At the 2012 International Truck, Trailer and Equipment Conference (ITTEC) in Port Melbourne, Martin Toomey, General Manager of US powerhouse Eaton, revealed how to succeed in China’s complex business environment.
According to Toomey, who has gained first hand experience as Managing Director of Knorr-Bremse Dalian CVS, it is crucial to understand the key issues facing the country's political leadership when entering the local market. “In a political economy like China, the state is your partner,” he said. “There is no separation.”
As the country’s political power is progressively decentralised, Toomey recommends engaging with local authorities to benefit from regional competition as provinces around the country compete for large-scale foreign investment.
“But, always consider that you will have to fight for survival after leaving the start-up phase, as local competition will rise and use the knowledge you have brought in in the first place. You need to have a counter strategy in place.
“Take a seat at the table, invest, employ, skill and localize,” he added. “Developing a market-based strategy is not just a business truism in China; always understand that the state is your customer and expect government interference.”
Toomey, who can draw on a strong background in implementing market entry strategies and forming focused teams, also stressed that a clear communication of company ethics is essential when entering the Chinese market.