Who would have guessed that today would begin with a piano recital in the middle of the train station’s waiting room? Got to be one of the highlights of the trip! Zhouzheng Garden and the New Suzhou Museum were the tourist parts of the day. And a presentation and factory tour at Starrett was the professional side of our visit today. What were your impressions of the Suzhou Industrial Park? How did today’s activities provide you with a more complete picture of business in China?
Tags: China 2010, Suzhou
South Korea 2020 
March 23, 2010 at 7:14 am |
Suzhou was by far my favorite city that we’ve visited so far in China. Even though it is still a big city in terms of population, it was not as modernized and developed as Beijing and Shanghai. The Garden was nice but all parts of it looked the same so after the first 10 minutes, it was difficult to tell what we had already seen. There were also so many people there that it made it difficult to enjoy the garden. Shopping at the local shops was by far the highlight of the day for me. The items they sold seemed to be better than souvenirs we found in the bigger cities, and seemed to be more authentic. The bamboo wall hanging that I bought cost me too much money, a feeling which was reinforced when during our visit at the Starrett factory, we were told that the average daily salary of an unskilled worker was the same amount I paid for the hanging. It also puts things into perspective in terms of what different parts of the world consider to be a lot of money.
March 25, 2010 at 11:54 am |
On our way to Suzhou, we took a train which was pretty clean, new, fast, and punctual which surprised me. I was not expecting such a high quality train service in China, to be honest. Suzhou had a beautiful garden that we visited but I was a little bit overwhelmed by the number of tourists there. Everywhere you go, you face a lot of people. This is a China after all. Factory visit after lunch offered me a lot to learn. On my way to the factory located in the industrial park, I saw a lot of Japanese companies too. I might visit some of them in the future. It is said that wage in China is increasing faster compared with that in other emerging countries. So I just wonder how this industrial park looks like in 10 years.
March 25, 2010 at 2:26 pm |
Today I began to realize how populated China is. After waking up early in the morning we went to the train station where the crowd was dense and people were everywhere (did I mention it was 7:30 am on a Saturday!?) As we continued on the journey I was under the impression that we were visiting a small town an hour outside of Shanghai. It’s all relative, by small town it turned out to be a city of 7 million people, that’s the size of Houston and isn’t even considered a big city in China!
March 26, 2010 at 12:38 pm |
Suzhou is a “small” city of 7 million people. I can’t get over that fact! The train ride to this “small city” was pretty cool. I did like the mini concert in the waiting room! Once we arrived in Suzhou and went to the garden, I got the first exposure to just how densely populated China really is. We toured one of the many beautiful gardens and it was packed! I am used to visiting gardens when I can stroll through, take my time embracing the beauty, and taking as many pictures as I want. I witnessed tons of crowds and gentle pushing in an effort to move from exhibit to exhibit.
I looked forward to the Starrett visit because the host was a native South American who relocated to China. I had a chance to see a “non US” perspective on China which was pretty cool. One thing I witnessed on the tour was the difference in application of safety standards. We also talked about quantity vs. quality. Many manufacturing companies in China place incentives on volume and quantity at the sacrifice of quality. Starrett seems to emphasize quality over quantity. Ultimately, the strategy you use depends on your business objectives (i.e. a high priced quality player or a low cost commodity). It was interesting to hear Starrett’s perspective on this.
March 28, 2010 at 12:57 am |
We went to Suzhou on a sunny day. The highlight of the Suzhou’s trip was to visit Starrett. I can now be proud to tell my friends that I know where some of those “made-in-China” products came from!!! I’m quite surprised to learn that recruiting workers in the Suzhou industry is quite competitive and turnover rate is like crazy there!
The afternoon meal was also great! I had the chance to taste the “Squirrel fish” again, my classmates were not very happy that sodas are not refillable in China. It’s amazing that I’ve survived without any sodas for almost 10 days!
March 28, 2010 at 12:27 pm |
Answer: $300-700 per month
What is, the average salary of a Suzhou business development park worker, Alex.
It is stats like this that puts China in a more realistic perspective that we hadn’t had until now. Beijing and Shanghai are great, but this is more of what I expected. A small city of 7 million people, a ton of opportunities manufacturing companies arbitraging labor rates and an underpaid, overworked local labor supply.
Starrett’s 40-hour capped workweek, “competitive wages,” and difficulty hiring and retaining workers was as surprising as it was, likely, atypical.
As Killian and I traded comments over, it is amazing how little of the manufacturing process is automated. Watching two workers circumnavigate a pallet of precision saw bits with essentially a roll of saran wrap highlighted that labor is so cheap, even simple automation may not be cost feasible.
March 28, 2010 at 3:42 pm |
An early start today could have dampened the morale of the group but everyone’s positive attitude kicked off the day to a great start especially the piano recitals, Ben’s Coldplay rendition and Steve and Margaret’s version of “when a man loves a woman”. Not only did we entertain ourselves but we were successful at entertaining the other travelers awaiting their train. It was also at this train station that we began to feel the impact of the high population in China. The trip to Suzhou also exposed us to a different side of the Chinese infrastructure – the high speed trains.
The concept of the industrial park came to live at our Starrett visit. We learned what it truly meant to own an office there – tax incentives and additional government benefits, the workers having more options to find work and moving from one factory to another. The concept sounds like a real treat for corporations but it also gives the workers some advantage.
March 28, 2010 at 7:17 pm |
The first thing we saw after getting off the train in Suzhou was the massive new train station construction project underway. I was beginning to think that the entire country was one big construction project! Just one more indicator to remind us of how rapid China is expanding our infrastructure. It was really interesting hearing professor Kelm compare it to Austin where there have been talks of a light rail system for 20 years now, I’ll bet the decision to do something like that in China takes closer to 20 minutes.
I didn’t feel like we got to see a whole lot of the Industrial Park and really get a feel for what it was about aside from what we knew going in, but the Starrett factory tour was interesting. I definitely took notice that the processes were quite labor intensive compared to how automated so many US factories are. I was especially intrigued by the comment they made about companies competing with each other for labor. Kind of funny to think that manufacturing companies are stealing floor workers away from each other when here in the States people can’t find a manufacturing job to save their life. I guess it would be a different story if anyone in the US could afford to live on under $400 a month.
March 30, 2010 at 12:34 pm |
I though the visit to Starrett factory was really interesting. It was an extremely clean and organized facility but one thing that really stuck out to me was the lack of safety precautions in the factories – no one was wearing goggles, masks, gloves, etc. China does not impose any safety regulations on companies and it sounded like workers weren’t concerned about their safety either.
It was interesting to hear about the intense competitiveness for factory workers and there is such high turnover, as companies have to recruit talent away from other companies. I assumed it would be the opposite. The components we consider (job culture, benefits, opportunity for growth, job security) when choosing a company to work for aren’t in play in China’s factories – the only thing considered is pay. This definitely brings an interesting dynamic of how to retain employees while still maintaining the low labor cost advantages of working in China.
March 30, 2010 at 6:57 pm |
After taking Britt Freund’s operations management class, I figured all things in any efficient and productive company had to be 6 sigma quality. Emerson, the factory manager at the Starrett plant, proved me wrong. It was interesting to hear the discussion on how the company is exploring a move in the direction of higher quality statistical process controls, but that employee training on this type of change, and not financial resources, is really the problem. How do you teach factory workers, especially low skilled workers, about the value of 6 sigma quality. Well, as Emerson suggested, it’s very hard to do.
Starrett was really an eye opening experience for me, partially because I had been reading a book called “Factory Girls” prior and during the trip that talks about the life of migrant workers in places like Dongguan China. The book is actually told through the eyes of a reporter, who goes undercover to meet with many of these young migrant girls and find out more about what life is like navigating through urban centers in China. While Emerson confirmed that factory life can be difficult due to low pay, long hours, and poor incentives, I was surprised to see that conditions in the factory were actually much better than I had anticipated. Starrett was clean, organized, and what’s more, they seemed to very Americanized in terms of their incentive structure. All employees that worked over 40 hours a week (ie those that were working that Saturday we visited the plant, for example) are paid overtime wages. Additionally, Emerson talked about how quality is highly emphasized in the factory as it gives Starrett a competitive advantage over other companies who emphasize volume, volume, volume with their products. Lastly, given that Starrett is an American company operating in China, factory workers are provided with some safety standards that would not otherwise be required in the United States – ie sprinklers that are affixed to vents in the case of fire, to give an example. Some safety standards, however, did seem to be below American standards given that many of these factory workers were not wearing goggles, gloves, or other forms of protective gear. I suppose since many of these people do not know any differently, the safety standards probably seem fairly generous in their eyes. Especially considering they can come to work for a set number of hours, get paid overtime, and get free electricity to charge their motorbikes while they are at it!
March 30, 2010 at 8:11 pm |
Another early start, and many of us who had spent part of the night on the town were regretting our decision! Fortunately there was the prospect of a train ride to at least catch up on shut-eye before we got to Suzhou. Despite my sleepy stupor, I was enlivened by the impromtu concert thrown by a few of my classmates. I have been able to see quite a few live concerts in Austin during my MBA degree, including Leonard Cohen, Bruce Springsteen and AC/DC, but the spectacle of Ben Ryan playing some Coldplay tunes on an incongruous piano in Shanghai station, while his backside rested on a reversed couch was definitely up there in terms of improvisation!
The trains were modern and comfortable with thoughtful footrests paired with each seat . After accelerating to over 120 mph (the carriages had digital speed readouts) we whisked through a bleak landscape. The ghostly outlines of half-constructed buildings, utility poles and watery fields flashed past.
Suzhou felt much more ‘Chinese’ than either Beijing or Shanghai, we were often pointed at and photographed by either locals or Chinese tourists. In the morning we visited some 300 year old gardens and had lunch at a local restaurant before our visit to Starrett; a manufacturer of saws and measuring equipment. The safety standards in the factory were conspicuously absent; none of the workers wore goggles, gloves or capped shoes even when carrying out drilling or cutting. These standards are not enforced by local authorities, so it is up to the business owners to run the operations as they see appropriate. Comparing this business to my own experiences of manufacturing at Rolls-Royce aerospace was difficult; the lead times on saws and gauges is very short so they can fill specific orders as they arise. The quality control at Starrett was evolving; the concept of carrying out measurement checks on measurement instruments sounded like a tail-chasing exercise!
March 30, 2010 at 9:31 pm |
Oh to be serenaded by Will and Ben one more time! They know how to massage those keys. Today was our first train experience in China. Honestly I was surprised that the train station was not more crowded. Not to imply that is empty by any means, but I guess I was expecting more people and less space. I guess I had the fact that it was Saturday on my side. On the ride out to Suzhou I was hoping to see some greenery, but there was none in sight. Hardly a patch. What I did see was construction on every corner. It really amazed me how much China was building. Construction was everywhere!
Although Suzhou was my least favorite city visit, the most memorable part was the factory tour. It was neat to see Chinese workers in progress and learn more about how to operate a manufacturing business in China.
March 31, 2010 at 1:19 am |
While it was nice to see another Chinese garden in Suzhou, the crowds were thick (it was a Saturday) and it was difficult to sit back and truly observe the garden’s beauty. I did have the opportunity to take a brief canal-boat “cruise” with Heidi, Lindsey and Dorothy. We thought we were in Venice for a second, as Suzhou has numerous canals weaving though the city. Our boat captain, who steered and propelled the small wooden craft with a large rudder off the back, serenaded us with a traditional Chinese song.
I enjoyed the Starrett factory tour. Actually, it made me want to visit other manufacturing facilities in China to be able to make comparisons, both of international companies like Starrett and also of local domestic companies. As others have commented, there seemed to be a lack of process automation and attention to worker safety in the plant. It would be interesting to see their numbers on direct labor costs, overhead, product costs, etc. and how they compare to other factories in China.
As the Chinese economy evolves and moves up the value chain from low-cost manufacturing to more service-oriented businesses (and low-cost manufacturing migrates to places like Vietnam and Indonesia), I wonder if companies like Starrett will pack up and move, as well. As we have seen in the U.S., the manufacturing sector has really dried up as factories and jobs have moved overseas, forcing millions of American workers into unemployment or other troubling economic circumstances. While one can argue that the overall effect on a macro-economic basis has been net positive, it is still a difficult transition for those individual workers and their families. Perhaps China will go through a similar process in the coming decades.
March 31, 2010 at 9:12 am |
This day was quite diverse. The day started off right with some live piano music and Salazar karaoke at the train station. I’ll hold onto that video for when Steve runs for political office 🙂 The garden was pretty, but extremely crowded. One of the highlights of this day in retrospect was the visit to Starrett. As an American tool manufacturing company, I had much different expectations for their operations in the Suzhou Industrial Park. As someone with in interest in tools as well as operations, I expected things to be quite a bit more automated and high-tech. Starrett was the complete opposite. With the exception of a few processes, everything was completed with manual labor, painting, powder-coating, packaging, quality control, nearly everything. This really drove home just how cheap labor is in these outlying areas of China.
March 31, 2010 at 9:17 am |
Our trip to Suzhou was one of the most rewarding experiences of the entire trip! During this day Paulo, Robson and I delivered our company presentation to Starrett factory. It all started very early in the morning at 5:30am, although I have to say that waking up this early did not seem too hard given the jetlag that I was still experiencing. After arriving to Suzhou, it was impressive to see the amount of people living in this “suburb” of Beijing ($7MM!!- more than twice the population of my home country Panama!!).
Working with Starrett factory was great! Our consulting project was somewhat different from the projects other groups had. In our project, we had to help an American company expand its product in China and not the other way around. This made things somewhat harder for us, as getting information on the Chinese “hand-tools” industry was definitely a challenge. However, this project helped us understand more how Chinese do business and some of the differences on how Chinese and Americans buy “hand tools”. For example, in the US the “do it yourself” market is increasing every year while in China this group is almost non-existent! After our presentation, we headed to the train station to catch our train back and it was incredible to see so many people gathered under the same roof! I was also pleased to see how friendly Chienese were as we were approached many times by locals who introduced themselves and wanted to chat with us (good luck Orlando was there to translate!!).
March 31, 2010 at 12:20 pm |
Today was really the first time that the Chinese reality for a majority of the population really hit me. Getting off the train and walking down the main street in Suzhou helped put in perspective how large the population of China really is. A smaller satellite city outside of Shanghai, Suzhou has a modest population of — oh 7 million. The crowded streets and dirtier conditions drastically contrasted the modern buildings and newly paved streets of Beijing and Shanghai. 1.3 billion is a ton of people.
The other thing that really struck me was learning the average salaries of workers in the Suzhou Industrial park. $300 a month is not a whole lot to live on- even with the subsidized housing and all of the resources available tot hem in the park. It really highlights how much cheaper the labor in China really is compared to the US and why companies continue to move thier manufacturing operations over there. Even as these wages continue to increase, there is a long way to go before it makes sense to move those jobs and production back to the states.
March 31, 2010 at 1:08 pm |
Starrett: Thumbs way up
Garden: Thumbs Down
Museum: Neutral
First let’s tackle the Garden. After experiencing the Forbidden City, I am concerned the bar is so high, any gardens we tour will fall short.
The Museum: very nice, very new museum with great Tea according to Robson, Paulo and Orlando. great Ancient History. But that is not why we are here. We are visiting Suzhou to see China’s emergence as a global powerhouse. We want to see the recent history (last 100 years) of what the city of Suzhou has accomplished to become a world leading in technology manufacturing (think SIP). So my feedback to them, is add recent history and show-off Suzhou’s accomplishments
Starrett: Incredible. Exactly what I expected after reading my China Book. American manufactures using older technologies and relying on cheap labor to keep them competitive. The machines are Starrett must have been 30 years old. And the factories workers only my $0.80/hour! Why invest in new technology to automate the manufacturing process when you can just hire more cheap labor. US’s Minimum wage is $7.25. Than means is 89% less to hire a factory worker in China. cutting worker wages and moving production to china has a huge impact to the company’s bottom line.
March 31, 2010 at 2:52 pm |
This morning would be the first of two that we had to wake up at 5:30am. When you’re not an early riser then this can present an issue. Luckily, the prospect of another fantastic breakfast (up to par with the Hilton in Wangfujing) was a big motivator to get out of bed early.
The train ride to Suzhou provided with a much needed time to recover from the previous night’s festivities. One has to marvel at how efficient things are in China. Also, I was impressed at how clean things are in China, for some reason I had thought this wouldn’t be the case.
The garden was a nice mix of colors and again we were met by a large group of local visitors. It seems every place in China has visitors and tourists and it’s a constant movement. The museum wasn’t really a highlight for me, so I decided to walk out and talk to some of the local shopkeepers. Having a Coke in the middle of Suzhou accentuates the importance of the american company. No matter where you are in the world you can always find a cold Coke.
The industrial park was amazing. The whole concept is so revolutionary and visionary. The government gives companies incentives to go there and set shop creating not only business, but perhaps more importantly employment.
Our visit to Starrett was really productive. The manager, a brazilian named Emerson seemed like such an easygoing guy (typical of brazilians like my new friends Paulo and Robson), and it would be so nice to work with someone like him.
It was not only until we were touring the factory that I remember Starett. They manufacture the vernier that I used in engineering school. I know most people probably didn’t know what a vernier is, but I sure did!
March 31, 2010 at 3:00 pm |
I have never been in a factory before, so the novelty of it was exciting. Two things I found interesting: 1) people were working on Saturdays and 2)I was expecting a lot more equipment in the actual factory than what existed. I am surprised at myself for actually saying this: but the tool factory was great!
It touches on one fact I remember learning about Chinese work ethic. Apparently, the factory workers were given time off as part of a new program to increase employee satisfaction and they did not want it. They were very confused about why they were given extra time off and required to work fewer hours — they rejected the idea and preferred to work their normal shifts. What a contrast in cultures.
Heidi, Lindsay and I took up the boat ride offer and enjoyed a little trip around the canal (very dirty water where people were washing clothes) and didn’t even pay extra for the serenade by our boat paddler. I thought I was in Venice for a second there. 😉
March 31, 2010 at 3:05 pm |
We were all a bit groggy after a late night on the town with the Alumni the night before, so the morning started slow. However, it picked right up when Will, Ben, Steve, and Margaret got the entire train station going with their musical talents. If you haven’t seen the videos of these four rockstars yet, please ask. Classic!
The train to Suzhou was very comfortable and very nice. It was a smooth ride and I got to get some good journaling done. One disappointing thing about the trip is that I was looking forward to seeing some of the Chinese country side out of the window of the train, but instead all I could see was about .5 miles out of the train because of the pollution. I have no idea how China is going to solve their pollution problem, but it is a MAJOR problem.
Arriving in the “small” town of Suzhou was much more what I thought China would be like. This small town was still 8 million people large (I think), much bigger than most US cities. I can’t remember who said it or when it was said, but someone said that the largest English speaking country in the world is China because about 600 million of their 1.3 billion people speak English. That number seemed to be substantiated by the immense size of Suzhou and how many people spoke English. What a place.
The garden visits were ok, and the Starrett factory visit was interesting, but not necessarily one of the highlights of the trip. It was still interesting to note how empty their warehouse was and that most of their processes were manual instead of automated.
Good day, but looking forward to Hangzhou tomorrow!
March 31, 2010 at 3:16 pm |
This morning I woke up geared for the high-speed train ride to Suzhou. After a short music performance, we were on our way. Visiting Suzhou was a nice contrast to the extreme urban environment in Shanghai. I enjoyed touring the small shops along the garden. The sellers seemed to be much less aggressive bargainers, which was relaxing.
Growing up in a city that was once overrun with manufacturing and steel plants, I enjoyed the opportunity to tour the Starett factory. It was completely different from what I had imagined. I was most surprised by the amount of unused space in the facility as well as their safety standards. In addition, the salary and cost of living information that we discussed during the Q&A session gave us even more insight into the manufacturing business in China.
March 31, 2010 at 10:07 pm |
My expectations for Suzhou were high because we heard all the beautiful women come from there, and the gardens were supposed to be gorgeous. However, it looked as though the gardens were only supposed to be viewed certain times of the year, and we weren’t there at the right time. It was interesting to learn about how the zigzag bridge kept away vampires…
The Starrett factory tour was eye-opening. We got to see ‘blue-collar’ workers making very little money. We learned that since there is a high concentration of factories in Suzhou, if a company pays just a few more dollars a year, a worker will leave. They don’t tend to have loyalty towards the company that trains them.
I was disappointed that we couldn’t visit a silk factory – which is another thing that Suzhou is known for. We didn’t see any silk at all while there.
April 1, 2010 at 4:29 pm |
For our visit to Suzhou, I expected to see a small town and a few factories. Instead, we get off the train and step into an urban city of 7 million people, bigger than my home state of Louisiana, and the Industrial Park had countless factories lined up one by one.
During our visit to Starrett, I was most surprised by the lack of automation. Even simple things were done manually. There were no conveyor belts, no assembly lines, just a few forklifts and the custom machines used to make drills, saws, and other construction hardware. It all came down to the economics, labor was cheaper than machines.
It got me thinking about how important economic policy is for so many companies’ invested in China. What would happen if China decided to let its currency float? Would the Yuan strengthen? Could that cause companies to rethink their labor intensive investments in China or would it cause them to automate more of their processes? Either way the accumulation of wealth in urban cities of China tells me labor costs will be on the rise. It will be very interesting to see how manufacturing in China evolves over the next ten years.
April 2, 2010 at 3:42 pm |
I believe it was the Zhouzheng Garden where we first learned about vampire bridges (and when Dorothy first started believing in vampires:). Basically, all the walking bridges in Chinese gardens are zig-zagged so that vampires won’t be able to navigate the turns and will then fall into the water. I really enjoyed being at the New Suzhou Museum. It was so modern and nice! Orlando and I had some tea with the Brazilian guys and that was cool.
Starrett was also really cool and interesting. It was so neat seeing how all those little parts and tools are made. I was surprised by how raw the warehouse was and how little automation there was with some of the processes. It was also interesting to learn about the technology park in general and the incentives that it is able to offer.
April 4, 2010 at 10:40 pm |
Second day waking up very early. The train trip to Suzhou gave us the opportunity to rest I little more and definitely the people whoe stayed up late the night before welcomed it. The arrival in Suzhou gave us the first chance to get in touch with a different China, one that is not so glamurous but is impressive in its own particular way.
The Zhouzheng Garden presented I totally different style than what we had seen in parks and palaces in Beijing a buildings were not as colorful and we could see more trees and ponds.
The wise decision from Orlando allowed us for some more time to visit the New Suzhou Museum, relax and have some tea before going to Starrett.
The visit to Starrett’s plant was very interesting and allowed us to understand better their business and the role of the Suzhou Industrial Park in the development of foreing business in that region of China.
Me, Robson and Juan ended the day doing our presentation to Emerson from Starrett. After the formal presentation we spent sometime discussing our recomendations and exchanging ideas about how Starret could overcome the challenges they have been facing. I think we were able to provide Emerson with some useful insights and I am sure he will be able to use some of them to improve Starrett’s results.