vol. 5, #2, february-march 2015, no....

Advances Newsletter, February-March, 2015

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Vol. 5, #2, February-March 2015, No. 46

Annual Turnover to Reach All Time High

One third of turnover came from overseas in Midea’s most lucrative year yet


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ADVANCES Newsletter

Contents

Midea Advances Newsletter is published monthly

by the International Strategy Department of

Midea Group. We welcome all comments,

suggestions and contribution of articles, as well as

requests for subscription to our newsletter. You

can reach us by email at: [email protected]

Address:

ADVANCES, International Strategy Department

Midea HQ

No. 6 Midea Road

Beijiao, Shunde, Foshan, Guangdong

P.R.C. 528311

Tel: +86-757-23270461

Web: www.midea.com/global

Managing Editor:

Kevin McGeary

Regular Correspondents:

Javier Romano

Nadia Mathias

Wang Haiyan

Lin Shan

Yang Rixi

Tian Hua

Liu Yulong

Wu Meiyun

Song Mingzhu

NEWSLINE

Founder Climbs 65 Places on

Forbes Rich List PAGES 4

Forecast: 2014 Most

Lucrative Year Yet PAGE 3

Midea Holds Marriot Event

for Consuls PAGE 3

CAC Signs Joint Venture with

Bosch PAGE 4

www.midea.com

The Little Man with the Big

I.Q. PAGE 16

Big Picture

People

Idea

Idea of the Month: Small

Talk PAGE 15

M-Smart Demonstrated at

Appliances World Expo PAGE 8

The Frontier of the Internet of

Things PAGE 14 Societies Help Overcome

Post-Holiday Blues PAGE 9

Money in Chinese Culture PAGE 13

Culture Clash

International Cooking Class

Held for Staff PAGE 7

Brand Ambassador Invents

Winning Recipe PAGE 6

CFO Meets the Press PAGE 5

Brazil Campaign Winners Re-

ceive Lavish Prizes PAGE 6

Company Recognized for

Leading in Robot Technology PAGE 10

28 Years at the Small

Appliances Factory PAGE 11

Water Heating Division Leads

in Marking Lantern Festival PAGE 11

Staff Celebrate International

Women’s Day PAGE 12


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Forecast: 2014 Most Lucrative Year Yet

By Advances

L ast year, Midea saw turnover of 140 billion RMB

(US$23.66 billion), an annual growth of 17 percent. With profit

at US$1.66 billion, 2014 proved Midea’s most lucrative year ever.

There was a decline after

2011 due to corporate con-

solidation costs, in combina-

tion with domestic govern-

ment policy changes but

Midea has adapted its strate-

gy to overcome it.

Overseas sales counted

for one third of the Group’s

revenue in 2014 as Midea

advanced its operations in

India, Africa, Latin America

and Europe. Midea Commer-

cial Air Conditioning (CAC) proved particularly impressive,

landing projects in airports, shopping malls and sports stadia

around the world. Just about every division gained a noteworthy

qualification or award to boost its international credentials.

On Friday January 20 it was officially announced that

Midea-owned subsidiary Little Swan turned over US$1.74 bil-

lion, a year-on-year increase of 23.79 percent. Earnings per

share were US$0.18, a year-on-

year increase of 69.23 percent.

Of this, US$341 million came

from exports, a year-on-year

growth of 26.37 percent. Eu-

rope and The Middle East

proved especially fertile hunting

grounds for the washing ma-

chine manufacturer.

The coming challenges include

going from an equipment manu-

facturer to a brand and continu-

ing to promote and develop the M

-Smart program of interoperable appliances.

.

NEWSLINE

By Kevin McGeary

Midea Holds Marriot Event for Consuls

S hunde, where Midea is headquartered, is a small, un-

glamorous town. However, this did not prevent Midea from

attracting consular representatives from around 30 countries to

the Shunde Marriot for the Group’s annual New Year Dinner

on March 13.

Nathan Lin of The

International Strat-

egy Division was

the host as Shunde

Mayor Huang Xi-

zhong and Group

Vice President

Andy Gu gave

speeches to talk about Midea’s role as a corporate citizen both

locally and around the world.

A local performance troupe also did a song and dance

routine to bring some Shunde culture to the overseas revellers.

Guests were then lavished with some of the finest Shunde cui-

sine, which is famous in China and has received UNESCO

recognition.

Rapidly increasing turnover


4

Founder Climbs 65 Places on Forbes Rich List

Via Forbes

M idea Group founder He

Xiangjian has climbed 65 places on the Forbes

Rich List to 125th in the world, the magazine

estimating his worth at US$9.9 billion. The

Shunde native is now the 9th richest man in

China, having founded the company with 23

people and 5000 RMB in Beijiao Village in

1968.

After Midea’s initial period of manufac-

turing bottle lids and car parts, the company

focused on the manufacture of fully finished

goods, starting with electric fans in 1980. Five

years later, Midea produced its first air condi-

tioner, a product which remains one of its

core businesses.

Over the following 15 years, the compa-

ny gradually expanded into a wide variety of

other home appliances, including refrigerators,

washing machines and microwaves as well as

compressors and commercial air condi-

tioning.

In 1993, the subsidiary which handled the

core businesses of the company, known as

"GD Midea Holding", proceeded with a

public offering of shares on the Shenzhen

Stock Exchange. The GD Midea's parent

company, known today as "Midea Group",

remained a privately held company.

He Xiangjian stepped down from daily

operations in 2012, leaving Paul Fang to

ascend to the role of Group chairman. In

May 2014 Midea raised $60 million in a

U.S. debt sale. Individual wealth is not the

most important thing. As Donald Trump

once said, money is just a way of keeping

the score, the fun is in the game itself.

NEWSLINE

By Javi Romano

CAC Signs Joint Venture with Bosch

M idea Commercial Air Conditioning (CAC) has

signed a joint venture with Bosch Thermotechnik GmbH. At a

press conference on March 31th in Hefei, Anhui Province, the

agreement will be signed by Uwe Glock, Chairman of the Man-

aging Board of

Bosch Thermotech-

nik GmbH and

Andy Gu, Midea

Group Vice Presi-

dent.

The new company will be named M&B Air Conditioning

Co., Ltd. and will be located in Midea’s Hefei factory. It aims to

manufacture All DC Inverter VRF products for the global mar-

ket. Bosch will benefit from Midea’s large experience in the

HVAC field. Midea CAC, at the same time, will see its sales

channels greatly expanded thanks to Bosch’s know-how. The

initially estimated total production capacity of the JV surpasses

30.000 ODU (outdoor units) per year.

Eric Tian, General

Manager of Midea

CAC, expressed his

expectation that

―With excellent VRF

products from this

joint venture, Midea CAC will further expand its HVAC busi-

ness and market share in the worldwide market‖.

Sales channels and brands will remain independent.

He Xiangjian


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CFO Meets the Press

By Wang Haiyan

T he only unchanging thing about Midea is

continual change, group vice president and chief finan-

cial officer Monica Yuan told over 20 media outlets in

Beijing on March 5. Ms. Yuan gave the interview to

New Express Daily, Southern Metropolis Daily, Caijing and

over 20 other news organizations during the Two Ses-

sions of the National People’s Congress & the National

Committee of the Chinese People’s Political Consulta-

tive Conference, at which she was a representative of

Guangdong Province.

Last year, Midea saw turnover of 140 billion RMB

(US$23.66 billion), an annual growth of 17 percent.

This strength can be attributed to strategic changes

made in the second half of 2011, Yuan told the reporters.

Adding that profit was at US$1.66 billion last year, Yuan ex-

plained that change was ―in Midea’s genes.‖

When asked about the capital investment from Xiaomi,

Yuan stated that the most important thing was working with

the phone manufacturer to provide the best consumer experi-

ence. ―We are a very open company. We have deals with Ten-

cent, Huawei, Alibaba and Xiaomi to help stay at the fore-

front of technology,‖ said Yuan.

When asked exactly what strategies had been successful,

Yuan pointed to the company’s emphasis on overseas growth.

―Sales outside of China now account for more than one

third of Midea’s total, which is the result of a long-term

strategy of boosting international operations,‖ she said.

President Xi Jinping and Premier Li Keqiang both spoke

at the Two Sessions. Key issues raised were slowing

GDP growth as the ―new normal‖, agriculture and the

countryside, anti-corruption, the promotion of core so-

cialist values, and the purging of ―spiritual pollution.‖

NEWSLINE

In The Great Hall of the People

Appearing on television

Meeting the press


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Brazil Campaign Winners

Receive Lavish Prizes By Nadia Mathias

T he winners of the Viva Maid Midea promotional

campaign which began in October were broadcast on national

television in Brazil in February receiving prizes that included a

car. The awards were presented by brand ambassador Edu

Guedes after the participants were taken on a free tour of Sao

Paolo.

Runners-up prizes included an interior decoration and

packages full of Midea products. ―This was Midea’s first major

consumer-orientated campaign and we are pleased with the

outcome. We gave away more than 300 awards to our custom-

ers and gave them the chance to appear on television‖, said

marketing manager Tatiana Vianna.

NEWSLINE

By Nadia Mathias

Brand Ambassador Invents Winning Recipe

M idea’s brand ambassador, celebrity chef Edu

Guedes, has created a recipe for those with a sweet tooth that

can be cooked in a microwave in just 3

minutes.

You can follow through the Midea

channel: YouTube (https://

www.youtube.com/watch?

v=s2Q3k1hPNWA&feature=youtu.be).

Ingredients

200g of chocolate-hazelnut cream

(Nutella)

100g of melted butter (1/2 tea cup)

2 whole eggs

60g of wheat flour (1/2 tea cup)

50g chocolate chips (1/2 tea cup)

Preparation

Place the hazelnut cream and melted butter

in a bowl. Stir well and add the eggs and

wheat flour. Then put half in a pan greased

with butter, merge with the chocolate chips

before adding the rest of the mixture.

Cook in microwave for three minutes.

Finish with broken hazelnuts and chocolate shavings.


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International Cooking Class Held for Staff

S hunde, where Midea Group’s international headquar-

ters is located, is famous for its cuisine, having won a UNESCO

listing as a City of Gastronomy in December. However, Canton-

ese cuisine (of which Shunde is the cradle) has long been open

to influence from other regions. Locals are now being influ-

enced by cooking methods from around the world.

On January 31, an open cooking lesson was held by Midea

Kitchen Appliances Division led by resident Spanish chef Joan.

Dozens of attendees representing a number of divisions got

together for a lesson in how to make and cook French Éclair.

The sweet desert has a place in French culture for appear-

ing in numerous love stories. The treat is considered indispensi-

ble at French weddings. Over time it became a popular snack in

the Anglophone world.

With a DIY spirit, members of staff used eggs, flour and

cream to make their own. This was the first of what will become

a tradition at Midea – International Cuisine Day. It is the most

enjoyable international road test for our kitchen appliances yet

dreamed up.

NEWSLINE

By Lin Shan


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M-Smart Demonstrated at Appliances World

Expo

M idea unveiled 229 new products in 32

categories at the Appliances World Expo in Shanghai

on March 11. Products in 30 of the categories were

part of M-Smart, the system whose white paper was

released at the same time.

M-Smart was unveiled at last year’s expo and

over the past year Midea has been able to refine and

develop the program. Alliances with Huawei, Alibaba,

Jingdong and Xiaomi have helped. Midea already has

products in 30 categories that can be controlled with

Apple and Android phones.

―M-Smart will not just involve WIFI but also Thread,

PLC and BLE. As well as white goods, it will also extend to

black goods, entertainment systems, and medical equipment,‖

said Mao Hongjian, head of research and development for M-

Smart.

The white paper explains everything from how M-Smart

works to why it makes business sense to the social implica-

tions of the smart phone.

Jiang Feng, director of the China Home Appliances

Association, gave the thumbs up. ―M-Smart is at the fore-

front of what will provide a new experience in home appli-

ances,‖ he said at the expo.

Three Olympic gold medalists posed at Midea’s stand as

Midea is the official sponsor of China’s swimming team as

well as having a partnership with FINA, the world govern-

ing body of swimming, diving and other water sports.

NEWSLINE

By Yang Rixi

A range of M-Smart products

Midea’s 768 square meter stand

Olympic champions pose at the stand


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Societies Help Overcome Post-Holiday Blues

By Tian Hua

classes at Midea University on February 1 for children of em-

ployees. The classes were divided into English, Chinese and

Math and both teachers and pupils got a lot out of the experi-

ence, according to Yang Wan, a residential air conditioning fac-

tory worker.

The Outdoor Sports Society went on a garbage clean-up

activity in some of Shunde’s greenest areas. Divided into mixed-

gender groups of four, members of the society went out with

plastic bags to collect and sort garbage over six hours, travelling

a total of 32 kilometres. There was a competition to see who

could collect the most and Chang Wenjuan of the Kitchen Ap-

pliances Division said that although her team only finished sev-

enth, it was great fun.

Other activities included a badminton tournament, a flow-

er photography event, a song and dance show, a basketball

match and a football match. These are all the kinds of activities

that help raise people’s spirits for work.

NEWSLINE

I n China, the ―January blues‖ tend to happen slightly

later as people return back to work after the Spring Festival.

Considering that a huge percentage of the population have to

migrate to cities to make their money, the post-holiday blues

involve coming to terms with being away from home and family.

The best cures for misery are shared physical activities, so

Midea is particularly encouraging at this time of year for employ-

ees to get involved in some of the many societies that its em-

ployees share. The Community Care Society for example held

Flower photography activity

The Song and Dance Society getting ready to perform “Die Young”

The basketball society

Preparing to make Shunde cleaner


10

By Advances

Company Recognized for Leading in Robot

Technology

M idea was mentioned several times in an article in

Caixin and subsequently Market Watch due to its leading role in

introducing robot technology. Fourteen workers were recently

replaced by robots at the Residential Air Conditioning (RAC)

factory in Shunde, leaving just two quality control supervisors.

Those supervisors will themselves soon be replaced by robots,

according to Wu Shoubao, deputy general manager of RAC.

Companies nationwide over the past five years have

ramped up robotics in the face of labor woes, such as worker

shortages and rising wages, and to cut their production costs. In

the process, they’ve helped build a new market for Chinese ro-

bot manufacturers that are competing against multinational ri-

vals.

Labor shortages are partly

linked to what Wu says are

changing attitudes among young

workers. Young adults histori-

cally formed the backbone of

the country’s assembly-line

workforce, but he said many

born between 1990 and 1999

now shun manufacturing jobs

for other pursuits.

The working-age popula-

tion — defined as those be-

tween ages 16 and 59 — is slowly declining. The National Bu-

reau of Statistics said this age group’s population fell by 371,000

in 2013 to about 915 million last year.

Moreover, companies looking for inexpensive labor in

Asia are no longer focusing on basing plants in China alone, as

labor costs in many other countries are far lower. The Interna-

tional Labor Organization says an average worker’s monthly

wage is the equivalent of 911 Yuan ($145) in Vietnam and 603

Yuan ($96) in Cambodia, for example, but 3,483 Yuan ($555) in

China.

Midea’s automation push got under way in 2011, just as

Guangdong manufacturers were starting to grapple with labor

dilemmas including worker shortages and high turnover. The

company imposed a hiring freeze and then implemented a policy

requiring that divisions with high turnover install automated

systems.

The transformation is continuing today at Midea. Its resi-

dential air-conditioner division, for example, plans to cut 6,000

of its 30,000 workers by the end of 2015, and another 4,000 by

2018.

Midea invested 800 million Yuan between 2011 and last

year to install automated systems with some 800 robots. It plans

to spend up to 900 million yuan to add another 600 robots this

year.

Not only are robots helping Midea resolve labor issues,

Wu said, but they’re also improving production and product

quality.

The International Federation of Robotics (IFR), which

represents robot manufacturers

and research institutes, said

China last year surpassed Japan

to become the world’s biggest

market for industrial robots.

Some 200,000 were operating

in China at the end of 2014, the

IFR said, with 32,000 installed

in 2013 alone, accounting for

20% of worldwide installations

that year.

The robot-to-worker ratio in

the country is still relatively

low, the IFR said, with 30 robots working in manufacturing

plants per 10,000 employees. Japan’s ratio is 11 times higher.

Four multinational companies — Switzerland’s ABB

Group ABBN, Japan’s Fanuc Corp. and Yaskawa Electric

Corp., and Germany’s Kuka Robotics,— are the dominant sup-

pliers of robotic systems for factories in China. Mir Industry, a

Chinese industrial consultancy, said the four account for about

58% of the nationwide market.

Zhang Hui, general manager of the ABB Small Parts As-

sembly Center in China, which services robot clients, said his

company spent years focusing on the world’s developed coun-

tries but now works to win clients in emerging markets with

total-solution packages.

NEWSLINE


11

28 Years at the Small Appliances Factory

By Liu Yulong

G uangzhou Daily reported in March that today’s work-

ing-age population in China will most likely have several jobs

throughout their lives. In the more socialistic economy of yester-

year, the ―iron rice bowl‖ or job for life characterized most peo-

ple’s careers.

One relic of this disappearing era is Zhou Jinmei, who has

retired after 28 years with the company’s Water Heating Divi-

sion.

The 50

year-

old’s

original

salary at

the fac-

tory was

85 Yuan

a month

and by

the end

she was known by all colleagues as a ―walking dictionary‖ when

it came to quality control.

A party was held in the training room and Zhou was pre-

sented with a plaque, a cake and a bunch of flowers to reward

her years of dedicated service. She told colleagues that her big-

gest wish for the future was that her son would graduate from

university and get a good job.

NEWSLINE

Water Heating Division Leads in Marking

Lantern Festival By Wu Meiyun

T he Lantern Festival, which fell on March 5, is one of

China’s most important feasts. In a rapidly changing country,

people can’t always be with those they would wish to be with.

For example, during Mid-Autumn Festival, it is customary to

look at the moon

at the same time as

distant friends.

At this year’s lan-

tern festival, the

Water Heating

Division repre-

sentatives at the

headquarters in

Shunde led the

way in pre-

paring tang-

yuan, the

sweet

dumpling

soup that is

traditionally

eaten on

this day, and

handing out

presents. At the same time, Water Heating Division workers in

Wuhu more than 1,000 kilometers away took time off work to

cook and consume the dish as a bonding experience with their

colleagues.


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Staff Celebrate International Women’s Day

By Advances

O n March 8, a day on which female empowerment is

celebrated; the various departments and divisions held activities

and gave out gifts to female members of staff.

Activities ranged from cooking classes to sports meetings

and gifts ranged from flowers to hampers to beauty products

and women of all roles and levels were included. Every year the

company marks the festival which was first held by The Socialist

Party of America in New York in 1909.

NEWSLINE

Village outing for Small Domestic Appliances staff

Beauty activity held by Kitchen Appliances Division

200 microwave workers have trip to Shenzhen Ocean Park

CAC holds dance class

Customer service staff defy “fairer sex” stereotype


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Money in Chinese Culture

By Javier Romano

E very culture like every person is different, and that

includes the ways it treats money. With this in mind, I’d like to

compare some attitudes toward money in China and the West.

A 2013 IPSOS survey found that 71% of Chinese defined

their success in terms of what they owned. However, what is

interesting is not whether China is more materialistic than other

societies but the way it differs. Answering this question could fill

a library but I will have a brief go here.

Traditionally, a Chinese does 3 things with money: save,

save and save. China is famous for its personal saving rate,

which is the highest in the world. Chinese households save be-

tween 34-53% of their income, while Americans save 2%.

A 2011 study by Yale economist Keith

Chen cites grammar as a possible explanation

for saving habits. His study shows that people

who speak languages that do not have a future

tense such as Chinese, Norwegian and German,

save more than those who speak English,

Greek and Romance languages which grammat-

ically separate the future from the present.

That is not to say that splashing the cash

doesn’t happen in this country. The words ―buy buy buy‖ are

commonly heard and expensive brands like Mercedes, Louis

Vuitton and Gucci have become so popular that in 2011 the

word ―luxury‖ was banned from advertisements in Beijing to

reduce resentment toward the free-spending rich. Since then,

―buy buy buy‖ has come to mean impoverishment through

waste.

However, whereas Americans were encouraged by banks,

credit card companies and ―positive thinking‖ gurus to get up to

their eyeballs in debt during the years before the Global Finan-

cial Crisis, China’s breakneck economic growth has not caused

vast numbers of private individuals to ignore the possibility of a

rainy day.

This is another amusing aspect… Cash is king. I guess the

sentence applies around the world. However, the average Chi-

nese will possess more bills than the average Westerner. Not

only because the biggest Chinese note (100 rmb) is equivalent to

approximately 16$ but also because of savings.

Apple is a hugely popular brand in China, the only country

where the iPhone 6 is more expensive in gold than in other

colours.

As with in a lot of cultures, gold symbolizes money. At

weddings, older guests tend to dress in the colour. The icono-

graphy of money is ubiquitous in the People’s Republic. The

Guangzhou Yuan Building near Midea’s headquarters resembles

a coin that was used here several centuries ago.

One of the most obvious celebrations of materialism in

China is New Year traditions. Serendipitously, the acronym for

it (CNY) is also the international acronym for the currency.

While at Christmas the presence of money is usually kept just

below the surface, CNY has the tradition of the red envelope or

红包, pinyin ―Hongbao‖. People with a higher social status

(older, married, richer…) give red envelopes

containing money to colleagues and rela-

tives.

Popular Chinese social networks such as

WeChat and Weibo have a special function

for the ―hongbao‖. With it, you can send a

virtual red envelope to your friends. The

money is real and goes directly into the re-

cipient’s account.

The most common auspicious greetings and sayings for

CNY consist of four characters. These include:

金玉滿堂 Jīnyùmǎntáng - "May your wealth [gold and

jade] come to fill a hall"

一本万利 Yīběnwànlì - "May a small investment bring ten

-thousand fold profits"

招財進寶 Zhāocáijìnbǎo - "When wealth is acquired,

precious objects follow"

However, the most typical is 恭喜发财（gōngxǐfācái）,which

is roughly translated as "Congratulations and be prosperous‖ a

second and unofficial part of this saying goes ―now give me a

red envelope!‖. One of the biggest culture shocks about coming

to China is the directness with which people talk about money.

―How much do you earn?‖ is such a rude question in some

places while it is perfectly normal in China. In the end money is

just money, it doesn’t need to be exalted or stigmatized.

Culture Clash

The Guangzhou Yuan Building


14

By Advances

The Big Picture: The Frontier of the Internet of

Things

S cience fiction has long had dystopian and utopian

ideas as to how technology will change the world. However, The

Internet of Things (IOT), which The McKinsey Global Institute

predicts will add an additional US$6.2tn in value to the global

economy by 2025, could be creating a world beyond the imagi-

nation of any novelist.

Under it, all physical objects will be assigned an IP address

and be transformed into information technology. As a result, not

just your television and computer but also your lamp, pot plant,

and even your pet will be part of a computerized network.

Things that were once silent will have a voice, and every

object will be able to tell its own

story and history. The refrigera-

tor will know when and where it

was manufactured, the names of

the people who built it, what

factory it came from, and the

day it left the assembly line, ar-

rived at the retailer, and joined

your home network. It will keep

track of every time its door has

been opened and which one of

your kids forgot to close it.

When your elderly mother in

Florida has a fall, you will know

if her fridge has not been

opened or her shower has not

been switched on.

Connected homes will be a huge part of the Internet of

Things. By 2019, companies will ship 1.9 billion connected

home devices, bringing in about $490 billion in revenue. Google

and Samsung are already ahead of the pack. Google bought

smart thermostat maker, Nest Labs, last year for $3.2 billion, and

Samsung purchased connected home company SmartThings for

$200 million.

Five years from now, more than 20% of U.S. consumers

will own smart refrigerators and smart watches. Right now the

world is watching closely the extent to which Apple’s smart

watch is embraced by the consumer. Internet-connected cloth-

ing is even coming. By 2020, 14% of consumers expect to pur-

chase some form of it.

Yet the pitfalls of this are colossal and the future belongs

to companies and individuals who know how to sidestep them.

In 2013, there were 13 billion online devices in the world, Cisco

systems predicts that by 2020 there will be 50 billion.

A system in which 50 billion devices can communicate

with each other is impossible to fathom, let alone manage or

govern. The vast levels of cyber-crime we currently face make it

abundantly clear we cannot even protect the desktops and lap-

tops we presently have online, let alone the hundreds of mil-

lions of mobile phones and tablets we are adding annually.

Technocracy is an ideology and the most damaging ideo-

logies involve total certainty. Dave

Eggers’ 2013 novel The Circle is set in

the near future and is about a compa-

ny as powerful as Google, Apple and

Facebook put together. Resistance to

the technological utopia is marginal-

ized to the point that one major char-

acter loses his life fighting it.

The person who feels responsible is

reassured: ―It’s like you were a doctor,

coming to help a sick patient, and the

patient, upon seeing this doctor,

jumps out of the window. You can

hardly be blamed.‖

In agrarian societies, we had tasks to

fulfill and did not have to worry much

about what people in the next town

thought of us. In the age of LinkedIn profiles, exposure is great-

er, resumes are obsolete and ignoring how we are perceived is

not an option.

As columnist Julian Baggini points out, from 24-hour roll-

ing news to social media, we now have running commentaries in

place of reflection, ephemeral news headlines over information

that matters. Instead of being mindful and appreciative of what

is around us we are becoming distracted by all the ways we have

of capturing and recording it. The promise to spend more time

looking into your partner’s eyes than at a screen could be added

to the wedding vows, though that may be a utopian step too far.

Big Picture

A sign of things to come


15

IDEA

Idea of the Month: Small Talk

By Kevin McGeary

I n China it is the norm to begin a conversation by ask-

ing: ―Have you eaten?‖ As in most other societies, it is polite to

ask unimaginative questions for which imaginative answers are

not appropriate.

A 2007 study at the Stanford University School of Busi-

ness tracked a group of MBAs ten years after they graduated.

Grade point averages had no bearing on their income -- but

their ability to converse with others did. Jack Kerouac said the

only people for him were the mad ones, the ones who never

yawned or said a commonplace thing: Kerouac would have

been a lousy businessman.

According to Debra Fine, author of ―The Fine Art of Small

Talk‖, making chit-chat that greases the wheels of social inter-

action is an acquired skill that anybody

can learn. Fine was once so shy that she

would hide in the bathroom during net-

working events, now she makes a living

from giving speeches on improving peo-

ple’s small talk skills.

Why is small talk, a dull dance

around niceties, so important to a per-

son’s career? Surely the world should

reward people who say the most insight-

ful and interesting things, not those who

have a gift for inanities. Groucho Marx

put it best when he said: ―The secret to

success in show business is sincerity. If

you can fake that you’ve got it made.‖

He could just as easily have removed the

word ―show‖ from the sentence.

Small talk is a highly sophisticated social lubricant that

requires emotional intelligence and sensitivity to context. Hav-

ing a skill for it can benefit any politician, businessperson or

salesperson. Thomas Chatterton wrote immortal poetry when

he was 18, Pele won the World Cup when he was 17and Men-

delsohn composed ―A Midsummer Night’s Dream‖ when he

was 16, but nobody has ever been a child prodigy at direct sell-

ing because one has to be fully versed in the ways of the adult

world before succeeding in it.

The prospect of making small talk terrifies a lot of people.

John Williams’ seminal novel ―Stoner‖ captures this well when

describing the mood of the eponymous main character’s wife:

―She spoke bitterly of the departed guests, imagining obscure

insults and slights; she quietly and desperately recounted what

she thought to be unforgivable failures of her own; she sat still

and brooding in the litter the guests had left...Only once had

the façade cracked when guests were present.‖

Small talk has a history, according to The Guardian. It was

the anodyne, inane language used to prevent contention in

polite company. If, in ―Pride and Prejudice‖, the effervescent

Lydia Bennett wanted to attempt to say something refreshingly

unpolished she would be told to shut up, lest she offend the

men. She’d be instructed to keep her comments to the weather

and the roads.

Lydia is young and immature and silly but the pressure to

behave in a ladylike fashion leads her to run off with Mr Wick-

ham; perhaps the only way she can finally

speak frankly and be allowed to be foolish.

There is a German neologism to capture

the pressure to make bantering small talk

with people you interact with daily: plausch-

plage. Coined by Ben Schott, it literally

means ―prattle-plague‖. Exhausting, isn’t it?

Mahatma Gandhi’s statement ―Speak only

if it improves upon the silence‖ is some-

thing of an impossible ideal in the world of

business. So how can one get good at small

talk?

Firstly, people like to talk about themselves,

let them. Don’t interrupt, don’t criticize

and don’t get too deep. If somebody is

talking about the weather it is probably not

down to a profound interest in meteorology.

Also, make periodic eye contact, don’t get too close

physically and smile whenever necessary. It is important to be

tactful: if you are not sure the other person remembers you,

volunteer your name. It is also important to carry yourself con-

fidently, being comfortable in one’s own skin is contagious.

As mendacious, manipulative and monosyllabic as small

talk is, there is no way around it. The best advice to give to

someone about to go out on a date is to be themselves. The

advice to give to someone going to a mingling event is: Be

anything but.

Gandhi: “Don’t speak unless it improves upon the silence.”


16

The Little Man with the Big I.Q.

By Song Mingzhu

L ike a lot of people of high I.Q., Song Mingyuan has been

observed to be well in touch with his inner child. After spending a decade in

full-time education at The Dalian University of Science and Engineering, he

has recently begun his professional career at Midea Residential Air Condi-

tioning (RAC).

Song Mingyuan was born in Dalian in Northeastern China’s Liao-

ning Province. He works in product planning in Residential Air Condition-

ing’s Research and Development Department. He took the time to introduce

himself.

Education Background

In 2002 I entered

the Management Depart-

ment of the Dalian Uni-

versity of Science and

Engineering. University

was a time of freedom

and happiness that I am

very nostalgic about. I

formed lasting friend-

ships and fell in love for

the first time. There was

time to daydream but

there were also challeng-

es to overcome. Some-

times I had entire morn-

ings of inactivity. Some-

times I would play foot-

ball till after sundown.

After four years of

this I graduated and land-

ed a role as an odd job

man at a logistics compa-

ny. This gig taught me a lot about myself. I decided to go back

to my alma mater. It seems without even thinking about it, a

three year Master’s program turned into a PhD which took an-

other three years.

The subject of both my Master’s and PhD was Business

Management. My specialties were consumer behaviour and ex-

perience marketing. My post-graduate studies were full of valua-

ble experiences, including a yearlong placement in America. It is

astonishing to think I spent an entire decade at the same school

but I enjoyed every minute.

Entering Midea

It is a great honour to join Midea RAC. This was in fact

my third offer since graduating. The previous two were from a

small private company and a college that is part of China’s Pro-

ject 211 (a 1995 project that selected 118 universities to increase

standards of science and research). I didn’t have to think about

it for long when select-

ing Midea.

The reason is simple. I

don’t want a buttoned-

down life. I want my

future to be full of

challenges and adven-

tures. At China’s great-

est appliances brand I

will receive the tough-

est training, meet the

most extraordinary

people, push myself to

the limit and realise my

own potential.

Even though at the

time of writing (March

4) I have only been

here for two weeks, I

already have the sense

that RAC is an environ-

ment conducive to inno-

vation. I feel I have both

flexibility and stability here. I feel my choice has already been

vindicated as Midea is certain to offer some unforgettable expe-

riences.

Midea Group is a huge machine that I just want to be a

cog in. I want to dedicate myself fully to the experience.

PEOPLE

Song Mingzhu


17

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