China: Are We There Yet?
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The McKinsey Quarterly has come out with a new survey on China (Doing business in China: A McKinsey Survey of executives in Asia); 253 C-level executives in Asia participated. It shows that "surprisingly few companies have any operations in China today," but that many more will five years from now. Currently, only 34 percent have operations in China. |
The authors write:
"Perhaps most interesting, at a time when many companies are assessing whether they have concentrated too much of their operations in China, only 14 percent of all survey respondents say their companies own one or more manufacturing plants, service facilities, or retail stores there... That relatively low presence won't last long, executives say. Overall, 90 percent of respondents expect their companies to be doing business of some kind in China within five years."(Note: you have to register to read the article.)
These are Asian executives, not U.S.-based executives. So the numbers will be much lower--right? Lower, yes, but still very significant. Our own January 2007 Future of IT survey found that 39 percent believe their company's IT organization will provide or arrange IT support for a facility in China. And here's an advance finding from our soon-to-be-released March 2007 Outsourcing survey: 20 percent of companies that do offshore outsourcing offshore to China. That's well below India, but that puts China in a clear second place. Chinese vendors hope to do more business with U.S. firms too.
