In the US and Europe, from consumer goods to construction equipment, the warnings are everywhere: “The Chinese are coming! The Chinese are coming!” You have to have a few shades of gray for the first reaction to such warnings to be a recollection of the 1966 comedy film The Russians are Coming! The Russians are Coming! that features an accidental Russian invasion of the USA. You also need to be north of 40 years old to remember the long and sometimes ugly trade war with the Japanese.
Cranes are just one of many Chinese exports – represented here by a lattice boom mounted to the Chinese character for China
But yes; the Chinese are coming. Not just in textiles and furniture but in excavators, wheel loaders and cranes. The (export) prices are great: two or three for the price of one. The quality is generally quite good – for the price – although trade show finish can deceive. China has a relatively clean reputation, and its people are seen as hard working and worthy.
Those with long enough memories to remember the scare-mongering that preceded the invasion of the Japanese and Korean products have lived to see how they are now amongst the world’s most respected. Are the Chinese just the next wave?
While the Chinese and Japanese share many traits, their diverging histories over the past 50 years have created some key differences.
From the ashes of World War Two, Japan sought technological input from America and Europe. In our industry, this started in 1952 when Koehring of the US established a license and later joint-venture with Japan’s IHI and was soon followed by many similar agreements (Link-Belt to Sumitomo, P&H to Kobelco, Bucyrus to Komatsu, etc.,) transferring US technology to Japan. The Japanese improved the designs and quality beyond the original products and through their connections with US and European partners learned about foreign customer expectations and how distribution and customer support systems worked.
While the Japanese were creating their industrial miracle, the Chinese were taking a great leap forward to communism with a massive centralized bureaucracy. This structure left little room for consumer power, customer service, product support, and so on. Indeed, such concepts were, and in many cases still are, little more than buzz words.
When the Japanese makers of construction equipment entered world markets 30 or 40 years ago, they had several key advantages compared with the Chinese manufacturers today.
First, Japanese society has nurtured strong interdependence traditionally which carried into buy-sell relationships. This has created a culture of good service and well-maintained high quality. In contrast, communism by its very credo has no place for such relationships between maker and user.
Second, by the time Japanese construction machinery started to arrive in export markets, it had been preceded by Japan’s makers of diesel engines, automobiles, and so on. Although the availability of parts was often a problem, the concept of product support was well known to the Japanese. Though it still took some years to get right, at least the manufacturers thoroughly understood the importance of this issue. The Chinese come from a different position. There is virtually no Western market presence for Chinese machinery and components such as diesel engines, hydraulics, drive trains, and so on – as a glance through any Yellow Pages would confirm.
Third, when the Japanese launched themselves on to the world stage, there were equipment dealers at every street corner looking for new opportunities. Not so today. Generally speaking, the only dealers now looking for new lines are the second-hand equipment dealers and brokers that have been already rejected by established manufacturers.
Today, product support is taken for granted by most users. Few buyers actually understand what is involved in providing same-day parts and service support globally for new equipment, let alone machinery that was manufactured 10, 20 or even 30 years ago. Such product support is not an add-on. Only if the manufacturer has invested substantially in product support from the beginning of the product’s design and manufacturing process, and continuously through its entire working life, can it offer an acceptable level of parts supply and service support.
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Only if the manufacturer has invested substantially in product support from the beginning of the product’s design and manufacturing process can it offer acceptable parts supply and service support |
Cranes have longer working lives than almost any other variety of construction machinery. During these long lives, component manufacturers change their products many times. Many of these suppliers go out of business. But 20 years after a crane was built, customers order parts and (rightfully) expect their orders to be accurately filled, generally within days. The only hope that the original equipment manufacturers have of keeping their customers happy is:
– To record the complete specification of every machine they have manufactured by piece part
– To record accurately every single piece part by number, maker and specification at the time of manufacture
– To maintain, update and correct this parts inventory as vendors have changed and technology evolved so a suitable replacement can be offered, together with appropriate advice and instructions
– To keep parts and service manuals for every model and series of product they have manufactured
– To employ a staff of experienced and qualified service technicians that can help customers repair damage or problems either through telecommunications or in the field worldwide
– To hold inventories of replacement parts for every machine they have ever built
– To organize and run an accurate and efficient parts tracking, retrieval, handling, shipping and replenishment system
– To employ an experienced and dedicated staff of product support professionals that can interpret customer’s needs coming in 24 hours a day, seven days a week, in different languages, from all over the world.
The centrally planned economies of the former Soviet Union or China did not develop these sorts of systems. To learn and implement this kind of product support is neither easy nor quick. It will take years. No doubt, the Chinese will learn how to meet global expectations of product support for capital goods. So the only question is, how many years? Will it be 5,10 or 15?
