Q. What challenges do you face doing business in China? A. Language and feng shui
The first answer came as no surprise, but feng shui? Really?
DWA Architects is a chartered architectural practice with offices in York, Warrington and London. Over 26 years it has built up an international reputation for excellence in the field of post-hospital care – from childcare to elderly care, delivering tailored accommodation for dementia sufferers, for example. Mel Fairbourn-Varley, Director of International Projects attended a training seminar I presented at recently in Leeds – we've continued the conversation since then, and he kindly agreed to Skype me and answer a few question about his experience of doing business in China.
First I ask: why is there a need for DWA's services in China? "It's because of our expertise in elderly care" he replies.
Design for elderly care is DWA's main business in the UK, and about six years ago they began to develop into international markets too. "The most successful UK architects always do more business overseas than they do at home. The leading UK practices have as much as 80% overseas", says Mel. DWA began by researching the Arabian Gulf States of the UAE, Bahrain and Qatar, and soon entered into a collaboration with Age Concern International (from Holland, now also based in Luxor, Egypt) which resulted in the development of a unique elderly-care assisted living model specifically suited to the Arab culture of that region. This approach is typical of DWA – their design solutions come through collaboration with trusted UK and international partners with expertise in real estate, operations and staff training...plus lots of locally based research.
A few years ago they were approached by Beijing-based TLD Design Consulting to develop a new elderly-care model for the Chinese market, which with a projected demographic of 300 million over the age of 65 by 2050, is the largest single market for elderly care internationally. This collaboration has now resulted in DWA's first project in China – and it's a big one!
Located in Shunde, Guangdong province, the Shunde Care Village project came about through an inventive collaboration between two parties: i) local government, who are providing the land for development, and ii) a local Chinese charitable foundation, who are paying for and building the Care Village, with accommodation for 750 residents, including both assisted- and independent-living options. A further 450 apartments are planned for Phase 2, a couple of years later. That's huge by UK standards.
Size is not all that marks this project out as unusual. The clients say they want to impact China's senior care market by showing that public-philanthropic-business partnerships like theirs can deliver high quality, affordable, specialised care for local people. They are insisting on the inclusion of specialist dementia care too – unusual for a private project of this kind in China. And their plan is also that delivery of care will be self-sustaining, not needing any ongoing funding by either party.
The Trust searched China for two years, looking for the right architect for this project, before concluding instead that they needed to invite designs from overseas. Early in 2013, DWA Architects were invited to enter this competition, as were international practices from Hong Kong and Denmark. Mel's team designed a solution, presented it to the stakeholders, and won the contract.
To be successful, DWA Architects had to produce an operationally efficient architectural design, suited to the requirements of Guangdong social culture, and tailored to meet the complex operational and care needs of both residents and client. The local knowledge brought by TLD Design Consulting was invaluable in developing a winning solution.
Why couldn't the clients find a domestic architect to suit their needs? "Because, I think, they recognized that the design quality of care provision in China is currently relatively poor, and that up till now most of the provision, including building design, has been institutional and government-funded... Because of a change in policy, the private sector is now being pushed towards the elderly-care market – partly by real-estate companies, and partly by insurance and pension providers. Investors and real-estate developers are now being encouraged to allocate land for elderly care and assisted living on a percentage basis, against sometimes stringent town planning policies. But the local market is not responding well to this, because they don't have the expertise to provide a good private-sector business answer."
So the Chinese government is encouraging investment into elderly-care, and has even lifted restrictions on foreign investment into this sector. "They've realized they can't deal with it on their own", says Mel.
I put it to him that, whereas Western countries began with an aspirational model of elderly –care and have had to develop that to include more acute and palliative care provision, till recently China's only model of residential care outside the family has been that of institutional care in "welfare homes". Some welfare homes, particularly within the western provinces, even combined care for orphans, those with physical disabilities or learning difficulties, and the elderly under a single roof – albeit in different "departments" – with the result that some people might grow into adulthood and remain in the same institution for life. One such welfare home that I visited repeatedly a few years ago, though brand-new and purpose built, showed no attempt to provide architecturally for the needs of these very different groups of people. Similarly, the majority of staff were generalists, and might simply be rotated between (say) nursing infants with Downs syndrome, the dementia unit, and adult physiotherapy. With state-run welfare homes like this being common in China, and still being commissioned, it's not difficult to see why the private sector is turning the West for better models.
Mel hasn't seen the kind of institution that I described, but he says it explains some of the "horrendous" designs he saw at the China Senior Living Expo 2013: "it was because they were designing institutions" and also on site visits in both Beijing and across the Guangzhou region.
Changing tack, I ask Mel about his involvement with the UK Shunde Business Association. "They were more interested in getting people to invest in Shunde than in promoting exports to there from the UK" he replies, "but now, as it happens, we are looking to open a DWA Architects base in Shunde through CBBC's Launchpad program, so the thing has actually come full circle". As well as a bit of involvement with UK-Shunde, Mel is involved with The Health Consortium UK, a group of northern-based health companies wanting to export their services to China, and the Leeds City Region China Business Club, founded to encourage investment into the Leeds City Region.
I'm impressed with the way in which DWA is taking a holistic approach to its China business relationships – such parallel activity gives Chinese partners extra points of reference, enabling them to do a kind of 'triangulation' operation, and locate us with greater confidence on their map of relationships. Mel mentions that DWA are in the process of finalizing an agreement with a Shanghai investment company to provide a number of elderly-care homes for Shanghai. Prestigious projects like this, along with local offices, connections with government, universities and local businesses, and regular visits, all provide triangulation points for potential partners and clients as they seek to establish trust.
What challenges have they faced? "I'll tell you about two – language and a cultural one related to feng shui" replies Mel. Feng shui? Seriously? Seriously. It seems that when bidding for the Shunde Project they beat all other competition in terms of understanding and meeting the design brief, "but what shot us in the foot was our lack of understanding of feng shui – we'd got our building completely the wrong way round! In the West, we like to have our bedroom windows' orientation east – west, but in Shunde they needed to be north-south" [he laughs] "so we had to go back to the drawing board. We were asked to hold on to our design concept but re-orientate it. Interestingly we've found that in different parts of China, different feng shui rules apply. So now we submit our initial thoughts to the client, and they employ their own local feng shui consultant to advise us on such matters.
"The second challenge is the language itself – especially in large meetings. For instance, the Trust that is our client for the Shunde project has about 20 people on its board. When I'm making a presentation to them they are very dynamic (in good Guangzhou fashion). They throw their arms around and shout at each other a lot in Chinese. I'm sitting there quite shocked, thinking I've put my foot in it. I turn to our partners and ask what's going on, and they say no, no Mel – they are all agreeing with you. They're trying to convince each other that they are wrong and you're right.
"In southern China, just across from Hong Kong, English isn't widely spoken, even by young people. In Beijing, English is more widely spoken. It's been a real challenge, and I'm not the best person at languages anyway." DWA's partners provide the interpreters and translators, but even then he can't be sure he's getting the full picture. And the meetings often go on all day, so they are very tiring. It might help if there were a pair of interpreters who could work like a tag-team. At least he gives them the full transcripts of his presentations in advance [NB. speaking as an occasional and not-very-good interpreter, I hope you do that too!].
As well as TLD Design Consulting, CBBC and UKTI, Mel draws on the news media and academia in order to understand market and demographic trends – he finds them more helpful than "sanitized" Chinese government sources. "And I'm building up a library of books" he laughs – (I sense that might be a hobby he enjoys too).
One study that I mentioned to him during the course of this interview was Enabling Business Opportunities for UK Companies in China's Elderly Care Markets – an excellent and detailed CBBC-sponsored report from 2013 (albeit with a slightly clunky title). I recommend anyone who is interested in elderly care in China to get a copy and read it. Of course Mel has. It turns out he was part of the UK team who contributed to it.
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