China: Shenzhen Redefining “Made in China”
Last week, I was in China. It was my first trip to the city of Shenzhen. I found some great learnings on the role Shenzhen plays to the Chinese economy vs. Beijing/Shanghai. China watchers – analysts, investors and government officials alike – would like to see the country cement their superpower status by becoming a global innovation leader. The government has spent hundreds of billions of dollars against this goal, but, to-date, most agree that few distinctly Chinese “innovations” have emerged.
A recent visit to Shenzhen allowed me to consider what “innovation” really means in the context of China.
Academics Lindtner, Greenspan & Li argue that maker-entrepreneurs in Shenzhen challenge the commonly held binary of a western innovation (‘designed in California’) versus low-quality production (‘made in China’). They assert that Shenzhen’s burgeoning maker culture represents a new type of innovation, and one that is uniquely Chinese. After spending a week immersed in the city, I find this a fascinating viewpoint.
Western tech entrepreneurs have flocked to Shenzhen recently prompting The Guardian to dub it “China’s Silicon Valley.” The city’s vast manufacturing complex – situated in markets like Huaqiangbei – make it a one-stop-shop for turning an idea into a sellable product. (Oculus Rift’s VR glasses & the Pebble smart watch were born here.)
Shenzhen manufacturers find various ways to capitalize on their infrastructure: make knock-off products that slightly improve a branded version, copy Kickstarter concepts before they hit the market, or even produce extra units of branded products to sell sans logo. Increasingly, the manufacturers create new brands aimed at the Chinese market like ascendant Xiaomi.
These practices stem from the oft-maligned shanzai, or counterfeit culture. In it, Shenzhen’s web of producers and makers operate as an informal network and a culture of sharing – much like the open-source software community in the U.S. New media platforms like WeChat mean they can collaborate to make new products 24/7 with unparalleled agility.
This is where – as Lindtner and others point out – Shenzhen maker culture gets interesting. The simplistic view is that Chinese factories simply crank out cheap copycats thus the narrative that the country needs to ‘catch up’ when it comes to innovation. On the ground, however, something distinctively more complex is happening.
As entrepreneurs engage in the process of bringing their ideas to life, they are transformed. Through tactile interactions with the parts, the components and the manufacturers who will put them together, the designs evolve. They get better and more interesting. And, their Chinese ‘makers’ gain their own unique views about ‘who’ the products should be for and the needs they could serve. Increasingly, they are inspired and equipped to bring related concepts to life.
These makers may be departing from others’ initial ideas but they are entrepreneurs in their own rights. They are constantly thinking about what ‘could be’ – what is upmarket, what the market needs, and how they could serve unmet needs. Using their knowledge of the manufacturing process and their connections in the shanzhai community, they move with speed impossible for more established companies to imagine. They take products to market in a manner akin to the celebrated “fail fast, fail cheap” mantra of Silicon Valley – a mentality that has yielded innovations like Siri, Tesla, and self-driving cars.
Shenzhen’s maker culture is increasingly on display in venues like the fast-growing Shenzhen Maker Faire (2016 show happening soon) and in an exploding number of maker and incubator spaces. It is a culture represented by the phrase “innovate with China” that graces the walls of Seeed, Shenzhen’s first maker space (and now a $10M a year business).
This all suggests that perhaps Shenzhen (and China) is a culture with a very different perception of innovation, one that is collectivist (like many aspects of Asian life) versus the more individualistic western concept. Perhaps China doesn’t need to “catch up” but is creating its own unique culture of innovation. It is a nimble one that may have more in common with western software design protocol where products are shipped before they are perfect and companies look to “iterate fast” with consumers.
This culture might even inspire western entrepreneurs, who face the reality of needing to “just start” with a new innovation if they are to have any hope of staying ahead of the competition.
This leaves us to wonder what exciting possibilities emerge when design happens at the site of production? Where the boundary between imagining & making blurs, there may be new offerings, new brands and new consumer markets for the makers of Shenzhen – and their western collaborators.
