Is China an Innovative Society?

by Stefan Lindegaard

I tapped into an interesting discussion on LinkedIn. Chris Gelken, who is host and co-producer of Today, a live news magazine, asked whether China is an innovative society.

Personally, I find the development of China to be both fascinating and a bit frightening seen from a Western perspective. Based on several visit, my take is that if China avoids too many financial bubbles, then the drive and ambition of the Chinese people to climb the value chain ladder will turn it into an innovation hotspot sooner than many think.

There are many great comments in the discussion and I have inserted snippets from a couple of them below. Check out the rest for yourself: Is China an Innovative Society? (requires group membership to China Networking Group)


Zhiyun Chen, Vice President at Pixelligent
I think as indivduals Chinese are very creative. It is result of strong natural selection by firece competetion in a closed society. The problem, though, is Chinese society still lacks mechnisms to channel the creativity of individuals into constructive innovations.

Edward Eng, Copywriter at Getchee
Rather than ask if China is innovate or not, people should focus on how China needs to improve its global marketing skills. The reason why many people think China isn't innovate is because no one knows what they are doing in China. People and businesses in China have great ideas and products but sometimes they just don't know how to effectively market them to the global consumer market. This is where China needs to strengthen its innovative juices.

John Walmsley, MD at Scot Lift Systems
They have the ideal situation for innovation as the Universities concentrate on designing and developing products which will meet a market need and not play around learning things which do not relate to Industry and Commerce. Where there is a gap is in Product design where they seem to lack the skills in making their products look modern and appealing. If they get that right then look out World.

Stephen DeKuyper, Managing Principal at CresaPartners
My experience tells me an overwhelming "no". Good at copying, good at driving costs down, but not innovative. I would be interested in seeing how many patents are applied for out of China. I guess it would be very low. I think with the size of the population, it will go up, but on a per capita basis, I think it will remain low. This does not equate to being smart or not. I just don't think there is an environment for innovation.

Bill Dodson, Principal at TrendsAsia
China excels at innovation, but not disruptive Innovation. "Small i" innovation is about patching and work-arounds. "Big I" Innovation is about changing the course of markets and even of societies. Chinese culture and history have always been supportive of "small i" innovation, due to the capricious nature of local government policies and decisions; and due to dramatic turns of events - revolts, revolutions, banditry, dynastic dissolution - that quickly destroy the fruits of labor. Hence, the tendency of so many constructions and creations in Chinese society to be just "good enough"; after all, who knows how long such works will be able to stand?


What do you think? Is China an innovative society?


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Stefan Lindegaard is a speaker, network facilitator and strategic advisor who focus on the topics of open innovation, intrapreneurship and how to identify and develop the people who drive innovation.

Innovation Perspectives - Educating Tomorrow's Workforce

This is the tenth of several 'Innovation Perspectives' articles we will publish this week from multiple authors to get different perspectives on 'What product or sector is in desperate need of innovation?'. And to close off the week, here is my perspective on education:

by Braden Kelley


"We need our children to be Masters of Mystery and Einsteins of Insight." - Braden Kelley

When I first saw this topic I wanted to write about education innovation, but I resisted when a couple of the contributing authors chose this topic. I wrote about the publishing industry instead, but then this week I came across a Phil McKinney article and had the opportunity to meet Sir Ken Robinson, and my passions for an education revolution were stirred.

We sit at the nexus of amazing new education technology capabilities, the globalization of work, and an incredible transformation in the needs of employers. The path forward is not the same as the road behind, but our education system is proceeding as if it were.

Instead of pursuing the current education mantra of more, better, faster, we need to instead rethink how we educate our children because we need to prepare them for a different world. A world in which flexibility, adaptibility, creativity, and problem solving will be prized ahead of the deep technical knowledge that is fast becoming a commodity and easily available.

I've said here on Blogging Innovation that the keys to business success are insight and execution. We are ending an era of incredible business focus on execution excellence and are entering an era of an increasing business focus on insight. Excellent execution will always be valued and required, but more and more components of this execution are shifting from the developed world to the lower-wage developing world.

We are currently in a race to the middle when it comes to standard of living as the developing countries like China, India, Brazil and others climb up the pyramid and developed countries like the United States, Italy, Greece and others slide down. Those developing countries wanting to stay near the top of the flattening standard of living pyramid will have to re-tool their education systems to to prepare their populations to grab as big a share as possible of the higher-wage insight-driven jobs.

Here is an interesting chart from a Newsweek-Intel Study reformatted by Phil McKinney:


Looking at the differences in perspectives between the American and Chinese respondents in the research, I came to two possible conclusions:

1. I am Chinese
   
2. The United States (and many other developed countries) are headed in the wrong direction and better change course on education fast

You may think that my views on education are too business-focused, but look even the arts are being globalized (look at Cirque du Soleil).

I believe that we underestimate children's ability to understand the real world and I think that the education system and the business world need each other more than they realize. We need to re-imagine our public-private partnerships and expectations when it comes to education, and we need to start educating today's young kids for tomorrow's world.

The fact is that we are pushing the limits of taking today's understanding of science to improve productivity an standard of living. Going forward we will need to break through currently held physical and natural limits and an expanded understanding of our physical and natural worlds. This will require a new generation of scientists and workers who can synthesize approaches from different cultures and disciplines, that are masters of creative approaches to problem soliving, and that have the entrepreneurial spirit to breakthrough perceived barriers. Are these the kind of students we're eduating?

What kind of students is your country educating?

As an added bonus, if you haven't seen it, I encourage to check out Sir Ken Robinson's video on "Creativity versus Literacy" here:



You can check out all of the 'Innovation Perspectives' articles from the different contributing authors on 'What product or sector is in desperate need of innovation?' by clicking the link in this sentence.

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Braden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

Will China 2.0 Out-Innovate Your Company?

by Rowan Gibson

Pick up your iPod and turn it around. Note the cool and somewhat snobby phrase that's printed on the back of the device: "Designed by Apple in California. Assembled in China." These eight words speak volumes about the Middle Kingdom's role to date in the global economic food chain. But it's already a seriously outdated paradigm. After thirty years as a lowly "workshop for the world", China is getting ready to move up the value chain. And this transition - from low-cost manufacturing to world-class innovation, design and marketing - will change the rules of competition everywhere on earth, including inside China. So forget whatever else your organization considers to be a strategic priority and ask yourself: "Are we gearing up for China 2.0?"

On a recent trip to Beijing, I was struck by how radically the focus of everyday business conversations has changed. And this has nothing to do with the global recession, which temporarily took some of the wind out of China's sails. It has much more to do with the realization that China is entering a new and quite different era in its economic development, and that companies (both local and foreign) will have to act quickly and decisively if they are going to carve out a place in it.

Until now, there were certain words that seemed to dominate all business conversations in China. Obviously, one of them was "growth", which is understandable considering that China's economy has doubled in size three times over in just the last thirty years! Another dominant word was "cost", as in low-cost, cheap, cheapest - which is a concept no nation has mastered quite like the Chinese. And still another was "export", since China's white-hot growth has been driven primarily by exploding overseas demand.

But now the game - and the conversation - is changing. There's a new set of words and phrases that I'm hearing more often in business circles in China. Like "world-class", "high performance", "global", "better" and "best". Company leaders - whether they are from local Chinese firms or foreign multinationals - are talking a lot less these days about "manufacturing in China" (been there, done that) and a lot more about "marketing, design and innovation in China" (you ain't seen nothing yet). This shift in rhetoric has incredible implications for the shape of future competition, both globally and in China's own massive home market.

However, you might argue that China still has a long way to go before the rhetoric becomes reality. And you'd be right. Take innovation, for example. In the recent International Innovation Index, produced in part by Boston Consulting Group, China was ranked as the world's 27th most innovative nation, just behind New Zealand. To put this in context, some of China's regional neighbors were at the very top end of the scale: Singapore was ranked first in the world, South Korea took the number two slot, and Japan landed in 9th place (right behind the United States). Newsweek's comment on these rankings was quite typical: "China excels at producing huge volumes of low-cost products, but Japan and South Korea are tops in innovation and high-tech goods."

It definitely won't stay that way. Consider some data that support this conclusion. For a start, the number of patent applications from Chinese companies has increased ten-fold over the last decade, and the annual growth rate is almost twelve per cent. In fact, the world's most prolific filer of international patents last year was Huawei Technologies, China's largest networking and telecoms company, which became the first Chinese enterprise to top the list. Overall, China ranked 6th among countries according to the number of patents filed, after the USA, Japan, Germany, South Korea and France. And if current growth rates continue, China will surpass them all in about a decade.

In his brilliantly researched book China Inc., journalist Ted Fishman says, "China has yet to introduce the kind of world-changing technology or consumer products that are the hallmark of advanced economies. But it will." And he continues, "The genius that has so far poured into creating great factories will soon be evident in great products and great brands that will offer the world unsurpassed quality and refinement."

That process is well underway. It's notable that in 1995 there were just three Chinese companies on the Fortune 500 list. By 2000, it was ten. By 2005, the number had jumped to eighteen, and in 2008 - a mere three years later - it had leapt to 35. Companies all over China are rising to the challenge of becoming high-performance business players, many on a global scale. Huawei, for example, is already giving Cisco a run for its money in the networking business. In 2007 the company reported annual revenues of $16 billion, and in 2008 $23.3 billion. That's a 45 per cent increase year-on- year. And over 60 percent of Huawei's revenue is generated outside China. Another Chinese champion, Haier Group, is currently the fourth-largest appliance manufacturer in the world, with global revenues in 2008 of nearly $18 billion. Sales outside China are rising by about 10% year-on-year, and the company has grabbed a significant share of the U.S. market by focusing on neglected product niches like compact refrigerators and electric wine cellars. Haier has already surpassed rival Whirlpool as the world's top refrigerator producer in terms of sales.

Gong Li, chairman of Accenture in Greater China, has a catchy way of describing the challenge of moving up the value chain. He calls it "Jumping Over The Dragon Gate", which refers to an old Chinese legend in which carps had to swim against the current and jump over a tall gate to transform themselves into dragons. As more and more Chinese companies close the performance gap with their global counterparts, Li believes they will be able to "make the jump". And Anil Gupta, co-author of the excellent new book Getting China and India Right, absolutely agrees. He warns that China will produce "fearsome global competitors at a speed that the world has not seen
before". So what exactly is your own organization doing about the rise of China 2.0? And, for that matter, what are you doing about it in your personal career? Isn't it time you started learning Mandarin?

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Rowan Gibson is widely recognized as one of the world's leading experts on enterprise innovation. He is co-author of the bestseller "Innovation to the Core" and a much in-demand public speaker around the globe. On Twitter he is @RowanGibson.

China vs. USA in Innovation

by Jeffrey Phillips

There's an interesting new survey out from Newsweek about innovation. The survey compares the attitudes and expectations about the US and China in regard to innovation. In the survey there are some relatively unexpected differences and some safe assumptions and conclusions drawn.

On the safe side, it's not surprising that a majority of people in the US and China believe innovation will be even more important in the next few decades than now. Most people understand the increasing rate of change and the need for new products and services to meet both growing consumer demands and the increasing constraints placed on our consumption. We need both new products and services and new solutions to growing demands for more energy and a cleaner planet. The survey also shows that we in the US have less respect for our innovation capabilities than the Chinese population does. In the survey we consistently underestimate our capabilities, or the Chinese are overestimating us.

But what was really interesting to me was presented in the middle and toward the end of the survey. The first item that caught my attention was this question: What are the factors that you believe are causing the US to fall behind China from an innovation perspective?

The answers were: Schools lagging in math and science education (42%), American government not doing enough to support innovation (17%), American business not investing enough in innovation (16%), Don't know (14%) and American workers lacking skills to be technologically innovative (11%). According to this survey, then, we in the US are slipping behind because our (1) education system is failing to create innovative, creative workers or (2) our government isn't doing enough to support innovation or (3) businesses aren't investing in their workers or innovation.

What incentives did the government create or offer to Google to become the dominant and most innovative search engine? College dropouts created Napster, which was used as a model to disrupt the entire music distribution business. My concerns are that too often we sit passively by waiting for some permission or some program which will allow us to innovate, rather than simply taking the initiative. Waiting for the government to select the "best" technologies or waiting for the educational system to do a better job educating is not an answer. Yes, we need better education systems but we need them to turn out creative, insightful people, not just engineers and scientists. Innovation has so many possibilities and facets that turning out more scientists and engineers isn't necessarily going to make the US more innovative.

Let's reinforce this point using the next slide in the presentation. The title of the slide is American and Chinese parents disagree about which skills their children will need to drive innovation. The first two categories sum it up.

American families favor more science and technology education for their kids (American families chose this option 52% of the time, Chinese parents 9%) while Chinese parents chose creative approaches to problem solving (American families chose this option 18% of the time while Chinese parents chose this option 45% of the time). We in the US are far too fixated on science and technology as a driver for new product creation, when in fact too often the engineers and scientists in an organization can act as a block or barrier to innovation, since they are too focused on what's feasible, functional and practical. We, in the US and in China, need to educate our children and our workers on creative problem solving skills, to have them reach beyond the obvious to attain new ideas for new products, services and capabilities. One thing I think we can safely assume is that there will be an enormous number of scientists and engineers worldwide. No country or firm will corner the market on those skills. However, the number of people who are truly gifted at thinking creatively and solving difficult problems and challenges is far smaller. Let's corner the market on those skills and then find the people necessary to build and deliver the physical products and services.

We run the risk of expecting innovation to be driven by a government bureaucracy or waiting for specific dictates from government or businesses as to the "chosen" technologies or industries. What we need is more initiative from every sector. We need to improve education and educational opportunities for our children and demand more depth and breadth in their education, not just focusing on more math and science but also more creative and dynamic thinking to help them solve new and thornier problems. We need to increase the training for our existing workforce to shift their skills to new types of work and opportunities. But we can't wait for permission and we can't expect a behemoth of a federal government to make the right selections. What we can hope for is that it creates an environment where innovation and creativity can flourish.

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Jeffrey Phillips is a senior leader at OVO Innovation. OVO works with large distributed organizations to build innovation teams, processes and capabilities. Jeffrey is the author of "Make us more Innovative", and innovateonpurpose.blogspot.com.

Can Innovation Create Competitive Advantage?

by Jeffrey Phillips

Over the last six or seven years, definitely since about 2003 or 2004, there has been an increased focus on innovation in many businesses. I think much of this was driven by several factors, including an increased rate of change in competition, especially the growing capabilities of India and China. I also think that information costs have fallen as the web has become more fully adopted, and consumers are demanding more. Finally, I think the focus on cost-cutting and outsourcing is reaching it's logical conclusion. Most of the things that could be cut, trimmed or outsourced have been. Many businesses in the US are relatively lean, and need to return to growth and differentiation.

All of these factors contribute to the need for innovation. However, there are a lot of trends that suggest innovation is important in the near future as well. The focus on global warming means new technologies are required to reduce emissions. In the US, health care reform will mean new demands on an antiquated health care system. The US Government is straining to provide services that the population expects and demands. The banking sector is ripe for change and disruption. All of these factors suggest a significant amount of change is in store for our government and for major businesses.

None of this is going unnoticed in the hallowed halls of major corporations. Booz and Company has just released its yearly Innovation survey, and more than ever, innovation is moving from an interesting sideshow in most organizations. Now, innovation is being recognized as offering a competitive advantage, perhaps one of the few sustainable advantages, and CEOs and executives are taking note. The survey points out that over 90% of the executives surveyed said innovation was critical to the success of their firms as they prepared for the market and economy to improve. One executive went so far as to say "the recession was a catalyst for increased innovation".

Booz and Company listed three reasons why they felt companies have continued to invest in innovation during the economic downturn:

1. Innovation is becoming a core component of overall corporate strategy


2. Recognition that product development cycles are longer than recessionary periods


3. Many see the recession as an opportunity to build advantages over their
   competitors

One of the biggest impediments to innovation continues to be the "constraints of the product development lifecycle". The product development life cycle in many industries is simply too long and too cumbersome, and any opportunity to shorten the development life cycle could mean real rewards. Conversely, any slacking off could mean falling behind the competition.

My take: Innovation is gradually moving from an occasionally interesting sideshow that is not focused and not strategic, to becoming a key focus of senior executives as they realize that only innovation can help the firm continually grow and differentiate. Innovation is rapidly becoming a capability or enabler that strengthens and focuses the corporate strategies, and should over time become a key enabler to many corporate goals and strategies. Once more firms create a continuous capability for innovation and modify their cultures to embrace innovation, then we'll see the real transition occur. It is heartening to see that more and more firms are placing more emphasis on innovation at a strategic level.

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Jeffrey Phillips is a senior leader at OVO Innovation. OVO works with large distributed organizations to build innovation teams, processes and capabilities. Jeffrey is the author of "Make us more Innovative", and innovateonpurpose.blogspot.com.

Building an Innovation Engine in China

by Stefan Lindegaard

I recently made another trip to China. My purpose was to meet with innovation leaders in order to build further on my understanding of the Chinese innovation community and thus on my global perspectives on innovation.

I had a couple of meetings and I did an improvised session at a company. Having met about 15 people and having spent 5 days in Beijing, I have to say that my expectations of what will happen in China grew even higher. The reason for this is the innovation people of China.

They are hungry, bright and very eager to learn. Yes, they still have a lot to learn. And many of them do not seem to have the creative mindset and the ability to think in a more holistic way which I believe is necessary in order to make innovation happen. These are tough things to learn and many Chinese people will never get this.

Despite such significant issues, I still believe that Chinese people will be major contributors to innovation in the coming years. You can get a long way by being hungry, bright and eager to learn. In order to tap into this resource, China-based companies - whether Chinese or multi-nationals - must continue to provide the framework for these people to grow. This actually brings us back to what it takes for any company to build an innovative culture including:

Have a strategy for innovation. I have said this many times before. You need to develop an innovation strategy that sets the direction and this strategy must be aligned with the overall corporate strategy.

Focus on people before processes and ideas. People drive innovation. Your first thing to do is to identify and develop the people who can make innovation happen. Upon this, you need processes that match these people with the right ideas and provide a way to turn the ideas into revenues.

Use a TBX(O) approach. Nothing happens without top management (T) just as well as nothing happens without the employees (B). Middle managers (X) are a great obstacle towards innovation so you need to work around this. Today, we also need to include outsiders (O) in our innovation process. More about TBX(O) here.

On top of this, China-based companies - as well as many Western-based companies - also need to deal with their authority driven system. I still remember a visit to Alibaba three years ago. Alibaba, founded by Jack Ma in 1999, is among other things the world's largest online B2B marketplace.

We met with a group of engineers and we asked how they dealt with innovation. No answer. We asked again and this time we got a short answer - "Jack knows." My point here is that innovation is a team-sport where everyone has an opportunity to contribute; not a game played by lone geniuses.

I will visit China again early 2010 hosting a Next Stop: Open Innovation session. I really look forward to work further with these interesting Chinese people on developing their innovation mindset and skills.

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Stefan Lindegaard is a speaker, network facilitator and strategic advisor who focus on the topics of open innovation, intrapreneurship and how to identify and develop the people who drive innovation.

Happy 60th Anniversary China!

When Are We Seeing A Parade Of Chinese Global Brands?

by Idris Mootee

Happy Birthday China! China celebrated its rise to a world power over 60 years of Communist rule recently, showing the world their capabilities in its biggest-ever parade of state-of-the-art military hardware. It has come a long way and still has a long way to go. I attended a cocktail party this evening and talked to many China observers on what this means to the world. And for multi-nationals?

This week I've been busy working on developing our China footprint or more precisely Shanghai is our beachhead office. I am excited but at the same time well aware of the challenges operating in that environment. Everything you know can be wrong overnight. No experts can tell you what's your market is like today and how it is changing tomorrow.



China's rapid urbanization will further change the social architecture of the country and causing pains. According to some McKinsey research, in 2025-2030 one in five of the global city dwellers will be in Chinese cities. Based on current trends, China in 2025 will have 221 cities with more than one million people compared to Europe with 35. 25 of China's cities will have more than 5 million people China's cities in 2025 will generate about 95% of its GDP (versus 75% today) Of the 350 million people added to Chinese cities by 2025 (about the population of the USA) 240 million will be migrants

Asia's emerging economies are already leading the way for a recovery, or was there a recession at all? It depends on how you look it at. Chinese societies are just taking a baby step to transform to a consumer society. As many US consumers are transforming out it (not sure if it possible at all). Are the largest global consumer companies ready for this momentous shift?




McKinsey's advice is that even the most sophisticated multinationals must change significantly to realize Asia's growth potential. The region is as diverse as it is vast. Its markets come in a bewildering assortment of sizes and development stages, and its customers hail from a multitude of ethnic and cultural backgrounds. Their tastes and preferences evolve constantly. The speed and scale of change in Asian consumer markets can surprise even experienced executives. To meet the challenge, global companies will have to organize themselves regionally to coordinate strategy and use resources in the most efficient way while at the same time targeting the tastes of consumers on a very local level.

The structural changes required by China's entry into the World Trade Organization (WTO) and the broader demands of economic globalization and the information revolution will generate significantly new levels and types of social and economic disruption. China has proven politically resilient, economically dynamic, and increasingly assertive in positioning itself for a leadership role in Asia. And becoming a global power.




For those Chinese brands, they are all gearing up to play the global game and most are not well prepared. China's domestic market is becoming ever more crowded and a strong domestic market will power up Chinese brand for international expansion. There is an urgent call for Chinese companies to master new skills that traditionally reside with non-Chinese multinationals such as marketing, branding, talent development, customer service, M&A management etc. It is not an easy path.

Take Lenovo for example, they are facing challenges both domestically and internationally. Lenovo is losing ground to rivals and Yang is replacing Amelio as CEO. Liu Chuanzhi, the company founder who stepped aside after the IBM deal, will return as chairman. It is a big setback. Despite a $93 million profit in domestic sales, overall results were hit by the losses in overseas sales and admitted that Lenovo was a "weak competitor" in the US and Europe. Weak is not a strong enough word to describe their marketing, pricing as well as distribution strategies. They still need to go global. Liu said in a press release. "But at this important time we want to pay particular attention to our China business as it represents the foundation of our global business and growth strategy."




The first problem is there is simply a lack of real global strategy and I don't mean just a product strategy. Lenovo's second challenge is a flawed sales and marketing strategies. They overrated their brand power and there aren't much outside China. Replace the Thinkpad logo too fast. Lenovo failed to understand that blurry branding and not giving enough thoughts to pricing strategy.

Going global is not so simple. It is even more complex today with the Internet making information transparent, geo-politics and diverging consumer tastes. The most common mistake is companies see globalization as taking a superior (usually by false assumption) business model, product platform, branding and quickly adapting to another country. Oh yes it is about scale and that alone is not strategic.




The right approach is to rethink your business model globally, not taking an existing business model and adapting it to China or India. First step is to identify key differences in customer needs (often opposite) and understand how to answer to those needs. Not stripping down of an existing product line and call it localization. The real strategic focus should not be on the tension between global scale economies and local considerations as it blinds companies to the very real opportunities. Instead, spend plenty of efforts to exploit the differences and in their rush to exploit the similarities across borders, multinationals have discounted the original global strategy: arbitrage, the strategy of difference and design your business around those differences.




As more and more companies like Lenovo are slowly emerging on the global stage, they should put more thoughts on what strategies are available (Chinese firms prefer to spend money on feng sui consultants and not strategy consultants) and what implications do they pose for their more-established competitors from developed markets? How are these companies building marketing talent (a big limitation), leveraging low costs, and market access in their home countries? How do they approach global market entry, organizational development, and mergers and acquisitions? What opportunities do such companies present to Western multinationals? A feng-sui man cannot really give you answers on those strategic questions.

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Idris Mootee is the CEO of idea couture, a strategic innovation and experience design firm. He is the author of four books, tens of published articles, and a frequent speaker at business conferences and executive retreats.

Part 1 - The Power of the Question (Shanghai)

Lots of bad stuff happening in China right now. So let's talk about some good stuff. Like the design coming out of Shanghai.

Innovation, no matter where it occurs, always begins with a burning question (or questions), centered around "Is there a better way?" Artist-turned-designer Lu Kun has almost single-handedly put Shanghai on the international fashion map by pursuing three such questions:

Why doesn't China's clothing industry pay attention to detail? Why is it so cheap and uninspired? Why can't we do it differently?

Tired of his country being perceived as one big factory, Kun is on a mission to demonstrate that creativity and innovation are alive and well in China. His bold designs are doing just that. Drawing his inspiration from what he knows best - the streets of Shanghai - Kun's original creations are being hailed as elegant and imaginative, yet at the same time distinctly Shanghainese.

Undaunted by China's lack of a financial backing system for developing promising fashion designers, Kun has broken new ground. Until the arrival of Mr. Lu, no Chinese designer had achieved a presence on the international catwalk.

Kun did it in less than five years. How?

It's as if Mr. Lu took the advice of Sakichi Toyoda, who said: "Never try to design something without first gaining at least three years hands-on experience."


Kun's six-step path to innovation:

1. Learning the basics of fashion design in a vocational high school.


2. One year of cutting and sewing at a Shanghai tailor shop.


3. One year at a startup Hong Kong label.


4. One year teaching sewing technique and production design at LaSalle International Fashion School in Shanghai.


5. Then out on his own as a personal fashion designer for wealthy individuals.


6. And finally the design of an entire line of special occasion and upscale casual wear.

As with all great innovators, it's the power of the question that drives Kun's artistry.

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Matthew E. May is the author of "IN PURSUIT OF ELEGANCE: Why the Best Ideas Have Something Missing." He is constantly searching for creative ideas and innovative solutions that are 'elegant' - a unique and elusive combination of unusual simplicity and surprising power.

The War for Talent Escalating

Here is an interesting video on how China has started advertising on Silicon Valley billboards to attract tech talent from Silicon Valley back to China.

America used to be the top magnet for tech talent in the world, but now risks losing that mantle as other countries develop. Will American companies be able to find a way to stop the brain drain back to immigrants' home countries?

Check it out:



What do you think?

@innovate

The World is Not Flat - Now What?

With rising fuel costs and inflation continuing to run in double digits in countries like India and China, the falling dollar, and rising oil prices pushing up transportation costs, is the world really flat as Thomas L. Friedman claimed in 2005?

With the cost of shipping a container from China to the USA nearly tripling by some reports from $3,000 to $8,000 and cargo ships dropping their top speeds by 20% during the crossing to save fuel (decreasing speed to market and just-in-time capabilities), will companies continue to globalize their supply chains?

Will some companies reverse the globalization of their supply chains?

And, of course, the most obvious question for readers of this blog...

Does this introduce new innovation opportunities for companies and advisors who can envision ways to profit from these new market characteristics?

Of course it will. Entire methods of production for different manufactured goods may be completely revised, only to be revised again if the price of oil and the dollar suddenly move in the opposite direction in a big way.

So maybe the opportunity here (if it has not already been implemented), is the transformation not from a global manufacturing process to one with fewer shipping points, but from a more rigid process to one that can be more flexible. Creating the ability for a manufacturer to switch between multiple manufacturing scenarios depending on what is most cost-effective. For example:


USA (raw materials) -> Vietnam (raw material processing) -> China (bulk assembly) -> Mexico (final assembly) -> USA (retail)

to

USA (raw materials) -> China (all processing and assembly) -> USA (retail)

to

USA (raw materials) -> Mexico (raw material processing) -> China (all assembly) -> USA (retail)

to

USA (raw materials) -> Mexico (all processing and assembly) -> USA (retail)

Thoughts?

Decreasing Standard of Living, Increasing Profits

We are at an inflection point in the developed world, and the fate of your standard of living rests either in the your own hands (if you are an entrepreneur) or in the wisdom (or lack thereof) of a few key politicians.

The question is will the direction be up or down?

Economic factors in our newly globalized world dictate that individuals in lesser developed countries like China and India will experience rising wages and an increasing standard of living while individuals in the developed world experience flat or declining wages and standard of living in a race to the middle.

This began happening some time ago, but has been buried under a pile of easy credit.

Housing costs have increased, food and fuel prices are surging upwards along with commodity prices as demand grows faster than supply. Meanwhile, real wages are declining. Sounds like a depressing situation, right?

Well, all is not lost. If we can't avoid the inevitable decline in the developed world, then as individuals--and even as states and nation--we can seek to slow its decline or reverse the trend completely.

How do we do this?

As states and nations, we must invest in improving our ability to efficiently provide the basics, while at the same time reducing our demand for scarce commodities.

Our businesses must move from being product-led or even customer-led organizations to maintain their lead by transforming into innovation-led organizations that can move faster than competing organizations overseas with lower costs that seek to copy their innovations.

As individuals we can either go along for the ride as employees and hope that our government and business leaders make these adjustments faster than foreign competition, or help to lead the charge as entrepreneurs.

The entrepreneurs among us must recognize this new reality in the world and identify ways to profit from it. We must uncover the new or amplified business and consumer pains and the solutions to them. These truths will exist across the developed world and thus will scale for entrepreneurs or businesses bold enough to pursue them internationally.

What does this look like you might ask?

Well, one example would be satisfying the need for consumers to increasingly downgrade from restaurants to other types of less-expensive prepared foods when time is scarce. UK supermarkets like Tesco and their ready meals offer a great example that could be replicated in fast-paced American cities like New York, Seattle, and San Francisco.

Another would be exporting used American SUVs to take advantage of their rapid repreciation in the era of $4 gasoline to places that benefit from the weak dollar and/or lower fuel prices.

There are a million more ideas and innovations out there for people to find and put to work even as developed economies crest.

So are you going to let this new wave pummel you or are you going to find a way to ride it?

That answer is up to you...