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Wednesday, 17 July 2013 14:41

Global innovation demands level, competitive, playing field.

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Chinese IT giant, Huawei, has called for a level, competitive playing field as a way of promoting industry innovation.

Huawei's rotating CEO, Ken Hu, has said that "innovation requires open markets that embrace fair competition and effective intellectual property rights (IPR) protection to sustain vitality.”

The comments by the Huawei chief are the sort of words previously more likely spoken by a US company than a Chinese one, but they seriously reflect just how far the Chinese business culture and economy has swung to the right over the last decade. China business had a reputation for brazenly copying, then improving, and then dominating the market. Not so any more. They plan to achieve the latter position by R&D and innovation.

Hu believes only markets that encourage open and fair trade and promote competition are the true engines of innovation that will drive future industrial and social development. “Two fundamental reasons attribute to the rapid social and economic development in the last 200 years: first is the advancement of technologies, second more importantly is that open trade facilitated global resource reallocation and industry restructuring, maximizing the utilization of technical innovations.”

In short, he is saying that the strong get stronger by doing what they do best. I cannot argue with that, albeit at the expense of any remnant of Australian manufacture.

Huawei  is a company worth watching. It seems no obstacle is too great in the pursuit of both corporate credibility and market share. Look how it has opened up offices around the world; set up local global research and design teams; imported the best talent from its European and US opponents; supported community initiatives; and by sheer strength of will has taken seats at the big corporate players table by involvement in the various global ICT standards organisations.

Hu has driven the company in the same manner a younger and enthusiastic Jobs or Gates would have done, albeit with characteristic politeness, persistence, and an inscrutable facade.

In his speech titled, ‘The Next Wave of Digital Society,’ Hu shared his insights on four trends of the digital society with business leaders, entrepreneurs, and thought leaders from around the world. Key points stressed bv Hu included:

  • The Internet will become a fundamental element of our business mindset
  • Flexible working practices facilitated by mobility will become a basic lifestyle option, with borderless enterprises becoming an essential form of business operations.
  • Through effective use of the Internet, cloud computing, and big data, humankind can leverage the wisdom of people and machines worldwide to create a new, connected, and shared wisdom
  • As the Internet and social media continue to gain popularity, the behaviours and preferences of consumers and individuals are converging, and intelligent analytics can be harnessed for business benefits. As niche and domestic markets shrink as a result, enterprises must evolve to do business globally.

"The Internet will become another form of infrastructure, just as electricity and roads did in the past. The Internet is no longer just a tool to improve efficiency. Networks have become the infrastructure to build future production models. More importantly, the Internet should be the starting point of our thought process. We will be able to see many new opportunities if we use such a mindset to evaluate traditional industries." Hu said.

Perhaps it is self-evident, but it clearly and succinctly shows the direction that Hu will take the company, and it's straight down the information superhighway at full speed.

Huawei also supports the Global Innovation Index Report which is a joint project of the Cornell University, INSEAD and the World Intellectual Property Organisation (WIPO is a specialist agency of the United Nations). The 2013 report has just been released and here's a brief overview:

"Although the first half of 2013 has seen a pronounced economic uptick, the global recovery is not as strong as anticipated last year. Economic growth in emerging markets and high-income economies is uneven: growth prospects for many low- and middle-income economies continue to be good, but many high-income economies continue to struggle towards recovery".

"Economic policy action is still focused on finding the right balance between reducing debt and supporting demand through stimulus spending. However, questions remain: Where will future growth come from to drive the global economy? Where will future jobs come from? In this context, the importance of innovation cannot be emphasized enough. It is the policies fostering long-term output growth—especially policies that promote innovation—that can lay the foundation for future growth, improved productivity, and better jobs".

"To guide polices and to help overcome divides, metrics are needed to assess innovation and policy performance. For this purpose, The Global Innovation Index 2013: The Local Dynamics of Innovation is timely and relevant. The Global Innovation Index (GII) helps to create an environment in which innovation factors are continually evaluated. It provides a key tool and a rich database of detailed metrics for 142 economies, which represent 94.9% of the world’s population and 98.7% of global GDP".

"Innovative countries (with the exception of a few small economies or city states) are rarely able to achieve uniformly high levels of achievements along all the different dimensions of the GII model. Instead, many innovation capabilities are developed in local ecosystems that revolve around particular cities, clusters, or regions. Against this background, it is only appropriate that the GII 2013 focuses on the local dynamics of innovation".

"The GII is primarily concerned with improving the ‘journey’ towards better measuring and understanding innovation and with identifying targeted policies, good practices, and other levers that can foster innovation. Written in a nontechnical language and style, the GII appeals to diverse groups including policy makers, business leaders, academics, and different organizations of civil society."

The full report can be downloaded here and the rankings report is here.

Rankings are out of 100 and Switzerland leads at 66.59 following Sweden, UK, Netherlands, and USA (moved to fifth place from tenth in 2012) above 60 points (and much of Europe is around 50 points).

Australia creeps in at 19th place (53.07) just behind New Zealand at 17th (54.46).

China is at 44.66 (Hong Kong is a standalone ranking at 7th place) but has a far higher efficiency ratio than Australia and an emerging middle class of millionaires that already outnumber our entire population.

Bottom of the list are countries including Yemen, Sudan, Madagasca, Togo, Algeria and Pakistan (19.3 to 23.3 points).

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Ray Shaw

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Ray Shaw ray@im.com.au  has a passion for IT ever since building his first computer in 1980. He is a qualified journalist, hosted a consumer IT based radio program on ABC radio for 10 years, has developed world leading software for the events industry and is smart enough to no longer own a retail computer store!

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