One Billion Customers

One Billion Customers: Lessons From the Front Lines of Doing Business in China
Extra Credit Book Review
Author: James McGregor
ISBN-13: 978-0743258418
By: David Hart

Overview/ Contribution to Knowledge

In his book One Billion Customers, James McGregor takes his readers on an insightful journey through fascinating and detailed stories that illustrate the complex business world in China. McGregor relies on his experiences to convey important principles he learned through his many years spent experiencing China’s business environment.

McGregor’s experience as both a journalist and a businessman in China provides a foundation for this book. His goal is to convey to the readers lessons they should learn before conducting business in China. McGregor intends to “show rather than tell what it is like to do business in China (p. xx).” His stories are loaded with practical advice. He notes that many foreign executives are simply unprepared to come to China (p. xx).” Often times it is a lack of understanding the Chinese business history, culture and environment that makes it challenging to conduct business. With a population well over 1 billion people, China presents incredible business opportunities.


The audience best served by this book includes those doing business in China as well as those considering or preparing to do business in China. Others interested in the Chinese business culture and history will also find this book to be intriguing. Finally, business people located anywhere will find nuggets of wisdom that they can learn from the experiences the author shares. Many of the lessons contained in the book can make people think about the cultural and psychological implications that can be applied to various business situations.


Where McGregor Excels

It is clear by reading this book that James McGregor is a master storyteller. Not only is he a good writer, but he chooses stories that are interesting to the readers. For example, he tells the amazing story of Lai Changxing (p.98). The history of this man captivates the reader. Americans may even somewhat relate to part of his story. Changxing’s riveting journey from being raised in a poor family in a small village to becoming a wealthy businessman is fascinating. He made a fortune smuggling items such as oil, cigarettes, and autos into China (p. 106). Many argue that his business practices crossed ethical boundaries. Later, he then had to flee China to escape prosecution from the government. McGregor’s strength is that he uses this story to make a point. He does not simply tell stories just because they are interesting or entertaining. He uses them to teach principles of doing business in China. He does not just tell the narratives, but he teaches his readers lessons they should learn.

McGregor also uses great detail in this book. As a journalist, he clearly has experience gathering facts from many different sources. A good journalist looks at all sides of an issue from various sources. McGregor appears to have done his homework. For example, he claims that his account of Changxing’s saga is “based on close reading and analysis of these often contradictory materials” (p. 98). He tried to get all sides of the story. He even tracked down Changxing in Canada to hear his personal version of the events that occurred (p. 117). Of course, as is the case with all writers, McGregor has his biases. He admits that he has made judgments about what he believes to be truth versus fiction (p. 98). It does seem as though he researched his facts before coming to his conclusions. I was impressed with the detail that he was able to gather in all of his accounts.

McGregor is very perceptive. He provides insightful commentary, weaving human nature with reality in order to make his points. He is a keen observer of China and its business practices. I was impressed with his ability to understand the events that he and others experienced. He not only understood the implications, but was able to extract lessons that his readers could learn from these events. At the end of each chapter, he has a heading entitled “What This Means For You.” He then explains what it is that he wants the reader to learn from the chapter.

He emphasizes the application of principles from the stories he tells. For example, in the chapter entitled “Eating the Emperor’s Grain,” the author speaks of first the “good”, then the “bad” followed by the “ugly” (p. 118). His advice sections are full of suggestions that cover all angles. He is very realistic in his commentary, not afraid of coming across as somewhat negative in his views. He tells it like it is. In doing so, he helps readers realize that business in China is no cakewalk!

An example of the author’s plainness is found in the fourth chapter. The author notes that “China can be a scary place to do business” (p. 127). However, in this instance he balances the negative tones by providing a hopeful statement. He says that “conditions for doing business are improving as the nation becomes more exposed to global business practices” (p. 127). Furthermore, he notes that “if your business is doing what is right for China, you can win a battle against the most entrenched and ruthless government foes” (p. 127). Throughout the text, the author’s tone is realistic yet hopeful. Yes, business is tough in China. However, if you develop the proper strategy and understand Chinese business and government, then you can become successful. This practical theme humbles the reader by stressing the importance of learning the necessary steps to achieve success in China.

One of the most reader-friendly features of this book consists of the end-of-chapter advice sections. McGregor labels each of these sections as part of the “Little Red Book of Business.” In these sections, the author uses bullet points to help the reader focus on the lessons he wants them to learn. These sections summarize the advice the readers should have gleaned as they read the chapter. For example, McGregor gives advice such as “Be tough. The Chinese respect it. Never tremble and obey if doing so will damage or destroy your business in China” (p. 153). He also says, “Frame your arguments to show how your business is good for China, not what is wrong with the Chinese government. You can’t make the system look bad” (p. 153). These particular examples can be explored more in depth when reading the chapter. In this particular case, the author teaches these lessons through his personal experiences with the Chinese government. McGregor negotiated with Chinese officials to help his company, Dow Jones, compete in the Chinese market (p. 127). His personal experiences interwoven with the stories of others provide the reader with a good variety of stories from which one can learn.

One recommendation I would make to someone reading this book would be to read the summary boxes at the end of each chapter before reading the chapter. Reading the boxes first gives the reader an overview of the principles to look for in the real-life stories in the chapters. Then, I would recommend for the reader to review the summary boxes at the end again after the chapters. There is a lot of information contained in this book. By reading an overview of the principles, the reader can get more out of the individual chapters.

McGregor is well qualified to write this book. His experience of living in China allowed him to witness firsthand the rapid expansion of the Chinese economy throughout the past two or three decades. He does an effective job of mixing in the history of business in China throughout the book. He helps the reader understand the many challenges and opportunities that business people have faced as well as continue to face.


Where McGregor Falls Short

The main weakness from my viewpoint in this book is that McGregor focuses mostly on big business examples. He tells fascinating stories of airplane manufacturers, newspaper companies, and other big businesses. However, he generally fails to focus much on small or medium-sized businesses in China. Many of the readers of this book may be considering doing business in China on a smaller scale than the examples discussed. It may be challenging for some readers to relate to the examples given. However, the advice summaries at the end of each chapter provide information that can be applied to anyone doing business in China.

McGregor’s writings also at times seem a little wordy. While detail can be a positive aspect of a book, I felt that there were times when he was too detailed. This was true both in the chapters as well as in some of the summary boxes. I felt that there were times when the author needed to simplify some of the chapters. In addition, although he used headings throughout the book, I felt that he could have added even more headings to help the reader better understand the transitions and the flow.


Interpretations and Summary

Overall, despite its weaknesses, I found this book to be a useful resource in better understanding how the front lines of business work in China. I particularly found the discussion on the future of China to be interesting. McGregor discusses the state of education. For example, he notes that China’s education culture has created a nation of people who cram for exams, learn by imitating, follow role models and absorb prescribed solutions for problems (p. 260). He says that the problem is that in modern China there “are no role models, no prescribed solutions, an no one to imitate” (p. 260). While I don’t know if this statement is completely accurate, I agree that it will be important for China to be willing to evolve in the realm of education.

I particularly found the discussion of Chinese MBA students to be relevant. Calling Chinese MBA students the “most aggressive and impatient in the world” (p. 268), McGregor discusses the recent history of MBA programs in China. He notes that there are some cultural changes that need to occur in order for Chinese managers to find success. For example, Chinese bosses often times give orders and analyze problems without input from workers (p. 269). The author argues that business schools need to transform their cultures by changing the way their students think. He argues that education in China prepares people to be led, not to lead (p. 272).

Does the future belong to China? McGregor believes that the answer to this question will be determined by whether the “Chinese elephant can transform itself from a rampaging sprinter into a methodical marathoner” (p. 295-6). This book does a great job of helping the reader understand that in order to find business success in China, one must understand the culture, government and business environment. In order to take part in this rapidly growing economy, foreigners need to realize that nothing is given. It takes hard work, understanding and relationships to be successful. The author makes this perfectly clear. One thing is certain- business in China is not for the weak or unprepared!