Ten tips

Vo many companies send their own employees as well as external contractors to China to scrutinize the potential suppliers they are targeting. But such auditing can quickly become costly and inefficient. Instead of an exotic and exciting business trip, employees are often stressed and angry after the trip. The following tips can help.

1. more buffers in planning

I think a detailed hourly planning is indispensable. Every flight should be booked in advance and every trip can be well pre-calculated through Googlemaps. The airports in China are usually a number bigger than you are used to and the delay of departure times is not an exception with such a magnitude. Due to the bad rush hour traffic and the speed limit on Chinese highways, you are allowed to drive at a maximum of 80km/h, and 40km/h in the city. The meeting usually starts ten minutes later and usually ends sooner than you initially agreed. Plan about 20 percent buffer time, as your Chinese friends usually schedule less time. For lunch, you should allow one to one and a half hours, while dinner will take at least three hours. Send your planning to your business partner beforehand and let him or her take part in it so that you can assess whether your planning is feasible in China.

2. the way to the audit

More than 200 billion yuan has been invested in China's rapid transit system project in recent years. In the Pearl River Delta area around Hong Kong, the Yangtze Delta around Shanghai and the region around Beijing, the network of express trains covers almost every corner. You can book tickets online at www.12306.cn. Unfortunately, you will have to ask your business partners for help to book tickets as the website is in Chinese. You can collect the train tickets yourself from the Chinese railway agency at Beijing and Shanghai international airports. You will need to show the booking number and your ID card to do so. You can have all the tickets for your stays in China printed at once when you arrive. Taking the train helps very well to keep your schedules on the ground as it is the fastest and safest.

3. Gift to less important employees

Small gifts make every Chinese business partner happy

Showing friendly respect

But also think about less important employees such as those from sales, executive assistance or quality assurance. With a gift, you show respect for these employees and they will be more likely to work proactively for you during the audit. They will get good accommodations more quickly, travel will be well organized, and coordination will work better. If you make friends with these people, they will also help solve organizational problems that you hadn't previously factored in more easily and quickly. The gift doesn't have to be ostentatious. Chocolates and sweets from the supermarket, cigarettes and cigars from the kiosk or music and souvenirs from the petrol station are all welcome. In a pinch, you can also buy gifts at the airport. A Chinese proverb says, "The gift may be as affordable as a goose feather, but the gesture conveys deep respect."

4. business etiquette

Please put on a suit or, if you are a woman, a business dress, even if your business partner receives you in robber's civilian clothes. The suit increases the esteem and also corresponds to the expectations of the Chinese business partners. They also see you as a role model

It is important to remember that auditing not only critically examines the Chinese partner's system, but also makes system problems transparent to the supplier in order to find a solution together. In other words, you teach, and are expected to teach, your business partner how to make their system work better. You can leave out the tie, however, because in China it is often overdressed. In China, it is more common for restaurant service staff, hotel receptionists or insurance brokers to wear suits with ties. An attractive presentation about your company is also part of business etiquette. The company history, philosophy and tradition should be presented. But also present the positive future, vision and industry experience of your company on the screen with vivid stories.

5. lunch breaks

Your polite host may offer you a three-course meal and a bottle of French red wine. However, be very careful with the consumption of alcohol. It is better to politely decline such an invitation in advance and clearly indicate that lunch should be simple and fast. For example, orders from fast food chains are clean, speedy and safe. If the supplier's factory is located far inland, the popular snacks of fried noodles and rice can also be found there. Use the lunch breaks to get to know your counterpart better and chat about private matters or your experiences in China. Avoid talking about politics. Also, don't complain about China. Such casual and noncommittal conversations give you the chance to get unexpected information about how the company is running, how the employees are doing, what they earn per head, how the employees are trained, where your counterpart has important suppliers, what makes the managing director tick and the like.

6. dinner with the management

Business in China works best on the basis of a good human relationship, then you can also look forward to a harmonious dinner. Invitations to dinner with the management are a very positive sign that the supplier is really interested in a future cooperation. In addition, you get to know the managing directors personally and their philosophy better.

Does the company value quality? Does it want to make further investments to increase productivity and quality levels? How does it see future cooperation with your company, etc.? After you have toasted a few times with the business leaders, the conversation will intensify both about the business and privately. Use these moments to address open issues and communicate honest demands. To save face, the supplier will most likely agree with your opinion and accommodate you

7. bring a video camera

Good video recordings of the plant management are the best raw material for the audit report and also provide important information for the subsequent cost calculation. The potential quality deficit of the plant can be made transparent by analyzing the video recordings. The analysis can also be used to create an FMEA analysis (Failure Mode and Effects Analysis) or "impact analysis" for short, and to conceptualize preventive measures. Most business partners will not prohibit such video recordings. If no recordings are desired, you can argue by signing the non-disclosure agreement (without penalty clause) or by referring to your company's auditing regulations. In the best case, record every step of the production process. In this way, document the entire production process as well as the interfaces (for example, in-house transport and quality assurance inspection; material preparation, etc.).

8. auditing of sub-suppliers

Even if the supplier makes a good impression, you should definitely try to check his main suppliers and sub-suppliers. Many Chinese corporations buy from smaller suppliers they know. There is hardly any company in China that has a vibrant supplier development system. However, the quality deficit could be pre-programmed with a sub-supplier. Most Chinese manufacturers source their goods from sub-suppliers nearby. Visiting these sub-suppliers must be spontaneous, otherwise a bogus sub-supplier will always be introduced. Get an explanation of where the main suppliers are located. Then use the scheduled buffer time to make a surprise visit. Even if there is counter-pressure, insist on your request and refer to the auditing regulations of your management. However, do not be put off by a possible negative first impression of a sub-supplier, rather concentrate on whether the manufacturing process complies with your quality requirements.

9. living processes (better quality control)

Instead of reviewing the QA documents, review each step of the process. The QA documents may have been refreshed before you arrived, but you cannot change the production process and the habits of the employees overnight.

The following points should be considered: How should QA be organized? By In-Process Quality Control (IPQC= random inspection of each work step in the plant by the plant's own quality assurance team) or by plant self-inspection? Within the framework of plant self-inspection, the employee himself checks the parts he has produced for defects and gives the go-ahead for the start of the next work step in accordance with the existing work and inspection instructions. Should the inspection results be entered in a standard document? How should the inspection results be evaluated? Where should the results be stored? Is there a final inspection at each work step? How can you ensure that the parts

Factory self-testing is preferred

are produced and inspected properly, etc.? Statistical Process Control (SPC) is not properly used in China, instead they like to use factory self-inspection to ensure production quality. If SPC is used in practice after all, you should also check exactly how it is implemented. Traceability at a Chinese factory is hardly possible. Therefore, design the system completely from scratch together with the supplier. Even if a traceability system exists, this unfortunately does not necessarily mean that it is logically structured and functions.

10. goodbye

When you leave, you should thank them for the warm and cordial meeting. Praise the auditing. Do not let your business partner take you to the next destination or airport because the chauffeur may overhear your discussion and comments about the operation and ultimately spy on your audit.

Supplier audits in China are basically not that different from supplier audits in other countries. The general principles and processes should also work well in China if the above tips are followed.