Perils of half-baked knowledge

This helps when working with Chinese business in the following spheres: interpreting and forecasting government policy in an industry, understanding Chinese people (for example customers) and knowing how Chinese human resources work.

China is still a developing country, and policies in many industries are still taking shape, so for Chinese businesses, being sensitive to public policy is crucial.

Consultancies such as Allpku are staffed not only by young talent just out of business school, but by dozens of partners with a wealth of experience.

Most of the latter will have reached senior management level in their specialized industries. They know their industry inside out and follow government policy closely.

In contrast, most partners in Western management consultancies are those who go into the consulting industry immediately after graduating from an elite university.

Granted, they will also be specialized in certain industries when they reach senior levels, but their perspectives will differ sharply from those of people who were soaked in the targeted industry for decades and then joined a consultancy later in life.

That means domestic management consultancies may well be better at forecasting and interpreting government policy.

Management models and products used by Chinese businesses ultimately serve the Chinese customer. If management consultancies do not fully understand the culture of Chinese people, the products they sell will have limited use.

Take the example of a State-owned ocean cruise company that wants to improve processes in its sales call center - processes that come from the US and do not work in dealing with Chinese customers.

The reason is that under US procedures, after cruise tickets are sold, the company emails the itinerary to the customer and charges his or her credit card.

However, the Chinese customer will not necessarily have an email address or be willing to give credit card details over the phone.

This illustrates that a one-for-all solution cannot be applied, and suggests that engaging a Western management consultancy could be fraught with risks.

Human resources are playing a more and more important role in most Chinese business these days. At the same time, HR consultancy products account for a large proportion of management consultancies' revenue.

That means it is important for management consultancies to sharpen up in this area.

Guolai Zhou is vice-president of Beijing-based Allpku Management Consultants Group. Shujie Lv is project manager of Allpku. The views do not necessarily reflect those of China Daily.

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