Entrepreneurs without money XXVIX: El Salvador possible entrepreneurship journey with China: Ethical Context (part B).
Good morning to all. After a week, I could recover the computer from my little brother, and now we are here for you again. So happy about this. In my last publication about the ethical context, we finished it, by wondering if El Salvador possible entrepreneurship journey of commercial relations with China is or could be ethically designed with awe?.
Let’s start. I shared with you the story of my Grandpa Maximilian. I tried to share the passion of him in relation to “quality”. Awe was my Grandpa Maximilian motto. And he taught us the meaning of “quality” by his own behavior example. He taught us about the importance of doing things with quality. My grandpa was working to create “awe” in each of his wood masterpieces. Grandpa Maximilian used conventional old tools to carve the furniture (he was so far away from using the modern actual technologies and machines to whittle). And even though he used rudimentary tools, he was committed to delivering “quality perfection”. Every furniture was created as a “chef-d’oeuvre”.
I partook my memories from one of my ancestors because business ethics is implemented as wrestling against all odds, every day. Business ethics is about finding perfection in our good behavior for ourselves and others, and in our business decision-making.
Richard T. De George wrote “Business ethics has as much to do with business as with ethics… Corporate organizations must be changed so that they can respond to moral mandates and so that those in business can act morally by design rather than by accident”. Grandpa Maximilian never acted by accident. He knew his business to perfection, his masterpieces to deliver “over the top or premium quality”. His brain was designed as such. Let me ask you: what is the Chinese brain motto? To produce cheaper without quality? Are the Chinese evolving from the world’s workshop to the world’s tech hub? Are they doing it with quality? or are they doing it to lead the new emerging technologies outsourcing to the world?…
When trying to answer the last questions, all it came to my mind was the label “Made in China”. The “Made in China” label and its branding has been associated with the temporality of products. The majority of products manufactured in China have a deadline. A useful product life. A perishable trademark. I am not sure about you, but if you buy products, which are cheap, those usually have a “Made in China” sticker or tag identification attached. And we all know by heart, those products are not going to last forever. In the case of shoes, probably they won´t last more 10 times usage, and in the case of clothing probably a maximum of a year. In the case of electronics and technological artifacts, usually, their life is limited to 3 years (at the most). Of course, the “Made in China” labels do have a benefit: they are the most reduced prices in the world market. And people who can´t afford quality or high prices, have at least an alternative with a perishable “Made in China” prospect.
This book by Paul Midler is interesting to explore. He has written a new one called “What´s wrong with China?”
Another example: let´s go to the furniture “Made in China”: the majority of those products such as the tables, chairs, sofas, closets, pantries or cabinets have a limited useful product life. If you don´t treat them with carefulness, they can break easily. A “Made in China” furniture is done in less than a few hours. Meanwhile, the same furniture, made by my grandpa Maximilian with excellent raw materials, took him months to finish it. However, there is a difference: A “Made in China” product won´t last the century of years of the piece of furniture that my Grandpa Maximilian did.
Grandpa Maximilian was building products with an eternal long-lasting value added. Moreover, his furniture could be a heritage for 4 generations or more. Meanwhile, the “Made in China” products don´t last “anything”.
A good society produces and cares for at least 4 generations ahead. The concept of the long-lasting legacy is embedded in its design. And the key for long-lasting products is the quality of the raw materials and the quality of the production process. The production process is as important as the raw materials. And like the design and purpose of them.
China has become the “top manufacturer of the world” (whatever product you could imagine) at expense of quality production and quality of life for the Chinese force or Chinese employees who produce them. Is it ethical to produce without caring for the people? If reduced Chinese labor costs are the reason why many multinationals and Chinese manufacturers establish their factories in China, I wonder if this is ethical? Outsourcing takes advantage of the differential in labor costs. What can we say about the unethical practices involved in outsourcing to China? Particularly if human capital is the most treasured thing for us.
Before continuing reading, please look at this video from the Walk Free Foundation. It is the Global Slavery Index 2018.
If laborers are deprived of even rudimentary education and are condemned to impoverished lives in comparison to the same type of job done in developing countries, are we accepting and promoting “modern slavery”?. If suppliers establish factories in China, with the purpose to use Chinese labor to reduce costs, are we accepting and promoting “modern slavery”?. If suppliers have factories in China, even if the working conditions are tolerable; but do not improve the quality of life for Chinese workers, are we accepting and promoting “modern slavery”?. Richard T. De George has written: “Slavery is of course, immoral. In consequence, it is unethical to buy goods made with slave labor, because doing so fosters the continuation of a business model, which promotes modern slavery, as well as profiting from it”.
Any cooperation agreement between China and El Salvador has to raise the standards from our land to “developed countries” standards of quality of life and quality of manufacturing. If not, we are promoting a “modern slavery” business model. And if El Salvador is not ready with institutional standards regulated by the law, we won´t be able to do law-enforcement with the Chinese potential investments or potential future Chinese operations here.
Any good society can´t promote alliances with countries which are ethically wrong in their business models conceptions. If we do it, we will muddy our own efforts to convert ourselves into a more ethical society.
Let´s remember that China is in position number 77 at the Corruption Perceptions Index 2017 from Transparency International. On the contrary, if El Salvador has the choice to partner business strategic alliances with any or all of the top 20 countries from the top ranking of Transparency International, why to choose China? We have the right to choose better commercial partners. I reassure you we will evolve to become a better society.
China is in the same process than El Salvador. China is evolving in its ethical roadmap. Don´t take me wrong, China has been investing in improving the quality work conditions, but it is still a “work in progress” nation when it comes to the ethical context. China has its own process to evolve to a less corrupted country, and we must look to partner with other ethical countries´ role models in the world. China has to put their own people at the core of its value proposition.
Why do we have to partner with countries which in terms of ethics, have more to learn than us?
To be continued… Thank you. This week I will make it up to you. I will publish three times. See you soon.
Source References which inspired me to write this article:
https://www.walkfreefoundation.org/news/resource/the-global-slavery-index-2018/
https://www.transparency.org/news/feature/corruption_perceptions_index_2017
https://www.itimanufacturing.com/news/made-china-really-mean/
http://peopleforethicalliving.com/socio-economics/the-exorbitant-cost-of-cheap-stuff-made-in-china/
http://www.paulmidler.com/china-supply-chain-bullwhip/
Disclaimer: All the presentation slides shown on this blog are prepared by Eleonora Escalante MBA-MEng. Nevertheless, all the pictures or videos shown on this blog are not mine. I do not own any of the lovely photos or images posted unless otherwise stated.
Eleonora Escalante Strategy 