This interview marks the beginning of the Leap66 Q&A series. If you’re interested in interviewing with us you can find out more in our post China Specialists: A Call for Interviewees. My old classmate Erik Barnes, whom I met in Taiwan, currently lives in Shanghai. He’s been there for about 12 years and has gained a lot of experience working for foreign companies as well as Chinese companies. He’s now working as an independent consultant and his business is thriving. Erik has a ton of great stories to tell about his experiences in China and here is the tip of the iceberg. Read on!
Leap66: Howdy Erik! We first met as classmates at National ChengChi University in Taiwan while you were there studying Chinese language and area studies. Before that you attended the University of Idaho in Iowa City, Ohio (you only get the joke if you’re from the states of ID, IA or OH). Describe the events that led up to your study abroad trip in Taiwan?
Erik Barnes: Early in my undergrad study I became fascinated with Asia. I was frustrated that much of the American curriculum in many subjects like history and foreign language were still Eurocentric. I figured there was this whole huge part of the world that was largely unrepresented in the traditional path and so curiosity was a large driving factor.
I had lived in France for a couple years, which gave me my first taste of living abroad and learning a new language. I wanted to attempt this again, but in my own unconventional way. (Why learn Spanish when you can learn Chinese?!) University provides the opportunity to do that. Once you get into the “real world” chances are your boss won’t ask you to take year off to live in another part of the world.
I specifically chose Taiwan on the recommendation of a professor who said that if I learned traditional Chinese first that simplified would come easier, but if I did it the other way around it would be hard.
L66: How did your studies and experience in Taiwan prepare you for the path you chose after college?
EB: Immediately after graduation I went back to Taiwan and worked at the World Trade Center in Taipei. Having that language and cultural experience helped set me up for that.
L66: What prompted you to move to Shanghai?
EB: I was living in France when I met a young Chinese lady. After she was refused a visa to the U.S., we decided to move to China. We chose Shanghai because she had lived in Beijing before and wanted to try somewhere new.
L66: Tell us about your first few weeks in Shanghai. Did you hit any snags getting settled into your housing? What sort of red tape did you need to deal with? And how might you have done things differently?
EB: I came with two suitcases and a backpack. For the first month I stayed in ¥80RMB/night hotel until I found a friend with a small apartment to rent. My first priority was to find a job and have an income.
L66: Describe your first day on the job in Shanghai. Were you reporting to a local Chinese supervisor or another foreigner?
EB: My first job was a sales team manager. My first boss was a Shanghainese lady who split her time between China and the U.S., where her family lived.
L66: How would you describe the differences between working for a foreign company Vs. a Chinese company? Are there major differences in the culture, workforce, pay rates, mobility etc?
EB: There are many differences as well as common points. I would watch my first boss leverage her “guanxi” to get results at times, but basically I was there because the company had been losing money and I needed to help them get out of the funk. The pay for Chinese companies at the time (2003) was significantly lower than for a foreign company, especially because many companies would tack on a “hardship” bonus to their expat packages for supposedly having to endure living in such a backward country. That didn’t last long, as soon people were clamoring to come to China. Now the pay gap has largely narrowed, especially if people stay at the same company for a long time. The average Chinese starts at a low wage, but an average manager’s pay increase is over 10% year-on-year and they often get at least 1-2 months pay as a bonus at Chinese New Year.
L66: What types of work experiences have your jobs in China afforded you? Where do you travel and who do you meet? How is the work-life balance?
EB: I’ve worked in sales, consulting, as project manager and now as a freelance trainer. My travel has literally sent me around the world: U.S., Denmark, Ireland, Germany, Singapore, Thailand, Korea and many others. As a freelance I am free to decline jobs, but once I’ve committed they don’t budge from my calendar. So many opportunities here that I tend to work at a pace that most Westerners would find nuts.
L66: What’s the craziest thing you’ve seen on the job?
EB: Not sure.
L66: Okay, good answer. You’re now operating as an independent people development consultant in the Greater China Region. How did you get the idea to push off on your own?
EB: The pay is better 🙂
L66: Fare enough. What sort of battles did you face in getting your consultancy off the ground? What was the turning point when you knew it would last? Have you recommended going solo to your expat friends in China?
EB: Getting traction in a market is a struggle for anybody. It takes persistence, belief in yourself and the ability to 吃苦 (chīkǔ) for a while until you get over the hump. My big breakthrough was when Microsoft took me in as program owner to localize an on-boarding program. That opened a lot of doors to me as well as gave me a good mentor (my direct report boss).
L66: It seems your business analysis and coaching skills are high in demand these days. Would you ever consider hiring staff to grow your business?
EB: I think about it sometimes. Finding people in China is easy. Finding talent is a challenge. Labor laws are also confusing and not something to jump into lightly. Technically, my business is through my Hong Kong registered company and I’d have to register a new one locally to start hiring staff. Not yet at a position where I find it a necessity.
L66: How is your business going now and what do you envision as the next level as you develop your services? What problems can you help solve for businesses in Greater China?
EB: Business is so good that I’m too busy to make many strategic changes. My next steps include aligning with other talented professionals in my industry to work on bigger, more meaningful projects. One such opportunity is a local partner wants to create innovation programs with me for the local Chinese companies. As the economy slows companies need to find ways to expand growth in a more competitive environment and learning innovation is part of doing that.
L66: Tell me about managing your finances while living in China. I assume you’ve got a bank account in your home country as well as in China. Where do you primarily keep your savings and retirement funds?
EB: I have money in my Hong Kong, Chinese and American accounts. My main investments are in a couple of rental properties I bought in the U.S. during the downturn. As an American, most global banks (like HSBC) won’t sell you any investments because of the threat of IRS penalties. Big brother limits your possibilities. My biggest asset is my apartment in Shanghai, but that isn’t liquid at all.
66: What do you wish you’d known about personal finance when you first moved to China?
EB: If I could turn back time I would have skipped my MBA and just come to Shanghai and buy real estate 🙂
L66: What’s all involved in buying a car in Shanghai? What are the ups and downs of owning a car there?
EB: I had to get my driver’s license in China first. Buying the car was straightforward, but getting the Shanghai license plate involved participating in the once-monthly auction to get one. I eventually had to pay ¥64,000RMB (just over $10k) to get the license plates, which means they are literally worth more than their weight in gold.
L66: In a nutshell, how would you describe the single best benefit of being an expat in China? What makes you want to remain there?
EB: China is an emerging superpower and people here have an optimism that is absent in Europe and other parts of the developed world. Opportunities come fast and the younger generation are at the forefront of this. People my age are already general managers and VPs. Young energy and seemingly relentless opportunities are part of what keeps me here.
L66: What is the single hardest thing which expats struggle with in China? Is there any situation that ever made you want to just move home?
EB: There are many things. For expat managers who were sent here by their companies there is often a disconnect between what the people at HQ expect and the realities of what is happening in China. Just because you are here doesn’t mean you magically have access to 1.3 billion customers or that your business will operate the same way it does in the home country. Divorce rates are high amongst expat managers for a reason.
L66: Even after living in China for 12 years do you feel like there is a cultural gap between you and your local friends and colleagues? How can long term expats like you help to narrow that gap and deepen understanding on both sides?
EB: The gap is there and it never really goes away. You learn to appreciate it, but you don’t really change into Chinese. I think many new expats make the mistake of thinking because of the embracing of Western food, entertainment and other aspects that means that Chinese want to be like them. It’s not true. They just adopt certain things they like, but they are still very much Chinese.
L66: If you could meet a U.S. university study abroad student arriving in China for the first time today what would you want to tell them?
EB: Stay humble. Don’t let the amount of attention irritate you or go to your head. You CAN learn the language, but it takes persistence.
L66: In Western media we often read about pollution and food safety scares in China. Are those news stories accurate or blown out of proportion? What’s your plan to stay healthy in China?
EB: I like to cook for myself 🙂 We buy imported baby formula and I sparingly eat local restaurant food that can have abundance of MSG. Doing detox occasionally is a habit I hope to keep.
L66: Thanks for sharing your experiences with us. We’d love to have you back again and best of luck with your adventures in China.