Reporter Volume 25, No.25 April 21, 1994

By BETHANY GLADKOWSKI
Reporter Staff

"Now we are considered experts (by our country) in Western business,"
said Jaifang Zhan. 
	Zhan, 45, is one of two graduates of the UB-sponsored China
MBA program visiting here last week. He and Cai Rang, 35, say they owe
their business success to the Western management practices they
learned through the MBA program, which graduated its last class in
1990. Zhan and Cai came here on a return visit to tour local
businesses and also attend a conference, "Greater China: Accessing the
Markets of the People's Republic of China, Tiawan, and Hong Kong"
sponsored by the UB school of Management. 
	The China MBA program, originally sponsored by the U.S.
Department of Commerce and the Chinese State Commission for
Restructuring the Economic System, began in 1984 but formerly ended in
1991 due to lack of funding. The program graduated nearly 200 students
within the seven-year span. UB management professors would teach in
China for three semesters through the National Center for Industrial
Science and Technology Management Development in Dalian. The students
would spend the last semester completing internships at manufacturing
plants and businesses in the Buffalo area. Dr. Frank Jen, a professor
in the UB school of management and program co-founder and director,
said "The Dalian center was labeled as the most subversive center in
China."
	The program was designed to teach members of Chinese business
community western management practices which would help trade
relations between the U.S. and China. Cai Rang, who graduated in the
first class in 1986, said that most of the students had a background
in engineering, and the program was mostly to train them in
administrative duties. Jen now says that the program was a means of
"introducing a revolution" to China's economy.
	Cai is currently vice president and senior engineer for
Central Iron and Steel Research Institute, a governmental research
division in metallurgy; Zhan originally worked for the Hangzhan Oxygen
Plant manufacturer but is now president of Premium Scheme, Co., Ltd. 
	Zhan said that being able to combine knowledge of western
thinking and with what they already knew about Chinese business made
them better able to understand large trade negotiations. 
	Despite hints early in the program that the graduates were not
using their new skills in their jobs, Cai said that the program was
very useful and that any such hints "are rumors." In fact, both
claimed that some MBA graduates have even become millionaires. Dr. Jen
also said that recently, one MBA graduate was the first "popularly
elected county executive in China." 
 	Zhan admitted that the transition following his return posed
some difficulties. One was that the software packages he had learned
to use here (such as Lotus 1-2-3, a spreadsheet package) didn't have a
translated version for Chinese.
	But a larger obstacle he faced was the company's reluctance to
switch from sales-oriented production to more focused marketing
tactics. Zhan was convinced that marketing the company's products
would tide it through economic decline, as well as boost its upswings.
He was right. "In 1990 we had a recession. Other businesses were
failing, but we were able to survive because we had formed good
relationships with clients through marketing strategies," he said. 
	Cai added that the key to using the course information to its
greatest potential was being able to modify it to the different
political and economic climates. Said Zhan, "Students came from a
variety of backgrounds. Western personnel management, for example,
can't be used in China because the culture is different. U.S.
companies can hire more people when demand is high, and then lay them
off when it decreases. In China, the people stay with the company and
cannot be laid off." But this trend is changing, he said. "Now, only
approximately 40% of the business in China is state-owned. This will
continue."
	Cai added, "By the year 2000, almost 80 percent of the
business will be privately owned." 
	One of the first things Cai changed in the Metallurgy ministry
was its structural organization. He said that after his reorganization
took place, annual sales increased three times in three years. He also
suggested to the government policy changes in research, science, and
taxation, which were later implemented. "The thinking (learned through
the program) takes you to a higher level," he said. "We learned things
about the world abroad. The program helped open our minds," he said.
"The hardest thing to fight was the old system."