Yankee traders will find Cathay has its own MBAs
Three years from now, American executives will have someone to talk to in China - not simply someone who knows English, but someone who knows profit margins, financial accounting, marketing.
These will be the new China's first China-trained MBAs - figuratively, executives in pin-striped Mao suits.
In 1987, 40 Chinese will graduate from a fully accredited master of business administration (MBA) program at the National Center for Industrial and Science Technology Management in Dalian, China. The program, staffed by professors from the State University of New York at Buffalo (SUNY), began Oct. 3. In a nation of 1 billion, with perhaps 15 million managers, the 40 Chinese MBAs may not be nearly enough to revolutionize the Chinese economy - but they will be crucial for ushering in free-enterprise methods in this heretofore all-communist nation.
Primarily, these MBAs, says Dr. Joseph A. Alutto of SUNY, dean of the program , will help modernize Chinese management and work with Westerners on joint ventures. In joint ventures elsewhere, Dr. Alutto notes, Western partners usually have some control over the work force - if only to protect their investment. That has not been so in China, where plant managers may control production but the Communist Party controls hiring and firing. ''Now,'' Dr. Alutto says, ''these people (the Chinese MBAs) will understand the need for control and discipline of the work force.''
Although this is the first MBA program in China, a business-training program has been in effect since 1980, jointly funded by the Chinese government and the United States Department of Commerce. The Chinese are also bringing in Canadian and European MBA programs, aiming not to imitate one model but to arrive at a uniquely Chinese approach.
''They want to see how far they can go without losing the essence of socialism,'' Dr. Alutto says. ''They want as much competition as possible, but that doesn't mean as much as in the United States.''
The chasm between Chinese quasi-communism and American capitalism is still enormous. During a recent lecture in China, Dr. Alutto outlined a profit-sharing plan that would return $1 million to employees as an incentive, thus helping the owner achieve another $1 million profit.
''The Chinese simply would not believe that a capitalist would ever return money to employees,'' Dr. Alutto recalls. ''So I would try to make them understand that it was pure selfishness, that by returning $1 million to employees as an incentive, the employer was getting $1 million himself.
''Then their concern would be that the behavior was unethical, that the prices of the product should have been reduced by $2 million instead. So you end up asking them, 'Would reducing prices be an incentive to motivate workers?' They can look around at the Chinese system and see that the answer is 'no.' ''
But while one can teach such ideas, Dr. Alutto says, in China ''they're still pretty hard to implement.''