We All Lose When Global Manufacturing Leadership Fails

By: | March 1st, 2014

Global manufacturing, the practice of companies opening manufacturing facilities in another country, usually a lower cost country, has benefited consumers by increasing their purchasing capability and stockholders by raising or maintaining profits. But what happens to the citizens of those countries, when the corporate leadership of these companies fails in their duties and responsibilities? This is a story of how failed corporate leadership and a global manufacturing strategy changed the lives of a father, his son and a community– forever.

Wuxi China is about 90 kilometers west of Shanghai.  Sometimes called “Little Shanghai, its total area is 4,787 square kilometers of which 30% is water. The city’s population is around 4.5 million. It’s a city with a 3,000 year old history which includes the Ming and Qing dynasties. Today its GDP ranks 9th among all 659 Chinese cities and its residents are some of the hardest working people in all of China.  If you go to Shanghai, take the time to make the trip to Wuxi, you’ll be happy you did.

A few months ago I was in Wuxi and had lunch with a long term resident. He’s 36 years old, was born in Wuxi and has lived and worked there all of his life, as did his ancestors.  He told me how Wuxi has changed in the last 15 years.  How foreign invested corporations and multi-national businesses, large and small, have moved into the city and started manufacturing operations. Because of the jobs this created, I expected he was going to describe how the lives of the residents improved and they were enjoying more of what life has to offer. But he didn’t.

Instead, he told me about his young son and his son’s single wish.  For Americans, it may seem to be a simple wish, but for this father, it’s a wish he may never be able to grant. This wish represents a powerful message to those companies and individuals who come to China, to India, Eastern Europe or any other country in search of low cost labor and profits.

His son’s wish was to fish in the river next to their home, take what they caught back to his mother to cook for a meal to share with his father.  This father had to explain to his son they could not fish in the river because the water was not safe and eating the fish could make them very sick.  I could see the difficulty on his face as he told me this story and he explained why.  As a boy he fished in that same river with his father. He took what they caught home, to the house he still lives in today, where his mother cooked a meal for him to share with his father, creating a bond between them and beginning the ritual of passage into becoming a man.

Almost every father, at some point, will take his son fishing to the places he fished as a child. In doing so, passes on his own memories of growing up to the next generation, a common ritual between millions of fathers across the world. Why then, did this Chinese father from Wuxi have to tell his son they could not fish in the place he had fished as a child with his father?  The answer is unfortunately simple, but also describes the frightening consequences of leadership focused only on profits and not on its responsibilities to the people of whatever low cost country they happen to be located.

He could not fish in the river with his son, because two multi-national companies came to Wuxi to manufacturer their products.  They built new facilities, hired hundreds of employees and, over the years, shipped millions of products. But they failed to tell anyone they were discharging their toxic waste into the ground. Eventually, this waste found the river. The water then became unusable and anything in the water, inedible.  It was only discovered after people started to get sick.

Like his son, this father also had a simple wish. He told me he hoped, before he died, he would be able to take his son to fish in that river so his son could take the fish home for his wife to cook as he had done with his father.  But in his heart, he knew that would never happen. His son would never enjoy what this father had enjoyed with his father.

A father – son tradition and legacy was broken because of the actions of strangers, from a foreign land, who came to his city in search of profits. The simple wish of this Chinese father and his son is a wish any father and son, from any country, speaking any language and following any culture would understand and share.  But more important – they would also feel his anger.

I left lunch and for the first time in my life, I was unable to find a single word of encouragement or comfort for this father who had a simple wish that he knew he could never fulfill. I was disgusted to be part of the global manufacturing movement.

That river was not destroyed due to a failure of the waste treatment facility.  It was destroyed for generations due to a total and complete failure of the companies’ leadership as they ignored their responsibilities to the people of Wuxi and China, in search of profits. And, it was preventable. All that was required was real leadership.

Regardless of the country of origin, every CEO, every senior executive and every employee of any company located in a low cost country must accept they have the same responsibilities to the people who live in that country, as they do to the people in their home country.

When they leave, if the country they chose to locate is not better because they were there, then they failed in their responsibilities. As leaders they get to decide what their individual and corporate legacy will be to the people of that country.  It’s a personal choice and but it’s also a corporate responsibility, it is their responsibility. They can decide if the water stays clean or not. They have the absolute responsibility and power to insure a father and a son can fish in a river, pond or lake in any country that they have located a facility.  It is their choice and it is their responsibility.

If they cannot make those choices or accept those responsibilities, they should just stay home.


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