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China delegation returns
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New North businesses forge deeper relationships to solve eco problems
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By Pam Pirman, March, 2009
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“I do business with people I know.” That’s what a Chinese businessman told Gary Vaughan, key account manager for Fox Valley Technical College’s Venture Center, when he visited China’s Guizhou Province in 2007. It was Vaughan’s first exposure to the Chinese business philosophy of “guanxi.”
“Roughly translated, guanxi (pronounced gwan-ZHEE) means ‘relationships’ and the complex network of contacts used by businesses and government officials to get things done,” says Vaughan. “In China, it is the key to all things business related, from getting a license to snagging a prime piece of real estate, to securing a contract.”
Building guanxi was at the top of the agenda when a recent delegation of Chinese business and government officials traveled to the New North to learn more about this region’s expertise in water treatment and environmental protection. The seven-member delegation visited the Fox Valley in mid-January, meeting with executives from the Boldt Company and environmental services consultants Foth and Environ. Their visit follows successful tours of the region by larger Chinese delegations in 2007 and 2008.
“The Chinese government is looking to spend over $100 billion between now and 2012 to clean up their environment,” says Vaughan, who helped coordinate the delegation’s visit to the New North. “We have world-class technical expertise and resources they need, especially in regard to water resources.”
Bob DeKoch, president and chief operating officer of the Boldt Company, says the small size of the recent delegation led to frank, direct discussions. “With a few people in a room, you really make personal connections and have the chance to talk in more detail. Combined with the broader reach of last summer’s delegation visit, we’ve made some great in-roads toward working as partners to address their issues.”
“We’re planting the seeds for future collaborations and future relationships between Wisconsin and China,” says Vaughan.
Tim Weyenberg, chief executive officer of Foth, the Green Bay-based environmental engineering and science firm that’s played a key role in the cleanup of PCB sediment from the Fox River, says his company’s technical expertise is well-suited to addressing the water-related needs of the Chinese. His firm is no stranger to guanxi.
“The Chinese approach is based on relationship building first, then the competence of the party you choose to do business with. Foth is, and always has been, a relationship-based company. How we do our business is consistent with how the East Asian communities have done business for centuries,” he says.
Weyenberg notes the delegation represented a large region in China, not a particular business or municipality. “So that is very consistent with our New North philosophy of one region, working together. We already have that much in common.”
China clearly offers market opportunities for Wisconsin’s environmental and water service companies. Of the 412 monitoring sites along China’s seven biggest rivers, 58 percent fall into the most highly polluted categories under China’s system of grading water, according to Steve Melching, an engineering professor at Marquette University. Some 97,000 jobs in at least 500 Wisconsin companies are connected to environmental industries, including consulting, wastewater treatment and monitoring.
Shanghai alone produces more than 4 million tons of industrial waste every day, and only 65 percent of the substances are properly processed before flowing into rivers, according to Melching’s research. More than 40 species of fish are said to have disappeared from local rivers in recent years because of pollution. In June, China’s version of the Clean Water Act took effect, but experts acknowledge it’s a small step for a nation swimming in dirty water.
“Of special interest to the delegation is the environmental regulatory structure in the U.S.,” says Vaughan. “China has clearly realized you can’t protect the environment in the face of unregulated industrial development. They are committed to changing that, and we have the resources to help them.”
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