China has become an area of tremendous potential for companies as the nominally communist country has embraced capitalism. The hybrid result, according to Ford CEO Alan Mulally, is in some ways an improvement on what’s been a pretty sluggish and inefficient democratic process elsewhere in the world.
In a Q&A with Keith Naughton and Craig Trudell for Bloomberg Businessweek’s interview issue, Mulally is effusive in his praise for the party and the government in China, where Ford’s sales are up massively.
Asked if they’re easier to work with than democracies, Mullaly replied: “They are a pleasure to work with. You’re welcomed, you’re part of the fabric. ‘What can we do to help? What can we do to work together?’ There’s nothing like it in the world.”
When questioned about the odd dichotomy between communism and full-throated capitalism, Mulally adds: “It’s fantastic. The working relationship between the party and the government is tight. They both have the same objective, to grow the economy.”
The obvious contrast is with Ford’s home in the United States, where politics and the government frequently serve as an impediment, rather than an economic booster, especially from the viewpoint of business.
The tenor of his answers might be coloured by his need to maintain good relations with China’s ruling elite.
Mulally’s relationship with the country goes back a long way. In the interview, he describes taking a lead role in China in the ’70s and ’80s during his time at Boeing. The country became a key part of his strategy at Ford from the beginning, and the business has been increasingly successful.
Other companies haven’t had as positive an experience. KFC saw sales plummet massively after a government investigation into its supply chain. And British drug-maker GlaxoSmithKline is embroiled in a bribery controversy and investigation. It’s great to be a favoured partner, but awful to be in the government’s bad graces.
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