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Wang Laboratories subsequent fall was dramatic even by the standards of the unpredictable
computer industry. The company posted its first loss the year after Fred Wang took over the
business. 90% of its market capitalization had disappeared within 4 years, and in 1992 it filed for
bankruptcy. The elder Wang was finally forced to admit that his son couldnt handle the job and
had to fire him.
The story of Wang Laboratories, although far removed from China itself, shows us a fundamental
truth about Chinese business; despite the modern facade of Chinese business around the world, it
continues to be based on family ties. The Chinese family provides the social capital to start up the
business, but it also imposes a limitation, which prevents them evolving into lasting, large scale
institutions.



, (Assertion, Development)

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_01)
Giving responsibility to work teams limits the division of labour. Workers are trained to do a wide
range of tasks so they can be moved around as the need arises.

_02)
Workers need a broad range of skills to see the manufacturing process as a whole. The
investment in training therefore has to be much higher that in traditional systems.

_03)
The essence of lean manufacturing is the creation of an extremely fragile manufacturing system
that can be disrupted by any worker. Stocks are kept at an extremely low level and any worker can
bring the production line to a stop if he sees a problem.



, (Assertion, Example)

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_01)
The Great Depression sent the auto industry into a period of massive unemployment and clashes
between workers and police. At the infamous battle of River Rouge in 1932, four workers were
killed by gunfire.

_02)
One of Asia's oldest stock exchanges is in Hong Kong. Share trading in the Crown Colony dates
back to 1866, and the Hong Kong Stock Exchange dates from 1891.