A Journey from the West

The BizSec Podcast is THE podcast that brings information security concepts and news into the boardroom, translating geek into business. Each episode we’re going to be talking about information security and technology security issues that matter to business, not just the technologists. We’re glad to have you subscribed on iTunes, Youtube or however you’re finding us and we always appreciate your 5-star reviews. Follow the conversation with us on Twitter @bizsecpodcast and find more information, links and show notes at BizSecPodcast.com. This episode: Our friend Zlatko Unger talks about his recent trip to Beijing and Shanghai with his MBA classmates

  • What are the advantages of leveraging resources and assets in China?
  • How safe is intellectual property?
  • What are some techniques of leveraging the advantages of producing in China, while keeping your IP safe? 

Back in April of 2013, Zlatko Unger’s MBA class went to China to get a better idea of how different businesses operate inside the country. During the two week stay, they visited several foreign branches of American businesses, a couple of factories, as well as a state owned steel plant. Below, Zlatko explains some of his observations during the trip.

There are many business advantages by leveraging resources and assets in China. The country offers lower cost of labor and high skill. This is important when it comes to R&D. Low skill, very low cost labor is also available for manufacturing products. Nowadays, most global organizations now have some presence in China. This is also a high amount of competition bidding for your business as there are many Chinese companies with  long track records of helping foreign organizations.

 There are  many potential risks with going into China. There are people or groups in China that are allegedly behind many industrial espionage events over the last 5-10 years. Foreigners feel that a  large fear that intellectual property will be lost. Additionally, there is a feat that one’s devices would be chipped or bugged for spying purposes. While in China, there are a lot of blocked sites that typical Westerners enjoy. For example, Facebook and Twitter are completely cut off, while FourSquare and Instagram work great. There are alternatives to Facebook and Twitter that are solely used in China. The majority of Zlatko’s peers were unaware of the depth of these blocks, but made do without relying on these social platforms.

When it comes to personal safety, unless you draw attention to yourself, you will not feel targeted. Metropolises like Beijing and Shanghai are quite crowded, but at no point was anyone’s safety concerned. However, when it came to accessing the internet from different devices, open access points, and un-secure log-ins were plentiful. Additionally, there were not many deterrents to someone capturing the open traffic at different hotel lobbies.

However, these security factors greatly differ when it comes to doing business in China. One view into doing business there is that if everyone else is doing it, so why shouldn’t we? A company must assess all levels of security from the initial communication, to first visit, and well beyond an ongoing partnership. Understanding the complex cultural differences in our cultures should be the starting point. Intellectual property is not treated the same way, and a company should only share the necessary components to get the business going. If there is a compromise, there might be a set of time before the IP is leveraged in the same market. Therefore, careful analysis of risk mitigation techniques should be used at all times.

In a future podcast we hope to cover how a business should go to market in China. Additionally we will talk about solving the security issues wile being in China. This will cover disposable phones and tables, to secure infrastructure for data sharing between a contact and home-base.