The Dragon and the Shopping Cart

A number of years ago I spent two weeks teaching the basics of E-Commerce to some students from Guangzhou province in southern China.
The class itself was quite high level, and designed to teach the rudiments of X12-based EDI, but also cover the concept of back-end integrations with order management, inventory, and financial systems and the way the data messages themselves were created and transmitted between the parties involved.
Although the students' command of English was only fair, it was far better than my Mandarin, which is non-existent and they seemed to understand my words reasonably well.
After the first few days into the class though, I could tell they were struggling to understand and we had to take an unscheduled diversion from the lesson plan to sort things out.
I learned that it wasn't language difficulties causing confusion, but rather some of the basic business concepts. These students were only familiar with 'cash and carry' business transactions and such familiar concepts (to us) as sending a Purchase Order to a supplier, then having that supplier ship the goods and submit an Invoice was a novel idea. I never did get them to understand the concept of specific terms of sale such as '2-10 Net 15'.
We didn't dwell on some these for long in order to get back on track. I just made sure they understood the basics of the most simple supply chain transactions, but this was a real eye-opener for me. Nevertheless, one need now only look at what thousands of small Chinese manufacturing firms are currently doing with ecommerce to see that in spite of coming from way behind, the Chinese have fully grasped E-business and the current generation's business leaders have learned their lessons well.

Social Contract or Line Item ?

I stumbled across this article in the IHT in which several writers espoused upon the varying ways which firms in the US and Europe are inclined to reduce their employee-related expenses (salaries, wages, etc.) during difficult economic times. In Europe, the trend is to reduce hours, perhaps have brief furloughs, but retain the workers as employees of the company. In the US, companies are more likely to have permanent layoffs in which the position itself is eliminated and the worker has little or no chance of re-employment with his former employer.

I recently had a discussion with an Italian friend about this topic. American firms are laser-focused on the bottom line and look at this issue in purely economic terms. Though all companies say they value their employees, the truth is that any employee, or work group, or even division - is strictly a line item expense on the balance sheet. Under tight economic pressure, American firms have little hesitation about doing whatever it takes to reduce costs, whether it's finding a new office supply vendor, changing internet service providers, or cutting positions. In their view, the company isn't terminating an employee, it's eliminating an unnecessary position (and associated costs). The human being filling that position receives nary an afterthought save for a few wistful reminiscences from former colleagues.

Surely there are notable exceptions on either side, but there seems to be some form of social contract that is part of the fabric of European life. Citizens there pay more in taxes, and perhaps put up with greater bureaucracy and silly rules, but have a far greater social safety net in return.