket, one gear bikes? I spot an upscale bike shop that has what back home we call mountain bikes. Between a conversation at the shop and later with Nancy I get my answer. Earlier in the trip I had asked her about a uniformed person at a very busy intersection, who was doing nothing about errant pedestrians or drivers. She was there to guard the thousands of bikes that commuters had left off near the intersection in a large, open area to get on busses. How could anyone guard bikes when she does not know the owners? She doesn’t; she’s just a presence. It turns out that no one wants to own and leave something as tempting and lucrative as a mountain bike in such a loosely "guarded" situation. In fact the more plain the bike the more likely it is that it will be there for the return commute.
Martin and I both wondered why we saw so few motorcycles. Motorized bikes were everywhere. But no motorcycles. Nancy said a decade or so ago many, a limited of number motorcycle licenses had been issued and many of those so licensed were killed in accidents. Not surprising given the mix of stereotypically exuberant driving, the under protected nature of riding, and reckless abandon of traffic in China in general. Issuing the licences was a implied link to death certificates and no more licenses were granted.

One of the conditions of parking our bus in the faux market lot was that our bus driver had to eat lunch in one of their eating areas and he was quite late getting back to the bus, It looked like we were going to be late getting to our last company, the Chinese division of Versatec. As the driver was trying to get the bus out of the lot, we encountered a cab that had parked in such a way that we were more or less blocked in. The driver honked, cabbie did not move; the driver honked again, the cabbie motioned to go around. Not possible. The driver honked again and opened the door to tell the cabbie to move. The cabbie indicated he had no intention of moving. I lost it, got up to confront the cabbie, and Leanna put her hand on my shoulder and shook her head no. Nancy got out and spoke to the driver. He moved his cab (better to use honey than a stick) and we were on our way only a half-hour late. What was I thinking? Was I going to be like my uncle who, in Mexico asking for directions and not being understood, ask again only louder? Thanks, Leanna. I could have caused a minor international event and embarrassed myself.
We arrive at the building that houses Versatec’s offices near our hotel. I recognize it because we had passed many times. We leave the bus at the time we should have been inside to start our briefing; I have no idea where the entrance is. More delay. As if on cue, a young Chinese man somewhat formally dressed approaches and asks if we are from Santa Clara University? Is he related to Grace at Tsinghua? He is our briefer and, I guess, being a good host, noticing his guests are missing, goes into the streets to find them. Inside he starts the briefing. He is not the one I had communicated with to set up the visit. When I called a week before the trip, to confirm the visit, my contact said "whoops, I have to be away at a mandated training session, but I will e-mail you with the name of my replacement."

The briefer launched into a standard presentation and we quickly started asking the questions we had about the company. He was a bit startled, but recovered and explained that he has worked in the storage business in other western companies in Beijing. However, he had been at Versatec for less than a year and would answer as best he could. He did very well (or we were simply pooped and accepted any answer) until I asked about the previous quarter’s disastrous financial results, well below analysts’ and company expectations. I ask whether the disparity was the result of their up-from-sales CEO had oversold expectations on a new product line. He professed not to understand my question; I rephrased it; he again said he did not understand the question. The assigned time was over and I let it drop. As we walked to the elevator, one of the Chinese students came to me and said that he thought that my question was understood and he was not willing to answer. On second thought why should he, as a mid-level person, say something to strangers about his CEO’s hubris. Fair enough...I was out of line. Damned cabbie.

Back to the hotel to refresh and depart for our final bus ride to our farewell dinner. The highlight of the dinner was a small cone-like dessert about the size and shape of an eraser one puts on a lead pencil whose initial eraser has been worn down. It was nothing remarkable. But the sight of one of the students putting one on each of four fingers on one hand was so silly we all were reduced to laughter of exhaustion and accomplishment.

The successful trip was at an end. The trip back to the hotel was relatively quiet. The students were off to whatever each wanted to do. Martin, Leanna, and I were up to our rooms to pack for departure the next morning to Shanghai to do some scouting for next year’s probable trip. I slept well knowing our experiment had been a resounding success. The start of the next leg was more problematic.

Transition to Shanghai
Up relatively early to the main Beijing airport about an hour away and somewhat easier on a Saturday in this ever-on-the-go society. Checking baggage I run afoul of rules for carry ons that are different than I expect. I had packed two small bottles of rice wine in my carry bag and, when they went through the xray, the belt stopped and I was signaled to come over and open the bag. With little language difficulty the bottles were confiscated. I was out a half a dollar. And learned that such products had to be in checked in baggage.

As we awaited for our flight to be called, we sat near the end of the down escalator on the lower level where our gate was. As I whiled away the time, I became mesmerized by the waves of humanity, mostly Chinese with other nationalities sprinkled in, coming off the escalator moving through this section of the terminal to their respective gates. I have never experienced any such continuous flow of humanity in my life. In the little less that an hour we sat there, I would guess that tens of thousands of people passed by. This was a symbol of the immensity of China, of the depth of human resources this growing economy has to throw into the maw of the growing economy that the Chinese are building. Before we left I was sent an article by a member of the business school’s advisory board that emphasized the significance of the this human juggernaut.

A factory in central China that produces precision automobile wheel rims in a way that would astound a westerner. The leaders of the organization made a conscious decision not to install state of the art manufacturing equipment, with the concomitant costs. Rather they turned to the vast human talent in the area and developed their skills to hand-make, blacksmith-style, all the rims not in a boutique manner but in volume. So far they are holding their own in terms of quality and quantity against highly automated factories in other parts of the world. Granting the article did not mention wages and working condition, this still speak much about their vast human resources.

In the air at last on Eastern China Air (run by Shanghai Airlines) I was in the window seat, Martin in the middle, a Chinese man on th aisle. Leanna was somewhere else in the plane. As meal service was served, my bowels told me there was food wanting out in a violent way. Forcing my seatmates to pick up their meals and raise their trays, I moved quickly to the nearest head, getting there just in time. Great, I thought. Seven more days to go and I have a bug, probably from the farewell dinner. I slunk back to my seat, apologized to my seatmates, and hoped there was not another episode soon. Not so lucky. Just as we were about to land another bout erupts, but the seat belt lights were on and we were descending rapidly. Hold it until everyone in front of me was out of the way and dash again to the head for relief were my only options. Done and relief. When I finally left the plane Leanna and Martin were waiting impatiently. When I explained my situation, there was sympathy. And it was time to head in to Shanghai to our hotel on our own.

The New Pudong Airport is I was told (given my distraction, I did not notice much of the outside on landing) a gleaming new airport, one of the finest in the world. It is built just off the Hangpu River on reclaimed marshland which supported the fisheries of native populations. This is another irony of the new China. Shanghai was founded on such an economy of remote fishing villages and a vestige of them is destroyed for this twenty-first century airport and the industrial area that is known as the New Pudong, the seat of some of the biggest foreign investment in China today.

Determined to make our way ourselves, we began to read the transportation signs to catch a bus into town. We knew that we could not get a cab because none would hold th three of us and all our baggage. And being on our own with no guide and no competence in the language, we were sticking together. Still, just as we made our choice of what bus to catch, we spotted one of the Chinese students and his wife who had also traveled on to Shanghai. With his limited Mandarin (he is from Hong Kong where Cantonese is predominant) he confirmed we were on the right bus. Outside as we were boarding a young woman in a uniform approached us and gave us a "credit card" from a Shanghai-based travel company Ctrip, which we were scheduled to meet with in a few days.

As the bus pulled out of the airport for the trip across the New Pudong into Shanghai, about an hour’s trip, I felt satisfied we were doing well so far on our own. Watching the views on the way in and not knowing in particular what I was seeing I wrote my own story. What I was really seeing was the immense industrial and real estate development rarely ever completed anywhere in the world on such a scale and a such a pace, a modern Chinese miracle. We would be back here several times in the course of the next two years and the immensity would become very real and potent. Across the Hangpu again (it curls around the New Pudong) we come down off the bridge and raised freeway onto city streets. The bus moves along for a mile or so, pulls into a nondescript parking lot, and everyone gets off. Taking a cue we depart, too. End of the line. I could tell from the skyline, as we came off the bridge, and from my memory of the website we used to book our hotel in Shanghai that we were near our hotel. We assemble, Leanna and I compare notes and guess which direction to go to find the hotel. Martin was along for the ride, so to speak, because he came into the booking and reservation process after Leanna and I had done all the scouting and scheming and was told where and what to book.

Park Hotel
We are headed to the Park Hotel, an art deco1930s relic in the shiny steel and glass high-rises of contemporary Shanghai. It is across from People’s Square, two metro lines can be boarded beneath the square, and it is reputed to have been Chairman Mao’s favorite hotel. It is still under CCP ownership, although the management is said to be contracted out to a professional organization. After two stays here the three of us are not certain about this. We came to stay at this hotel in typical Chinese fashion. A very recent MBA graduate had just relocated to Shanghai to work for Intel and his sister was an assistant general manager at the Park Hotel. We got a deal and great rooms.

We find two cabs, give the cabbies instructions as best we can with Leanna’s cab in the lead. Shortly, the cabs are separated and I get a sinking feeling. We are at a stoplight. And the cabbie looks at me (I am in the front seat; Martin in the backseat with the rest of the luggage that would not fit it what might be called a trunk) and asks we something in what is probably Shanghainese about where now. I take a wild guess and point down the road ahead on what I soon learn is Nanjing Road. Right where we want to be. In five minutes the dirty dark brown stone facade of the Park Hotel looms on the left and Leanna is there paying her cabbie. Relieved, Martin and I get out, pay the cabbie, and get our bags to go into the hotel. The bell boys are on us in a flash, just in time. Elegant as the hotel is (much like the plush hotels on Nob Hill or Union Square) this place could not be called handicap compliant. Several steps up to the doors through hand-opened doors and into a fine wood and marble lobby, we made mostly on our own and with some luck, no grief or miscues. As we check in Susie, our contact, is notified, comes to greet us, and promises to come to Leanna’s room after we check in.

What happens the next few hour is a blur. After "sucking it up", so to speak, from the time to get from the door of the plane to the door of my room, I collapse on the bed. After resting, I rouse myself, unpack, and seek out the others. We exchange visits to our respective rooms of which Leanna’s is the most posh; it is really a suite of rooms and looks out over the square. We tease her about being Susie’s pet. Susie is not dumb; she knows Leanna is in charge of logistics and that we are scouting out accommodations for the probable ‘05 trip. Hence, the best room is hers. My room faces west which turns out to be source of a silent tug-of-war between me and the cleaning staff. If the curtains are open during the day when we are out and the air-conditioning is off or down, I open the door to a furnace on my return, and it takes into the evening for the air-conditioning to get the temperature down to a tolerable level. So, l close the drapes when I leave, and they open them when I am gone. I use a trick I learned in Beijing. In both hotels the lights and AC are activated by fitting the plastic room entry card into a slot inside the room door. Upon leaving, extracting the card turns everything off. Fair enough. So, I develop a two-fold strategy to keep my Park Hotel room reasonably cool for my late afternoon return. In the morning when I leave I, I turn out all the lights manually and leave the Ctrip card in the slot to keep the AC on low. Also, if we come back during day, I close the drapes again. After the second day I have a decent temperature in my room when I return for the night.

Still, while am able to solve the problem of having a temperate room for the evening. Getting on line at the Park with my borrowed laptop proves impossible during the entire portion of this part of the trip. It is an annoyance, mostly, because I can pay by the minute in the business center on the second floor. When I try to log on from "my’ computer, I get the access program that the Peace Hotel apparently put on the computer. I search for it to delete it; no luck. I check my room information and call tech support to come try. The first one to come in the woman who cleans my room daily. I give her the benefit of the doubt, figuring she is the first line of support for issues like is it plugged in, have I found the desk drawer where the broadband outlet is, have I plugged the right cables into the right places? Everything checks out and she motions for me to wait. A few minutes later a young man in more formal clothes shows up. He must be level two support. He checks a few things on the computer...no luck. I go down the business center to e-mail Ruth in Media Services at the university. Given my schedule in Shanghai and the time differences with the west coast, all this takes place over three days. Ruth e-mails back a solution. Doesn’t work; I give up; now I have twenty pound boat anchor to use to get on line. Martin, too, is disappointed because we both have to use the business center and only during their business hours. Next year I will bring my own laptop. But that means I will have to buy one because, when I asked my wife if I could borrow hers, oddly she turned me down.

After the room tours, a little more rest, and feeling better, I agree to meet the others in the lobby to head out on Nanjing Road to look for food. The heat and humidity were more intense than I remember growing up in Oklahoma. As Martin and I grouse about the weather, Leanna, who spent several years in Africa with her husband and children, implies we are wimps. We find a place, negotiate and consume the food and beer (piju) with both mental and physical satisfaction. They want to continue on down Nanjing to the Bund and the Hangpu. Given what I went through midday, I decide to go back to my room for the night and agree to meet in the lobby in the late morning for more casual sightseeing. Parting, I go to my room, take a cool bath to get rid of the day’s grime (pollution in Shanghai is almost unbearable for an asthmatic), dry off, and throw up dinner. Welcome to Shanghai.

Breakfast at the Park was not as sumptuous as the Peace and more Chinese oriented. Nevertheless, given my experience with food the last few days, I had scrambled eggs and a glass of milk. Let’s see if that stays down. Down to the lobby to meet Martin and Leanna; only Leanna is there. Martin has decided to sleep in. I am not that willing to take on a strenuous day like the one at the Summer Palace last Sunday, so I propose crossing Nanjing Road to People’s Square and see what we find. Turns out to be a rewarding experience.

Entering the square we pay a token fee. Wandering around on the paths, we are treated to gardens, lily ponds, the typical things one would expect in an urban setting almost anywhere. We stop at a stunning lily pond (the leaves are so big, if one did not know better, it appears as though there is no water) and I pose Leanna in front of the pond with the old British Club, since converted to other uses, in the background and a new metal and glass skyscraper beyond that, capturing in one picture two centuries in the life of Shanghai. As we leave the pond, we are approached two boys who appear interested in us. They greet us in Mandarin; we are beginning to know a few basic phrases in Mandarin. We return the greeting and, then, they speak in English. They are in our equivalent of middle school students and they want to practice the English they are learning in school. So, we converse in basic English, they asking names of objects around us, we correcting mispronunciations and correcting grammar. After a while, they had exhausted their vocabulary, they thanked us, and we parted. I am not certain who was more thankful, they for the practice, or we for the trust to ask for our assistance. Several years ago as a young naval officer I had a similar experience in Kagoshima, Japan. We had put into port on a weekend and had an afternoon for shore leave. Some of my buddies and I walked to the nearby zoo, where we encounter some young teenagers who wanted to practice their English and the vehicle was the zoo animals. Kagoshima at least at that time was an out-of-the-way place and the signs at the zoo were only in Japanese. Walking around the zoo, the students inquired about each animal or bird and we would reply. However, in some cases my buddies and I had to come to agreement on what the animal of bird was before we could inform the students. We had only a short time off the ship and we left to return, being thanked by the youngsters. It was a refreshing break from our military routine.

Leanna and I turned up a path that would lead back to the hotel and heard an odd set of instruments playing unfamiliar music. As we rounded a bend, we can across an energetic group of middle age and older people dressed from informal to very informal, playing and singing a variety of tunes. Their instruments were eclectic at best. The centerpiece was the drum, a plastic jerry can, accompanied by other more normal instruments, a male vocalist using an amplified speaker. The players, singers and impromptu dancers were mostly male. The observers were attentive women. Leanna and I had no idea what they were singing or what the words to the music meant and there were no youngsters around to translate. Our experience had been that the educated Chinese into there late thirties were almost all conversant in English, reflecting government emphasis on learning English. We can only guess no one in the group spoke English enough to tell us what was going on.

We sat on one of the benches to listen and observe. While we did not understand the content of what we were watching, we were captivated to its affect, the enthusiasm and dedication. As we sat each of us was shaded by a parasol held by female observers. When the women saw my camera, they indicated each would like her picture taken as she held the parasol over one of us. We complied and each smiled broadly. We left shortly after and returned to the hotel. I had had a good outing; and I had kept my food down.

While in my room watching CCTV there is a program on which there is a mild debate about a newly enacted law giving pedestrians the right of way crossing streets is useful and enforceable. One position is that given the rise in vehicular traffic pedestrians need some protection. The other counters that it hinders commerce and is unenforceable. From my observation of intersections on Nanjing Road north of the hotel one takes his life in his or her own hands when crossing on a green light with the walk light on. Yes, protection is needed; yes, enforcement at this time is not possible, even at intersections where there is uniformed presence.

Two SCU MBA grads who live and work in Shanghai met the three of us for a little sightseeing. We all pile into the car of one the grad’s friend and go under the Hangpu to the Pudong to look back at the lighting of the Bund. The young woman driver negotiates the traffic easily with none of the manic charging which we had become accustomed to with cabbies. Refreshing. As we make our way down the bank of the Hangpu to look back across at the lighting, a young woman with a European accent and appearance me stops me and asks if I am Dave from Detroit. I respond no and move on. We pass by her as we make our way back to the car and I stopped and asked her if she had seen Lost in Translation. No she responded with a puzzled look on her face.
The famous neon lights on the Bund were only partially lit. Even though neon takes very little power to light, given the severe scarcity of electrical power in China, the government has ordered most of the neon lights off to conserve power. Would we rather have Intel run a full night shift and a few tourist lights or Intel run half a night shift (not possible) and have all the tourist lights?

The Bund itself is only the shell of its historical self. When one compares historical photos with current profiles outwardly, they look similar. The old photos show hotels, embassies, banks, night spots. Their insides are almost all gone, swept out after 1949 and the revolutionaries threw out the decadent west. Decadent is in fact what one could call the Bund and most of urbane Shanghai after the turn of the last century. Given its current reincarnation some of the decadence is reappearing on and in the old the Bund.

We reach the car and head back under the river for an evening of dinner and nightlife. I don’t want to push myself and I ask them to drop me back at the Park. Given what I hear the next morning, I am glad I pumpkined myself.

Shopping Around
Our first prospecting visit is with a software company that is in a restart up mode. They had a startup life in northern California, did not do well, and relocated to Shanghai to restart. When we get to the offices, it is a real start up. Odds and ends furniture, no one at the reception area, layout without rhyme or reason greet us. When John does come out, we are warmly welcomed and escorted into a meeting area without enough chairs and a table with a phone on it with its wire stretched tightly to the wall. Outside there is a building under construction that is at the moment a deep hole in the ground where the pilings are going in. It is going to be huge. John says his company is moving soon. John is Chinese from Shanghai, educated in the US, and he worked for HP and Cisco in the US before founding this software company; his business card say he is a product manager. He reviews the company’s history and prospects, revealing along the way some information that is proprietary which later he implores us not to reveal. We agree. His company is still private, looking for more VC funding. They are in the 3G space with some cutting edge products and promising alliances. We inquire about coming back next summer. He agrees. That night I stay in again to guard my health.

The next morning one of the MBA grads is accompanying us to visit a travel agency that appears to be Internet based. We catch a cab with windows down and start out; he looks at our contact info and makes a call to be certain he is going to the right place.. We ask the driver to roll up the windows and turn on the AC (we have learned that the price per mile indicator on the cabs tell which has AC and which do not). He does so and the cab stalls out. Without any fanfare he pulls over motions us out, gets out and hails us another cab, and tells the new driver about our destination. We offer to pay for the distance he has taken and pay for the phone call. To our surprise, he refuses. A considerate cabbie. As we look for the address of our destination, I am glad Allen is with us, because our second cabbie is having trouble finding where we need to be soon or we will be late and that is disrespectful of our host. After some to and fro and a few U-turns, we arrive just on time.

Inside we are taken to a large conference room with an immense wood conference table. Our host, the director of international business development, enters, greets us, and gives us a briefing about the organization, its short history and its development. He is Chinese from Shanghai, but raised and educated in the US. In fact he went to highschool in San Mateo about three miles from where I live. He is currently planning to relocate his family to Shanghai in the next few weeks so his kids can start in school on time.

After the briefing, we are taken to another building to look at the operations. As we enter that building in a room off to our left is a roomful of junior highschool aged kids (or so I think). The floor we enter looks like the room full of clerks that Citizen K encounters as he tries to get his troubles resolved. There are dozens of young people in small cubicles, looking at monitors, clicking at keyboards and mice (this turns out to be the "Internet" part of their business), and talking into their phone headsets to customers. The atmosphere is casual, business-like and very upbeat. On the way out I ask about the room full of kids. They are an incoming group of the reservation clerks all highschool graduates and some with some college. A young company indeed in several respects. We ask if we can return next summer with our MBA students and he agrees. The three of us did not need to caucus to make the decision to return. We were impressed and later one of us buys stock (they are listed on NASDAQ, another story) and makes some money on the transaction.

Afterwards we find a place for lunch, part company with the student, and head down to the Metro to get back to the Park. The Metro is clean, efficient and easy to use; most of the signage is in English, too. It is very difficult, however, to exit the underground coming out where you expect to come out. Of the half dozen times I came back on Metro to the Park, not once did I come above ground at the same place or where I planned to. Once I emerged almost as far away from the hotel as the Metro ride I took to return. This does not happen to me in the Bay Area, New York City, Boston, or DC. I have to work to get better on exiting the Shanghai Metro underground some where near where I expect to be.

Next up tomorrow, Tuesday, is the founder and chairman of a software company that serves financial institutions and Intel, which I worked for for three years several years ago. For the afternoon I prepare hand-written notes on SCU thank you cards for everyone we visited in Beijing. Making certain I have the correct English address for each is time consuming, but I am thankful for the ritual of exchanging business cards.

The founder of the software company meets with us in the lobby of our hotel in the informal bar area. There was a pair of Chinese men in the same area talking so loudly we could hardly hear our soft-spoken guest. He is from the mainland, raised and educated in the US, and for twenty years CTO of the World Bank. He describes his start-up, which looks like a large company if you visit his website, with engineering teams in China and India and sales reps all over the world, while he spends considerable time in the US. He is surprisingly candid with three relative strangers. The enterprise is not going well; it is difficult to manage such a distributed organization; and the product line may be misfocused. Hence, he is rethinking the whole endeavor. As he explains the complexity of the situation and gives his deft analysis, we decide we want to engage him next summer for his experience and clarity of thought and not so much about his company, sort of a resident guru. He is a agreeable. We thank him for coming to see us and I now understand why he preferred to meet us at the hotel. There may have been no there there.

Intel has been in China for over twenty years. In Shanghai there are two assembly and test facilities in the free trade zone in New Pudong. As I exchanged e-mail with the contact at Intel, we tried to figure out the best way for we three emissaries to get to get lunch and to their facilities. This was when I thought we were going to meet the software executive at his office near Intel. We finally settled that my Intel contact would pick us up at the hotel and bring to New Pudong and lunch would occur along the way. Our contact had been in the lobby towards the end of our meeting with the software executive and he approached me shortly after the executive left. We collected Martin and Leanna and went outside to his rather large, dark car that came with a driver. It seems that Intel to manage risk does not allow its executives to drive themselves in Shanghai. Good idea. Probably easier for a westerner to learn Mandarin than to learn to drive safely in Shanghai.

John lives in Rio Rancho and is rotating through Shanghai training his Chinese replacement. He is the head of government and public affairs for Intel in Shanghai and, as such, helps steer it through the laws, regulations, and bureaucracies to meet its corporate goals. Since it is nearing noon, he suggests lunch in one of the reclaimed buildings on the Bund. The driver maneuvers us through the narrow streets and deposits us at the lobby of an impressive stone building. Inside we take the elevator to an upper floor to the restaurant. The setting was spare with wood floors and modern art paintings on the wall and views that were spectacular looking out over the Hangpu with its water traffic and the spiraling new buildings in the New Pudong, in particular, the Onion Building, aka, the Pearl of the Orient TV Tower.

M is a culinary delight matching the decor and the views. The food is a fusion of Asian, European, and American cuisines (Frommer’s calls it Continental). And the prices reflect the overall excellence of the place. Glad Intel is picking up the tab. M is an interesting name and concept. They also must have a marvelous publicist. In almost every in-flight magazine I have read since, M is mentioned as one of the featured restaurants in Shanghai. We settle into the car as the driver takes us to the plants in the free trade zone. I think my digestive system has returned to normal; it’s amazing what good food will do. We wind through the plants, office buildings, condos that we saw from the air as we landed and the bus as we went towards our hotel four days earlier. Almost all of what we witnessed was not there five, ten, fifteen years before. We also passed the site where, when construction is finished will be the second tallest building in the world, behind the "1776" to be built near Ground Zero in Manhattan. Soon I see Intel blue ahead of us. We pass through security gates, enter a building, and, suddenly, I am back at Intel.

Consistency, boring consistency, in decor is one of Intel’s trademarks. From here on it is old news to me. Leanna and Martin on the other hand are fascinated with the historical timelines and objects on the walls, the look through windows into the assembly areas, the employees in semi-bunny suits. We ask John if we can meet with key executives when we return next summer. He replies cautiously yes, but warns he is returning to Rio Rancho in the spring. And he has had his tour here extended twice before; so, he might be here when we return.
On the way back to the hotel John and I chitchat. I tell him some Andy Grove stories. He asks about training for new supervisors; I refer him to Corporate where one of my teammates developed a program for supervisors a few years ago. We are dropped off at the hotel. Leanna wishes we were going home tomorrow. No such luck. We have one more organization to prospect and we are hosting a SCU recruiting event the next evening at the hotel.

The next day Leanna decides she will stay behind and work on her presentation and Martin and I take a cab in the morning to the last prospect, a telephony value-added company. The ride is two blocks down and two blocks over, a 10 yuan ride. We could have walked. We enter a very new building with some floors not yet finished, go to the fourth floor, and enter the most lavish and stylish space we have encountered so far. Very modern, like M. We meet with a business development manager, a young Chinese woman, born and raised in Singapore, with an undergraduate degree form Brown. She had worked with one of the founders in the US and he asked her to come to Shanghai after the company was founded. The presentation demonstrated that the company had some promising initiatives and products. One of their strategies was to be the mobile data, access, and entertainment medium for the more remote regions of China. They look promising (one of us buys stock; doesn’t do well); we ask about meeting with execs when we come back next summer; she says she will help. Looks like our prospects of adding Shanghai to our agenda are good and we will be able to offer some good organizations. Too hot now to walk back to the hotel; we take a cab.

I change into t-shirt, shorts, and sandals for Metro ride to the large outdoor faux market to get gifts. I leave the next morning early, so I only have this time to shop. Leanna and Martin have been to the market earlier and I have my directions. Two stops south, exit left, walk two long blocks, turn right and I am there. On the Metro a young woman speaks to me and asks where I am going. I tell her and she says she is headed in the same directions. She works in a nearby province in a governmental job. She is in Shanghai today to take a computer class to make her work more efficient. We exit at the designated stop, exit left, and walk. After a block, she indicates she has reached her destination and I am on my own. I find the market and like to think I could have found it on my own. However, on my way back to the Metro, I overshoot it and have to reason my way out of nearly being lost to find the Metro.

Shopping was necessary, and not fun. My strategy was to enter a stall if I thought it had something I wanted. I stated my price and if the keeper did not come to agree, I left. Sometimes I got what I bargained for, sometimes not. One time, when I turned to leave a stall, without reaching a purchase agreement, the woman keeper grabbed my arm to prevent me from leaving and, in doing so, scratched my arm to the point of blood. Then she ran after me, saying I was cheap. I got everything I wanted except a shawl for my wife. For that I went to the department store next to the hotel. When I found two I wanted, I bargained for it and got the listed mark down which was not posted. To pay I had to take a chit to a central place on the floor, pay the fee, get a receipt, and return to the shawl area, present the receipt, and get the shawls. Lessons learned: you can even bargain in a department store and the overall transaction is very inefficient.

Shower and get into nice clothes one more time. There was finger food and drinks at the reception area for the recruiting meeting. We knew we would not actually recruit any students. Since we were in the area, we might as well show the flag. Most of the dozen people who showed up were fiends and colleagues of the two MBA grads. However, one attendee was a reporter from the paper where Leanna had advertised the reception. We made the paper the next day. Afterwards, Leanna and I made plans at the front desk to check and have a cab early the next morning. Back in my room as I packed I thought: Beijing was a success; prospecting in Shanghai was promising; and my shopping was completed. I had my tickets for reentry.

The cab ride to the airport borders on terror at least for Leanna. We leave the Park quite early; there are few other vehicles on the road; and the cabbie puts into practice that business maxim: time is money. The sooner he gets us to the New Pudong airport the sooner he can pick another fare. She tells him in English to slow down often. Each time he flinches at her forcefulness, not understanding and keeps careening along the relatively deserted freeway. With the speed the trip is mercifully short. Check bags, head to the JAL business class lounge, decompress. A little over four hour to Narita which we are now familiar with and do not come close to going out of the airport (without visas for Japan. How to explain? Oops, we did not mean to leave, can we come back in?) like we almost did on the outbound trip. Settle into the Admirals Club and wait for AA to call our flight to San Jose. Weary travelers, we are quiet with a little conversation. But we do agree we did it. We made it work (our slogan as we pushed the experiment forward). The experiment is a success and we will advocate for expansion. We board AA, take seats apart.
I am mentally and physically exhausted and the long flight from night into light was a blur. No remembrances. As we deplane and clear customs, Leanna’s husband picks us up and takes me to my office on campus, where my wife retrieves me a few hours later to take me home to meet the two feral ragdoll kittens she adopted while I was away. The immediate impact they have on my life is that they think my bathroom is their refuge. Since they were feral and to keep them early in their new residence from hiding under beds, she kept them in my bathroom and the small hallway outside it. Now I have company each time any time day or night I am in my bathroom.
We convene the last class session a few weeks later for students to present their findings. The presentations are a result of a revolt before we all left Beijing. They argued, reluctantly convincing me and Martin, that our original assignment was lame, and given all they had learned and all the pictures and videos they had taken, they could work in small teams to make multi-media final presentations. Did not happen. We got group papers and Power Point presentations. Some of the presentations were illuminating and concise; some were mundane and rambling. None live up to advance billing. Later Arthur tells me they were lacking in critical observation and analysis to which Martin and I have already agreed. Their saving grace was that many preconceived notions about China had been dispelled. Martin and I revisit the final assignment for next year and decide not to be so swayed again. Not that it is not tried again.

Debriefing and Moving Ahead
Late August the three of us meet with the Dean just after he has had breakfast with a few of the students from the trip. Assessing the pluses and minuses, we decide to do a repeat and formally add Shanghai the following summer. Later Leanna recruits two faculty (one from India, one from England) to take a second group to Germany. The school year is rapidly approaching and there is a buzz in Kenna Hall, where to business school is mostly located, that the China trip was wildly successful and the experiment worked. Leanna and I meet to outline enough of what we will do in summer ‘05 so she can put together flyers and web pages. A six minute film one of the students made was shown at opening assembly and we thought that and the buzz will fill both trips quickly. This proved to be incorrect and we have to put posters and flyers in the halls of Kenna and hold more than information sessions. We know, however, China will sell enough seats. And I do not begin to recruit summer '05 visits until January, 2005. I give it a rest. The Dean initially balks at giving me release time to put together the second trip. I win him over (he is reluctant) and decide to keep a log so I can demonstrate the amount this all takes.

Beginning Round Two
In mid-January, 2005 I begin the task of assembling a set of organizations for the coming summer, but first comes the task of clustering them so that our drive times are economical. I am mostly certain of Beijing, but some organizations in Shanghai that I want to visit are spatial unknowns. Chang sits down with me and a map of Shanghai and the surrounding area and we get the list into appropriate clusters. Many are close to the Park; some are in New Pudong; some we might be able to walk to. This mapping process is aided by a sweetheart deal from the Park with very good rates. Once that it is settled we can proceed. To the chagrin of some ‘04 students we reconfirm the Peace Hotel in Beijing...it is central to many activities there.

Within a month I am able to pin down almost all the places we plan to visit. This coming summer we will have a line-up of much smaller organizations with a few divisions of larger US companies. One organization puts me off until June and two others will not return e-mails. Patience and persistence are required. Leanna and I have "fired" Prague and she with a lot of contacts will handle logistics. As we move into spring the schedule must be tightened and finalized as best we can so the busses can be chartered. In summer time there is heavy demand for chartered busses and we must book them in spring to make certain we have them. Ctrip becomes our preferred in-China travel agency for handling various parts of our logistics. This works well often, poorly other times.

Now enters a helpful and complicating player. From Leanna’s six degree of separation meeting at Tsinghua in ‘04 the manager from SinoVoice, Rita, becomes an informal part of our team. She in the US until late spring to finish her MBA and will move back to Beijing after that. Good to have a contact in place. We first met Rita when she came to see us at SCU just after the first trip to sell us on visiting SinoVoice the following summer. She was almost overenthusiastic. But I agreed to include her organization in mix and, since they were apparently housed in the Tsinghua University incubator, it would be convenient. That turned not to be the case.

Since we had parted company with Prague, we had no one on the ground in China. Leanna had tried to contact Nancy but could not make a connection. I turned to Rita to bug the organizations I had not yet been able to pin down. One organization–Citibank–kept putting me off. I tried an e-mail to the Canadian early in June and it bounced back. I sent another to the person who sat in on the first session but did not say much. He replied that as I had surmised in my e-mail to him that indeed the Canadian had left the Beijing office. He agreed, then, to coordinate a visit but the time I had assigned conflicted with the opening of a major Citibank facility in Shanghai. The PDA-based dictionary organization, while initially enthusiastically replying to my e-mail for second visit, fell off my radar: no e-mail response (but no bounce back) and no connection via phone. So, we dropped them and added Citibank in that spot. Well, maybe. By the time I got back to the bank, that time was questionable.

Things got more complicated. Leanna had found Nancy and was working with her. Nancy shortly after that communicated that there are medical problems in her immediate family and she was withdrawing, finding us a replacement, Kelly. So, without Nancy I gave Rita my contact info for Citibank and turned her loose. 1pai/Yahoo had bowed out but the schedule is full (some said more than full) except for the slot for Citibank. Alas, we took off to China with this issue unsettled. Then, another surprise. The Dean, in discussing the trip with the head of the school’s advisory board, a prominent local VC, came away from that discussion with a list of individuals at four more organizations I should contact.

The Dean was more involved for this trip because of an idea that arose during some idle time in the Park lobby. Leadership was one of the factors I was interested in and it rarely got the attention it deserved during our visits. Leadership is his strength as a teacher and researcher (in the teaching scholar mode of SCU) and we decided to play to that strength with a leadership panel in each city the coming summer. I would add the people from the head of the advisory board to the panels. In this group was an asset, Jenny, who proved to be invaluable. Jenny is from Beijing with an undergraduate degree from China. She immigrated to the US to work and get an MBA and had returned to Beijing to be the marketing VP for North America and the European Union for ZparkGlobal (aka, Zhouguancum Software Park). Jenny repositioned the software park to Zpark so she could say the name in her markets without "huhs". I was interested in a business park and I needed someone who could speak about the regional economy of Beijing and tie it to the national and global economy. She could and was willing to do both. Business parks in China are incubators in the US sense with real estate development added on. In some areas business parks are local flashpoints. Since the government holds title to all land, the economic expansion has given rise to questions about how some land is used. Land for business parks are sometimes appropriated from poor and low use people and those people lose their meager livelihood. Some charge that local party officials benefit financially from the aggregation of lands into parks. Public officials lining their pockets during the early part of the economic boom was a contributor to the Tiannamen Square incidents in 1989.

Another gem on the list was a company whose vice-chair is a Sand Hill Road VC that I could not track down by phone, e-mail, collegial intercession. Viola, that company’s president is on the list. One e-mail and he was on board. I also got a leadership panel participant from this organization.
About this time I get an e-mail from Grace at Tsinghua. She has been asked to analyze the HDTV set business as a potential for investment and development in China, asking what I know about the industry. My comment is that in the US broadcasters were slow in adopting it and the FCC may have to step in. She also mentioned I had made her famous (her words). When her thank you note arrived in the summer, no one knew who Grace Wang was. No one knew her English name. Now people were asking who is Grace Wang, her fifteen minutes of fame? We e-mailed back and forth a few times and I invited her to this year’s visit (her boss had affirmed he was speaking...no backing out). Later she e-mailed she was changing jobs. I reiterated the invitation, but she did not respond and I lost contact with her.

We had dinner at a local Chinese restaurant with all the students, faculty, administrators, Dean and his wife to kick off this year’s effort formally. Chang was able to attend, but Arthur was otherwise busy. Gary Zhang who had hosted us at HP in Beijing was in town and I invited him, if he had time. He said he would come if it fit his schedule. But he was actually on his way to SFO at dinner time and missed the dinner. Leanna had an agenda. She wanted students to decide who they were going to room with; we had visas and passports to return, schedules to hand out. And students wee reminded of payment schedules. As students introduced themselves, we find out that one is leaving a week after his second child is scheduled to be born. I know Tim from another class I taught and I told him he owed his wife big time. From some of the things that were said I am alerted that there are some misconceptions about China in the room. I make a statement to keep an open mind and check assumptions. We have a substantial contingent of Indians who are measuring the competition. Their presence on the trip is rewarding and enriching in the comparisons they can make. And often they don’t agree with each other. The Dean’s wife, Jackie, asks what she can do to prepare and I hand her a copy of last year’s reader packet.

Classes started mid-spring and the students were eager for early July to arrive to get on the ground in China. This group of students was a quite varied group except in one category. We had eighteen males and two females. Although several were married, settled down, and some with children, Martin, Leanna, and I were worried about an Animal House atmosphere at times. As far as I know, this fear was unfounded. Or they kept it out of our sight. From random comments from the two females the imbalance was noticed and tolerated by them. The differences among ourselves is rich. During one class we each talk about our international experience both personal and in business and we astound ourselves at the depth and variety we have as a group. In another class the students have to report on an interview each had with a local global entrepreneurial leader using the text (Developing Global Executives) as a template. They were so taken by what they heard from each other’s interviews they posted them on the Yahoo Groups site we had set up for all to view.

One class was a movie night and we screened a film, The Soong Sisters. One married a wealthy banker, one married Sun Yat Sen, and one married Chang Kai-shek. The movie follows their early development, marriage, attempted revolution, defeat of the Japanese, revolution again, and the installation of the Communist Party as the new rulers of China. Most of the students, including two who are Chinese, saw images of China very new to them. I had to remind them that this was a motion picture and not necessarily good history. Beginning at the turn of the last century, it crammed the period of 1939 to 1949 into the last few minutes of the movie, implying the period was uncomplicated when in fact it framed substantially what China became and is now.

As we wound down the classes, I resurrected an offer of a former student in one my other courses to visit his former employer which was a high-flying, if not controversial, chip company based in Shanghai. After several e-mail exchanges among several operatives, I plugged in one more visit the last afternoon we would be in Shanghai. I had this opportunity because I had allocated the morning and early afternoon of that day to an extended visit to Intel. That would not occur. John was leaving Intel, Shanghai in mid-spring to return to New Mexico. He passed me off to his replacement, who passed me off to his assistant who was a recent local college grad. I tried every card I could, including my former employment at Intel and my close work with Andy Grove and Craig Barrett. No dice. We would get the standard briefing, a walking tour, and we could have lunch on our own in the cafeteria. Period.

Off Again
Off to China for the second trip. My flight out of San Jose left quite late, but was without event. My wife had given me a DVD player for my birthday to watch movies of my choice on the twelve hour leg to Narita. Of several DVD I purchased, I chose to watch "Closer" directed by Mike Nichols about relationships of two couples who join, swap, and rejoin each other. The ending was so degrading and depressing that it haunted me for several days. I mentioned later to Leanna and she said she and her minister husband walked out before the end.

To distract me from the agony of the movie, as we neared Narita, it was clear, because of our late departure, there was no way I was going to make my connecting flight on JAL to Beijing. A flight attendant said to check as we departed the plane for someone to give me directions on the change in my flight plan. As I deplaned, I and a Chinese teenager were met by a ground attendant and told of our new connection and instructed where to go. The teenager was very worried. He was from Beijing and was going home for a holiday break from a highschool he was attending in San Francisco. I knew more or less where we were to go and took him in tow. (Narita is intimidating if one is not a seasoned traveler.) We made it through the busses, trains, corridors and ticket agents to make our new flight. We parted after we boarded and I never saw him again. I reflected on the irony: an American helps a Beijinger through a confusing Japanese airport. "Closer" receded.

Peace Again
The second morning we are off to sightsee with Rita as our guide. We (Leanna, Martin, and Leanna) go to a section of Beijing we did not get to last year and were going to a faux antique market. On the walk in Leanna tells me that Rita had announced she was taking the week off from SinoVoice and will be her roommate at the Peace. She did not object, but in hindsight she should have. She had no privacy for a week; Rita announced one night that she was getting a massage in the room and Leanna had to hang out in the bar.

The faux antique market was not much different from all the other markets with knock-offs. This market specialized in fake antiques. Much less crowded and cooler, but it could be that we got an early start to the day. Back to the hotel to pick up Barry and Jackie; they had gotten in the night before from Europe and wanted to sleep in. Back out again to the Pearl Market (mostly faux) and then the Temple of Heaven Park. We make a quick pass through the market (we’ll be back) to the park. I bargain for a hat, 10 yuan and a keeper (it sits on the odometer of my treadmill). It says "Beijing Tiannamen Liunain" which roughly translates as "Beijing Tiannamen Memories" and it serves me well for two weeks.

In the Temple of Heaven the Hall of Prayer for Good Harvests itself has a shroud around much of it and a sign indicating that it is closed for refurbishment and will reopen in several months. (Many parts of the Forbidden City are in the same state: all in prep for the Olympics) We encounter many older Chinese and we learn the one of the retirement perks is free admission to all parks and other public areas (all charge a small fee). I like that perk. I am sixty-five now. Can I get into Yosemite free?

The promenade between the Hall and the Imperial Vault of Heaven is long, broad, and has a wide view of most of the rest of the grounds. It was only for the use by the royals and ceremonialists only a few times a year to bless upcoming harvests and the general well being of the realm. I puzzle at trees that are topped off. Nothing could be taller than the sacred structures.

Back to the Pearl Market. Barry is at a faux watch stall looking for over an hour. I worry that if he spends so much time there and buys nothing, there will be a fire storm. Relief. He buys four watches. One of the students forgot the adapter for his Dell laptop and I look in the electronics section for one. Dell’s are made in China; surely there is a knock off adapter. Nope. Leanna comes away with a suitcase to carry back all the gifts and nick knacks she buys. Martin scores some faux Armani shoes. I got something at the faux antique market for my granddaughter and will get some Xian (terra cotta) soldiers at the Friendship store after the Great Wall.
That evening several of us head out to a Hakka restaurant, Old Character Hakka, touted by last year’s students. Hakka is the name of group of people originally Han Chinese from the North whom migrated south to avoid the suppression of the Mongols. Their cooking features the use of native and natural ingredients and reflects an inland nature with little or no seafood (which was in fact present in our dishes). We have been told we are in for a treat. But first we are in for an adventure.

Our cabs (there are eight of us: me, Leanna, Martin, Rita, the Dean and his wife, one of the Chinese students, Tim, and, Wilson, the oldest student on the trip [we will hear more about him later]) take us to near the address we have from Frommer’s Beijing. It is dusk and we cannot see too far ahead as we look for the building. We arrive at the spot where it should be. Nothing. A man appears out of the darkness and asks if we are looking for the Hakka restaurant? Relieved we say yes. But I am puzzled: why is he asking us if we are looking for the restaurant which should be right where we are standing? He reveals that they have moved and he is there to provide direction and transportation for folks like us who had the old address. His presence is a testament to the people resource in China. He calls two vans, we pile in, and off we go. Looking back we were very trusting; they could have been "Shanghaiing" us.

After a ride that takes us almost back to where we started, near our hotel, we disembark, walk down an alley to a light colored building. Entering we pass through a room with men sitting at tables, shirtless (it is still early evening and still hot and somewhat humid), and smoking. I am wary; can I tolerate the smoke? Luckily, we are taken into another smaller room where we are one of two large parties; in the other one all speak US English and appear to be young American professionals working in Beijing. No one is ours smokes and only one in the other group does. I can handle this.

We order by a combination of pictures on the menu (there are some eews) and Rita and Tim’s ability to query the waitresses. First, piju all around now and more later. We order over a dozen dishes, all with enough for eight. They are fresh, tasty, some very spicy, a few surprise bones. A treat and a change from plane and hotel food. More piju; no one is driving. Then a couple of desserts. An hour or so later we asked for the bill. After we split it up, including a tip (no tipping in China; we did anyway...service was excellent), and we each pay a little less than $4.00 USD. Amazing. I note from a business card I picked up there here are two more in Beijing.

The next day is the start official start of year two’s lab: Tiannamen Square, Forbidden City, Summer Palace, and a welcoming dinner at the Shangri-la Hotel. It is also our introduction to Kelly and our bus driver for the week. While she is charming and informative, they will turn out to be a trying pair. He is stubborn and will not ask for directions (unless I force the issue) and, as a female, she will not prod him. Sound familiar?

The drive to the Square is short; during the week some of the students jog there and back each morning. There is nothing remarkable this year. We split up to wander until we regroup to go to the Forbidden City. As we do, there is much commotion near us. One of the many vendors on the Square is trying to wrangle us into a group picture with the famous portrait of Chairman Mao in the background. Some of the students are all for it (tourists all) and the rest of us begrudgingly agree. Get it over with. I don’t order a copy. Later when we return to SCU, Leanna has an extra copy she gives me. Revealed in the photo is a rare quality; a powder blue sky. There had been rain the night before and it cleansed the air (see coal, upcoming). It is now a most prized possession which I will mount on our living room wall. When I showed it to my wife, initially, she could not find me in it. Where’s Andrew?

Chairman Mao’s portrait is an incredible symbol in China and, needless to say, he is a national hero. And deservedly so. Maybe; maybe not. His story is mixed. And what legacy does he have in this new partially capitalist country. The current generation of leaders (shortly after Mao’s death) moved away from the common man base of the Party.

A magnificent biography by Jung Chang and Jon Halliday, ‘Mao’: The Real Mao, methodically demolishes every pillar of Mao's claim to sympathy or legitimacy and is enormously popular with Chinese outside of China and is and will continue to be banned in China itself. What will it take for the portrait on Tiannamen Square to fall? Or will he remain revered in spite of who he really was or what he did? In the US we have a relatively analogy (analogy not a parallel) in the Jefferson Memorial and Jefferson’s slave holdings, his"wife" Sally Hemmings, and their offspring who would neither be his heirs nor be recognized by his "real" descendants. Thomas Jefferson’s reputation is tarnished, but he is still and will continue to be revered. As I reread this I do not mean to compare Jefferson’s treatment of blacks as in any way similar to Mao’s unbelievable treatment of almost all around him and the Chinese population in general. We revere our heroes, in spite of themselves. Mao’s portrait will fall with the symbolism of the acts that will be necessary to allow ‘Mao’: The Real Mao to be read in China and to be on the reading lists in Chinese History classes in Chinese universities.

As I said earlier, there had been rain during the night and, as we entered the formal Forbidden City, one of the students looked at the horizon and proclaimed there were mountains out there. Seventy-five percent of the power generated in China is coal-fired and the exhaust is not scrubbed. Particulate pollution is severe and the impact on the health of the young and young to come and their impact on a broken health care system is potentially overwhelming for the nation. Coal plays another monstrous role in China. With the rush to fuel the power needs, coal is being mined maniacally and ruthlessly, a reflection of an out of control economy and unregulated growth. Mining accidents are mushrooming in the unregulated rush to capitalize, literally on the need for coal for power. Another example of the imbalance between exploited countryside and its inhabitants and the prosperous cities.

We move through the City remarking on its various sites, losing track of each other and regrouping. Twenty-seven are hard to keep track of. We decide to set a plan into effect (we had not printed this year’s agenda in Mandarin) and set end-times and places each time we leave the bus so we don’t leave without anyone. Leaving the City, we encounter some of the most destitute and deformed beggars on the whole trip. So vivid are their plights that one of the Indian students remarks later that the scene was not like anything he had encountered among beggars in India and had troubled him since.

Summer Palace was too brief. We cannot do in two hours with our large group what the three of us did in five hours last summer. I am disappointed, but the students, having no prior point of reference, are satisfied (except for the availability of food they are willing to consume). I hope with time they will become more flexible. We do see the Marble Boat and take a short cruise on Kunming Lake. I have a small capped vial with me to collect water for my church’s Ingathering for the coming fall, the beginning of the church year, called the water ceremony. The charge is to bring back a small sample of water from our summer travels and combine them in a ceremony to create our reverential water for other ceremonies during the church year. I contemplate leaning over the side of our boat to gather some water from the lake. The freeboard on the boat is quite high and I would have to an extreme hang job to gather the water. Better not to freak out the boat personnel and not give any student too big a chance to help me farther towards the lake’s surface. I pass on the opportunity. Back to the bus with grumbling about the food available and warily looking forward to our welcoming dinner in a few hours.

I had lobbied for the Hakka restaurant or one in the Kerry Center called Horizon. Leanna had opted for the Shangri-La because a recent MBA grad, Serena Wei, is their Director Training - China. I had Serena as a student for one course and Wilson had known her as a fellow student, so there were warm mutual welcomes as we entered the space for our dinner. When we left our hotel on the bus to the Shangri-La, we were all expectant of something special and we had dressed for the specialness. Arriving I was struck by the grandeur of the exterior of the hotel and the expensive vehicles–cars and busses–in valet parking and inside by the detail and splendor in the lobby and beyond. We were in the most awesome (non-historical) space of the whole trip. Later Leanna, Martin, Wilson, and I would get a personal tour from Serena that was even more impressive. And we find out this is where US delegations, including Bush, stay when they are in Beijing for official visits one of which will occur just after we leave Beijing. After seeing the spectacle, I am glad Leanna picked Serena’s hotel.

I sit next to SCU Professor Jim Sepe and his wife. Jim is in Beijing at Beijing University teaching two courses in accounting to Chinese MBA students during the summer term. We invited Jim and his wife to join us for this dinner. Jim and I had met several times back at SCU to try to figure out how to get some of his and our students togther for networking to no avail; mutual schedules do not fit. We settled on inviting his students to attend one of the Leadership Panels and some do. He and his wife are not thrilled at their accommodations (think dormitory-like) and check into a hotel on the weekends for relief. His wife inquires why my wife is not present and I relate her mobility problems. She suggests a concoction sold at CostCo called JointJuice Plus, a glucosamine and condroitin mixture, which my wife has tried to no avail. She rejoins that it takes up to three weeks to begin to take effect. I e-mail my wife, she starts a regimen, and begins to get some relief shortly after I return home.

Arun, one of the Indian students and probably is the most cosmopolitan (or aspiring to be) on the trip, sits on my other side. We are being served a Great Wall Winery Cabernet Sauvignon of unknown vintage. I had had some in Shanghai last summer and it was more than drinkable, so I expected this would be OK. Arun was unsure as he would be later during the meal. He asks me what was the most expensive wine I ever had. That was hard to answer. I have had a glass or so of many elegant and expensive wines in my time as a wine columnist, apprentice wine-maker, and a short term in wine sales and consulting. I settled on a recent experience of serving a jeroboam of Ferrari-Carano Cabernet Sauvignon (1985, Alexander Valley) to the board of my wife’s organization of which she is the executive director, done because I thought the wine’s time was coming due (I had called the winery about this; they thought I had held it too long) and I could not think of another coming gathering of sufficient number to warrant serving it. Opening a jeroboam (three liters) of this vintage, one does not have two glasses, recork it, and set it aside for another time. It will produce about seventeen ample portions and needs a group larger than a small family meal to do it justice. I had also never opened this large a bottle of wine. Given the opinion of the winery, we were in dicey territory and I was worried. Pretty high diving board for such a risky venture. As I proceeded, my ah-so was not cutting it and I switched to a pump-like opener. Pushing the needle in, I began to pump one, two, three, four, five times. On the sixth the cork moved a little. One, two, three, four, five more pumps and the cork popped free, the tip coated thickly with sediment, a good omen. As I candled the wine into five carafes I had rounded up at the Catholic retreat center where the board dinner was, the wine as expected showed a rich brownish-red color. I had set aside another wine glass with a coffee filter over the mouth into which I poured the dregs (a trick I learned from an owner of 231 Elsworth, an erstwhile famous French restaurant in San Mateo). The aroma was rich and earthy, another good sign. Removing the filter, I sampled the filtered dregs. Marvelous and relief. A mature, full-bodied Cabernet, deep and complex and ripe. The winery doubters of their own wine (I phone them to tell them the results; nonchalance) were wrong. I did not tell Arun all this, but I did tell him I paid $90.00 for it at the winery.

Dinner begins with introductions and salutations all round. Wilson stands and asks to speak personally. In Mandarin he thanks Serena for her hospitality. Surprise throughout the group. And it will not be his only surprise. Later I learn that he has been studying Mandarin tapes in preparation for the trip and he drew on what he learned for and during his previously mentioned trombone playing trip.

Our Peking duck dinner was served and what a dinner it was. An elaborate and delicate twelve-course meal. The first course was a platter of five-spice marinated beef, smoked pomfret, mini barbequed octopus, pickled cucumber, century egg, and jelly fish. All went well until the century egg (also known as a thousand year egg). An egg is "marinated" in charcoal and lime for a hundred days, leaving it bluish-green tasting like cream cheese and with a strong aroma. Arun balked; looked suspicious to him. "Egged" on he ate it, but was not pleased he had given in. From that point on during the meal when he came upon something unknown, we could not convince him to try it. He did try soft-shelled crawfish and was not sure about that. I don’t like them either–in Beijing or New Orleans. He did agree that the Great Wall red was quite drinkable.
The Peking duck came by so quickly and delicately I had to look back at the menu to find it. What a relief from last year’s greasy duck! After a long day with lots of walking in high humidity and heat, good food and drink, we head home to the Peace Hotel for the night.

In the morning at breakfast Arun has learned the Mandarin phrase to cook the bacon hard. Another cuisine adjustment. The continental way to cook bacon is warm and soft and he does not like it that way. We will notice our mutual foibles for the next two weeks and the students devise a point-based game to rank each of us. The results are provided at the end of the trip with details of transgressions except for me, Martin and Barry. We get point totals, but no details. When asked, the students say we may get the details after grades are in.

Today we are off to the Embassy, Citibank (maybe: we are still negotiating with them), and ZParkGlobal, a visit with multiple purposes. On the way to the Embassy we contact Citibank; it will not work, a no go. We inform the students and they plan to take time to shop and tour the Hutong. We arrive early and only the coffee shop is open. Some students head off to refill and come back with our Embassy presenter in tow. We head up to the briefing room and, after leaving our electronic devises with the security guards, settle in for a briefing on the macro economy of China. Bill is much more blunt than last year’s presenter. He is particularly hard on the banking system (and we won’t get to delve more into this with Citibank), its practices and lack of consumer and commercial acumen. Next he zeroes in on compliance the WTO conditions. While the central government has agreed to many special provisions and negotiated numerous required side agreements, compliance at the provincial and local levels with agreements and the like are spotty and can be very frustrating to foreign organizations doing business in China the further away from Beijing one gets. This was emphasized by two presenters at an executive seminar ("New Perspectives: Re-examining Your China Strategy") presented recently at Santa Clara University.

On the way back to the hotel students arrange shopping outings and others arrange their Hutong tours. We give them a time to be back or be picked up to be on our way to ZParkGlobal (Zhongguancun Software Park) and retreat to the hotel. On the way out to ZPark it is clear this bus driver has only one route in mind from our hotel to the area where ZPark and most of the other organizations and places we will visit in Beijing and the route is usually very congested with foot and vehicular traffic with long wait at stop lights and signs. Each time we move passed the Hutong, Forbidden City, Drum Tower (all tourist attractions) on city streets, over a canal and by a earlier formal entrance to the city. This route works well today as we pick up the students from the Hutong. Time to converse with Martin or Leanna or listen to the patter between Rita and our guide, Kelly, (when they speak in English); let the driver do his job.

We miss the turn off to ZPark and wind around Beijing and Tsinghua Universities. I try to get Kelly to call ZPark for assistance. She is reluctant; she does not want to have to give directions to the driver. I ask her to have the driver call; she does not want to because she does not want to embarrass the driver by telling him what to do and, thereby, implying he does not know where we are. All of this is unspoken, but it is there Gender, role, and cultural issues all rolled into one. Finally, I, who has never been to this business park and cannot read the street sighs, see a building with trappings that look like what I have seen on brochures Jennifer Pan, our host, had given me back in Santa Clara. I point Kelly to what I recognize and I see Jenny outside, coaching us in like a third base coach. The driver follows the non-verbal signals. We arrive only a little behind schedule.

As we leave the bus, Jenny who is quite tall is now also lopsided as she hobbles to meet us. She indicates a sports injury has booted one of her ankles. We move inside to a model of the park and are briefed by Jenny’s new boss, a woman. The park is one of the most ambitious, well known, and successful in Beijing and China. Many major US and world companies are present and it is center for Chinese software startups, some of which some of us will meet in the fall when Jenny brings five of them to northern California on road show. It is a multi-purpose community, not just an incubator in the Bat Area sense. There is another official there, a woman, who has oversight of business parks in Beijing. I resist asking who occupied this land before the park was established and what happened to them. Having been briefed on the park, we move to conference room for Jenny’s briefing on the Beijing economy and its relation to the larger Chinese and world economy.

The cental government, major historical attractions, and Beijing and Tsinghua universities (among 150 others) plus many other institutions are the heart of the economy. The growth of Beijing from a sleep government town with many small shops to a modern megalopolis is breathtaking. Though overshadowed by Shanghai, financial institutions thrive and grow. Information technology is growing. Building for the 2008 Olympics dominates the landscape: highways, buildings, restored historic sites, sports venues. One figure contradicts experience: unemployment is 2%. Two percent does not square with the number of beggars we see and encounter. Examining the basis of the data may help. Is it based on the number of legal workers? All workers? Two percent does not compute.

Evening brought a leadership panel at ZPark among some local leaders I had recruited with Jenny’s assistance. We are joined by a few of Professor Sepe’s students. Jenny, an executive from a software company Jenny recruited, a semiconductor executive, and Rita’s boss are our panelists with the Dean as the moderator. I had primed the panelists with some questions from the students and topics we were studying beforehand by e-mail. All were Chinese and except Lenny, Rita’s boss, had worked and/or studied in the US. As we asked what worked for them as leaders in organizations in the new Chinese economy, their answers were relatively similar to what we would hear from a set of native US leaders: respect, openness, honesty, feedback, expectations, responsibility, and communications were concepts discussed among them. When asked about work-life balance, a major difference arose. All strived for balance for themselves and their employees except Lenny. His position was that he worries mightily for the well-being of the company and the employees. And he expects significant devotion from the employees to get the work done at any cost. We listen respectfully and later note the distinctly different tone from Lenny. Rita will say more later. End of uneven day and back to the hotel. Martin and I try a bus discuss with the whole bus with great difficulty: too many people over too much space. He and I huddle and decide to split the bus into two parts for tomorrow’s bus discuss. And that will elicit an interesting cultural comment from a surprising source: Kelly. Back to the hotel and scatter for personal activities. I learn later that the students discover the Peace Hotel mezzanine and "import" six packs for into-the-evening equivalents of dorm bull sessions.

Wednesday morning we are off for repeat visits (for Martin, Leanna, and me)at Blue Focus and HP with dinner that evening with our VC from Pacific Enterprise Capital at the hotel. The trip to Blue Focus brings out the cultural differences between Kelly and the driver and me and Leanna. Blue Focus is located in an old, converted manufacturing space in a part of Beijing that is not the new, sparkling variety. Hence the markings on the buildings were not prominent and streets a little less well marked. I began to recognize the part of town as we got closer, then, suddenly we were on a street taking us into fields and derelict buildings. Driver lost again, won’t ask for directions, Kelly won’t correct him, and we are late (not good). I intervene forcefully and insist that Kelly (with Rita’s help...she is older) tell the driver to call. Instead, she called, talked to Blue Focus, and gave the phone to the driver for directions. He accepted grudgingly; we were relatively close and arrive a few minutes late.

We were greeted as we climbed to the second floor by Oscar’s assistant. Oscar, the CEO, would be coming a little later (a client needed his immediate assistance) and his second in command would begin the briefing after which Oscar would join us. We got the standard dog and pony show: history of the organization and PR industry, a review of clients and the kind of work they did for them, and a trip around the building that showed that the employees were seated by client groups. A student asked if they did any PR for Japanese firms (a ticklish issue given the current state of relations between China and Japan) and almost on cue the presenter showed some artwork for a prospective Japanese client that turned out to have some images and word play that would have been very unfortunate if in fact they had used the before they discovered them. They did and they didn’t.

Oscar arrives. He is in his mid-forties, slightly shy, and soft-spoken. He began in PR after graduating from Beijing University with a degree in political science and a short stint working for the central government (read CCP). As the economy began to open up, he and some friend saw the need for PR and the opportunity to start a PR firm which they did. He had grown it, left to raise kids, it faltered and he came back and is still there.

After some basic and gentle questions, one of the students asked again two questions had asked of the number two earlier, who demurred and directed him to address them to Oscar. I typically take a seat near the presenter to be able to present thank you gifts easily. The conference room we were in was tight and rather stuffy. Arun asked: how much had Blue Focus grossed last year and how much profit they had made. Oscar ducked his head, swallowed, pushed back from the table, and reached for his pack of cigarettes to light up, which he did, inhaled and exhaled deeply. I am sitting immediately to his left as a blue smoke plume spreads my way. An asthmatic, I try to unobtrusively slide my chair back to escape the triggering smoke.

Oscar recovers, answers the questions in generalities, and moves on. I on the other hand am now sitting in a tightly closed room next to plumes of triggering smoke. Mercifully the session ends and I can move away till the cigarette is spent. Leanna is the only one in the room who knew what was going on with me, so, that part was without incident. I give Oscar the special thank you gifts (reflecting a second visit), we move to the entrance and pose for the obligatory handshakes and group picture. When we are out of the building, the students are all over Arun for asking questions that obviously upset our host. He gets grief for this for the rest of the trip and probably beyond.

When we leave, more bus driver aggravation. He takes a street away from Blue Focus that is almost a footpath. A wire crosses the path that looks like it will scrape and catch on the bus roof. He has Kelly hold the wire up with a broom handle-like device to get past it. I settle into my seat; live with it.

As we approach HP, we call to get permission to park off the street in their lot. Permission denied; bus driver karma at work. Bus disgorges us to seek lunch before the HP meeting. I walk a little in th mid-day heat, move up to the 10th floor, get some water, and eat my banana. I use the toilet and settle into an informal seating area to wait for the meeting to start. Into the area comes a young Chinese male, by dress an applicant for an hourly technical work; out of the formal glass doors comes a young female interviewer. I watch the symbols of a dance I recognize and whose words I cannot understand. Papers change hands, questions are asked and answered, and the applicant leaves. One thing I wonder: did he get the job?

It is time. The troops assemble and we go in. It is Gary and Robert again this year; no Bennie. We are escorted into a comfortable conference room with individual bottled water at each seat. The presentation is crisp and thorough and answers all the advanced questions we sent, down to the impact the new CEO’s (who had been on the job for barely over two months at that time) plans are having on China operations. More follow-on questions are fully and graciously answered, in particular whether HP, China was making money from its internal operations? Yes. Then they focused on a training program for user IT managers on how to fully access and use the capabilities of the HP equipment they had purchased. A big hit and helped increase sales. We take a tour on the way out and pass their customer support operations that is arranged by the geography each serves. Our hosts walk us down to the area where our bus will pick us up. What a recovery from last year’s disastrous visit. I e-mail Arthur in the Bay Area the good news. He responds "Yes" and that he had been on the phone with them the day before.

Mike, the VC, joins for dinner at our hotel in the open restaurant in an area set aside for us but accessible to other patrons. I had gotten Mike’s OK for this arrangement. After our meal he rose with a single sheet of paper of notes and launched into a talk that excoriated the leadership of China for a panoply of ill-thought out policies and initiatives. His main charge was one apparent to each of us: economic expansion had come at the expense of the environment and commoners. Their land had been commandeered, their health was imperilled, the air land and water polluted. And the educational system was turning out graduates that were not up to western standards. In all this he said we, indicating his identification with China and Chinese, but not with its leadership and their policies. The most severe implication of the picture he painted was the probably impaired the health of the workforce going forward and their inability to get health care as the central government dismantles it, leaving common workers without affordable access. I look around apprehensively to see if anyone is noting Mike’s comments. All clear. In the after-dinner chatter students are appreciative that he has been open and had spoken frankly. He had taken some of the luster off the picture we had been presented so far.

Disturbing images on CNN and CCTV: the bombings in London. A slight sense of unease. Should I worry about our safety? We are Americans who stand out in a large metropolitan area. For once the buttoned down policy state of China is a comfort, for perverse reasons.

Thursday morning on our way to Tsinghua University and SinoVoice Rita informed us that her boss, Lenny, was moving SinoVoice that day and we would not be able to visit them. We settled for Rita briefing us on the bus on our next long trip to the Great Wall tomorrow. We "arrived" at the university which is typical of most major urban university’s every where, a sprawling, disaggregated set of buildings. In a change of behavior the driver asked for directions at the gate as we pulled into the campus. With some navigating we found the building and moved into the small auditorium where we would hear from Jeromy, Managing Director of Tsinghua Science Park Venture Capital (who had failed to appear last year). We were not in his facility but at the School of Economics and Management and their seemed to be no one there who knew Jeromy or where he was. Not again!

In the auditorium even though classes were not currently in session were several Tsinghua MBA students. Jodie, the onsite contact from last year, had secured their presence, but, she herself was not there. Then two things occurred. One of the SCU MBA students, John, came to me and asked if Jeromy was to be our presenter. They had met, coincidentally, on the plane on the way over and John assured me that Jeromy had told him that he was planning to meet with us. And a Tsinghua MBA student, Johnny, approached me to ask if I was in charge, told me that Jeromy was on his way (but late) and that he, Johnny, would be the opening act. He took the stage and introduced himself and the said apocryphally (this is a story I have told often) that he was in awe. He was appearing in front of people from Intel, HP, eBay, Pay Pal, and he rattled off more names from the bios we had sent ahead. I sat there thinking to myself these students are all individual contributors and as such not necessarily worthy of the adulation he was giving them. Then the magnitude of what he was saying struck me. He was worshiping Silicon Valley that the companies of our students’ represented.

There was give and take among the two sets of students and several one-on-one conversations were struck up. Jodie arrived to say that Jeromy would be there shortly. With that I relaxed. It was also OK that we were running very late because SinoVoice was put off to the next day and we had given up on reaching Cool Tech for the afternoon. Jeromy arrives and he is much younger than I had anticipated; he was born in China and educated in the US. He launches into a standard pitch about the venture and shows data indicating rising rates of investment which is to be expected as the trend is increase in foreign direct investment as companies and countries rush to cash in on the China market.

During the Q & A session Tim asks about IPR and Jeromy is (acts?) indignant. It is such a common question and complaint, so, I am certain he is tired of being asked about. His response is one I have begun to hear so much I think it has become the, so called, party line. Western consumer goods (CDs, purses, shoes, software et cetera) are priced well beyond consumers in China, implying prices are seen as excessive and, therefore, the goods fair game for imitations and knockoffs. As good move up the value chain, the amount of pirating decreases significantly. I can buy the first part of his argument; many Western consumers are irritated at the apparent over-pricing of some goods, e. g., CDs, that pirating the content is common-place and the traditional music industry is hurting. The second part is harder to square. While I have seen no data to confirm or deny his assertion, it does seem the more complex the goods, the fewer unit sales, and requirements for installation, service, and up-dates, the less there may be a "market" for successful knockoffs. I have since heard the same "defense" of the IPR issue from a leader of the central government, aka, CCP.

We depart and begin our bus discuss. Having tried to do it with the whole bus earlier to disappointing results, Martin and I divide the bus in half and stand back-to-back to hold our discussions which yields much better results. But we succeed in scandalizing Kelly. As Rita recounts it later, Kelly thought we (Marin and I) had demeaned ourselves. From her cultural perspective faculty sit and students stand in such situations, or if the faculty stands, the students stand; never should the students sit and the faculty stand. We are amused. How would we have accomplished that given the way a bus is configured? She accepts us as alien to her way of thinking.

That evening Leanna, Martin, Wilson (Serena and Wilson had worked on several projects together), and I are invited to dinner by Serena. We squeeze into a 200 yuan cab, a Saab, and head out in rush hour traffic to the Shangri-La Hotel. Traffic is very bad and the cabbie takes a road parallel to the main drag. Turns out to be very interesting. The road we are on is like a street in any upscale US neighborhood. But in fact we are on embassy row. We pass at least two dozen embassies on the way. Most of the buildings are simple two-story stone structures, all with security fences, gates, and personnel and indistinguishable from each other except for the signs and plaques noting the country names.

We come into the hotel from the back side and walk through an elegant array of high fashion stores with the real goods. No faux here. I am walking with Martin and I confess some of the names are unfamiliar to me; Martin, being more fashion conscious, seems to know them all. After a meandering stroll we reenter the wonderful Shangri-La lobby. An accomplished ensemble is playing some familiar concert-worthy classical Western music and no one appears to be paying attention. I listen contentedly and attentively until Serena arrives.

She take us on a tour of the French, Italian, and Japanese restaurants in the hotel and then we wind our way across a few streets and through a few buildings to a Sichuan restaurant which she announces is her favorite. We are her honored guests and we feel honored. After we are seated, she inquires whether we have any restrictions and how much spice we are willing to try. I, for my part gamely say, order away. Big mistake. With the first bite of the first appetizer the spice is so hot the I immediately lose my voice and cannot speak for several minutes. Maybe she planned it that way. Recovering, I am a little more careful, asking questions about dishes I do not recognize. We all charge full steam ahead through the rest of the meal Serena has ordered. Turns out to be another mistake for me and Martin. We talk throughout the meal and Serena reveals the she is being transferred soon to her native Shanghai and she does not want to go. She likes her living and working set ups in Beijing. What she does not tell us, which Leanna and I discover months later, is that she is married and Shanghai is where her husband is. We finish our meal and discussions and the four of us head back to the Peace and Serena heads home. The four of us have to be up extra early the next morning for a trip to the Great Wall at Badaling.

Friday morning early I was feeling the effects of the Sichuan dinner. I did eat breakfast, but my stomach was upset. I settled into the bus across the aisle from Martin who was in worse shape; we discussed not going to the Wall. Leanna came on board, listened to us grumble, gave us an over-the-counter remedy, and told us to suck it up in her caring and gruff way. She and Wilson seem to be OK. Wilson in fact would not have missed this part of the trip. He had told us all from the start that he was going to play his trombone from the top of the wall and he had in its case in hand as he boarded. Feeling punky I tried to sleep on the trip to the Wall, but I stayed awake and quiet and enjoyed the mountain scenery on the drive.

When we arrived I felt up to tackling the steeper side again. This time the driver got us next to the gate. As we tried to walk around one of the structures, we were blocked by PLA soldiers. A Party functionary was in that area and we were not allowed. I bristled, but said nothing at the time. This kind arrogance of power and sense of entitlement of minor officials is something which manifested in policies and actions angers the ordinary Chinese citizen.

Somehow I lost track of the main group and start the climb on my own, able to set my own pace. I climbed at a resolute pace, determined to get farther than the previous year. On my climb I overtook a student given the name Big Dave (to distinguish between the two Davids on the trip). He was struggling, starting to come back down, saying he had an upset stomach. I pointed to an area where I knew there were toilets and followed him visually as he descended. Convinced he was under control and proceeding steadily, I resumed my climb noting that I was close to last year’s stopping point. I matched that height and exceeded it coming to a sheltered area where I could visualize the rest of the trek to the end of the steeper trail. It went on for another quarter mile in an undulating manner; I determined that coming back would be as much climbing as descending. So, I rested and heard a trombone playing the Star spangled Banner, stopping and playing another tune (Wilson told us it was the Chinese national anthem). The students who were with Wilson said later the playing of the latter anthem was the only time they had seen the hawkers stop pestering them as they watched this tall, thin Anglo play their anthem on a strange instrument. Satisfied, I started back down. When I got to the shops at the bottom, Big Dave was there with a meal in front of him. The official hogging the area we wanted to enter was gone and we could get something to drink and sit down to rest.

After a short rest and rehydrating, we boarded the bus for the Friendship Store for shopping and a meal. But, first to the sweaty and pooped crowd Rita briefed us on SinoVoice. She described the translation products, their product strategy, and the contract they had won to provide translation services in eight languages in kiosks in Beijing during the 2008 Olympics. An irony is that their products run on a proprietary, Japanese-developed software platform which they lease. Rita also editorialized about what it was like to work in a startup led by Lenny, a work addict, claiming this trip with us was the first time she had off in months (including working weekends).

This year we passed up time at the Ming Tombs to get more time to shop at the Friendship Store. The Stores are state-sponsored co-ops for local artisans to ply their wares. Prices are realistic, bargaining is frowned upon, hectoring is minimized and quality is more assured. We arrived before lunch and were taken on a tour of a cloisonne foundry where we got to see the stage-by-stage development of large cloisonne pieces. The piece here is about four feet tall. Entering the restaurant, we again were given the mysterious chit. This time I asked what it was for. It is to use to accumulate sales totals to get further discounts in the Store. The meal was fuel and time to recoup energy, nothing special. After lunch shopping started in earnest with some minimal haggling. I came away with a small set of terra cotta warriors from the Xian region for my older grandson. Getting to spend time looking more closely at the products and comparing them to what we see in the faux markets, the quality shows well and makes the faux goods shoddy in comparison. The old communist system has its good parts.

Back to the hotel for a shower, change of clothes, and re-embark to the local Rockwell facility for two presentations. Joe, who works for Rockwell had gone to a company get together in Beijing the day before our official trip started where he met Bruce, a new VP, who had worked previously in US embassies in Beijing and India (Chennai, Bangalore, and Hyderabad), a good comparison that the Indian students looked forward to. We were piggybacking his presentation onto one by Mike’s colleague, a patent/trademark attorney Liu, who was going to address IPR issues.
Liu review the legal situation, laws, current processes giving a basic underpinning for the rather rigorous system for IPR in China. He then addressed actual practice, which is widely known not to be strong. He pointed out that the judiciary in China is a division of the government and had little independence, that judges are selected for variables other than judiciary experience, that their pay is paltry (reinforced later in Shanghai by the head of MoFo there), that they have little knowledge in many of the technology areas we were curious about. Lastly, he noted a provision in the law that allowed IPR to be ignored if it were in the national and/or economic interest of the country. All told, IPR will get short shrift until Chinese organizations have substantial intellectual property of there own which other Chinese organizations are taking without permission.

Last up for Beijing was Bruce. I sat to his left just out of his line of sight. A mistake. Had I known how adamant and hard charging he would be, I would have moved into his line of sight to signal to cut him off. He was a blunt and straight forward as any one to date about doing business in China as anyone besides Mike. His comparison of China and India was cogent.

India has a freer society and polity, its polity is diverse and leads to slow and inconsistent policy development, its infrastructure is poor, the population is mostly highly educated and fluent in English and Western traditions, excels in service and software, and corruption and bureaucracy were deeply entrenched. China by contrast is central and closed in polity and society, decisions and policies are quick, English and Western traditions were taking hold, infrastructure stronger than India, and solid as a manufacturing powerhouse. His prediction: invest in China in the short term, in India in the long term.

I began to be concerned that we were going into the evening and we owed to the bus driver and Kelly to let them end their day. I broke in to say we would have to continue this over beers at the hotel. We went outside to get the bus back and it took about a half hour for him to appear. A fitting end to his service. And I am certain I lost style points with the students over cutting Bruce off. We resumed over beers at the hotel an hour later.

On to Shanghai...sort of
Saturday morning we are all down to the lobby early, packed, getting breakfast, and checking out. We have an 11:00am flight out to Shanghai with busses at both ends supplied by Ctrip in Shanghai. We need to leave optimally for the airport by 9:00. No bus. Tim calls Ctrip for us and gets the local contact. No bus, but it is on the way. 9:15. No bus. After 9:30 the bus arrives. Not enough storage under the bus for all our luggage. So, we pack luggage around ourselves in the passenger area, barely getting all of us and our luggage in. As we leave for the airport and this new bus driver takes a different, more expeditious route away from the hotel, a cheer goes up.
We board a large aircraft (probably a Boeing 777) with a significant number of what seem to be school children among us. It makes for a very noisy and lively flight. I am in the section with 2-5-2 seating and it is an ordinary flight. As we descend, I do not see the area surrounding the Pudong airport. As we land and deplane, the buildings are unfamiliar. We are in the older Beijing airport, Hongqiao, to the west of the city center where, as we are, most domestic flights arrive. We get our baggage and move to an area where it appears busses are boarded. No bus for us. Tim calls Ctrip for us to find out what gives and cannot get through to anyone. We wait. No bus. We give up and try to find vans and cabs to get us to the Park Hotel, telling the students we will reimburse them. Ctrip is in our dog house. On the way in to the Park Narana looks out the van window at the dirty grey sky and asks if it is always like this. I answer even after rain. He is depressed.

After checking in and unpacking, I am in the mood for nothing but getting on line and e-mailing my wife. I tell her of the days travel travails and end with a loving salutation. The next day I get a reply from my church secretary (Raeann) asking if the e-mail she had received was for her or my wife (Raughley). I had picked the wrong e-mail address. (A note on our rooms at the Park: while we got a good rate for rooms for all, Martin, Leanna, and I did not the quality rooms as actual guests as we did as prospective guests the previous summer.) I am hungry, but don’t want to pay room service prices. I go down to the lounge area and order a sandwich to take to my room. What I ordered and expected was, amusingly not what I got. An adventure to continue for the next several days.

Shanghai Real Time
Sunday was a cultural day: Yu Garden, Shanghai Museum, and an acrobatic troupe in the evening. We hoped the gardens outside in the morning would not be too hot. Wrong; at least the museum and acrobatic troupe would be indoors. We meet our new guide, Alan, who seems quite organized and congenial; he enjoys his work and has been doing it for ten years.
The Yu Garden (Yu Yuan) in Old Town is an estate garden built by an official in the Ming Dynasty. It has gardens (in gardens), rockeries, carp ponds, all on meandering paths. In our time there it was also populated by an inconsiderate group of Scandinavian youth/adolescents. At one section there were dragons that guarded the garden that were almost life-like. So much so I want to sic them on the offending youth.

The garden contains several buildings which call into question how one would live long enough to beneficially use all of them. But that probably is not the point. It strikes me that another feature of Chinese life is manifesting itself. If it can be big, make it so.

After the garden one of the students finds a shop that makes stuffed buns that is thronged, a line a block long to get to the window to get the buns. Alan says they are as good as the line is long. Tim and a few others get in line to get all of us a treat. And after a long wait what a treat it is.

We head back towards the Park to the Shanghai Museum (air conditioned). The first floor is artifacts from China’s Bronze Age and imagery from the introduction of Buddhism into China. Our Indian students are informative in understanding the Buddhist exhibit. Afer a while I break away on my own and meander through other floors, getting a snack on the mezzanine floor, and viewing exhibits entitled Ceramics, Painting, Calligraphy, Seals (official, not ocean), Jade, Coin, and Furniture. The uppermost floor is Minorities’ Art Gallery, the most intriguing to me. I spend most of my time here. The organizers have taken great steps to notarize the non-Han populations that the Communists took pains to bring into the history and everyday life of the dominant population. The costumes, household items, items of livelihood and commerce show the rich diversity of all Chinese life and show vividly the different regions of China. Whether today that diversity is honored in everyday life is another issue, especially, if separate identities are claimed as their own.

From the hotel the bus takes us to the Shanghai Acrobatic Troupe at the Shanghai Centre Theatre, with a modern auditorium. The Troupe tours internationally and makes their home here. The program is almost two hours long with a couple dozen acts. Some are acrobatically complex and challenging; others are comic or dramatic; men, women children (a few) all participate. In the highly challenging acts there are some flubs. The performers reload and try again often with success, a few times not. In the end, outside formal gymnastics competition, it is the most amazing set of physical feats I have ever seen. Oh, and pictures taking was not allowed. Not for some of our students.

The bus dropped us off and we were on our own to get back to the hotel. Come head off for a night on the town. I am not up to it. I join two students, Joe and Big Dave, for a simple meal at, yes, California Pizza Kitchen. (Did I mention we passed the Lamborghini and the Mercedes dealerships on our way to the Theatre). We are seated and notice the we are three of the few customers in the place. Then, the unintended comedy act take place. After we are seated, I leave to use the toilet (which is why I decided to keep it simple tonight). Coming back, a young man is finishing taking the two students’ orders and leaves the table. Another comes back and takes mine and asks the other two if he can take their orders. No, already done. Before our food comes, which seems like a long time, a third young man comes to take our order again. No, already done. Orders come, not correct. Given difficulty to date, we accept what is brought. We eat and our bill comes. On it is a gratuity charge at which we chuckle. No tipping in China? And a gratuity charge for such stunningly bad service? We pay it anyway.

We go out to get a cab. Big Dave and Joe are turned around and try to get a cab going the wrong direction. I insist we cross the street to get a cab in the right direction. If I have any reason to be smug about this, I keep it to myself. I will experience a similar confusion later in the week. But, I will do it by myself.

Monday we will visit the law firm Morrison & Foerster in the morning and Ctrip (yes, revenge?) In the afternoon. In between would be a tour of the Shanghai Urban Planning Exhibition Hall (aka Shanghai City Development Museum), as a way of familiarizing ourselves with Shanghai, and lunch on our own which was our practice. MoFo, as many of our Shanghai visits, was close by, a short trip down Nanjing Road, in a new high-rise.

We were ushered in to a conference room for many fewer than we were. During the course of the meeting our collective body heat overcame the air conditioning system. We had a lively presentation and discussion about the law practice, especially with startups, and IPR issues with Chuck, the local partner, an American Anglo educated at Yale, UC Berkeley, and UCLA. One point he made about the poor IPR enforcement was the nature of the judiciary and judges. The judiciary is not independent, which we knew, and the appointment of local party members, unschooled in IPR matters, as judges, which we also knew. He also reconfirmed our understanding that the practice of precedent we were familiar with did not apply in Chinese courts. And he mentioned that judged were not paid a professional wage, which emphasized the positions were not prestigious, at least at the local level.

I asked about an incorporation pattern Martin I had come across last summer and was used by at least three companies we would visit in Shanghai (Ctrip, 51 job, and Linktone). This scheme was a clever way to get around the restrictions of the central government about what industries could go public on what stock markets. And this arrangement also gets around restrictions about taking profits out of China. Each is incorporated in the Cayman Islands and listed on NASD. And they were physically located in China, employing and led by Chinese, serving Chinese customers. Chuck responded that that had been true until late January, 2005. At that time the State Administration of Foreign Exchange (SAFE) issued Circulars 11 & 29, asserting that it had oversight and currency control for these kinds of companies. Thess actions have chilled this kind of startup methodology. SAFE, as far as I can tell, has not done anything yet. This is a pattern we will notice again: claim the right of regulation, but not act...a shot across the bow, but no boarding. A threat held over an organization’s head.

The museum or exhibition: I knew this existed from a contact in San Jose and I had two Chinese nationals tracking it down for me. With some effort we were able to locate it. What I did not know (and I should have known) until we drove up was that there was a fee of 20 yuan each to get in. This caused Leanna, our walking bank, to scramble to find enough money to cover the entrance fee for twenty-six of us. On the mezzanine level was a gallery showing the historic and contemporary Shanghai. Part of the exhibit showed photos of locations of residences of famous people. Wilson and I found Sun Yat Sen’s former residence and decided to go see it later. We never made it.

The third floor was a stunning, walk around scale model of contemporary and future Shanghai. Hourly there is a sound show (in Chinese). Projecting out to 2020, the population will be 16 million with innumerable high-rises. Where the energy for that many new buildings and people is not answered. How to control for the impact of those numbers on the environment (one that is already significantly polluted) is not indicated. Off to the side is a 360 degree multimedia diorama of Shanghai. Standing in the middle on a rotating platform we fly above Shanghai. It is exhilarating and I see some parts I can identify.

The top floor is an art gallery (closed) and a coffee bar (open). Many of the others have gone off to find lunch. I decide to stay there and have a ho hum lunch and stay in an air-conditioned environment. I can look down to see the area the bus will return to and I also use the vista to take photos. Given the nature of the glass (microlite), photos don’t turn out well. The bus arrives and we board for Ctrip. This going to be interesting. There have been enough screw ups that Leanna has been on Alfred’s case by e-mail and phone and he is our presenter.

We arrive early and Leanna and I start in to find out were we are meeting. John, who is having a battle with stomach virus, comes along. The receptionist understands we are there to meet with Alfred. She does not understand our request for directions for John to a men’s toilet. Leanna, gets a pencil and a pad and draws a toilet stool. Visual message understood and another person leads John to relief. We find out our room and the rest of the students come in for our meeting.
During the briefing Alfred is undeterred by his company’s foul ups and shows how by targeting the market–frequent business and discretionary fliers–and by making reservation and ticket reception easy--they have built a successful company like a Travelocity or Expedia. However, while thought so on the outside and in the US press, Ctrip is not an internet company. The bulk of their transactions and sales take place over the phone with the tickets delivered directly to the purchaser by messenger service. It was interesting to view the difference between the educated reservation workforce and the rough and ready messenger group. We discover that they are not basically an internet company by accident. One of the students notes that in his research that the Ctrip website is infrequently updated. This leads to Alfred’s revelation. It is not surprising that the bulk of the transactions are real-time: there is still general distrust of online credit transactions (and minimal use or credit cards) and mailing a precious commodity like an airline ticket.

After our briefing we are allowed to wander through one of the reservation areas with the students talking to the reservation agents who are all young with at least a highschool education (some with some higher education). The students come away impressed with the competence and dedication of the agents. We leave and no one has embarrassed Alfred by probing Ctrip’s gaffes. On the way out Alfred asks to beg off as a participant in a leadership panel that night. I ask that he try as best he can to come. Ultimately he is a no show. He calls Leanna after we leave and she lets him off the hook. Sharp bargainer...gives her more leverage to extract concessions for earlier Ctrip foul ups. Does not help the panel because we are already down one. Ben Hu had e-mailed earlier saying he would not in Shanghai on the assigned date.

Back to the hotel for our Shanghai Leadership Panel. No Ben, no Alfred. Only Linda Chien, Corporate Development Manager for 51job, who is a stand in for her boss Rick. I check the meeting room with Leanna for readiness and realize I had given Linda the wrong floor. I head down to the lobby to give someone I have never met directions to the correct floor. I guess she is confident and in her mid-thirties (and Chinese and female). My guess is correct and the first person I see fitting my guess is in fact Linda. I inform her she is the panel; she says she is up for it. She is very outspoken about coming to China to accelerate her career. It is like the Wild West. Anything is possible; make your own rules; and maybe make your fortune. Linda is a sea turtle, a Chinese raised and educated abroad returning to work and live in China. She has an MBA from the Anderson School at UCLA and had a lucrative career at Bain & Company (which is where many of 51job execs come from) when she was approached to come to 51job. She did not hesitate. When asked what she looked for most when hiring, she thought for a few seconds and the said with emphasis decisiveness! Asked to explain, she said that too many Chinese in organizations are permission-seeking, which can be detrimental (and sometimes paralyzing) in fast moving organizations. She also repeated something that was becoming a theme: lack of middle management skills. We thanked for her solo role and called it a night (academically).

The next day we lose our bus for two days. All three visits are walking or cabbing distance. Leanna is leaving early the next morning to meet a new granddaughter back in the Bay Area. I realize she has the Shanghai map with all the routes and places marked out (and I don’t). I irritate her asking for it as she is trying to ascertain John’s health and whether he needs to return home. But ultimately I get the map so I literally know where we are going. The next day (Wednesday) we are to visit Linktone and 51job. We tell the bell captain the number of cabs and what time we need them tomorrow.

The next morning there is drizzle so I nix the idea of walking to Linktone and catch a cab with the Dean (he is back with us) and a student. We all arrive as concurrently as if we had all come on the same bus and go up to the assigned floor. The offices are much more built out than last summer. We are escorted into a conference room to meet with the new CFO, Colin, also a sea turtle, replacing the founding CFO. Linktone is using mobile technology as a VAR for content to reach multiple and far-flung users. We get the standard dog and pony show and, afterwards Barry asks if American companies should be worried that talented people like Colin are choosing to leave and come to China. Deflecting the complement, Colin quietly says yes. About this time with some commotion Martin shows up (he had tried walking, became convinced he was on the wrong path, retraced his steps to the hotel, and took a cab only to realize once he arrived by cab that he was almost there on foot before he turned around).

The conversation took an interesting turn, one showing the savvy the students were developing. A question was asked about freedom to operate in a structured polity. Colin’s answer showed a theme we were noticing. He answered that that was one of the reasons he was hired; eighty percent of the time the rules are black or white and twenty percent they are gray. The strategy in the gray area is to take bold steps in your best interest and wait to see whether you get whack. Organizational strategy by Whack-a-Mole (see comments under MoFo), which leaves lots of room for arbitrariness and/or favoritism by government officials. We finish the session and Colin’s assistant (without whom this visit would not have happened; while we were walking I gave her a personal thank you gift) took us on a tour of the floor we were on. It had a striking resemblance to a plush Silicon Valley company (the CEO is a sea turtle from the valley). The most striking feature is the large aquarium in the CEO’s office (he was out). I would guess the employees are treated well.

After noon we catch another fleet of cabs (still drizzling and not within walking distance; we underestimated) to 51job. We arrive early and they are not ready for us so we sit in what must be a training room. We find ourselves with nothing to do in our structured process. In the room are samples of 51job’s work, newspaper ads for hiring employees into organizations, a very low tech business. The ads are very revealing of the difference’s in legal and cultural practices. The ads specify gender, age, appearance of the desired hire. This generates a vigorous spontaneous discussion about the differences with our hiring restrictions.

Linda from last night comes in. Rick is ill and she and the CFO, Kathleen, will brief us. They have the same last name (a common one) and they look alike. Are they sisters? No one asks. 51job runs employment ads in dailies in fifty-one cities in China. They are quite successful, although their stock is taking a beating and investors are litigiously grumpy. Expansion plans are underway into executive recruiting, and management training which may take some of the pressure off. The issue comes up about mobility of employees to move from one region to another to get a better job and the impact that will have on a growing economy. Linda and Kathleen think that there are enough ways to work around the restrictions so that they are a limited impediment. Another example of an area where governmental authority has the potential to be capricious.

Out to the lobby and it as still drizzling. We do not have the advantage of getting cabs in front of the hotel and must compete with the locals in getting cabs that come to the office building to drop fares off. The competition is uneven. Most of us (guests) are mostly deferential in jockeying for the cabs. The more we are out hustled, the less deferential to the locals we become and after about a half hour later we are all on our way back to the hotel. Tomorrow is a short day for the students with Cenotech (aka Naesasoft) in the morning so some are arranging a sightseeing trip out of Shanghai.

The next morning we cab to Cenotech. We arrive and John (from last summer) is not there and no one knows who we are or where he is. Finally, they reach him on the phone and he is chagrined...he forgot and will be here within an hour, even though he and I exchanged e-mails three weeks earlier confirming time and place. I tell the students that I would stay with those who were willing to wait and the others are free to go to keep their sightseeing reservations. We will brief them later. John shows up within the hour very apologetic. We are rewarded. John, a sea turtle is the most western management savvy of all we have visited so for (our briefer at Intel tomorrow will match him). He is developing software for the 3G space in China. His product is ready and will be tweaked once the telecoms release standards later in the year. Asked about middle managers, he is casual. They are not a problem. He delegates budgets, staffing requirements, hiring and firing to his staff; he sets goals and checks regularly on performance. He learned well at HP and Cisco.

We cab back to the Park and others take off to be tourists, although trip-weariness has set in. I decide to stay back because Leanna had pushed the bus back a few hours on Friday given the short visit at Intel and I had to do some negotiating. Intel would not agree to see us later in the day so we called Alan and put the bus back on the previous schedule. Also, earlier in the year a former student e-mailed offering an entre to SMIC which is a short distance away from Intel in New Pudong. I turned him down because I though our Shanghai schedule was set. When we got to Beijing I reconnected with the former student and he got me a contact in Shanghai for SMIC. I arranged to see them after our lunch in the Intel cafeteria. I also sent our bus number to Jessica at Intel to get through parking security when we got there. Not a very relaxing afternoon.
Martin was beginning to worry. Saturday morning he was scheduled to fly out to Xian and Shangri-la and his ticket had not yet been delivered. He used my computer to connect with the agent in New York through which he had booked his trip. No satisfactory response. More frustration. More to come.

The next morning we were up earlier than the crew wanted to be. I made note of Jessica’s cell number so we could call her when we arrived at Intel. The night before I reread the instructions from SMIC: picture IDs required for entry. I sent a warning through Yahoo Groups to those who had laptops. I stood outside the elevator exit to send those who had no picture IDs back up to get them. I was losing style points all around. Alan and the competent bus driver are back. We board.

We settled into our long ride from the Park to the free trade zone in New Pudong; our time was almost over. Mostly quiet as fatigue was setting in. We had worn them out. Arriving at Intel I gave Tim Jessica’s phone number to get us in. The gate guards did not have our bus number, so, we could not get into the lot. Number disconnected. Guards did not have bus number authorized. Stalemate. Manoj, a student who works at Intel in Santa Clara, comes to the front of the bus and shows the guards his Intel badge; they nod; the gate opens and we can get off the bus and go into the plant. Manoj fires up his laptop, gets on Intel’s secure site to find Jessica’s number. I had transposed two numbers. We get passes, Jessica comes out, and we are escorted into a conference room.

Derick is our briefer. He is Chinese, educated in the US (MBA, Anderson School, UCLA), and a new resident of Shanghai. He rose through the finance ranks in Santa Clara and asked for a rotation through China. Intel’s plan is to initially staff its China operations with US and other execs and bring locals on board and turn the operations over to them as they develop and show competence. The two plants we are visiting seem to be well into the transition. Derick saw this as a chance to move to China. We get a standard (for me) dog and pont show. The two plants in Shanghai (and the new facility in Chengdu) are assembly and test plants. Chips are made elsewhere and shipped in to China. Someone asked whether Intel would locate a fab (a chip making plant) in China. Derick did not hesitate: NO!

He revealed a product, a computer, that had been developed by Intel engineers in Shanghai for the local population. A clear contravention of Intel’s corporate strategy of make high volume products. However, it reflects a minor change in strategy to develop products that sell in the new markets where its facilities are located. This was designed for heavy use in internet cafes all over China and was selling well. The product development process was initially resisted by upper management, but was given enough grace as an experiment that they prevailed and succeeded. It is an example for plants in Brazil, India, the Middle East (Turkey) among other sites.
Our presentation is over and we a mostly self tour which is problematical. We were admitted under Manoj’s auspices so he is responsible to keep us all under his watch (Intel’s rules). We struggle to stay together. This becomes impossible when we enter the cafeteria for lunch, but, no one challenges us.

On the bus on the way to SMIC we give the go ahead to change the farewell dinner to a place, Luna, in Xintiandi (the old French Concession) with the provision that the students get us out of our current reservation (at a restaurant next to our hotel) without incurring a cancellation fee. No one knows the name of the restaurant. Leanna had set it up and had left the details with the Dean, who was not with us. Tim calls the hotel to get the name. The operator does not know, the front desk does not know, the operator cannot find Susie, our contact at the hotel. In short no one is willing to take the initiative to help us find the name. Tim calls Big Dave who had stayed behind at the hotel (not feeling well enough for long bus rides). We give him the charge of cancelling at the current place (with no fee) and getting reservations at Luna. Done and done. And a good thing because Tim was running out of minutes on his SIM card and power in his batteries.

We get to SMIC early and I go in to call. I have been corresponding with a female named Sebastiani. I had a student at USF, Don Sebastiani of the Sonoma Sebastiani’s, and I wondered if there was a connection. As soon as I heard her voice I knew there was not. She was straight from Italy. She came down and took us into a side conference room that did require showing the picture IDs I had sent several students back to their rooms to retrieve earlier in the morning. More style points lost.

She is joined by a young Chinese man from Silicon Valley, an analyst. The briefing details the rapid rise of SMIC as a foundry in China for the world. Their rise has been so rapid the they were successfully sued by TMIC for poaching executives and customers. They had swooped in during a semiconductor downturn to buy facilities, capacity, and contracts to insure revenue streams several years out. They are manufacturing (on a contract basis) other semiconductor companies’ proprietary chips and insist they can protect their intellectual property. We are dubious. On the way back to the hotel I ask the students which they would rather work for: Intel or SMIC? Almost all respond Intel.

Dinner at Luna was a relief and a delight. End of responsibility. Barry knows the per head limit for the meal and is watching over that. Luna has a Filipino-Chinese fusion fare and reasonable Australian wine. Dishes of food and bottles of wine circulate. Toasts made. Thanks given. Done and done. Some sadness on my part. Martin is off to UMass, Boston next month. I had indicated earlier in the trip I was stepping down (I told the Dean I would come back one more summer to break in a younger faculty. He opted for a whole new team). So, for the current purposes, I was done with China. In a few months I will get a surprise.

Tourist and Home Again
The next few days I get to play tourist; I leave early Sunday morning. I sleep in Friday, rise for a late breakfast (getting there just before they close and they close up as I eat), and plot a long walk up Nanjing Road. In the evening I am going to walk down Nanjing Road East, go across (under) the Hangpu and back, and dinner at the Peace Hotel with Wilson and his wife and two teenage daughters (they had come over to tour with Wilson at the end of the study travel). Tomorrow Wilson, his family, and several students, and I will take a day trip to Suzhou and Zhou Zhuang.

I study the map of Nanjing Road West in the Shanghai Frommer’s, looking at cross streets and points of interest. The mid-morning sun was hot. So, what’s new. Just go. The further I walk the more sumptuous the stores and their goods. I recognize many places along the way from my study of Shanghai. But the street signs are not conforming to the map I just studied. As the surroundings get more sumptuous, there are fewer pedestrians and fewer non-Chinese. Side walks less crowded with people and vendors make for a much nicer walk even in the hot sun. I walk for an hour and a half including detours into various buildings in particular Plaza 66 which has a real jet aircraft hanging above the lobby. I reach a turn-around point at the entrance of the Jing’An metro station. On a side street is an old art deco movie theater like ones I used to go to as a youngster in Oklahoma City. They are all in the same rundown condition, no longer used for their original purposes.

I cross Nanjing and retrace the Road. I stop at an official building whose nature I could not make out on my outbound trip. It was a sex museum; I pass on the opportunity. I mention it later and Ekta says she went in with some of the male students, saying, after almost two weeks with eighteen of them, they could not gross her out anymore. When I get back to familiar territory, I catch a cab the rest of the way back to get out of the heat. Wilson is in the lobby and wonders if I am ready for our eastward trek I wash up change a few clothes and go back to meet my afternoon and evening companions. Before I leave my room I look at the map. I had noted the cross streets in the wrong direction.

By the time we leave the hotel and start on the eastward walk the crowds are out. Even the pedestrian mall is crowded and the narrower two blocks beyond it to the Bund is almost intolerably crowded and at the hottest part of the day. We press on and enter the lobby of the Peace Hotel (no relation to the one in Beijing). It had originally been the Sassoon residence, then the Cathay Hotel, now the Peace Hotel. An art deco wonder, well preserved. We would return to the top for dinner. We ask for directions to go under the Hangpu to look back at the Bund. Not quite certain of what we were told, we start out in the direction indicated. We almost accidentally find an under-river Disney-like ride. I am confused. Last summer Leanna and Martin indicated they had walked under the river. We buy tickets and wait to board a car which moves through a tunnel with characters that pop up like an amusement ride. Coming out of the ride and looking back we see the brilliance of the neon; they all seem to be on tonight. I am getting used to sitting out in the warm evening (growing up in Oklahoma summers has odd payoffs), enjoying the view and the warm, polluted breeze.

With our return tickets we retransit the Hangpu ride and head for dinner at the top of the Peace Hotel. Wilson indicated I was being treated in appreciation of getting his family to China. An all- female traditional jazz band plays quietly as we order and eat. I think Wilson and I, both jazz enthusiasts, may have embarrassed them as we applaud their work. We order several dishes, the food long become familiar. I had the best meal of my two trips. The view back to the Pudong and along the Hangpu through the haze was twinkly. The Winners go down to the ground floor bar, where Wilson had sat in in 1995, but was disallowed this time, and where a larger traditional jazz band played. They stayed. I took a cab back to the Park. I could not have endured the smoke-filled bar, even if I was not exhausted from the long day. We had a long day trip the next day.

Wilson had set up the day trip and the cost was 600 yuan inclusive. We met in the lobby for a very leisurely day, leisurely compared to the almost two weeks of go-go-go which I had planned. The formal distinctions are off and our relationships shift to the informal. Yet I am still Professor to them. As we come into sight of Suzhou our guide, whose name I have forgotten, mentions that it has a population of three million. John and I groan. We were expecting something more rustic.
We pass the Humble Administrator’s (or Stupid Officials) Garden. We visit the Forest of Lions Garden which resembles the Yu Garden in Shanghai and contains a miniature replica of the Marble Boat. Our guide takes us to a gallery of sorts with a tour I avoid. I’ll look for myself. We are escorted into a sales room where we linger. Leaving, I notice something that reminded me of an incident with Rita early in the trip at the faux antique market in Beijing. After a transaction between Leanna and a vendor, there was a side conversation between the vendor and Rita in Chinese. We asked about it. The vendor wanted to know if Rita was our guide. If so, she was owed a commission on Leanna’s purchase. After we left the gallery in Suzhou our guide collected her commission. We moved on to a silk factory turned museum. First, lunch. A problem arose for two vegetarians in the group. The pre-arranged lunch did not account for them. The rest of us pooled our vegetables for them.

Across the street was the old factory with exhibits and machinery that showed the development of silk from birth to cloth. There was an order room to buy bedding linens to be shipped home. Outside there was another department-store like setting with more silk goods. After each we waited while the guide collected her commissions. The bus left Suzhou for Zhou Zhuang.

Between the two we see the rural life we had been expecting earlier. The contrast was stark and very, very poor. Shanties on land and boats. People traveling on foot and by bicycle. Poor dress. Buildings are slapdash. This is the way more than half of China lives.

Zhou Zhuang is a village off, or more aptly on, Dian Shan Lake. It is laced with canals on which we will ride. First we visit an old preserved residence. As we all enter, Arun is missing. No where in sight. We stop for a while to se if he catches up. No Arun. Two students go off to look for him. When the rest of us finish the residence tour. Arun has been found. He loses style points. We board gondolas (I don’t know the Chinese term) rowed by women through the village canals, under the historic bridges, beside rustic housing.

We are deposited outside a lane of shops. In one gallery there is a trumpet unattended on a stool. Wilson takes it to his lips and plays a few notes. Others in the place are amused and encourage him to play more. He plays "when the saints" and stops there; did anyone understand? A young man spots the SCU logo and asks me about enrolling. I give him the URL for the SCU homepage. Our bus is waiting to take us back to the Park Wilson’s wife encourages one of her girls to get fluid to avoid dehydration. A good and bad idea. On the trip back in a side conversation initiated by Wilson our guide tells a little about her life. She is single and lives on her own with a room-mate. Her mother bugs her to get married and tries to line her up with suitors, all of whom she rejects. She had a job after college working inland at a factory of a European auto maker and lived in the company dorm. She left for more freedom at a cost. She was now an independent contractor for a tourist agency, the one who got her this gig. She has no benefits and work is seasonal and depends on the whims of the schedulers.

Furtive whispers between the children Wilson. The fluid has prevented dehydration, but, now presents another problem. One has to pee and we are a bit less than an hour from the hotel. The guide confers with the driver: no rest stops on the this toll road, no place to turn off. Solution: stop beside the road, get some tissues, and go into the bushes at the side of the road. Done. I tell her she will have a story to tell in August during orientation as a freshman at UCLA. She is more relieved than amused.

At the hotel I schedule a check out early the next morning (I ask about the exit fee; it is included in my airline ticket) and ask for a cab to be ready for the trip to the New Pudong Airport. I will be up and out before breakfast is served. That’s okay. I can get breakfast of sorts at the JAL business lounge. Home again soon. I partially pack and sleep well from a long day.

Up early, finish packing, and check out. Waiting out front in the sunrise is a 240 yuan cab, a nice Saab, somewhat pricey, but, I will take it. Load baggage and settle in for the long ride to the airport. The weather is mild and the atmosphere surprisingly clear. The driver starts out with the windows down and it is pleasant. The roads are almost empty and he gets up to about 100 km. Leanna would have freaked again. We make it much less than an hour.

I am left outside the JAL section. Enter, get ticket (which was changed in the computer, but not on paper several weeks ago) and boarding pass, and check bags. A security agent does not like the image of something in one of my bags. He motions me over and asks me to open the bag. He points to a device that has aroused his apprehension. It is the pump for the blood pressure device I use. I hold it up along with the cuff. He nods in recognition and motions for me the put them back in the bag and to close the bag. Baggage clear; breakfast coming. The lounge has several travelers as we silently move about fueling ourselves, reading, waiting to board.
The flight is without event, arriving at Narita on time. I move to the lounge, wash up and get cheese and crackers. I open my laptop and search for wireless connections. One come up from the airport itself for 250 yen for twenty-four hours. A fellow traveler sees my screen and mentions that across the lounge where several people have their laptops on, you can get on Cathay Air’s free wireless connection. I move across the lounge, open AOL, and check to see if my wife, who often works late into the night, is online. Yes, she is. I send her an IM. She is surprised. I am getting ready to board so we have little time to interact. When I sign off, I tell her I will sleep as she should, also, and I will see her in the morning at the San Jose airport. Just before I shut down I send a message to the SCU China Yahoo Group telling the last one out of China to turn out the lights.

I am seated next to a teenager who is into her iPod. So, I keep to myself, listen to music, watch a movie, and contemplate what I will do with the retirement time I will have after the last class in a few weeks. I am in for a surprise. Unfortunately, I do not sleep much. It will take a few days to get my day/time worked out. After landing, I breeze through customs as though there is no strife in the world.

Epilogue
Jennifer e-mails that she is coming through northern California on a road show with five Beijing software companies and invites me to participate in some of their activities. Then, Mike, the VC, comes through town and asks for a meeting. He has a business proposition. Let’s produce management training videos using SCU’s cachets of Jesuit and Silicon Valley to broadcast via satellite into business parks in China. I’m back in the highlife again.

The dog and pony show was revealing. The first day was presentations at Wilson Sonsini and the second day was an open session on issues at Greenberg Traurig followed by dinner at Mings. From these several new and recurring issues emerged. There are issues of cultures when participating in the global marketplace, between Chinese and other nationalities and among Chinese of different native settings. Scaling up and growth are hampered often when entrepreneurial leaders want to maintain control of their creations. And not having or desiring to be part of middle management (everyone wants to be a boss, an owner) limits initiative and growth. It is clear that a maturing management class is necessary for the Chinese entrepreneurial environment to exploit the opportunities in front of them. While mostly young, the leaders were well educated, well connected and (given their youth) relatively experienced and energetic. They will grow personally over time. Yet, it is clear again that China’s entrepreneurial economy is growing in spite of its leaders an their capacities.

The opportunity that the SCU-PEC nexus has identified can capitalize on the Chinese managerial shortcomings: provide managerial training via satellite for Chinese executives in the business parks which their company’s occupy. Beijing, we have problem! The first quote I got for production costs was $100.00 per finished production minute. So, at the start we are priced out of the China market; producing something in northern California to sell in China does not make economic sense. The business model now is to produce the basic academic footage (lectures with PowerPoint) at the lowest cost (studio on campus, student workers) and add features (short interviews, vignettes) to the basic product as income allows. So far we have the introductory series material on disk (five one-hour lectures), waiting to be edited and marketed. Typical startup: funds spent, products not finished, no income.

In the fall after the first trip I approach the new executive director of the Center of Science, Technology, and Society to host a symposium on doing business in China. Trouble is many organizations are doing the same thing; how to put an SCU twist on it. Finally, it morphs into "New Perspectives: Re-Examining Your China Strategy" held in January, 2006. I proofed (for content) all the presentations. All were well done and painted China’s economic growth in way too rosy a picture. Some presenters took my message seriously. Overall the symposium was well received and some eyes were opened.

Currently, my research is focused on the Internet (and mobile telephony and digital technology) and the ability of the CCP to control society and polity in China. Are the forces the CCP are employing to restrict the open political/social use of the Internet strong enough to withstand the forces the populace trying to overcome the CCP resistance?

Peace,
Andrew
July, 2006