Asians
have a deep consciousness of their past predominance. Even as the
Hellenistic and Roman empires blossomed, China built its own imperium.
And when Europe collapsed into semi-barbarism, China developed the
world's most advanced civilization, as the originator of paper,
gunpowder and the printing press. Even as late as the mid-eighteenth
century, admiring Europeans such as Leibniz and Voltaire considered
the Chinese Confucian system a role model which European monarchs
should, in the words of Voltaire, "admire and blush-but above all
imitate."The habits bred by such long-standing superiority led
many in China at first to reject European-style science, industry and
capitalism. Although some Chinese intellectuals advocated the
abolishing of Confucianism in their societies-equivalent to abolishing
all Christian influences in the United States-a more predominant view
held that Western ideas and the Confucian system were utterly
incompatible. "The barbarians do not recognize the moral
obligations between ruler and minister, father and son elder brother
and younger brother, husband and wife," argued Chu I Hsin, an
important late-nineteenth century Confucian scholar. "Barbarian
institutions are based on barbarian principles."
Yet over time
many Asians-impressed by the superior material and military power of
the Europeans-sought ways to blend Confucian precepts with modern
European economic systems. Rather than accepting the Lockean concept
of a "state of nature," the Asian societies have generally
tended toward careful cultivation, insulating and controlling their
social and economic conditions to the greatest extent possible. Even
with the massive flows of products, information and capital across the
Pacific, the ancient virtues still find expression.
At the center
lies an attempt to maintain the traditionally strong cocoon of social
and psychological supports. Rather than being an unalloyed pursuit of
profit, capitalist motives are often interwoven with an evolving set
of duties and obligations. Among the over 46 million overseas Chinese
who have little in the way of strong political loyalties, the key
emphasis is on serving the interests of the family and its trusted
retainers.
K.S. Chung, an entrepreneur reared in Canton and
Singapore, learned the Confucian fundamentals at home. Today he
instructs his children and grandchildren in the same principles.
At
eighty-three, Chung heads over thirty family-owned enterprises spread
from Bangkok and Hong Kong to Los Angeles and Zurich, with 1986 sales
of over $100 million. A man of simple tastes and unpretentious
appearance, Chung reflects the "Western notion" of the
totally self-interested entrepreneur who considers his success proof
of basic superiority. In truth the "superior man" achieves
the Confucian quality of jen by being gentle, responsive, charitable
and selfless in the service of others;
The highest duty of man is to
create and produce. You should not think how are lucky, due to the
environment's whimsical position, to be placed in the responsible
position of planning a productive project. To be successful, you have
to enlist other people's willing co-operation...In other words,
according to Confucian humanism, all men are born spiritually equal
though they may not
be
materialistically the same. You have to treat everyone with respect
and dignity ...This will encourage him to contribute his best effort
in cooperation.
According to Chung, the entrepreneurial attainment
of personal material goods is secondary to the promotion of a common
interest with others, particularly within the clan and its followers.
This approach explains much of why entrepreneurs throughout Asia
-whether in controlled systems or in the free-for-all of Hong Kong -
often approach their enterprises with a longer-range, fundamentally
group-oriented mentality. Within the Chung operations this has meant a
willingness to absorb losses for as long as five years in developing
such diverse new businesses as growing tobacco in Thailand or selling
microcomputers in mainland China. Large sums are also set aside to
send family members, and trusted retainers, for advanced training at
schools in both Europe and the United States.
"Our goal is not
just to make money this year or next," notes Chung's son and heir
apparent Wing, an engineer trained at the University of California at
Berkeley and at Columbia University. "We think in terms of
passing the company on to our children and their children. Nothing we
do really makes sense unless you see it in the context of the
family." These attitudes are not confined to Asia; our new
immigrants bring them to business and life in the United States.
In
Japan, Korea and some other Asian states, this profound sense of
long-term commitment often has been made to extend to the nation as
well. Confronted by foreign Western powers armed with vastly superior
economic, military and technological power, the samurai behind the
1868 Meiji Restoration overthrew the decaying shogunate and
consciously sought to remold the social structure to encourage
commerce and industry, the pursuit of money, as being the best way to
defend the nation. Yet they, too, recoiled at the prospect of becoming
"Westernized."
The Meiji leaders' solution was
"Western technology, Eastern spirit." The reformers
essentially turned the pursuit of profit, previously classified as
despicable, intoo a noble pursuit-the balance sheet equivalent of the
samurai sword. Yet the ethics remained, as in the Chung family,
founded on something other than short-term ego gratification. Profits
were necessary, but not primary. Even as they urged adoption of the
latest Western technologies and economic systems, the Meiji leaders
sought to preserve traditional Confucian values. As Eiichi Shibusawa,
one of Japan's earliest industrial leaders, wrote in 1873:
Those who
return from abroad ... cite how much better than in Japan is
everything in those counties, not only their cities, their currencies,
land reclamation methods and commerce, but their armies, scholarship,
parliamentary processes, laws, steam and electrical power, clothing
and machines, For the advancement of our civilization, they declare
that Japan must emulate the West in all these things...Yet if the form
of things is given too great an emphasis and the substance is
neglected, government will go against its people; institutions will
thrive while the people are impoverished, and living standards may
rise while the strength of the nation withers. For all the merits of
foreign things, the nation itself will risk bankruptcy before it even
has seen success...
Yet in a world marked by extreme economic turbulence, being "entrepreneurs on the run" has its advantages.
When K.S. Chung arrived in Bangkok, he certainly had schooled-himself in survival economics. Since the
1930s he had built several businesses-ranging from commodity trading in Malaysia and restaurants and
newspapers in Canton, to a Hong Kong steel business and a flourishing postwar Japan-China trading
company-only to see them perish because of corrupt officials, wars and civil insurrections.
"I started with a failure and had many others." Chung recalls, sipping a cup of hot tea on a muggy Bangkok
afternoon, "but that's how the family got its training. Setbacks are not really bad. They make you grow up in
your business philosophy.
Such attitudes might violate ethics in societies such as Germany or Japan, where failure is considered a
disgrace, but they work in entrepreneurial societies, whether in Asia or the United States, Starting virtually from
scratch, and with thirteen children to support, Chung opened a small cookies shop and set up a company
shipping Thai produce to Japan. Although Bangkok, where one person in ten is of Chinese descent, remains
among the most congenial locales for members of the Chinese diaspora, Chung took no chances. He sent
many of his children abroad for schooling and today Chung family members hold citizenships in the United
States, Canada, the United Kingdom and Switzerland.
Alternating between his base in Bangkok and a new trading firm in Hong Kong, Chung took full advantage of the
family's dispersion. While the Bangkok -based family members developed a profitable tobacco and produce
business in Thailand, son Kim-married to a Swiss woman and living in Zurich-opened a European textile and
watch-importing business. Another son Wing, moved to Los Angeles, where he helped launch a new
microcomputer firm.
To a casual observer it is almost impossible to make sense of the far-flung Chung empire. There are no clearly
delineated chains of command, and although there's a board of directors, no one can recalls ever being
convened. But according to K.S., such formalities are unnecessary. What the Chungs are selling, he explains,
is not things like wristwatches, computers or tobacco, but the family members themselves," he explains. "By
keeping them in different places, we maintain the maximum flexibility to do our trading, no matter what happens
in any one place."
For the future, however, the place K.S. is focusing on is his native China. When China began opening its doors
to outsiders in 1972, K.S. seized the opportunity to gain exit permits for several family members still on the
mainland. While son Wing was badgering for the first shipments of U.S. tobacco to China since the Korean
War. Soon some of the very family members who had been rescued from poverty in China were sent back, this
time with American or Canadian passports, to exploit their old contacts within the Communist bureaucracy. By
the mid-1980s the family owned a taxicab company in Canton, sold American computers to the Chinese
government and started shipping a host of products-ranging from silk lingerie.to wrist watches.
As more Chinese entrepreneurs leave Hong Kong. Taiwan and other locales for the United States, the benefits
of this connection for American businesses will grow. In the dark days after the collapse of his father's
Japanese enterprise, Wing Chung lived with his grandparents in a tiny apartment in Hong Kong, sharing a bed
with two of his brothers. But by 1958, the family's finances had sufficiently improved to send him to the
University of California at Berkeley, where he received a degree in mathematical statistics. He went on to earn
a master's degree from Columbia University and an IBM Watson Fellowship.
Before Wing's arrival at Berkeley, the Chungs had little to do with America. But Americanization proceeded
quickly. Eschewing the family business, Wing joined Hoffman LaRoche, the pharmaceutical giant, married a
Chinese woman from an upper-class Beijing family and settled down to a comfortable life in suburban New
Jersey.
When he finally succumbed to K.S.'s blandishments and joined the family business, Wing brought with him
many American ideas. One key concept was to move the family away from the commodity-tracing business
and into more technology-intensive fields. In 1978, Wing convinced the family to invest $50,000 in Action
Computer Enterprises, a fledgling microcomputer firm in Pasadena, California. The first sales of the company's
product were for use in the family's Thai tobacco-growing operations. Later, using K.S.'s carefully cultivated
local connections, Action also started selling computers to government agencies and banks in Thailand.
But Wing soon focused attention on the newly opened Chinese market. Although virtually every major computer
manufacture in the world was assaulting this seemingly bottomless market, tiny Action flourished in China. By
1984, operating with a staff of twenty-five sales and service personnel in Hong Kong, Action was enjoying sales
in China accounting for nearly one-third of its total $5 million in revenues.
More recently, the Chungs have expanded their American connection, with several family members-including
K.S.'s heir apparent, Wing-taking U.S. citizenship while the offspring of even the distant Bangkok branch of the
family are shuffled off to American schools. Even the family's unofficial newspaper, the Chungs' Times, is
printed on a Macintosh in Wing's son Ivan's bedroom in suburban Claremont, California.
At the same time, the family's business operations have also grown in the United States, including a
silk-importing business in Los Angles and planned garment factory. Perhaps more important, however, is a
newly established computer operation known as Universal Digital Computer Corporation (UDC). Run from a
small suburban office in La Mirada, California, UDC sold roughly $5 million worth of high-technology equipment
in its first year of operation. By 1987, the company had won a contract to distribute Convergent Technologies's
powerful new microcomputers in China.
It proved an auspicious arrangement, both for the Silicon Valley manufacturer and the Chungs. Using
connections cultivated during the years with Action, UDC president Victor Chung, a former Red Guard rescued
by the family in the mid-1970s, followed his grandfather's business methods, networking carefully deep into the
Communist Party bureaucracy. These connections reaped over $4 million worth of sales in 1987, including a
key contract with the Industrial and Commercial Bank of China, which controls more than half of the retail
banking trade in the People's Republic.
"We've been building our reputation with the Chinese Administration of Technology Industries for years,"
observes the thirty-two-year-old Victor, now a model capitalist in a freshly pressed blue suit and white shirt.
"We may be a small family business with limited resources and no [proprietary] product, but we have the
connections. That gives us an excellent chance."
In the years ahead the Chungs-like many of the Chinese diaspora-plan on expanding their role as conduits
between Asia and the United States. Like British mechanics, German scientists, Jewish scholars and
Japanese farmers of the past, the Chinese trader now is adding new assets to the nation's economic wealth.
"We will always have our links back there. China must be the future market for us, and Hong Kong a key base
of operations, "Wing Chung said over lunch at a Los Angles restaurant. "But for us, for the kids, for the family,
the real base-our home - will be here in America. Of all possible worlds, this is the best choice."
