Jack Perkowski’s Lessons From the Field

Jack Perkowski: Well, I made a lot of mistakes. I made some of them more than once, unfortunately. When I look at every mistake I made, it’s because I didn’t listen hard enough and I reacted too quickly. I kind of gave in to the American instinct to kind of; you just react.

In China, things are never quite what they appear to be. It takes a long time to really understand what really is going on behind the scenes, and what somebody’s really trying to tell you.

So I would say the mistakes that I’ve made had been when I acted too quickly. And there was a case where one of our general managers was doing some things that the alarmist around me kind of called my attention to, and frankly, I kind of listened too closely to them, rather than taking a deep breath, and really try to understand the situation a little quicker.

And we end up removing that general manager because of what they were saying he was doing. And I later found out that was a big mistake and I really ended up apologizing to our Chinese partner because I’d reacted too quickly. So every one of my mistakes kind of falls into a category like that where I just didn’t listen hard enough and I acted too quickly.

 

Question: Case study: Trial by fire

 

Jack Perkowski: Well, the biggest thing to me is the fact that the Chinese have a substantially different and lower cost perspective.

When I first went to China, companies would come in with very good products and they think they were priced right for the China market and end up being too expensive. Or companies would come in, and they would think that because they now have a plant in China that they have a very cost effective plant.

Be it they find that in China, there are all these other plants that are much, much lower cost. And so, a lot of people wonder how can these products be too high priced for that market? How can my plant in China be so cost uncompetitive with local Chinese companies? And what I’ve discovered, and this kind of came to me about 1998 or 1999 is that the Chinese have a much different and lower cost perspective. They look at money differently.

I always carry around with me two bills, one is 100-RMB bill, one is 100 US. And when I tell people those two bills are looked at exactly the same way in their respective countries. You can’t get a bill larger than 100 US in the US. You can’t get a bill larger than 100 RMB in China. When I, as an American, look at that 100-RMB bill, I instinctively, even though I’ve been in China for 15 years, I divide it by 8 and I really see $12.50. When a Chinese, no matter how wealthy they are, look at that same 100 RMB, they see more like what I see when I look at a 100 US, completely different cost perspective.

And once you sort of understand that and internalize that, then you start to understand how the markets in China start to work, and why those foreign goods are too high priced for the market, and why these Chinese companies can be so cost competitive.

It seems like a very simple concept, but once you understand, it starts to explain a lot about China, and that’s what I mean when I talk about these little bits of logic.

Question: What has been your most valuable lesson in leadership?

 

Jack Perkowski: I think you’ve got to lead by doing. I think people, like I said before, people when somebody comes in a leadership position, everybody said, I don’t care how big their credentials they have and they may have work for a very famous company in the United States, but you know what, if that company doesn’t have much in China, nobody in China even knows what that company.

So it might be a $10 billion company here and nobody in China, none of our general managers even know what that company does, they won’t even know what a big company is. So what you’ve done elsewhere, doesn’t really doesn’t really count for a lot. All these general managers know that managing in China is probably one of the more difficult assignments in the world. And so, they want to, so, okay, show me what you can do in China. And the only way that you can really lead in China is by establishing that individual credibility. They have to view you as somebody, first of all, is willing to roll up their sleeves.

Secondly, somebody that can really teach them something or tell them something or really show them how to do something. And once you do that, they follow. And then, the other part of this is doing what you said you’re going to do. So you get up and you say that we’re going to do this, we’re going to do that, and you go and you do it, then you get the credibility. But leadership is not something that somebody can confer. Or, you can’t confer that kind of power on somebody. Everybody’s got to earn it in China. And that doesn’t make any difference how senior you are or how junior you are, you’ve got to do the same thing.

 

Question: Who have been your mentors?

 

Jack Perkowski: I’ve got a really good team of people that surround me. A guy named Wilson Ni who’s our head of Sales and Marketing. Wilson has worked for me for 10 years. He came, he went to Tsinghua University, one of the leading universities in China. Worked three and a half years for Daimler, three and a half years for General Motors, joined us in 1997, 1998 when we were struggling. And Wilson is a very, very smart guy because he interfaces with the marketplace and all of our general managers in his day to day activities. He’s always coming in and telling me things about the market and what’s happening and every time I talked to Wilson, I learn. Okay. So he’s sort of one individual.

There’s a guy who was the Chairman of [Yuchai] [IB]. This guy’s a bigger than life guy. He took a very small agricultural diesel engine maker in [Yuchai]; made it into the largest diesel engine company in China. No small feat concerning what he had to go through to in that whole process.

He obviously has a vision for the whole industry. He’s someone I got to know very early. And so, he’s somebody that I’ve learned a lot from.

[Dong Yang] who was used to be the general manager of BAIC, Beijing Automotive Industry Corporation. They’re a partner of ours in one of our joint ventures. Every time I meet him, he gives me some insight about the market or whatever that tends to corroborate what I’ve been seeing, but having him say it, means that I know that I’m on the right track.

A lot of people like that around China, that I interface with or have interfaced with that you kind of get a piece here and a piece there, and you put it together with your own experience and you’ll start to get much clearer or bigger picture.

 

Recorded on: September 22, 2008

"Mr China" explains how things are never what they seem in Chinese business.

Politics & Current Affairs

Political division is nothing new. Throughout American history there have been numerous flare ups in which the political arena was more than just tense but incideniary. In a letter addressed to William Hamilton in 1800, Thomas Jefferson once lamented about how an emotional fervor had swept over the populace in regards to a certain political issue at the time. It disturbed him greatly to see how these political issues seemed to seep into every area of life and even affect people's interpersonal relationships. At one point in the letter he states:

"I never considered a difference of opinion in politics, in religion, in philosophy, as cause for withdrawing from a friend."

Today, we Americans find ourselves in a similar situation, with our political environment even more splintered due to a number of factors. The advent of mass digital media, siloed identity-driven political groups, and a societal lack of understanding of basic discursive fundamentals all contribute to the problem.

Civil discourse has fallen to an all time low.

The question that the American populace needs to ask itself now is: how do we fix it?


Discursive fundamentals need to be taught to preserve free expression

In a 2017 Free Speech and Tolerance Survey by Cato, it was found that 71% of Americans believe that political correctness had silenced important discussions necessary to our society. Many have pointed to draconian university policies regarding political correctness as a contributing factor to this phenomenon.

It's a great irony that, colleges, once true bastions of free-speech, counterculture and progressiveness, have now devolved into reactionary tribal politics.

Many years ago, one could count on the fact that universities would be the first places where you could espouse and debate any controversial idea without consequence. The decline of staple subjects that deal with the wisdom of the ancients, historical reference points, and civic discourse could be to blame for this exaggerated partisanship boiling on campuses.

Young people seeking an education are given a disservice when fed biased ideology, even if such ideology is presented with the best of intentions. Politics are but one small sliver for society and the human condition at large. Universities would do well to instead teach the principles of healthy discourse and engagement across the ideological spectrum.

The fundamentals of logic, debate and the rich artistic heritage of western civilization need to be the central focus of an education. They help to create a well-rounded citizen that can deal with controversial political issues.

It has been found that in the abstract, college students generally support and endorse the first amendment, but there's a catch when it comes to actually practicing it. This was explored in a Gallup survey titled: Free Expression on Campus: What college students think about First amendment issues.

In their findings the authors state:

"The vast majority say free speech is important to democracy and favor an open learning environment that promotes the airing of a wide variety of ideas. However, the actions of some students in recent years — from milder actions such as claiming to be threatened by messages written in chalk promoting Trump's candidacy to the most extreme acts of engaging in violence
to stop attempted speeches — raise issues of just how committed college students are to
upholding First Amendment ideals.


Most college students do not condone more aggressive actions to squelch speech, like
violence and shouting down speakers, although there are some who do. However, students
do support many policies or actions that place limits on speech, including free speech zones,
speech codes and campus prohibitions on hate speech, suggesting that their commitment
to free speech has limits. As one example, barely a majority think handing out literature on
controversial issues is "always acceptable."

With this in mind, the problems seen on college campuses are also being seen on a whole through other pockets of society and regular everyday civic discourse. Look no further than the dreaded and cliche prospect of political discussion at Thanksgiving dinner.

Talking politics at Thanksgiving dinner

As a result of this increased tribalization of views, it's becoming increasingly more difficult to engage in polite conversation with people possessing opposing viewpoints. The authors of a recent Hidden Tribes study broke down the political "tribes" in which many find themselves in:

  • Progressive Activists: younger, highly engaged, secular, cosmopolitan, angry.
  • Traditional Liberals: older, retired, open to compromise, rational, cautious.
  • Passive Liberals: unhappy, insecure, distrustful, disillusioned.
  • Politically Disengaged: young, low income, distrustful, detached, patriotic, conspiratorial
  • Moderates: engaged, civic-minded, middle-of-the-road, pessimistic, Protestant.
  • Traditional Conservatives: religious, middle class, patriotic, moralistic.
  • Devoted Conservatives: white, retired, highly engaged, uncompromising,
    Patriotic.

Understanding these different viewpoints and the hidden tribes we may belong to will be essential in having conversations with those we disagree with. This might just come to a head when it's Thanksgiving and you have a mix of many different personalities, ages, and viewpoints.

It's interesting to note the authors found that:

"Tribe membership shows strong reliability in predicting views across different political topics."

You'll find that depending on what group you identify with, that nearly 100 percent of the time you'll believe in the same way the rest of your group constituents do.

Here are some statistics on differing viewpoints according to political party:

  • 51% of staunch liberals say it's "morally acceptable" to punch Nazis.
  • 53% of Republicans favor stripping U.S. citizenship from people who burn the American flag.
  • 51% of Democrats support a law that requires Americans use transgender people's preferred gender pronouns.
  • 65% of Republicans say NFL players should be fired if they refuse to stand for the anthem.
  • 58% of Democrats say employers should punish employees for offensive Facebook posts.
  • 47% of Republicans favor bans on building new mosques.

Understanding the fact that tribal membership indicates what you believe, can help you return to the fundamentals for proper political engagement

Here are some guidelines for civic discourse that might come in handy:

  • Avoid logical fallacies. Essentially at the core, a logical fallacy is anything that detracts from the debate and seeks to attack the person rather than the idea and stray from the topic at hand.
  • Practice inclusion and listen to who you're speaking to.
  • Have the idea that there is nothing out of bounds for inquiry or conversation once you get down to an even stronger or new perspective of whatever you were discussing.
  • Keep in mind the maxim of : Do not listen with the intent to reply. But with the intent to understand.
  • We're not trying to proselytize nor shout others down with our rhetoric, but come to understand one another again.
  • If we're tied too closely to some in-group we no longer become an individual but a clone of someone else's ideology.

Civic discourse in the divisive age

Debate and civic discourse is inherently messy. Add into the mix an ignorance of history, rabid politicization and debased political discourse, you can see that it will be very difficult in mending this discursive staple of a functional civilization.

There is still hope that this great divide can be mended, because it has to be. The Hidden Tribes authors at one point state:

"In the era of social media and partisan news outlets, America's differences have become
dangerously tribal, fueled by a culture of outrage and taking offense. For the combatants,
the other side can no longer be tolerated, and no price is too high to defeat them.
These tensions are poisoning personal relationships, consuming our politics and
putting our democracy in peril.


Once a country has become tribalized, debates about contested issues from
immigration and trade to economic management, climate change and national security,
become shaped by larger tribal identities. Policy debate gives way to tribal conflicts.
Polarization and tribalism are self-reinforcing and will likely continue to accelerate.
The work of rebuilding our fragmented society needs to start now. It extends from
re-connecting people across the lines of division in local communities all the way to
building a renewed sense of national identity: a bigger story of us."

We need to start teaching people how to approach subjects from less of an emotional or baseless educational bias or identity, especially in the event that the subject matter could be construed to be controversial or uncomfortable.

This will be the beginning of a new era of understanding, inclusion and the defeat of regressive philosophies that threaten the core of our nation and civilization.

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