China, Heavy logistics Costs & You

We all know that China is the world’s factory, but after you make something, how to do you move it around so that you can use it or sell it?

NOT planning for the costs and scheduling involved with shipping can be disastrous to your bottom line anywhere.

This is true in China as well, especially with the recent report indicating that the cost of shipping in China is on the increase year after year.

China's logistics costs increased 18.5 percent year-on-year to reach 8.4 trillion yuan ($1.33 trillion) in 2011, said a report issued by the National Development and Reform Commission, the National Bureau of Statistics and the China Federation of Logistics and Purchasing.

Since last October, the State Council, or China's cabinet, has campaigned to boost the country's logistics capabilities and better link producers and consumers to cut intermediary costs.

Enter NetSuite, the Logistics Cost-Cutter

Automated Order Processing is one way NetSuite quickly realizes the China State Council’s above objective, as it links customer orders from call centers or websites all the way to the customer's doorstep, in some cases even providing real-time order status and full-process visibility and tracking to boost operational efficiency and customer satisfaction.

Tightly connected to this Automation is the need for strong, up to date Inventory Management tools that give its users real-time control over key supply chain processes. This allows for demand-based stock replenishment, advanced bin and lot management and real-time inventory tracking.

The Point: NetSuite delivers with its integrated shipping and order fulfillment. They help you tackle the challenges of multiple channels, partial ship and drop-shipping requirements, and dynamic order volumes.  

While there are some smart features or advanced functions that are not yet available in China, NetSuite by far outpaces the competition in terms of dynamically provided inventory updates and shipping requirements that CUT COST and provide a closer link between you  and your supply chain.

Apple and Micromanagement

Last weekend, as I watched a mob of people line up in front of the Apple store in Beijing, pushing and shoving each other to get the latest Apple gadget, I asked myself, “How do they do it”?

Well, here’s a big tip about Apple and how they do so well in a very tough market.

 They “micromanage” what they think is really, really important.

Micromanage is a dirty word to a lot of professionals, and for some, with good reason. But let’s review some examples from a recent Wall Street Journal (WSJ) article on Apple’s Micromanagement style that might make you think twice before getting rid of the old concept altogether.

 1.    First, their retail manual gives their store associates specific phrases to use when customers are upset, or how to greet people. Actual words to say. Not ideas but ACTIONABLE SPECIFICS.

 2.    Something else the manual or their policies say will likely surprise you: if an associate is six minutes late 3 times in a six month period, you can terminate them.

 If it’s really, really important, you’re not micromanaging it in a bad way; even if you get really far down into the details.

So why do I need NetSuite for this?

 NetSuite is perfect for an executive who can identify the key elements of the business that are vital, or “core”, and focusing in them as much as wanted or needed. 

 It can sift through mountains of data, even if that data is dynamically shifting, and show you an up-to-date version of that data all the way down to the transaction line or journal entry, if need be.

This includes manufacturing information, inventory data, sales, accounting, marketing and more.

Real-time, dynamically updated data to a very precise level.

Can’t this be done with other software systems?

Of course – but they are sure to be much more expensive to build and maintain, and not nearly as flexible. Also, nothing is as accessible as NetSuite – a true SaaS system.

Apple material and story from the Wall Street Journal and Manager Tools (manager-tools.com/)

please translate to Chinese and post to Trigger website, Kaixin, RenRen, and all of our blogs by this Thursday~

Go Home

(With Your NetSuite)

Everywhere you go, managers, HR Staff and mentors tell you to look for "balance" between work and family.

The reality is that there is no balance between work and home, but there IS a way to be at peace about the work and family struggle.

Family and work are two different things, like fruit and air… stop trying to make two things balance that are totally different in nature and therefore should NOT to be in "balance."  These aren't two equals.... FAMILY IS MORE IMPORTANT.

So go home.

Start planning your work calendar so that you leave at 6:30pm for example. Just go home and be with your family, without any computers or smart phones.

So what if 6:30pm comes at the office and you have some work that still needs to be done?

With NetSuite, you can still go home at 6:30 and spend time with your family. Later on, when the time is right, start up your computer, smart phone, or iPad and log into NetSuite.

The beauty of NetSuite is that as long as you have an internet connection, you can do whatever you need to do from wherever you are.

No special tokens, password devices, or corporate firewalls and intranet hassles. One website login, that’s it for access to your entire business CRM/ERP/E-Commerce system.

Trigger can take you there~

Management tips and references from Manager Tools (manager-tools.com/)

Obstacles to Cloud Computing in China – Part VI, Fear, Uncertainty & Doubt (FUD)

The Issue: There’s no question that moving to the cloud can be a nervous experience. Today we wrap things up with Cloud-FUD by hitting the last big area: Resistance to Change.

Key Point: In this area of resistance, it’s the executives job to be transparent about future plans, and to be iron-willed in demanding change. It’s often a culture thing more than anything else.

The two biggest areas of “Fear of Change” FUD that are stronger for cloud computing systems in China relate to the fact that staff are “too busy” to learn this new system and/or to change the new system to work the way it is “supposed” to work, and that the current system is working fine (even if that system is pen and paper).

As we all know, China has undergone MASSIVE change in the last few decades, and one area within businesses that still needs to catch up is information SYSTEMS.

People here have growth wealthy, made excellent careers, and seen great successes in the past decades by using basic information systems, VERY rarely integrated.

So now, when the boss comes in with a new “cloud” system that integrates everything, it seems truly idealistic. Chinese can be very practical people who want to finish the job and get paid as soon as possible. Having a “cloud system” often sounds like a dangerous waste of time.

Explain the direction of the company, the way that this will SAVE their time in the future, and that these systems are used around the world and IN China now, with great success and profit.

Repeat this explanation many times. Repeat your vision for the company. Enforce the changes.

Just like anyone else in the world, when the staff see the benefits, you can relax a bit – they’ll become your biggest champions.

Obstacles to Cloud Computing in China – Part V, Fear, Uncertainty & Doubt (FUD)

Last time we covered Security FUD for cloud computing in China – now let’s move to Ownership!

The Issue: Moving to the cloud can be a nervous experience and all involved are sure to experience uncertainty, doubt, and a little fear. These feelings begin with the cloud system being installed, and include the implementing team as well as the client company itself!

Key Point: There’s no big change here – FUD is an EASY to beat with leadership from all levels (especially the top).

What is Ownership/Control FUD?

It sounds something like this…

“Right now I can control, access and touch the servers and hardware. If you move our servers to the cloud, they’ll be somewhere in the US or UK – we can never see them.”

This is especially strong in China, where there is strong concern about several things:

1. China’s Network Infrastructure and Speed
2. The Great Firewall, and when it might strike (See earlier Post on Firewall)
3. Foreigners controlling data that are difficult to communicate with via language and culture

China’s Network Infrastructure and Speed

It is certainly true that the network infrastructure of China is improving, but less reliable and quick that in other countries. Especially when traffic leaves the country and goes west, you can see packet drop/loss by tracing the hops. Match this truth with the truth that ERP/CRM systems are critical for daily business operations, and you have a valid point from your team that you need to address.

• Solution: Smart Cloud Computing systems do not involve a large amount of data traffic for a single transaction, and certainly nothing that is time-critical (like a VOIP conversation) and will cause whole transactions to fail. These systems are built with small businesses in mind, no matter where they are in the world, and that means bandwidth concerns are addressed for tight budgets. Therefore, this issue is not a concern for users in China, and we’ve seen large and small companies successfully utilize NetSuite, from Beijing to Shen Zhen. Test and demo a system with a good connection, and you’ll know all you need to know. Requesting vendor help here is acceptable!

The Great Firewall, and when it might strike

The consistent boogie-man in all talks cloud, the Great Firewall is always a concern.

• Solution: I wrote about this is a previous post in this series, and other repeating that post, I will simply build on it by saying that the Government has never blocked cloud systems we’ve seen in use here in China yet, and we’ve been doing this since 2006. Why? It’s in their BEST INTEREST to let you make money. They block sites that are anti-government, but they are not anti-business or anti-money making.

Foreigners controlling data that are difficult to communicate with via language and culture

It may be tempting to label this fear something or another, but it is a valid piece of FUD because this issue DOES come up with traditional IT systems. What happens if there is a problem? What if they want to make a change? What if they need their data back quickly?

• Solution: Fortunately, the solution is the same as with any other system (traditional or cloud). Get a good local China vendor who knows their cloud systems and how they work and can provide assurances in this area. They should also know YOUR systems. They take time to learn your needs, your future plans, and your pain points/concerns. They know your staff as well!

There is a consistent theme amongst all this FUD – education, smart partnerships, and communication, communication, communication.

Obstacles to Cloud Computing in China – Part IV, Fear, Uncertainty & Doubt (FUD)

The Issue: There’s no question that moving to the cloud can be a nervous experience. Especially for your IT staff and managers, who are responsible for maintaining the confidentiality, integrity and availability of your data.

Key Point: This is a common problem and an EASY one for the executive to beat. But unless it’s done with focus and consistently, Fear alone can defeat all of your plans for a successful, cost-saving deployment. You need to communicate the mission to go cloud, and not to give up or go back!

How do You Know FUD? : FUD usually comes up through you organization in 3 big statements.

1. (Security FUD): What if they lose our data? Or what if there is a big fire or someone steals our data from the data center? If someone steals your password, they can access our whole system from anywhere.”
2. (Ownership & Control FUD): “Right now I can control, access and touch the servers and hardware. If you move our servers to the cloud, they’ll be somewhere in the US or UK – we can never see them.”
3. (Resistance to Change FUD): “What we have now is working fine – why do we need to change? I’m too busy to work on a new system that will just slow me down.”

FUD is not always bad, but in this case, the three above make little business sense and if you let them beat you, your staff and your company will pay the price in resources lost.

SO, let’s look at what the business reasons are for answering the above challenges. Today, we will address issue number 1 – Security FUD! :

1. Security FUD
   1. First lets address the idea of the vendor losing your data, by data theft or natural disaster.
      1. In most cases, the data is much more secure in the type of data center used by good cloud vendors such as box.net or NetSuite than any sort of server farm in the local company. They feature armed guards, cameras, strong firewalls, antivirus and intrusion protection software packages, and that’s just the beginning. If a company wanted to match these data centers, they would need to be massive global corporations.
      2. In addition, these robust data centers are built to withstand massive fires, earthquakes and flooding. They are backed up in other states and countries and the technology used for restoring data is top of the line.
      3. Often times when we hear a business owner say this to us, I find that their server is in a room next door in a poorly secured area, backed up only rarely, and (in several cases) even not working because of issues with hardware and software. Make no mistake about it, when a system isn’t working, it’s costing you money!
      4. The truth is that for you to have the same level of service and security
   2. Now let’s consider the other FUD factor for security – stealing passwords for total access
      1. Impossible unless your configuration is completely incorrect (something Trigger has never seen). This is one we often hear, but the truth is that vendors like NetSuite and Box.net are very secure systems
      2. They use industry-strength encryption for transmissions, and allow for tight restrictions on access to resources based on roles. Certainly not a green light to access all data.
      3. Also, because of the nature of a cloud system, as soon as an issue is detected, it’s quick and easy for administrators to log into the system and take away the account in question.
      4. Finally, the rules for protecting passwords are the same for every system. If they steal a password for a client-server system, they’ll have the same access, but you may not have the same backups in place!

Obstacles to Cloud Computing in China– Part III, Interconnectivity

Cloud computing is a young industry, and even more so in China. As a result, a lot of the features of cloud computing that are championed in the west are limited or unavailable here.

The Point: If the smart executive plans for interconnectivity issues in the beginning, they can still realize the benefits that “out of the box” interconnectivity would have provided.

Some systems that don’t play well with Cloud Computing systems in China:

• Banking/Payment Systems
  • Credit Cards
    • Other than Visa and MasterCard, most western/international credit cards will have a hard time integrating by default.
    • Chinese credit cards rarely integrate with western cloud computing systems, due to their banking system limitations and different banking regulations.
  • Online Payment Systems
    • Alibaba.com
      • This is the Chinese "Paypal" and very popular in China. Most websites offering E-Commerce in China consider it a necessity to offer payment through Alibaba.com. Most western cloud systems are unfamiliar with it.
• Shipping & Logistics
  • National Post, Shipping & Freight Companies
    • Important for calculating shipping and tracking the location of your package
      • The Chinese postal system is not integrated or planning to integrate with any cloud computing systems that I know of, as of the time of writing this article.
      • In addition, western companies like DHL, FedEx and UPS operate in China but do not offer the same interconnection services that they offer in the west.

The Solution: Consider the following 2 steps:

1. Examine all business aspects of the interconnections you want, and be sure your staff understand how this would need to work with your cloud system.
2. Weight the costs vs. benefits of either:
   1. Making a work-around: Often you can get “almost the same” function as if it was totally integrated with a bit of extra thought and tweaking.
   2. Customizing an integration through programming: True to its nature, cloud computing offers a lot of flexibility in what can be integrated with a bit of extra coding or creative system configurations.
   3. Simply not offering this integration service: Because many of these services and systems are not offered in China now, they are sometimes not expected to be provided. This is something you’ll need to consider very carefully, but at times you may find that after careful observation of the market, these integrations are “bells and whistles” that can be provided later.

Obstacles to Cloud Computing in China – Part II, Network Censorship

Any discussion of cloud computing obsticles in China would be incomplete without talk of firewalls and censorship – an almost cliché topic in the IT community here; but only a small concern to the executive who prepares in advance.

KEY POINT

The executive who prepares in advance for internet blocking will consistenly enjoy all of the benefits of cloud computing, worldwide.

NOT JUST CHINA

Although a primary concern for cloud users in China, I urge the CIO/CEO considering cloud computing to understand that their concerns go beyond the Chinese “Great Firewall” and include the organizational, state and national firewalls of other entities as well. Large corporations for example sometimes limit file sharing and web 2.0 sites within their corporate networks.

PREPARE

Resolving this is simple enough, and takes little time/budget

1. Equip your staff with 3G devices, and VPN software tools
2. TRAIN YOUR STAFF
   1. How to use the tools you’re giving them
   2. Which tools are best to use, and where
   3. How to configure and troubleshoot these tools for the best results

Trigger sells a VPN of our own that is also “in the cloud” and works very well for this sort of case for about $60/user/year.

In the past 3 years, two of our partners have been temporarily blocked, but with a clear contingency plan in place clients were able to continue with business as usual.

YOU NEVER KNOW WHEN OR WHERE

Never assume that users will be immune to this issue because the location they are travelling in has historically been open.

India for example has traditionally been very open to corporate IT and cloud computing but that could change.

They currently have censorship measures in place at multiple levels and the government plans to set up a centralized mechanism for the country to block websites as it pleases, and when.

THE 12 MOST RESTICTIVE

The list below are some of the most stringent censor nations of the internet, and if your business is operating in any way within these countries, you’ll need to be prepared.

1. Burma
2. China
3. Cuba
4. Egypt
5. Iran
6. North Korea
7. Saudi Arabia
8. Syria
9. Tunisia
10. Turkmenistan
11. Uzbekistan
12. Vietnam

Obstacles to Cloud Computing in China – Part I, the “Chop”

We’re going to start this series out with a smaller issue and warm our way up over time to some of the larger issues that will hinder, but far from stop, cloud computing adoption in China. Today we’ll cover the company chop.

Although a small item, the company chop in China is of vast importance and carries with it a lot of power – if your organization could grow arms and write down its own signature on paper, this is what it would look like.

Losing your company chop can mean an inability to sign contracts and even conduct business. Dealing with the government without a chop will get hairy quickly.

So when the old-fashioned chop meets the cutting-edge cloud, there is a big collision with lots of sparks. In the end, you still can’t beat the Chinese Government when it wants its way, so document management in the cloud takes a serious hit.

For companies looking to save time and cost with their printing, faxing and general document sharing, they will find important functions like e-signing and e-faxing to be useful only when dealing with foreign companies that are free from the requirement of the chop on all official documents.

Any transactions (and there are a lot) between your suppliers and customers within China will still need to be printed, chopped and faxed.

If you want to then put a copy of these important documents on Box.net, for example, you would then need to:

• Print the documents
• Chop the documents
• SCAN the document with the chop
• Upload it on box.

Digital chops do not exist in China, and there is only one chop for one company, as far as I am aware.

This little red stamp is one of many mid-to-large obstacles you need to consider when moving your organization to “the cloud” in China~

2011 is here and predictions for economic growth are better than in previous years. How can your small-medium growing business capitalize on:

• The predicted economic upswing?
• The growing trends and services in Cloud Computing?

Your big 4 resolutions for 2011 are here!

1. Take that small step into the cloud if you haven’t yet…
   1. It’s no secret, Cloud computing gives small and mid-sized businesses IT capabilities they traditionally could not afford
   2.  Going into the cloud gives you the benefits of a robust system with little overhead and less risk than an in-house solution
   3. Cloud computing systems make you look bigger than you are, allow you to offer better services, and manage your business assets more efficiently
   4. Many concerns about the cloud (ex: cost and security) have been addressed
      
      
2. ...if you stepped into the cloud in 2010, take it to the next level in 2011.
   1. Improve and look for features you missed during setup: When companies first get into the cloud they often miss a bit. Implementations may be an over-generic and simple because it’s all so new
   2. Invest in another system: Now that you know something about how the cloud works and its strengths vs. dangers, analyze your business and look for areas where cloud can provide value
      
      
3. Leverage the power of the cloud with mobile devices to make the “mobile workplace” a reality in your business
   1. One of Cloud computing’s major advantages is that it is safely accessible wherever you are, as long as you have a wireless signal – and this is NOT restricted to laptops
   2. Apple’s iPad and iPhone, along with the many Android devices have allowed users to access the cloud anywhere, anytime via their smart phone/device
   3. Leading cloud computing vendors like Box.net have embraced the trend and are offering very good applications that make using your company system easy, quick, safe, and VERY mobile!
      
      
4. Improve Efficiency and Customer Satisfaction: Integrate Your Website with Your Cloud and Break the Communication Barrier
   1. Ecommerce - When a customer submits an order, operations such as packing, shipping, and re-ordering stock can all be kicked off via notifications from your cloud system.
   2. Logistics - Inventory is managed and measured via matrix in your cloud system and your website can dynamically reflect items stock numbers
   3. Logistics - Less errors take place as you integrate your customer input into your system - from addresses on packing slips to product specifications.
      1. This means clients who get their product more quickly, and get exactly what they ordered
   4. Marketing - As your system works with your website, you can track which user views and purchases which products, and customize their web experience, as well as market to them more directly.
   5. Customer Service - Without any staff effort, clients find satisfaction by tracking their product through your website, as your system reports its location en route