Gas supplier's maxim: Stay ahead of curve

"When China starts to make something, it's very easy to become the world's largest. That creates many opportunities for us," he said.

For example, the country's desire for high-end manufacturing also drives the use of industrial gases. Praxair has offered welding technologies to the world's largest golf equipment makers in Guangdong province with a shielding atmosphere supplied by its gases.

China revenue for Praxair now accounts for around 5 to 6 percent of its $11 billion global revenue.

Ho believes Praxair China can grow at a rate faster than that of the nation's gross domestic product and expected revenue generated from China can rise to 10 percent of overall sales over the next five years.

To further consolidate market position, Praxair will inaugurate a China Technology Center in the Pudong New Area of Shanghai, which stands close to the proposed free-trade zone.

The center will focus on several key growth segments of industrial gas applications in China, including steel, combustion, metal fabrication, metals and materials processing, pharmaceuticals, water treatment and electronics.

In these segments, Praxair delivers complete solutions to its Chinese customers and uses advanced techniques to optimize its supply chain that reduces the gas delivery cost for customers.

"Establishing this Technology Center has been a natural progression for us. China is our largest and fastest growing geography in Asia, and Shanghai is the headquarters for Praxair Asia and China," Gupta said.

The geographic proximity enables the R&D organization to be able to collaborate seamlessly with other departments, including the development of the applications market, sales and business expansion at this location.

For example, in the metal fabrication laboratory, Praxair has developed advanced shielding gas mixtures, which it has implemented at customer sites to help them optimize their welding process parameters.

This has added value to industries in China's high-growth market segments, such as automobile manufacturing. Increased welding speed helps customers improve labor productivity and quality, while also reducing post-processing for cleaning and reducing emissions of welding fumes.

Increased presence

In April, the company signed a new gas supply contract with its long-term partner, Chinese auto maker BYD's battery unit, and further expanded cooperation supplying gases for another production facility for the client.

"Our talented local team works along the entire innovation spectrum from customer-need identification to idea generation to development to commercialization," Gupta said.

Furthermore, Ho lauded the establishment of the Shanghai Free Trade Test Zone and expects the experimental area with its related incentive policies will improve the efficiency of the company's cash management.

"Looking forward, when such free trade test zones roll out, the State Administration of Foreign Exchange will further open up its policy on yuan convertibility. It will facilitate the cash management of foreign-invested companies to a remarkable extent," he said.

The zone will bring about vast business opportunities for Praxair because the policy will draw more new high-tech enterprises and high value-added manufacturing companies to establish themselves there.

"Among them there could be businesses in the areas of high-end machinery, integrated circuits, new energy automobiles, bio-pharma as well as state-of-the-art intelligent manufacturing, all of which will be potential customers for Praxair," said Ho.

Furthermore, Shanghai is home to several excellent universities that conduct research in areas of interest to the firm. It has formed collaborations with Tongji University for wastewater treatment, East China University of Science and Technology for gasification, and Shanghai Jiao Tong University for welding.

"We also fund scholarships for students and sponsor research at these universities as well as recruit top technical talent from these and other institutions," said Ho.

While serving on the board of governors at the American Chamber of Commerce in Shanghai, the largest such association in Asia, Ho identified a talent shortage as the one single hurdle Praxair and other US businesses shared.

"Recruiting, developing and retaining qualified talent to support our business growth is always a priority. We do not necessarily hire the smartest people, but we strive to build a superior business culture based on flawless execution, operational discipline and continuous improvement, so that suitable people as team players can thrive as long as they wish," he said.