STS Manufacturing in China
Mark Hanson, the young general manager of a Chinese-American joint venture in China, had just returned from a long overdue week's vacation in Thailand. As he began going through the stack of paperwork and messages on his desk, Hanson realized that just because he had been away for a week, the issues and problems in the joint venture had not disappeared. The issues involve quality problems in the JV, relations with his Chinese counterparts, supplier selection, training, and Hanson's relationship with his superiors at Tellsan Products (Tellsan), the American partner. Moreover, after working at Tellsan for 18 months he was seriously questioning whether or not Tellsan had made the right decision about even being in China.
This case serves multiple purposes. First, it is intended to illustrate and update the market-oriented changes that China has made since Deng Xiao Ping began the process of opening up to foreign investment and economic reform in the latter 1970s. The organization of the Chinese economy and the rules and regulations that govern business behavior comprise a rich historical, cultural, and political dynamic unlike any Western marketplace. Second, the case deals with a series of issues facing the young general manager of a Chinese-American joint venture in China. The case provides the context for a discussion of the managerial and personal challenges of being a JV general manager with multiple bosses, dealing with at least one unsatisfied parent, and working in China. The case can also be used to illustrate the generic realities of international joint venture management.