Near Yellow Mountain

Sunday, August 9, 2015

The China Syndrome - Part One (getting there)

Snow Festival in Hokkaido - We were in no hurry to leave Japan

Ten years ago this week my family moved to Shanghai, China. The fact that we were already seasoned expats with more than five years in Japan under our belts did not make the decision to move easier. After so much time in Kobe, Japan seemed like home. The kids were happy in school. We had an interesting life exploring Japan and many other places in Asia. 

My company sent me to Japan as their lone ex-pat in a city where they didn’t have a local office or any support services. After five years, my expat “report card” showed company sales in Asia had grown 300%, profits were up 400% and a troublesome joint venture had been restructured. My “reward” for success was being asked to move to China, for tax rather than strategic reasons. The company leaders did not like the fact that after five years in Japan the burden of my personal taxes in Japan increased significantly. The US has a barbaric "double payment" tax code for expats. Since my ex-pat agreement required the company to pay all taxes associated with my exp-pat status, I was asked to move to China. In typical fashion with corporate bureaucracy - the move actually cost the company more in taxes overall but that miscalculation is a story for a different day.

Living was easy on Rokko Island in Kobe

“No” means “Hell No”

Late in our fourth year in Japan, my boss visited and asked me to move to China. Since my division had limited sales and no infrastructure in China, I asked what the "mission" was. The answer was “keep doing what you are doing, just do it from Shanghai”. I reminded him that I had two teenage daughters who were happy where they were and a wife who was like the poster child for the successful expat. Why move if there wasn't a good reason?

I also had done some research before we moved to Japan about “expat landmines” and had an agreement that gave me more control than normal regarding how and when I returned to the US. I couldn't prevent the move back but I had some level of financial and geographic protection when the time to repatriate came.

My decision was made – if they were going to try to force me to move to China, I would use my “exit clause” and return to the US before my elder daughter started her junior year in high school. Despite my frustration at being asked to make what amounted to a "tax move" - I played the game, waited a week and sent a carefully worded email declining the assignment in Shanghai. I fully understood that decision could effectively end my career with the company. The response was swift: My boss said he “understood", but he also said that I was still the "top candidate for the China assignment".

“Let the Games Begin”

Normally, my boss was patient and savvy in his dealings with me. Rather than continue this conflict with me head-on; he arranged for me to meet his boss for breakfast at an upcoming company meeting in the US. Although I liked and respected my boss who was a long time ex-pat himself – his boss was another matter. The “Big Boss” did not like my independent streak or my lack of interest in being what he called “a good corporate soldier”. 

The "one on one" breakfast meeting in a private room with the Big Boss was brief. After the obligatory 10 seconds of pleasantries I was told: “there is nothing in the US for you and you just need to make this move”. My one word response was: “why?”.  After a pregnant pause, I looked over my untouched pre-ordered eggs and bacon and began to thank him for his time and excuse myself. This was clearly the power play I expected – “be a ‘good solider’ or find another job”. Before I left the room I was told “maybe we can think of something to make the move more attractive”. I decided to leave before I said something I shouldn’t and closed with “I’ll wait to hear from you”.

As luck (or good planning) would have it standing outside the door as I left was a tall, balding man I had never seen before. “Hi, I’m Tom”. “I am the new HR director and my first job is to get you to move to China”.  I looked up at Tom, shook his hand and said: “Best of luck with your first assignment, by the way did you know my wife and I are house hunting in Charlotte this week”. Actually the short conversation included a couple of four letter words that weren't "golf". 

The day got more interesting as the company arranged for me to skip the afternoon corporate session to meet a very expensive consultant who was an expert on Asia in general and China in particular.  The consultant was a breath of fresh air. He knew Asia inside and out. He asked about my experiences in Japan, my family, etc.  Before we ended the meeting he said – “look, China could be a wonderful experience for your family but it won’t be easy.  I have known your company for a long time - they don’t understand Asia and you will never get the support most people need to make an overseas assignment work.  On the other hand, you succeeded in Japan so you can probably make it work.” He went on to say “you should only move to China if every member of your family is committed to go because otherwise you will be miserable”.  At this point I wasn’t sure if I was getting his honest opinion or if my time with him was part of a strategy to use reverse psychology on me……

A few days later we were back in Japan. I continued to mull over what my future looked like moving back to the US – I wouldn’t be fired immediately because of my agreement and the fact that immediately axing returning expats was considered “bad  form". Likely I would be assigned to “special projects”  and advised that I probably should begin to look for “opportunities outside the company”.

The second morning back in Japan (a Saturday) I got an early morning call from the President of another Division of the company asking me what my “decision on China was”. He was calling from the US and knew it was very early in Japan.  Through the haze of jet lag; I just laughed and asked why he was asking. Apparently, my boss had enlisted another helper to get me to make the “right decision”.  I had spent my five years in Japan operating with almost total autonomy – suddenly there were several people trying to help me make a decision I had already made.

Family Meeting

My daughters were well aware that a decision about where we would be living in the next school year was being made. I picked a family dinner to break the news that we were "definitely" moving “home”. There were no outbursts but tears began to well up around the table. I asked why everyone was so sad. The bottom line was the girls wanted to stay in Asia to graduate high school. If Japan was no longer an option they were perfectly happy to take their chances in Shanghai. They wanted to stay in an international school until they were ready for college. I told them that China would likely be much tougher from a quality of life perspective and I thought it made more sense to go back to the US if we couldn't stay in Japan. I appreciated their desire to stay in Asia and knew it would be a much better financial decision.  I am no match for the tears of my progeny - so in the end my daughters really made the decision for us to move to China. My "wiser than me" wife thought staying in Asia would be good for the girls and better for me so she wisely let things play out slowly.
The Details

I knew that many of my peers back in the US had been approached about a China assignment if I refused to go. My division was based in a nice area of North Carolina. Most people asked to go to China had kids in school and nobody was willing to move to what they perceived as a "third world communist country". Of course the company could  have "hired outside" but the lithium business is a unique niche and hiring someone from the outside who could be effective immediately overseas was nearly impossible. Armed  with those facts, I was able to negotiate a great package for the move to China and a safety net for my return. I felt quite sure that no matter how successful I was in China, I would not be with the company long after I returned to the US. The independent streak and determination that enabled my success in Asia was poison in the halls of a conservative US corporation's HQ.

From a business perspective, I knew moving to China would be interesting. My concerns about quality of life were reasonable but in the end it was better to ask the kids if they were willing to risk it. As we finalized plans for the move it seemed that I was the only one worried about it.

Shanghai - one of the World's Great Skylines

We arrived in Shanghai on a rare, clear day in August. A typhoon the previous day had cleared the sky for us. Our adventure in China was about to begin but that is a story for another post.

Post Script: After some initial struggles my family flourished in Shanghai. Both my daughters graduated from high school there. The business  prospered, when I returned to the US, the person who replaced me lasted almost a year before he got fired. Of course after two years "home", I got fired (a mercy "killing") too and started Global Lithium.