ITT's long history in China
ITT was founded in 1920 as the telecommunications company International Telephone and Telegraph. The company gradually expanded its business into the insurance, hotel, and manufacturing sectors until 1995 when the company split up and created ITT Industries, which is the legal successor to the original ITT. In 2002 the company, which is headquartered in White Plains, New York, had global sales of $4.9 billion and employed 38,000 people. Today, the company is made up of four main divisions: fluid technology (39 percent of revenue), defense electronics and services (30 percent), motion and flow control (19 percent), and electronic components (12 percent). ITT Industries is the world's largest pump maker—producing systems and services to move and control water and other fluids.

ITT's presence in China dates back to 1928 when the company established the country's first major telecommunications exchange system. Today, ITT Industries has roughly 7,500 employees in China with a total investment of more than $100 million, making China one of ITT's major manufacturing bases. The company manages its investments in China through a Beijing holding company and has 10 facilities in eight cities: Nanjing and Nantong, Jiangsu; Shanghai; Shenyang, Liaoning; Shenzhen; Tianjin; Xiamen, Fujian; and Zhenjiang, Jiangsu (see Box: ITT's Ten Manufacturing Sites in China).

"China is very strategic to ITT's future, and our products and services fit the PRC government's development plans well," remarked Mark Steele, president of ITT Industries-China, referring to the company's water and wastewater pump systems and electronic components. To pursue these opportunities and expand its position as a key supplier to the China market, ITT continues to move production lines from North America and Europe to China. The company is also diversifying from manufacturing traditional pumps to producing systems that not only pump water, but also clean and treat it.

It's in the water
Roughly seventy percent of China's population still lives in the countryside and needs water management systems for agriculture and daily life. Thomas R. Martin, ITT Industries senior vice president and director of corporate relations says, "China includes water management as a top developmental priority. The PRC government recognizes the connection between development, public health, and safe water. Many people don't realize that unsafe drinking water is a global problem and is not confined to less-developed countries. Each year roughly 2.2 million people die of water-related diseases worldwide, the majority children under five. Globally, one-half of all people don't have access to clean water, and the vast majority of these are in Asia. Although Asia accounts for roughly 60 percent of the global population, it has less than 40 percent of the world's usable water supply."

In China, ITT manufactures two main types of fluid technology products: pumps (which can involve water, sewage, irrigation, and drainage) and filtration systems used in the treatment of water and wastewater. Steele adds, "A lot of the pumps we manufacture are made with new, high-level technology that have added value by using less energy to operate. Our pump solutions can reduce the cost of pumping by as much as 40 percent, saving our customers money in the long term. Although China's wastewater market is fragmented, with roughly 80 percent of the nation's pumps supplied by indigenous manufacturers, ITT is one of the largest pump manufacturers...and is well positioned to address the country's future requirements."

ITT's customers in China are frequently cities and project-based corporations working on major government infrastructure projects such as the Three Gorges Dam, the South-North water diversion project, and the country's numerous wastewater initiatives. ITT's Goulds pumps are installed in the Three Gorges Dam, and the company's Flygt, Lowara, and Goulds products are being positioned for projects tied to the 2008 Olympics in Beijing. (ITT's Flygt Division built an artificial white water course for the 2000 Olympics in Sydney, Australia.)

An investment in people
ITT's largely Chinese staff is helping China build its infrastructure through the company's pump systems and electronic components. "People are our strength. By providing employees with training and leadership opportunities, our organization ultimately becomes rich in talent, especially when employees stay on board for long-term careers," Steele remarked.

Steele—who in his spare time has climbed to the Mount Everest base camp, skied to the North Pole, and completed a six-day, 150-mile marathon through the Sahara desert—worked in ITT's Hong Kong-based electronic components group for nine years before moving to his Shanghai post in November 2002. As ITT Industries' China president, Steele focuses on government and legislative affairs, corporate development, internal systems, and management development—which includes training ITT's China workforce on the company's key management disciplines, including its Value-Based Six Sigma (VBSS) certification program. VBSS is a management discipline that encourages employees to work efficiently, focus on quality, and learn to solve problems—ultimately, Steele asserts, creating internal expertise and improving value for customers.

ITT Industries introduced its extensive nine-month VBSS certification program in 2000. The program operates under a black-belt hierarchy—with "champion" as the highest ranking, followed by black belts and green belts. The program also integrates elements of the company's Value-Based Management program, which goes beyond cost to assess overall project value.

Steele said he is confident that ITT's long-standing presence in China and the company's manufacturing "footprint" and talented workforce will enable ITT to contribute successfully to China's development.

	ITT's Ten Manufacturing Sites in China
	Fluid Technology Nanjing Goulds Pumps Ltd. Joint venture established in 1985; makes pumps for agricultural market and municipal and construction trades. ITT Flygt Shenyang Joint venture established in 1994 (now wholly owned by ITT Industries); manufactures submersible pumps for wastewater and municipal projects. Shanghai Goulds Pumps Joint venture established in 1998; produces process pumps for chemical, petrochemical, and general industry.	Connectors & Switches Cannon Zhenjiang Connectors Joint venture established in 1995; manufactures connectors for mobile phones. Cablecom Shenzhen Joint venture established in 1998 (now wholly owned by ITT Industries); makes cable assemblies. San Teh Tianjin, Nantong, and Xiamen (2 plants) Acquired in 2000; the four plants produce keypads for mobile communications and automotive markets. Man-Machine Interface Tianjin Acquired in 2000; manufactures contact dome arrays for mobile phones and hand-held devices. SOURCE: ITT Industries