Having been working on building R&D teams both for Chinese customer and western customer for many years. There are lots of debates about how to build a innovative and efficient team in China. Here are some tips for western companies when considering building operations especially R&D force in China.

1. Think before take action

• - Before setting up offices in China, come to 2 - 3 cities of China and spend a few days in each city.
  - Talk to companies in the cities and get first hand information. Do not let local government to introduce, or ask any local agencies to arrange. Do it by yourself, get introduction by yourself. The company list is available in websites
  - Cost structure in China is different from other countries. Even inside China, different cities are very different
  - Work with partners to help your operations 

2. Understand the difference and focus on shared value

- For companies who want to enter Chinese market, understand the difference is crucial. Most western companies failed not because they do not have good products, but because they do not understand Chinese market. Google, Yahoo, ebay all quit from China. However, we can see IBM, HP, Simens, Volkswagen are very successful in China.  All the successful companies have some similar characteristics: localize, flexible offerings, hardware or solution instead of service/software only.
- Pure R&D in China is much easier than S&M in China. The engineers in China are the same in many aspects: willing to learn, pursue new technologies, anxious for opportunities working in other countries ……   So when you manage your team in China, focus on the similar characters and build the trust.

3. The first several employees or partner is very important

- The importance is obvious but may be more in China.
- Try to make your company looks big so that they can be proud of. Most Chinese people prefer to work in a big company. 

4. Lead and rewards

• - Lead by example is important , however it means differently in different areas. In China, managers' behavior is  followed by their employees. Managers are respected if they come to office earlier and go back later.  So if you want your employees work hard, you have to demonstrate your effort. This is quite similar to Japanese.
  - For 80s generation in China, a very good way to reward is to hang their photos in the front wall of the company.   Publicity is more important for 80s than 70s.
  - Do not publicly criticize your employees

5. Understand the government

• - Government in China plays important role. Understand government and assign resource to work with local government will help you achieve support from government and bring benefits to employees
  - Do not blame government publicly. Start with good things when you give government feedback.
  - Remember Chinese government is everywhere. Together with them, partners, clients will respect you. 

6. What books you need to read to understand China to next level?

• There are many of them. I prefer these:


• - The Three kindom
  - The Art of War