Loud Thoughts

先看基础篇，再往下读。记住：成功不在点子，而在执行能力。全世界都能看这博志，你赢在更好地执行能力。没错，别妄自菲薄。再去读一遍基础篇。如果你准备好了，你一定行，也一定会赢。

假设你有IT的背景，有协调的能力，有点组织能力。中国的农村，是你最佳的空间。农村是集体共有的资源，平均教育水平低，没有什么资讯系统可言，生产力低。从另一个角度看，管理，组织，IT能带来最大的生产力提升的空间。美国的农民生产力，是中国的20倍。如果你找到一个农村，提升他们的生产力10倍，你能赚多少钱？

首先，农民们得信的过你。最简单就是你的同乡。中国人乡土情深，你说同一种乡音，分析给他们听，才能走下一步。感情及信任，是一切的基础。

做什么呢？最简单的是产销链。一样的作物，农民拿多少？市场卖多少？中间到哪去了？如果好好经营，去掉中间人，缩短产销链，大家都有好处。

再来是专业化及个性化。一村种一种庄稼，和全国每一村都不同。这庄稼要好好选：以自然条件为主，农民知识为辅。市场需求和经销，是下一步的工作。大家种大米，这村种香米。大家种桃子，这村种水蜜。

当然最赚钱的是新产品。农产品需要几年才能获利，不能全村一下转种。要有计划的更新，一亩一亩，一家一家，大家有组织的做。几年后就成了个产业。然后往下个村推行。

比较有魄力的做法是把整村租下，改种新作物。现成的农民，成了你的员工。他们的地，就是新的工厂。只是不制造，而是耕作。农民的收入改成工资，而不是卖农产品。既然决定权在你，资金由你出，成本风险在你，将来的收益也是你的。农民担心的是你倒了这么办？你必须给他们个保障：银行里一笔保证金，如果公司倒了，农民不会一无所有。盈利分红更是激励士气，降低成本的好办法。

这是个十年大业。没有决心，不要进来。这也是最有意义，最赚钱的事业。

其实我是要学PodCast怎么做。但第一步是要有材料，我这没什么创造力的人，去那里找材料呢？在北京时，买了套评书CD。那时就转成MP3，放在iPod里听。想想就用它吧。自然会考虑产权的问题。但我的CD还在海上，看不到许可的细节。记忆中，没有任何许可。也就是说，那些CD是我的，如同物理财产。等我拿到CD时，如果我无权分布，那就得把这些撤下喽。

I was to learn the mechanics of podcasting, but having contents appears to be the necessary 1st step and I don’t have any. While I was in Beijing, I bought this audio book and quickly ripped them into MP3 so that I can listen to them on my iPod. Seems like perfect contents, only I don’t know the licensing terms. If I remember right, there was not any. For CDs bought in China, this should means I own those CDs (instead of licensed the contents). Those CDs are on their way from China to US. I will search and read the license, if I ended up not having the rights. Well, this link will have to go down.

这系列是我对中国这代人的期许。尤其有高校资历，又在北京，上海，深圳的外企做了5年左右的年轻人。会介绍些创业的观念。我认为成功率颇大，但没有一步登天的。

你得有高校资历，至少5年工作经验，最好10年包含2至3年的管理经验。不然也得有协调沟通的能力。

你得有点创业冲动，也愿意做些牺牲：优越的待遇，大城市的生活，一呼百诺的威风，悠闲的假期，等等。不必也不该全丢，但总要舍几个。

找一二个伙伴。路是很远的，需要有伴同行。不能用配偶，可以是朋友。创业伙伴最重要的是能同甘共苦。平日留意个性相投的人，观察他的为人处事。时间到了，看能不能共襄盛举。不要被背景财力迷惑，那是能补足的。性格是不大能改的。

中国没有健全的退场机制。创业的后果：倒了，卖掉，或继续盈利。上市的机会不大。也就是说，要做好长征的打算。可以一二年没赚钱，不能把将来退休的本赔进去。自己人已经投入了，不能把家人在拉进去。

想好自己的能力，经验，及性格。能力是出身，知识，学问，或训练。经验是上场实战的刀疤。性格是待人接物的风格。这些是别人无法取代的，也是你竞争的本钱。

中国人讲“谋定而后动”。我常告诫年轻人：“武功没练好，一下山就被人杀了”。再回头读一遍，你准备好没?

When travel via air, carry-on are restrictive, but checking-in comes with the worry of lost or, worst, being looted. They are so vulnerable. What if a stranger reaches in? Are my jewlery safe? They may touch my underwear!

TSA may cut off locks for random inspection.

The humble cable ties are pennies per pound. The smallest one withstands the strongest fingers, yet yield to the least threatening cutting tool. It is basically temper-proof, also colorful as an identification device.

Throw a bunch into the hand-carry bag. Tie your check-in luggage at the counter and board with a peace of mind.

I decided to create a new blog for my new employer, Juniper Network.

Starting July 20th, Beijing will be an easy to move-around city only for the Olympians.

First the most expected: only cars with license plates that are even can drive on the even days, odd plates for odd days. This means, on average, only half the cars are allowed on the roads. Beijing Municipality has done this trick many times and most citizens are used to it, but never for 2 months. On the wrong days, take a taxi (exempt), public transportation, car pool, or just work from home.

Next comes 200RMB fine for driving on the “Olympic Only” lanes. These are like car-pool lanes, just reserved only for those special permit. “Chump change,” you said. “I will pay US$30 for a speedy commute.” It is 200rmb per violation with no upper limit. You can get a ticket every 2 minute. By the way, same for the 1st rule.

All residential areas, particularly popular for foreigners or migrant workers, are now checked several times a week. Police or neighborly citizens come knocking on the door, request to enter, and survey the house for any strangers. Those without proper documentation — national ID card, passport, residential permit, etc. — disappeared.

Foreign worker’s family members used to work under a single working permit, although technically issued only to an individual. No more. Those without working permit to their name got dismissed, sometime after many years of employment.

Visa processes are so restrictive that legitimate visitors are turned away. For business visas, the sponsoring company must guarantee that the visitors will abide all laws and stay out of trouble. The consequences can be quite undesirable, particularly to the head of the company that made such promises.
The number of visitors is so low that hotels and landlords are busy adjusting the income expectation downward. Renters who were evicted now find themselves in buyer’s market and quite an enjoyable bargaining position.

All subway stations have erected airport-like security check-points. Passengers carrying liquids must take a sip to board. I don’t know what will happen to grocery shoppers.

No large trucks may enter the city, except for those carrying perishable vegetables, meats, and other groceries. Small trucks may enter or leave the city only from mid-night to 5am.

Postal or delivery services cannot accept anything liquid, powder, with compressed air, with battery, or electronic. The online auctioning sites are suffering major sales reduction. Companies rely heavily on couriers.

No major network changes. If a company wishes to move from one location to another, it cannot change the routing configuration by the telecom operator or ISP.

Knock-off hand-bags or pirated DVD? Forget it! The popular shopping places are all hush-hush when customers approach. Many DVD/CD shops simply shut the doors, “We are temporarily close and will be open soon.” “You know, it is Olympics,” said the shop keeper. “Come back in September and we will have more to show you.”

Foreign workers changing job must de-register immediately. This means the company must cancel their working permits within a day or two. Further, the visa must be changed to a non-working visa (L-visa) or switch to the new company immediately. This is a bit twisted since the visa-changing process takes 7 working days. To do this properly, a foreign worker must submit the passport and working permit to the government at least 7 days prior to the last working days. L-visa (tourist) holders now cannot ship large amount of things out of the country. To move out of China, a Z-visa holder must arrange the shipment prior to the changing of the visa then. The proper process is then: find a new job, arrange shipment, move to a temporary place, resign from old job, wait at least 7 working days, and leave the country for the new job.

All factories near Beijing have stopped or significantly reduced their industrial pollutant output since this spring. Beijing is frantically trying to improve its air quality, to no avail. Rumors said they are seeding rain clouds to “wash out” the air. (It is usually a bright blue day after the rain.)

No eating dogs anymore. Historically, Chinese and Koreans enjoy eating dogs. They are known to restore the warmth in body in winter days. “Out of respect to the culture of our visitors,” said government officials. “Dog meats are not served during Olympic time.” Trucks transporting meat will be inspected and fined for violation.

Last night, we saw 3 armed military personnel at the street corner. There was no obvious reasons for such sentry. Each of them held a big gun, wore helmet, bullet-proof vest, and combat boots. They wore black uniform instead of normal Liberation Army color. The intimidation effect is quite impressive.

Mr. XI JingPing (習近平, Vice Chairman of the Party, widely believe to the successor to Mr. HU in 4 years) said, “All we want is have a safe Olympics.”

Well, he has spoken, it shall be done. Beijingers will live in the new forbidden city until September 20th (after the special Olympics). Many of them couldn’t wait for this to be over.

Too many dread the request from headquarters every year or so, “Your term is coming to an end.” What follows is the all-too-common maneuver to renew.

As designed, and often so used, the generous bundle of compensation and perks commonly known as the expat package, is for short-term assignments typically of 2 to 5 years. At the end of the term, the individual returns to the home country. The trouble comes when one gets addictive to China. It is vibrant, culturally rich, and friendly. The expatriated wishes to stay for indefinite term but don’t want to give up the nice package.

From the corporate side, the arrangement is excessively expensive and conceptually difficult. The package usually costs 2 to 3 times the person’s US salary; how could a temporary deal becomes many years, seemingly not ending? The corporate wants things clean. It also wants compensation to be fair: to those hundreds of local employees as well as more in headquarters.

But there is no need for confrontation. There is a way to make both sides happy. Ready?

Assumptions

For ease of discussion, we will assume that you, the assignee, is from the USA. You are a senior person that provide good value to the company. In other words, you are competitive and worth your money.

With that assumption, the rationality for localization is not about saving money. The company should be willing to provide you with reasonable and competitive compensation. What they need is the right argument to justify it. If this assumption is not true, then you are not really competitive, from the company’s point of view. You should either accept the lower pay or seek other jobs.

The basis of the discussion starts from the simple principle: your income should remain relatively the same after the localization. The goal is not to degrade your quality of life drastically.

The company wishes to do good business in China. Otherwise, you have no value here anyway.

Considerations

China and the US agreed not to double tax. This means the same money will not be taxed in both China and the US. China, however, do not have the same agreement with the state of your residence. You will have to pay state income taxes for whatever income declared in your federal tax return.

Both China and the US has progressive tax rates. You should have a firm grip on your effective tax rate: the amount of taxes divided by your effective income.

Perks are generally not taxed in China if the company pays for them. They are taxable income in the US.

The working days you spent in the US are usually subject to the US income taxes. China’s tax process are not sophisticated enough to refund you those. How many days you will stay in the US? How many of them you will be working?v

Your company probably have a pre-tax 401k matching program for US employees. There is no such thing in China. You should consider asking for this.

If you have dependents in the US. Who will pay for their medical insurances?

Unlike the US, personal relationship is the foundation of all business interaction. As such, social prestige is part of the business. People do judge you on where you live, the car you drive, the clothes you wear, etc. The company should consider these with its compensation design.

Contrary to the common belief, the senior talents in China frequently receive equal or even higher pay than their US counter-parts. Only junior ranked are less expensive. This is really just the simple function of supply and demand. I found the “crossing point” to be at the director grade. This is true for both MNCs and local enterprises.

China citizens are not allowed to own foreign stocks. Many companies worked around the laws, but you may also find yourself excluded from future stock option grants.

Lastly, if you consider retiring in the US, what you really to compute is the rate your retirement fund accelerates. Does localization implies retiring in China? Both the company and yourself should make this point clear.

Calculator

Here’s China’s personal income tax table. You should verify its accuracy, since China adjust the tax-free income regularly.

To use this table, find your range, multiply the in-range portion with the tax rate and add in the “quick deduction” value. Don’t forget to deduct 800 first.

For example, if you make 90,800 a month, first minus 800 to get 90,000. Find the 8th rung. Your in-range portion is (90,000 - 80,000 =) 10,000. Multiple that by the tax rate of 40% (=4,000) and add in the quick deduction number of 10,375. Your monthly tax will then be 4,000 + 10,375 = 14,375. Your effective tax rate is then 14,375 / 90,800 = 15.8%.

Next figure out your US tax bracket. The simplest way is to average your 3-year total tax paid by your 3-year total adjustable income. Don’t forget state taxes.

Now, if your China effective tax is X and US Y. If your pre-tax US income is Z, the rough equivalent China income shall be Z * (1 - Y)/(1 - X). Convert that answer from US$ to RMB. If your company pays bonuses, or extra-month’s pay in China, factor those in.

Now the Perks

You should try to arrange most of perks to be paid out by the company directly. They are then not taxed in China, but still taxable in the US. So add them all up and multiply them by Y and add that amount to your China income. I know that your China income is then subject to its taxes and will become your US income again. The computation is too complicated and not really amount to much. This simple method will do.

How to Negotiate

At the end of the day, you must be worth the compensation. Be sensitive to the decision maker’s judgment. He or she will eventually decide whether you are worth whatever you are asking for. A totally fair deal may be too much for him or her to pay. You must accept this and know your bottomline. Most companies are willing to give you an enticing compensation package if it is justifiable according to the policies, reasonable, defensible to the general constituents, and scalable to a general class of employees.

The education assistance is easy. Your children have their future in the US and should not be jeopardized by your assignment in China. Family first, not compromisable.

House and car services are a bit trickier. Supposedly, a localized person should provide his or her own housing. But the company should really take care of the differences. China’s houses are in general more expensive and the mortgage terms much worse. Don’t forget management fees.

The same argument applies to car services. Cars are luxury items in China and are 30% or more expensive than the equivalent in the US. Given that, it is really not much more to hire a chauffeur. Note that normal social protocols expect senior managers to arrive at social functions driven.

Three years ago, I stayed at Grand Hyatt for several days waiting for my apartment to be ready. All family members came with me. I left them on their own and went to work. One night, I came back and found them at the Red Moon bar having Japanese foods: very delicious.

Tonight, my last in Beijing, I have Japanese again in this high-end bar. Three years’ memory rolled by.

Wow!

I enjoyed The Economist so much that I am willing to pay US$303 a year to receive an issue every week in my mailbox. Nearly US$6 an issue is the highest rate in the world. The same subscription costs US$129 a year in the USA. The privilege of reading this magazine is 234% more expensive in China. Outrageous? But my choices are only two: pay or not to read. I relunctantly chose the former. So when my move to the US finalized, I was too glad to call to change the address. Same money for more. Sweet.

I was astonished. The Singapore office was glad to change the address, the process takes 6 weeks. The lady over the phone apologized that she can not extend my subscription or refund me for the difference. “Why?” I was puzzled. “That I should pay more than double for the same thing. It makes no economical sense.”

She stood firm. The Asia office owns my subscription and cannot charge me the US rate. It is as if they are two different companies. Note that Japan, Hong Kong, Singapore, or any other countries are also cheaper than China. What I must accept is to pay for the highest rate for the lowest region in the world.

“But,” she knew how ridiculous the situation is and offered. “You can cancel the rest of the China subscription and we will refund you the unused portion.” This is where I was astonished, “You would rather risk losing a reader than doing the right thing?” The cancellation process takes 2 weeks.

Thanks, partially, to the teaching from this famed publication, I chose to be economical.

Cross posted at http://blogs.sun.com/syw

Humor me. Have a piece of paper and draw the productivity curve of yourself over the next 15 years. Most people’s curve steeply go upward during their younger years (30 to 45) and flattens out as they age (50+).

Humor me again. Draw a curve of China’s economic growth over the next 15 years. If you think the break-neck speed will continue forever, you are crazy. Most people predict a gradually flattening curve after about 10 years.

If you are 27 to 35 years old in China, do you see the amazing similarity of your curve and the country’s? Do you realize this overlap happens once and only once? China will not have the same growth rate again. Therefore, the opportunity is reserved only for one generation, and that’s you. Not me, a geezer, not those who are still in college or just graduated.

Or, we can reverse the angle of the conclusion, if this generation does not answer to the call, China will not grow as fast for the next 15 years. History has forged you and China together. Isn’t that exciting?

Be entrepreneurial, take risks, innovate. Whatever you do, don’t fail China. Don’t fail yourself. Don’t fail history.