A Bill Moyers Special - Becoming American: The Chinese Experience

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Public Affairs Television "Becoming American" Interview with Shirley Young

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BILL MOYERS: So, this was during the very early period. This was pioneering work.

SHIRLEY YOUNG: It wasn't early. This was like in the 80s. We're not talking about the 40s or 50s.

BILL MOYERS: That's true. What’s the secret of understanding the psychology of consumers?

SHIRLEY YOUNG: I think there was so much knowledge about that. I didn't have to bring it in. I happened to be the vehicle. But the issue was the company wanting it. That was the issue. So, my job was really to come and bring that perspective into the company and persuade people to want it. There were dozens of companies and experts and research experts and marketing experts out there all over the place. But General Motors didn't want to have anything to do with them.

BILL MOYERS: But what did you do? What was the key? What was the turning point? What you said, did, showed them?

SHIRLEY YOUNG: Well, I don't know. When I look back on it was kind of pigheaded or arrogant or something to think I could even go in there. But first of all they said, "Well, maybe you'd like to come here." I said, "Are you crazy?" Okay? I got this great job, I work at Gray Advertising, I travel the world, I have a reasonable reputation. People invite me all over the place. I have complete freedom to choose what I will do and where I do it, and I'm appreciated. Why would I come in and butt my head against a wall like this?"

Well, so, I agreed initially to be a consultant. And it became more and more [hectic] as I was carrying two jobs, and I just couldn't do it. But at any rate, they kept on offering me jobs and I kept on turning them down.

I said, "First of all, people here have waited 30 years for this job." There were very few vice presidents. And I couldn't take it from them. I haven't waited 30 years for it. I probably couldn't do as good a job as they could. So, I'm not gonna take it. I was offered three or four jobs that came up as vice presidents. This person is retiring, this person is leaving, whatever. I refused them all.

Finally I said, "However, if you create a job-- a vice presidency, which is what I'm doing now. I was a kind of an ambassador without portfolio within the company. I was unthreatening because I was an ambassador without portfolio. I could go between Pontiac and Chevrolet and Oldsmobile who didn't talk to each other. I could go between executives in this line and that line and that line who didn't particularly like each other. And I could talk to all of them. And I was the only person who could do that.

At one point somebody once said to me, " I don't know if I should tell this to you because maybe you're the enemy." (LAUGHTER) I mean, that was the way they considered each division-- Chevrolet person to think that Pontiac is the enemy. They would never tell a Pontiac person that.

BILL MOYERS: The people at General Motors have told me that they never had a more successful consensus builder. They never had a person more agile at connecting different and disparate parts of that company.

SHIRLEY YOUNG: Well, I don't know about that but anyway that's what my job was. And I think, number one-- people came to recognize that I could be helpful to them. Number two, I always observed confidences. So, if this division told me something that I knew they didn't want that division I never revealed the confidence. But I would know it.

I'll give you an example. At one point, every division had their own approach to how the market is segmented. Is it rich and poor or is big and small? Is it fuel efficient or not? How is the market segmented? Which is obviously very important if you're trying to understand how to position all your different brands. And everybody had a different way of looking at it.

And I'd go and talk to them and say, "Don't you think we should have a single market segmentation approach for the company because it's like trying to conquer Europe with a different map." And they said, "You're absolutely right. But the one we've got is the best." Then and I go to each [department] and each one said that.

So, then what did I do? I knew that everybody agreed on one thing, that there should be one [market segmentation approach]. But I knew that they differed on which it should be. And that's where I could use then the leverage of how to use the management. I went to the management and I said, "You tell them that the goal is to come up with one. And let them work it out themselves."

General Motors is a very obedient, disciplined company. I mean, if the word comes from the top, they do it. So, that word went down and they were told, "Okay, you divisions and corporate, get in the room and solve this problem. There's gonna be one approach that's gonna be the company one. Fight it out amongst yourself." And then left them alone.

And they did indeed do that. So, my job was knowing what the problem was and knowing what they did agree on. So, once I knew they agreed on something that was a point of getting people together. (LAUGHTER)

BILL MOYERS: As you think back, is it possible to identify one important insight that they gained about the market, about consumers at this time?

SHIRLEY YOUNG: That was one that was crucial. That in fact the market was divided into these different kinds of groups that had different interests and needs. It wasn't just rich and poor; it wasn't just big and small. It was people who wanted performance and people who wanted a more conservative style. Understanding the different segments.

BILL MOYERS: People who wanted fuel efficiency.

SHIRLEY YOUNG: Yes, but they wanted usually a complex of things. For example, in styling some people like a very sporty style. Very sleek sports vehicle, so you have tachometers, you have all that kind of stuff.

Other people don't like that. For example, Buick people. At one point they said, "Well, let's upgrade and let's make it all computerized, all digital." And they went to great expense and put all these modern electronics into the Buick vehicles.

Well, the people who buy Buick's it's not just an old/young thing, it's an orientation. They want simplicity, they want more traditional, they want clocks that you turn and can find where the dials go. And they put all that stuff and they hated it. So, that was putting the product for the wrong segment.

BILL MOYERS: That's me by the way. I still like my cars very simple. I like to reach over and turn the radio.

SHIRLEY YOUNG: Well, there's a whole group of people, particularly those who like Buick's, who like that. And once you change that, although it was more modern, more fancy, more hi-tech, they hated it. Now, there's another group that wanted that and they might drive Pontiacs. They would want that.

So, you needed to keep up and do it there but don't do it here because you had to understand which group of consumers wanted what benefits and attributes. So, that was what was essential in developing this whole "marketing segmentation" understanding of the automotive world.

BILL MOYERS: Now, I'm beginning to understand why after you retired from a full time position at General Motors in 1999 you took on a challenging assignment for the company in China. Tell me about that?

SHIRLEY YOUNG: I should talk about how did I get to China.

BILL MOYERS: How did you get to China from General Motors?

SHIRLEY YOUNG: I went with General Motors.

BILL MOYERS: Oh, you did?

SHIRLEY YOUNG: Oh, absolutely. No, what happened was that here I was doing really basically helping the domestic market. And trying to help them understand what would their brand stand for. Chevrolet was the all American baseball, hot dogs, apple pie brand. Right? It shouldn't get all fancy and talk about it being European and German and all that. But that's not what the Chevrolet person wanted. That was what the brand equity of Chevrolet was.

And so we did a lot of work in terms of understanding the Buick brand equity. It was solid, conservative, it didn't want those zippy, zooty things. There were a lot of errors that were made.

In fact at one point they had a vehicle which had the fastest acceleration, the most powerful engine in the whole General Motors. It made no sense. Why would you put that under a Buick? You could put it under a Corvette or maybe even under a Chevrolet but not under a Buick. It was an oxymoron.

So, that was what we did a lot of. That was what I was doing at General Motors until about '94, '93-'94. And I got kind of pulled into the China business because I didn't go there for China at all. And that was not part of the mission at all when I first went there. It was for marketing, consumer branding, et cetera.

Well, I was sitting in Detroit and these delegations in '93, '94 would start coming from China. And our head office, General Motors international head office was in Zurich. So, these delegations would come to Mecca to come and see General Motors. And the people would tell them, "Oh, we're very sorry. Our head office is in Zurich. You gotta go the Zurich."

Well, it was so difficult for these Chinese to come out to get a Visa and all the rest of it. They were not about to hop on a plane and go off to Zurich. So, they would go to see Ford and they'd go to see Chrysler. They would be kind of contacted or connected to a very junior person at the company 'cause we didn't have anybody international at a high level in Detroit.

So, I would hear this from my Chinese compatriots. There were over 1,000 Chinese American professionals at General Motors. They work in the research labs and all different places. And they would call me up and I would have met them just socially. There were these Chinese American associations, and on occasion they'd invite me to a party.

So, I knew these people, and they would call me up. And they'd say, "Shirley, this delegation. He's a minister at a very high level. And he's seen a vice president the Ford, he's seen a vice president at Chrysler and we don't have anybody for him to see. We've told him to go to Zurich. Could you please come and have dinner with us so at least he could say he got an officer's card from General Motors. And it won't make General Motors lose face."

So, I went. I have nothing to do at all with international business and I would sit at dinner and then they would start telling me, "General Motors has got the wrong products, the wrong partner, the wrong strategy, the wrong this, that, that."

So, it put me in a very awkward position because of course I'd have to report this to the international people. I'd say, "Well, last night I had dinner with so and so minister, so and so whatever and here's what he said. I had to do that. It was the responsible thing to do." But it made me feel terrible and obviously the other people didn't like it. Why was I messing in their business for?

But I did. We had a head of our component divisions, a man named JD Badricker (PH) who was in charge of all the components. And he was trying to open up China because Jack Smith had become CEO of General Motors in a big change in '92. I remember we had a lot of difficulties in management.

Anyway, he became the new CEO and he was an internationalist. And he had his eye on China. He was convinced that China would be one of the future sources of growth in the future. And he had even traveled to China himself privately. So, he really had this in his mind.

And he asked the component people to open up because that seemed the easiest way as opposed to a whole automotive plant. So, they were charging out all over the place and sending back all these reports about how they all saw this plant manager and he really wants to work with us and it looks really great. But nothing was happening.

And then I'd hear from these people who came, these delegations, "You've got the wrong strategy, it doesn't work that way, blah, blah, blah." So, I asked the Chinese Americans. I said, "But why don't we create an advisory group which would take the benefit of your knowledge and present it to help General Motors take advantage of it."

And it was really very touching because just through the network they sent some faxes, emails or whatever it is and I remember we met at the tech center on an afternoon in a big auditorium. They're all Chinese Americans. I would say there are about close to 100 of them in this room.

And the man who opened the meeting said, "We called this meeting because in all the years we've been together, we've all loved General Motors and we've all wished that we could help General Motors be successful in China. But we've never had the opportunity. And this is the first time that we're gathered together on General Motors business as opposed to for New Year's or for Christmas or whatever it is. This is the first time we've gathered on behalf of General Motors with the chance of offering our knowledge to help General Motors succeed in its China business."

And it was really very touching because, here they'd all been wanting to do this and they were all spread all over and a lot of them had Ph.D.'s. They're high level researchers. But they had no way to do that.

So, I created this advisory group to leverage these people which would then advise the various groups to do it. But of course what happened was that companies being what they are, it was not welcome at certain parts. Now, our component groups were welcoming it but actually the automotive side, the international, did not love the man who was in charge of it. In fact, he told us to disband. So, this is a case where again some persistence was required.

BILL MOYERS: Tell me what you're doing for General Motors in China.

SHIRLEY YOUNG: Well, the objective was to get a project accepted by the government.

It was a controlled industry. And therefore, you had to get approved from the government. You just couldn't go and spend money and start building something. You had to get approval, because this was a national priority in terms of the automotive industry. So, every major company in the world wanted-- There was gonna be one last project of the last five-year plan, which was gonna be ending in '95 or '96.

BILL MOYERS: You mean the Chinese government wanted to develop an automobile industry?

SHIRLEY YOUNG: That's correct; they did. But they also understood from all their research that they shouldn't let too many people come in. Because if they did, the business would be fragmented and be very inefficient.

And they already had too many small companies. They wanted to have the big project. And so, they wanted to get a major partner in. So, every major company, whether it was Japanese or German wanted to go in, including American companies.

And so, the whole question was: how did you go in? We started out by thinking it was more like the American model. Which is, you go in, you find a partner and you work it out with them, and they decide it makes sense, everybody's gonna make a profit, and that's it. Well, that's not the way it is in China, (LAUGHS). So, when we started to try and do all these businesses, and we found we weren't getting anywhere, we said, "Let's step back. Let's figure out what is this market about?" And that was part of what I helped to do, together with my colleagues, and determined was necessary. Just by listening to what the Chinese people were saying.

Number one, through an advisory committee of all these Americans of Chinese background that worked at General Motors, it became clear. This is a controlled market, an industrial planned market, especially in the automotive [industry].

And there were several big companies. They had several big companies, acouple of minor, secondary companies. And it was gonna be one of those six companies that was going to become a partner. And therefore, you had to work with them, not just go and find somebody. And you could find people in a province who would say, "Oh yes, we wanna develop an auto--" and say, "Yes, we'll help you."

But ultimately, it would fail because it wouldn't get approved at the central level. So, we said, "Let's find out what is it that they want?"

There was a company in there, Volkswagen. They'd been there for many, many years. But its product was an old, old product that was only sold in China. It was not sold in any other major market in the world. And they felt also, that they didn't have any capabilities to modify that.

Because they didn't have the technological know-how. So, from that experience, the Chinese had decided, "We want to be a world competitor in the future. Therefore, we must have modern technology." Well, we learned that by listening. And we heard about what it was that they were looking for.

So, we changed our strategy. Instead of going with the approach normally used in American business, very straightforward, you have a bull's-eye target, you go straight to that target, "I want a deal. I'll find a partner, fast, makes profit, we're gonna go." Well [in China], it's like a spider's web.

There are all these different influences. Because first of all, the motivations are not the same. If the government entity is involved, they don't get stock options. They're not gonna get a big bonus. Their stock is not gonna go up. So, what are they thinking of when they're talking about developing something? They're thinking of what's the social benefit? What's the benefit to the industry? What's the benefit to the economy? What's it gonna do to jobs? What is it gonna do to technology and training?

You have all these influences that are impacting what they decide they want to do. So, you really have to understand that you're not dealing with very straightforward profits. If we like it, if it works, it's great for everybody. No. It doesn't. It's great for the American company because we get options and we have stock and all that.

But that's not great for the Chinese side, 'cause they're looking for a much broader picture. So, therefore we said, "Let's step back and say what is that broader picture?" Well, they wanted to industrialize and develop the economy. And they knew that the automotive industry is one of the important engines of the economy. Therefore, they wanted a modern automotive industry.

Which meant technology and to-- product and all the rest of it. So, all these different factors and parties had to agree as to what was best, because they were all advising. So, we then stepped back and said, "Instead of just looking straightforward for that bull's-eye of a deal. Let's step back and understand what this market is looking for and what it's about."

That's what we did. And we recognized that gee, not only the city government's involved, the center government's involved and the scientific community's involved 'cause they want the best technology.

And the educators are involved 'cause they want training. There's even an aspect of foreign relations because they wanna be sure that it fits with a friendly country. (CHUCKLES) And all of a sudden, we were talking about understanding and getting involved in all these sectors, by which we then figured out who the best partner was and said, "Our goal is to be seen as the best partner for China's automotive industry."

So, our strategy changed from, "Let's get a deal that'll make us both [profitable]--" sure, we still want to get a deal that made money. But we also said, "Let's be seen as the best partner for developing China's auto industry."

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