From 1949 until President Mao's death in 1975, China was a typical example of the restrictions and problems posed by centralized planning and forced collectivization of Communist ecosystems.Under Mao, farmland was managed by central planners in the big cities, and land property belonged to the State, transforming independent farmers into public employees. Incentives for production were reduced or even counter-productive, since farmers were not allowed to decide what to plant, when or where.
The consequence of this system were dire. Mao's forced collectivization involved a major cultural change in traditional rural China, and failed catastrophically in 1957-60
15 million farmers death during the famines caused by the new system
Under Mao's shadow, Deng Xiaoping -his eventual (and unlikely) successor in 1978- look at Hong Kong and Macao as examples of the benefits of a different model, based on an open, trade-oriented economy and entrepreneurial culture.
Deng considered another major cultural change: in this case, taking China's coastal cities out of the centralized planning system, and letting them operate like entrepreneurial, export oriented hubs.
Deng expected that to spur China's growth out of poverty at a much faster pace, like Taiwan:
In 1979, Deng created new "Special Economic Zones", where private property and free trade and free enterprised would be allowed and encouraged to operate as a "buffer zone" between China's communist system and the global economy
Each SEZ was organized around universities and logistics Between 1979 and 2009, China 's GDP per habitant -which had been growing sluggishly from 400 to 700 dollars during 30 years of collectivist culture,- jumped in just 20 years from 700 to 4,000 dollars (at 1991 values) making the economy grow at a 10 % yearly pace.
Deng addressed cultural change with a different approach than Mao. Instead of forcing the change on all the country and replace the existing system at once as Mao did in 1949, Deng announced in the Fifth Congress of the Chinese Communist Party that China would embrace what he called "market communism", letting the market fix the prices freely and free trade allow faster export grow.
Deng summarized his pragmatic approach to change with the phrase " it doesn't matter what color is the cat, if it chaces mice"
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Soon Deng's reforms unleashed a productive revolution that ended secular famines by empowering farmers
Towards the end of his life, in 1991, Deng travelled through the country educating people in the new culture, summarized in a simple phrase: "it is ok to prosper"
Thanks to his cultural change, 1,2000 million chinese live today in a U$S 4,000 dollar GDP per habitant , middle income country and 400 million joined the middle class
China is set now to become the world largest economy and the banker of the world.
Everything started with cultural change.
What lessons can we learn from Deng for our projects?
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4 comments:
CULTUREL CHANGE
In Mexico as in some other countries the governments make decisions without considering the consequences of them, the 19 of November of 1976 to expropriate earth clearing to the agriculturists the opportunity to continue generating economic development its organizations, to occur them to the ejidal sector was a political decision, without a culturización plan in which the ejidatario assumed little by little its new function within economic cycles of agriculture, were no a strategy neither in thought, nor action, very either could here be applied the ideal vision of the Dr. Kaufman in which there was results mega, micro macro and, has been a total defeat, the ejidatarios sold the earth in their majority to the old producers and the minority them rent. success that to date one has had in agriculture in the valley of yaqui subsequent to those decisions has been because during many years it is generated in the organizations and their individual plans of development in which all participate government, private initiative and agriculturists
CULTURE CONCEPTS
In the organizations a problem to solve is the human relations by the diversity of cultures from which they come each individual that the Integra that makes different in thinking, to act as much in individual as in the group, the proposal of Gert Hofstede is to look for the similarities which they will do possible to diminish and to make the treatment between all more equitable, the group power is in the end the one that prevails in the organization, but are convinced that nobody loses its form to be but a group force is generated.
Trompenaars “defines that the culture is one it forms to solve human problems” In ours to act, that if that we eat, as we dressed, as we spoke or we are expressing our culture, defines the same society to us our behaviors seen like norms and principles or values, nevertheless by different cultural formation some people act outside the rules, we applied our individualism in the organization, the familiar life nevertheless of a consensado group also, the emotions , we expose as them there are differences, we made individual decisions, sometimes the people pretend we were member be difficult, but it is our appreciation by stereotypes that we were created, like when the status of the people by his profits, his goals short and long term his commitments before the environment in that they develop, some times participate in, but the majority of the times is imprisoned of him, the point will be like participating, being part, the idea is to think that things affect others and thus to handle them,
I believe that when we analyze the example of Deng Xiaoping and the evolution of China's economy from a completely centralized communist economy to a modern mixed economy, there are 3 important lessons to be learned:
1.- Politics cannot be ignored. We tend to think of "politics" in terms of governments, but I think the term applies to the process through which a group arrives at a collective decision. The "Great leap forward" was largely the result of political doctrine and Mao's idiosyncracies overriding scientific knowledge, and of established dogma crushing dissent through severe punishment. This can happen in any group and is not just limited to communist governments.
2.- Decentralization of power is essential to form an organizational structure that is capable of reacting adequately to change.
3.- Unity for the sake of unity is not a virtue. I remember one of my O.B. teachers used to say that when it comes to organizational change the most important step was to get the leadership on board, that change cannot come from within, it must be generated by elements external to the organization, and that elements of the organization that resist change must be removed.
I respectfully disagree, I believe enduring and effective cultural change cannot be imposed, it must be desired and sought after by a majority of the stakeholders in a project, and that includes both the base and the pinnacle of the organizational pyramid. Dissenters can be merely obstructionists, but they may also have valid concerns which must be examined and adressed, they may very well force us to go back to the drawing board for the right reasons.
Only then can the external consultant or O.B. expert have the chance to develop a project that has a reasonable chance of success, by working with, instead of against, the body of the organization that is the target of development.
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