Jeffrey Towson is a private equity investor and a professor at Peking University’s Guanghua School of Management. Along with Jonathan Woetzel, a senior partner at McKinsey & Co., the management consulting firm, he has written The 1 Hour China Book, which, as its subtitle (Two Peking University Professors Explain All of China Business in Six Short Stories) indicates, is a book that attempts to explain everything that anyone might want to know about Chinese business in an hour to 90 minutes.
We reached Jeffrey Towson by phone to ask, is it really possible to tell someone everything they need to know about such a large topic in so short a time?
It’s a big topic, or series of topics, obviously, and you’re working with a collaborator. So did you and Jonathan Woetzel ever disagree about the importance of anything and whether anything should be included that the other person did not think should be included, or vice versa?
The challenge with this book was, it’s written for people who do not necessarily know a lot about China. But the problem is that it is such a big topic. How do you cover something so big, so quickly?
The trick to doing that was not to dumb it down. To be brief, but not simplify. So that was probably the area we argued about the most. It was an attempt to make this simple and readable for someone who still is interested but realistically doesn’t want to spend hours reading ten big China books that are each 500 pages. How do you get it short and readable without dumbing down the content?
That’s where I think we had our biggest arguments. That was some good back and forth. But we’ve both been on the ground for such a long time, we see eye to eye on most things. John is the guy who opened McKinsey’s office in Shanghai in 1995. He’s been on the ground longer than anyone I know, doing in-depth analysis. So he usually wins those fights. He’s citing things I don’t even know about!
I was thinking about it, and it’s not just that it’s a big topic condensed into a short book. It’s several huge topics condensed into one short book, right?
I mean, we admit it is a ridiculous idea, to try to take on something so huge. But it’s not a made up problem. You talk to a congressman in the US and this is literally what they would ask us.
We’d sit down and they would say, “What can you tell me about China.”
And we would say, “Well, what you know?”
What do you say? I can recommend ten books, they’re each about 500 pages, it will take you weeks. But you know they’re not going to read it. It’s a silly problem but it’s not a made up one. So now if they call us and say, hey, let’s sit down for lunch at some Washington, D.C. hotel, “What can you tell me about China”, I say “Read this. It’ll take an hour.”
Something I’m interested in is about the way you published this book. Do you plan on updating it? Because I do find that there were some references that are very recent. And I wonder it will relatively quickly need to be updated.
We wrote the book so that if it we’re going to explain this quickly, it has to be things that are permanent, that aren’t changing. We put graphs in there, but the graphs are all twenty-year graphs. The urbanization chart, the consumer behaviour chart, I mean these are twenty-year curves. So those shouldn’t change. The one that gives us trouble is the internet, because every 6 months everything is out of date. If we had written this a year and half ago, it would have been all about Weibo. Now it’s all about WeChat. That’s changing so fast, I’ll probably update that every three months. But everything else should be pretty permanent.
The brainpower is changing a little bit, but urbanization, manufacturing, that’s 20 years that that’s been going on.
So you are updating it, constantly more or less.
Yes. We had both done books with the major publishing houses and decided we weren’t going to do that any more. At least not for this one. So we did it through Amazon, and we have a print version. But I can update it on my laptop in Beijing and the version on your Kindle will get updated almost immediately. It’s pretty nice, actually. (I’ve done already like 15 times.)
You’ve done it already?
Yeah, I do it all the time.
That’s very interesting. You’ve written a book, but now it’s like the process isn’t over. You have to keep working on it, in a way.
It’s a little bit like a piece of software.
What kinds of questions do people ask you about China?
The ones we get all the time are sort of high-level West vs. China thing. It’s almost like an anxiety. If you go to a place like Ohio, it’s an anxiety like, ‘I’m worried about it. I’m worried about my kids and how they are going to do.” I’m not totally sure where this anxiety comes from. It’s sort of this macro-level thinking. And it’s one of the criticisms we make. As soon as you talk to a person in the US or the UK, as soon as you bring up China, they stop thinking about businesses and life and they start thinking about macro-level subjects like politics, and interest rates and RMB evaluation, and that’s not something you normally do. Folks in the US don’t worry about dollar depreciate. We worry about, like, we like Wal-Mart and we don’t like Apple or whatever. People tend to kick into this macro-level thinking, which in my mind is always about anxiety.
It’s interesting that you say that, because though obviously, it’s all related (and so you do talk about politics a little bit) but those macro-level questions about politics are not one of the topics.
Yeah well, I think it’s massively overweighted. If you’re living in Texas, what’s going in DC on a daily basis is not going to affect your life that much. Every now and then, something might, but it’s more likely that what will affect your life is that Samsung has a new Galaxy 5 out and you’re buying Coca-Cola. And I find that that’s pretty much the same in China. People focus on the government stuff, because, I guess, that makes good news. But look at how most people are living. They get up, they turn on their cool phone; they go on WeChat all the time, apparently; they walk down, they’re getting Starbucks, and they turn on and watch a movie put out by Huayi Brothers.
So, that’s 95% of life. But if you look at the media coverage, they kick up to this macro-level. I just don’t think it moves the numbers, if you actually look at revenues. Everything we talk about in that book, we talk about trends. But “trends” is kind of an overused term. We looked for anything that moves the revenues of companies. If we don’t see it showing up in the revenue line or the cost line, we don’t consider it an urgent thing. The politics stuff don’t move the cost or the revenues for most businesses and most people’s lives on a monthly basis. But people talk about it obsessively.
The One Hour China Book: Two Peking University Professors Explain All of China Business in Six Short Stories is available now as an Amazon Kindle ebook or paperback.
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