Hsinchu: Being Taiwanese

Participants: Wilson, Peter W, Kevin, Robert, Angela

You know, the this-week article is easy to read, but the question is not easy.

Why?

Because you say globally, from a global view.

Why is that difficult?

In Chinese, we say, we are easy to find the advantage or disadvantage of others, but not yourself.


I was saying, like Americans are perceived as loutish, insensitive ignorant aggressors. But they’re also sometimes seen as generous and open-hearted people, so what I’m saying, is how do you think Taiwanese are perceived in the world?

So start from this question first?

Sure. Any takers?

My first impression, is when people ask what’s your relationship with Chinese, that’s what people normally ask first.

What’s your answer?

Well, you’ve heard my spiel on that before.

You know, when we participate in a conference in a foreign country, Taiwanese is not individual. I would say most of the people, first time when they see the Taiwanese, they think you are Japanese.

Yeah, but that’s cuz white people can’t tell Asian people apart.

Not, but they can distinguish Korean from Japanese, but they can’t distinguish Chinese and Japanese.

So Angela, are Americans, can you identify Chinese people, Taiwanese people or Japanese?

Well, I grew up in a very mixed neighborhood, and went to a racially very mixed high school with largely low-income kids, and there were a lot of Vietnamese there, and some Chinese, besides Black and Hispanic and then like a minority of whites, too. And when I was in college in NYC, there’s just everybody from around the world. But a couple of years ago, I was in this hostel in Seattle, and there were some Taiwanese staying there, and this white woman there was commenting on the ‘Japanese’ people. I don’t know, I haven’t lived in the US for more than 10 years, so I really can’t say, but I think maybe Asian foreigners are mostly identified as Japanese first, because of the economic race with the Japanese?

So maybe after several decades—

Right! They’ll assume they’re Chinese!

I think this article has a strange view. I don’t know, I don’t think most of Taiwanese people are very confident when we go out, when we face the other foreign countries. So it’s very strange, you know, Kenichi Omae is a Japanese, and he encourage and appreciate the Taiwanese people’s contribution to the Asia global area and to china economics, and even think Taiwanese could take advantage of economic strength even better than Japan in future.

Yeah, we don’t normally hear stuff like this, right?

So the Olympics, in the game a good performance, so this article reflect the effects is, Taiwanese need the, another words we have perform or achieve the better, a better or a do the better job than our expectation, from the outside, from the foreigners’ view. But I don’t know, it’s normal or common for Asian peoples, because we read a lot of articles from Omae, he’s always release a warning to Japanese gvt, and emphasize the Japanese it’s a competition in the future, in the next decade if the Japanese gvt don’t take any effective economic action, or the education, or globalization, because Japanese is a relatively closed country. Because I heard that in Japan, the most technical articles, they will translate to Japanese, so that’s why most of the Japanese people don’t feel the immediate pressure to learn English or Chinese or some foreign language.

Our education system can’t educate our students for systems integration. Also for engineering. So our gvt hire a lot of experts to build up our system, but sometimes it’s not successful, for some public engineering case, like the transportation system. For aerospace, we want to import some foreign company to help our industry to build our space satellite for outer space, to put our satellite in outer space. But our experience is not successful.

But didn’t they actually get it up?

Yes, but the original goal was not reached. We wanted to transfer some technical experience, but sometimes, you can’t transfer this to local company.

Why not?

Yes, why can’t they get the experience from the foreign company?

Because the language barrier?

Not exactly.

But if you dedicate yourself, you’ll get something back. Like semiconductor, we pick it up little by little then we start building 6 inch, then 8 inch, and then every have some kind of experience and now the 12 inch, although it’s not that much of an issue. But the point is, if you want energy in, you have to give some back. Learn and watch, still can gets something.
Even you go to SE Asia, you can see the building is just like square, actually you don’t need architect, you could just do it yourself but for instance, they’ll have a guard on the second floor, because the ground floor is the parking plaza. But in Taiwan you never saw this, l never.

I want to point out the, I heard someone say, if the individual Taiwanese, they have advantage to do work perfectly, but if a lot of Taiwanese is put together, their strength is lost. And they say we are good at mimic something, for example, maybe we have the advantage to copy the concept or concrete concept from outside company but if we put our power on redesign, we can’t. You know why? It’s a good question to ask our education system. Maybe can train our students to redesign or initiate a new concept.

Actually, I’ll give an opinion. The problem is not creativity. It’s market size. If they do innovation. If I do this product, how much can I sell. This one is OEM product, but this one is copy. But this one is already on the market, I don’t have any risk, it’s easy to sell. It’s safer and more profit. Because Taiwanese business usually small and middle sized. Korean ones are a giant monster, very big. So small sized ones have to be more flexible. So normally they will cut it in this way. So they try to make similar one. As long as the performance is good as the original one. But if you sell your own brand how will people accept that?

You said, we have to focus not only the local market, but we have to target on the global market. And another example is for the South Korea enterprise. Samsung is a gvt sponsored business so the scale is large, and its not a useful model for Taiwan. I heard someone say that the Samsung model is not appropriate for Taiwan, because south Korea’s local market is larger than Taiwan, and it’s gvt sponsored, so they can dominate the market and also compete with the global market. But in Taiwan we don’t have this advantage. And the other example is Israel. They don’t have the local market.

So where is the market for Israel product?

Global.

Their largest industry is military, right?

Yes, and aerospace.

India, too is very strong for military products. Not for consumer products.

Because consumer products you have to be competitive, but for military, you don’t have to be. It’s a different business model.

I remember the 60s, the background of Taiwan and Korea, they’re both focused on manufacturing, but they choose different approach. Taiwan was small and medium sized enterprise. But Korea followed Japanese style, large enterprises. So they got Samsung, Golden Star, what’s now LG, so they tried to follow the Japanese business model. So actually you can look the actual enterprise, only three or four large companies, but Taiwanese have so many, so it’s a very different business model. So I’m working in a foreign company, I can see, even though Taiwan is a very small country, you can find many different kinds of products here. Like facemasks used in industry.

The public safety industry.

Yes, but you won’t see this in another country, because it’s not a big enterprise, so people won't get into this, but here there’s small business, so they’ll find any niche they can. So talking about marketing, it’s not so strong. The giant guys they have R&D. But small and medium size, no marketing, and first generation, their English is not so good, maybe Japanese is good. But they’re not doing trading business, like Singapore. Those guys are very good at marketing. And their language capacity is better than Taiwan. And they’re businessmen, that’s their style. Be we do manufacturing. Singapore just buy and sell. So the good thing is we can make and sell, but the bad thing is we don’t have a strong brand.

I think the interesting thing, is Taiwan’s global brands, people don’t actually know they’re Taiwanese. Like Giant bicycles.

Right, well Taiwan market is too small, so they have to go overseas, but they don’t have enough resource for R&D and financing, so they starting the aftermarket. It’s not like apple computer. It’s not that they can’t design, it’s that if they design, nobody will buy it.

Well, can I give you an opinion as an outsider? One of the things that really shocked me when I began working in Taiwanese companies is how people would cover for the one who couldn’t perform well. Like, me. My Chinese was so bad, and I didn’t know meeting etiquette, and I didn’t know the building code, and my coworkers just covered for me, constantly. They just put up with what I didn’t know and worked around it, because I was their teammate. But I think in an American company, a similar situation, I would have been just hung out to dry. So when you said earlier, that one Taiwanese on their own is fine, but when you get a group, it gets mediocre, do you think this might have something to do with that? That people are spending their energy covering for the useless people, to keep face for the team?

It’s from Confucius, we want to keep harmony, we don’t want conflict on the team, so we will tolerate some troubles or some fault for their colleague.

Yes, but Japan is also like this, but they’re more successful.

Even more serious. Japanese focus on team opinion. But I would say Taiwan style is in between of Us and Japanese style. US is very concentrate on opinion of team leader, and also public opinion, and even you don’t like you still have to follow. The decision of Japanese is very slow, and difficult to change. But also stable, and well sorted. They think everything carefully, and everyway, then start. But in Taiwan, we go 50 percent, and then go, we move, and then adjust. But Japanese think it through, and then when they movie, it’s very clear.

So Taiwanese are flexible.

Sure, but not well sorted, and it’s risky.

And Japanese, the way they do business, they follow the SOP, the company their bosses set, and the member in the team, normally they will follow every detail, their steps, their company or standard procedure. But I agree with Kevin, usually in a meeting, the boss usually speak, and everyone keeps silent, this is similar to Taiwanese style. In my experience, when I travel in the meeting, the junior engineer, or even senior engineer, if you don’t ask questions, they keep silent. So I don’t know the real reason why we lack confidence. For Japanese people, because the major language we communicate with Japanese customers or vendors still we discussing English, okay, so I think the most the Japanese people is not so confident in their communication in English, so but my experience contact with the Japanese people, usually some, if Japanese people who can speaking English, usually can become leader of crosee countries project, and go more opportunities or promotion
So I think more and more of Japanese people who like to travel to Taiwan and maybe short term stay for two or three years, and normally after finish the supporting mission in Taiwan, they got a lot of improvement in English communication ability, and they get a promotion.

But my idea is more Japanese, they want to send overseas, because they don’t want to be fixed in their life, they don’t have to be relaxed. If you work in Japan, you have to stay from 8:30 to 10:00, but in the US, they can go home at 6. So if they have to go back to Japan, they’re sad. Life in Japan is strict, you have to follow, even if you don’t want. The people in Tokyo are really pressed. High density, high pressure. I was in there for about 2 years, I know the life there. You are just pressed like a dog life.

I heard someone say, if you are a Japanese, you shouldn’t go home before 8, even they’ll go to bars, other wise they’ll show they’re failure.

So if you’re out on the street late in Tokyo, you’ll see so many people in suits. And they have to get up very early, because of the traffic, so they have to get up like at six. And the commute is like one and half hour. So the life is hard.

But the Japanese people I contact, even they’re in Taiwan, they work very hard. They might work overnight, without inner, work harder than local engineer.

I’m saying it’s a different work style. I worked in a joint venture in Japan. They say, just work there, we work overtime, but their arrangement, if you work overtime, you work another 12 or 24 hours. But for us, it’s just ridiculous, its not good for your health or your energy. So we would split into two shifts. But the Japanese would just assign one person for 24 hours. Okay, you work 24 hours, so you just sleep in the chair. I don’t know if they work harder, but their style is different.

So that’s what I want to say, you know the discipline, I think they’re more disciplined. They try their best to achieve their boss’ assignment before the deadline. I don’t know, on the other hand, we can say the Taiwanese people is more flexible, but we also can say that most of Taiwanese engineer lack discipline.

But we’re still better than china.

Yes, but right now, we have to compare to higher developed country, not developing country. But even some Chinese company, their discipline is even better than Taiwan. So the quality, of course now the market price of those made in Japan is higher than Taiwan, and higher than china, but it’s the quality image. But I think that will be changed. I think this depends, still the discipline is very important. I think maybe we define maybe 10 assembly steps for one product procedure, and the japan do it one by one, and maybe the Taiwanese will remove 2 or 3 steps, but in china maybe they only take 5 steps. So I think the, you just take the Samsung example, or some big enterprise, it’s nothing to do with the enterprise scale. I think the size of the enterprise is the result of your company globalization. Not strategy. So over 85 percent of Taiwanese company is small to middle size scale. But their efficiency, I think most of them is better than big international company. So, in the article’s Omae mentioned the smile curve. Because most of the Taiwanese company are OEM, the biggest one, Foxconn, is the biggest EMS company. But the smile curve emphasize the added value in your company, for your product. And the lowest added value is the manufacture stage. For the upstream the process is R&D, new product development, and downstream, the sales and marketing, so the two ends of the smile curve is the weakest point for Taiwanese company. But these two sides are the area with the highest added value. So that’s why the acer invest the resource to build this global brand, like BenQ.

Well, BenQ was a failure.

Well, you don’t know the next ten years.

Well, the merger with Siemens was a mistake.

Well, you’re talking about the working style of the Japanese, well, think about the consumer electronics industry. They have a lot of innovative products. You say they’re discipline, and have lots of new ideas. It’s very interesting, they can leverage the discipline, and they have lots of great new concepts. And the other one is for china. One of the biggest private company in china is Huaway, it’s a telecom company. Now it’s the biggest telecom company in china. But it is fully private. The scale is very large. You say in Taiwan, our company is mostly small and medium sized. But Huaway’s scale is very large. So they can compete with the global industry. So you can say the telecom industry now in the global market worldwide, the biggest is Motorola, Nokia, but Huaway the scale is large enough to compete with these companies. So in Taiwan you mentioned Foxcom, and Xycell is become to one part of the third party to Huaway, is not compete with. So scale is sometimes important to global market.

The point I mentioned is not to, of course, you want to compete other international company, you have to upgrade your company’s globalization degree, but I emphasize the efficiency or the effectiveness. Most big companies were originally small. Also Acer is not international brand company, but they also started small, founded by doing some oem business. So of course the Samsung, I don’t know if you remember, he also damaged from the financial crisis of 97 in Asia and Korea. But now it has become the international, the first-tier company, I think its because of, of course the resources is coming form Korean gvt, but most important, it has built his own brand, and his strong of product develop capability. That’s the root cause for become the leading position in many industry. Okay, so, I don’t think the finance supporting or the conversion for explain the success.

Yeah, but what about the lack of competition, of the monopoly, the protection by gvt?

I’m sure, it wasn’t the fair competition, for example 30 years ago, Yulong, the car maker.

Yeah, but they almost died from too much protection.

Yeah, but not yet, they’ve a new car the Luxgen, it’s coming out next year. They want to have their own brand car, that’s the dream of the founder.

It’s just a dream.

They had a lot of money to waste.

But back to Huaway, you know their R&D budget is bigger than Taiwan gvt’s budget.

But basically, the market in Taiwan is too small. The LCD factories, the DRAM, its just not big enough.

Anyways, it’s not just support from the gvt, you have to find your core value.

But you cannot deny that if you have backup form the gvt it’s better, right.

Can we change the topic, Omae said in the wake of the three links [= travel and communication links between Mainland China and Taiwan, which up till now have not been allowed to be directly linked]. But what does that have to do with silicon valley? They are talking about Asia pacific operations area: manufacturing, air and ocean hub, telecom, banking, Chinese media, like books, newspaper. But look at banking, its impossible.

Why not?

We don’t have the character for banking.

But, there’s like more banks per square foot here than any other place I’ve been.

But it’s not like we’re Hong Kong. Manufacturing, we’ve got that down. Ocean shipping, we’ve got Kaohsiung, maybe Keelong. Telecom okay. We’re really weak in banking. Media okay.

Well, a huge market for publishing.

Yeah, and ten years old Taiwanese songs are now popular in china.

But I think the silicon valley idea is the idea of innovation for new companies. So the environment is motivated for the new company to set up. And because you say the local Taiwanese market is not big enough, so our target market is global, so new company if they want to set up target market, then that’s the sprit of silicon valley.

Another think I’m curious, because he says we can take advantage of upward motion of china. Maybe we’ll be marginalized.

I would say it’s because of the communication gap, because there’s no communication gap between Chinese and Taiwanese industry.

It’s funny, take advantage, hard to say.

And we mentioned the teamwork culture, maybe the Taiwanese working style is more similar to the Taiwanese worker.

What about Ireland, is that a viable model for Taiwan?

I heard about one strategy or policy in Ireland, is that everyone can vote, even if they’re not a citizen.

Yeah, this is such a refreshing idea. It’s post nationalist, it’s global. Where you are is where you are, not where you are from. Like the mayor of one town, he’s actually a citizen of an African country, but he was elected mayor. He *could* be elected, even though he’s not an Irish citizen. And *was* elected!

So did it change your perception? I’m guessing not.

Actually I’m not sure about the main point, it has to do with the three links? And are we really in a position to take advantage of china’s rise?

How about the note. Internet, only 1% written in Japanese, so this is a disadvantage for the Japanese. But I would say it’s similar to Chinese.

Language as information access tool. Korea only knows what Koreans know, but we don’t know what Koreans know.

In Taiwan we have over 8 million internet users. 2 million are the maybe internet society users, on Wretch, so they’re familiar with Chinese webpage, so the ratio is one fourth. One fourth are doing Chinese pages. So I’m curious about this 1 percent.

I think it’s the whole world, not just in Japan.

So that’s a business opportunity if you know Japanese.