For two hundred years China was considered an economic basket case; its population resigned to a life of poverty among the rice fields. Yet today, 120 million Chinese go abroad each year, not as refugees, but as tourists. Not just any tourists either. They often snap up all of the latest trinkets of luxury brands like Yves Saint Laurent, Prada and Chanel before willingly heading back home.In the last ten years alone, China’s GNP has increased from about US$4.6T to over US$21T. In fact, in 1985, that number was less than $500B. Less than 40 times what it is today. To put this into perspective, in the same timeframe, the United States’ GNP has little more than doubled, from about US$8T in 1989 to about $18.5T today. And in case it didn’t jump out at you, China’s GNP is today higher than the United States’. 

So, what drove this?

In 1978, then leader Deng Xiaoping liberalised the economy without changing the political system. This supported the pursuit of capitalism without abandoning the communist political system. China invested heavily in physical infrastructure, it became the factory of the world and it applied an exchange rate policy designed to promote competitiveness.But unlike LinkedIn co-founder Reid Hoffman’s practice of sleeping on a problem to wake up with a solution, China’s leaders didn’t magically wake up one day with these strategies at front of mind. Like anybody successful, China sought out help, it sought out mentors, coaches, guides and so on. It sought to stand on the shoulders of giants to learn how other nations had pulled themselves out of their own slumber.

Standing on the Shoulders of Giants

Xiaoping did so by sending Chinese officials abroad to learn from them. In particular, he wanted China to learn from Singapore, which had gone from what some commentators call a ‘backwards fishing village‘ in 1950s  to one of the strongest financial centers in the world, despite having, at the time of Deng Xiaoping’s reign, a population of about 2.5 million people. Modern Singapore is a remarkable phenomenon, which has attracted the attention of social scientists. The island city state located at the tip of the Malay peninsula is now home to some five million people, and has one of the highest per capita GDP in the worldDid Deng Xiaoping say any of the following?

• “but we’re not Singapore”
• “but we’re 9 million square kilometres large and you could ride across Singapore on a bicycle in a day”
• “but we have a population of 900 million and Singapore has a population of just 2.5 million”
• “but Singapore has a different political system”

No he did not. He sought to learn from them.

Corporate Complacency

Yet, all the time I hear executives at large companies say:

• “but we’re not a startup”
• “but we have a legacy culture”
• “but we have different policies”
• “but we’re heavily regulated”
• “but we have legacy infrastructure”
• “but we’re listed and accountable to shareholders”
• “but we’re really busy right now”.

On and on the list goes.

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