China and the myth of the not-so-early adopters

By B.J. Richards

There’s been an idea floating around for a while now that Chinese businesses have been unusually slow to adopt new technologies.  It seems to have started with a McKinsey study (as these things so often do), was quickly picked up by the business press, and then, perhaps even more quickly, became one of those things people were saying to sound smart over drinks at tedious work functions. And so a new truism was been born:  Chinese businesses are slow to adopt new technologies.

The story goes something like this: with Chinese labour costs so low, Chinese businesses have had little incentive to adopt labour-saving solutions.  After all, if labour is cheaper than the things that would help you cut back on it, why bother?

It’s easy to understand why the idea caught fire: it has a simplicity that makes it easy to understand and convey; it’s the kind of thing that sounds really useful to know; and, let’s be honest, the temptation to cling to any little tidbit that makes the Chinese market sound just slightly less mysterious is powerful, indeed.  We understand.

But is it actually true?

Well, it very well may be.  But it certainly hasn’t been the experience of the consultants we spoke to in the course of researching this year’s report on the Chinese consulting market, many of whom were very eager to tell us about the booming business they are doing providing technology solutions to Chinese businesses.  And, yes, that’s Chinese domestic businesses if you were wondering (we’re told the multinationals tend to contract for that sort of thing out of their home offices back West).

We admit there’s likely some sample bias at work here.  At Source, we focus our research on what we consider to be the ‘big’ consulting market – that is firms with at least 50 consultants and the work they do for their mid-sized to large clients.  Organisations of this size probably spend a lot more time thinking about the global competition than the average business does, and so are much more likely to be interested in the technology that will allow them to follow international best practices.

Luckily enough, big, global management consulting firms have loads of experience integrating new technologies across organisations, and making them more efficient and productive in the process, and they’re more than ready to bring their talents to eager Chinese businesses.  And that’s not even touching the arguably bigger opportunity to help these businesses reach China’s growing middle class through wildly popular social media and digital delivery services.  We predict China’s already robust market for technology consulting is going to have another big year of double-digit growth -- and there’s certainly nothing slow about that.