Due to such "wise decisions," small computers for office use have made their way into the Taiwan market. And, because of these "wise decisions," Wang Laboratories, Inc., one of the world's leading office automation companies, has gained a solid foothold in Taiwan's growing market—it has maintained an annual growth rate of over 40 percent for the past five years, to reach an NT$560 million (US$14 million) annual sales volume in 1981. It is number one in the market in word processors and small computers.
At the same time, Wang's manufacturing plants in Taiwan have also seen solid growth since their founding in 1967. Wang expects to export US$50 million worth of monitors, quality assurance testing devices, and various parts to the U.S. and Europe in 1982 from a newly completed plant in Yangmei, northern Taiwan.
But what especially distinguishes Wang from other computer manufacturers in Taiwan is its in-depth commitment to research and development. Recently, Wang set up a research and development center at the Hsinchu Science-Industrial Park. It is the first, and at present the only, Wang R&D center outside the United States.
Dr. An Wang, the founder of the Laboratories, is a Shanghai-born Chinese-American, who first went to the United States in his late 20's to work for a Ph.D. in applied physics at Harvard University. The cultural affinity may explain part of the reasons for his present investment in Taiwan, but so large a business decision required a greater basis than just cultural factors.
Dr. An Wang calls Taiwan "an international symbol of the genius and opportunity of the free enterprise system." On his second visit to Taiwan last November, he noted that the partnership between the public sector and the private sector in Taiwan has decisively promoted economic growth. He credited educational levels on the island as important factors in Taiwan's fast-developing technology. "Taiwan's careful attention to education has turned out a generation of well-trained professionals," he said.
In the past 30 years, Taiwan has created a solid foundation for high technology, and electronics is now the second leading industry.
After carefully surveying the situation, Dr. Wang concluded that he is fully confident of the prospects for the ROC government's plan to expand capacity (in the production of computer and data processing equipment here), to encourage further development and technical upgrading of high technology, and to pave the way for the growth of high technology as an export industry. Wang pledges "partnership and cooperation."
The electronics industry, which began in Taiwan in 1960, became one of the most important industries in Taiwan by the 80's with US$360 million in exports in 1980, and US$410 million worth of exports in 1981. Moreover, its achievements in micro-processor and microcomputer manufacturing have won recognition-and elicited some amazement-from the world community of science and technology. It has also become the example, for developing countries, of the process for creating high value, high technology products.
The maturity Taiwan has demonstrated in the electronics industry reflects its ample supply of engineering professionals. Because of the emphasis on professional education, as well as on basic skill training, the engineering graduates turned out from Taiwan schools every year exceed the number graduated in the U.S. proportional to the population.
Frederick Wang, senior vice president in charge of R&D at Wang head-quarters, adds, "Taiwan provides a relatively secure climate in social environment. Geographical affinity to the markets in Japan, Korea, and Southeast Asia is also an important factor to be considered."
In making the decision to invest in Taiwan, Wang's executives realized there were problems to be solved, too. Labor costs in Taiwan are not the lowest in the area. And there are problems of quality control and of coordination with other precision industries. Yet, to Wang's executives, these were not problems too difficult to solve; rather, the question was whether it was worthwhile to face them. "Someone had to start. Wang Laboratories has now made a long-term commitment to Taiwan," said Victor Ku, general manager for R&D at Wang, Taiwan.
Dr. Wang is the inventor of the core memory. He sold the rights to IBM for US$500,000 and used this capital to create Wang Laboratories in Boston in the early 50's. Since, Wang Laboratories has developed many new products and processes, such as computerized typesetting and electronic scoreboards, and has maintained research and development's importance within the company. Last year, Wang Laboratories invested US$90 million, or 8 percent of its annual sales of over US$1 billion, into R&D.
The objective is to link the machines to Asian languages and cultures
In line with its traditional concentration on "foresight and technological advancement," Wang' set up an R&D group in Taiwan: some 30 engineers at Hsinchu are committed to the development of products meant specifically for the Asian area, such as special systems for different languages, instead of traditional computers that speak English only.
The written Chinese language, along with Korean and Japanese, is ideographic in nature, unlike the alphabetical languages of the West. "We are working on development of a multi-lingual system, one that can speak not only English, but Oriental languages," explained John Feng, president of Wang Computer, Taiwan.
Most of the engineers at the Wang R&D center are very young, under 30, and are locally trained—graduates of Taiwan universities who majored in the computer sciences or electronic engineering.
In fact, all staff members in Wang Laboratories' overseas operations are recruited in the operational areas. Of the 600 personnel at the company's three branches in Taiwan, only two are from U.S. headquarters.
Engineers signed on in Taiwan go through a three-month training session at headquarters in Massachusetts before starting on research projects at Hsinchu. "With careful guidance, it usually takes half a year to a year for them to conduct independent work," reports H.L. Lee, deputy general manager of Wang's Hsinchu operation.
The concise and youthful group reveals its aggressive and agile side in the development of its own R&D projects. Instead of the months and years of planning and waiting normal to large organizations, they can usually push a research project through in several months, with satisfying results.
Wang is not worried about the lack of senior staff. "We will create our own R&D environment," insisted Feng, who is in overall charge of projects in Taiwan. "We realize our group is very young. But we also feel that if we provide a good R&D environment plus well-organized projects, we will attract those engineers we may require to join our work."
Eventually, they envision creation of a "hundred-percent Chinese computer," a computer that not only speaks Chinese, but is also designed, manufactured, and utilized by the Chinese.
For the moment, Wang operations here are busy concentrating on technical transfers as the first stage of the research and development projects. This includes transfer of technology applications, as well as of management methods, such as management by objective.
Wang has made over US$10 million worth of investments in the ROC so far. It has also engaged in technical exchange programs with Taiwan electronic firms and other research institutions, and has trained ROC technicians at U.S. facilities. Many engineers at Wang manufacturing and sales branches here have undergone two-year training courses in the U.S. Wang hopes such cooperation will maximize Taiwan's relative strength in product development; in turn, Taiwan can provide advanced product definition and system design.
Since the U.S. market has now stabilized, and the growth rate in the European market is low, the most promising computer market is in Asia. With the establishment of the R&D center at Hsinchu, Wang hopes to be at the fore-front of computer developments in the Asian region.
The imperative, then, is to create a system that speaks local languages, one that can be used not only by computer experts, but by laymen, such as office workers.
Computer output is no problem. Most computer systems can produce beautiful images for all ideographic languages. What Wang, along with several other major computer companies in Taiwan, is working towards, is a satisfactory input (software) system that anyone can use with brief training.
"Although engineers at our head-quarters were working on this problem, the results were not ideal because of regional differences in documentation and customs. Dr. Wang saw, then, the need to move the research project to Asia, to the place where people would understand the difference," explained a senior research engineer.
How to make a computer speak your language is, of course, one of the most important factors in developing a "Chinese computer." But, the problem is not limited to this. If the computer is to be used in every office, it also has to accommodate local customs and other local requirements.
For example, by using office automation (OA) machines, one can save time in writing, locating, and filing office memos.
In the office—Computer, program, and people, smoothly linked
But not necessarily so in a Chinese office, using the OA machines as they now exist. The "memo," as an example, is essentially a Western concept: it includes all the things, of which one office worker needs to inform another, involving matters in or outside the office. Under the Chinese office system, however, the "memo" can be further classified into han, or letters from one office to another; cheng, or memos from a lower ranking officer to a higher one; ling, or memos from a higher official to a lower one, etc.
And, in the communication between offices, people usually require original copies certified with an office seal. Computers cannot print traditional seals, by nature.
How to modify the current system to accommodate the Chinese way has become a central tropic at Wang's R&D center in Hsinchu.
An example of another problem arising from social custom: Taiwan is going through a transformation stage from family-ownership capitalism to one of professional management. Many companies, especially those who would most benefit from the type of OA machines Wang can provide, are still managed by traditional owners and their immediate families. One of the big advantages to such companies in using computerized systems, is the conveniences in OA inventory control. However, since all owners are family members, it is difficult to establish the required rigid registration system for inventory, since it requires a strict management discipline of such family members.
In this case, computer and human beings require more communication. While the computer needs to consider human factors, human beings, sometimes, have to change their concepts and behavior patterns to accommodate a computer system.
Wang's executives in Taiwan, in that respect, insist, nevertheless, that traditionally oriented Chinese are not only suitable to work in computer fields, but are also suitable for employing computers. "After all," notes H.L. Lee, "the Chinese are patient, pay attention to details, and are good at planning for the future, all attributes needed for computer operation."
To Wang, as well as other computer firms in Taiwan, the future will largely depend on whether the market they themselves depend on can support their projects. But, "I do not think we have to worry about it," said Feng confidently.
"We have a steadily growing market. The future is unlimited to us," added Jackson Lin, who is in charge of Wang sales in Taiwan. "The government's encouragement and the private companies' efforts have put the computer industry high on Taiwan's list of developmental priori ties."
Because it seeks development, Wang Laboratories has no intention of setting up facilities in mainland China. Denying rumors that it might, Dr. An Wang asserted in a Taipei press conference last November, that he believes that economic growth requires a positive public-private partnership; but, since under Communism there is no freedom for private enterprise, there will, therefore, be no growth, he stated.
It is, of course, too early to tell whether Wang's research and development center in Taiwan will payoff in materialistic terms. While the Wang staff works toward the vision of a one hundred percent Chinese computer, it has already contributed to Taiwan's information industry, in the sense of pushing it from a manufacture-centered industry to one involved in original design.