ASIA
26 March 2014
Asia's Innovation Cities
As Asia's economies climb the development ladder, strategies must shift from absorbing and adapting global knowledge to innovation. And cities are the hubs where most innovation takes place.
In the early stages of climbing the development ladder, Asia's emerging economies have made great leaps by simply absorbing and adapting global knowledge.
But there comes a point, especially for advanced economies like Japan, Korea, Hong Kong and Singapore, where innovation and knowledge creation becomes increasingly important. And cities are the human hubs where most innovation takes place.
Which are the world's most successful innovation cities? And how do Asia's cities stack up in the innovation stakes? To help us answer some of these questions, the Melbourne-based "2thinknow" has created the Innovation Cities Index.
First of all, what do we mean by innovation? The OECD, through its "Innovation Strategy", identifies four types of innovation -- namely, product innovation, process innovation, marketing innovation and organisational innovation.
And what is key in all these types of innovation is that something be "new" or "significantly improved". In other words, the concept of innovation goes far beyond the confines of research labs to users, suppliers and consumers everywhere.
To capture the breadth of the concept of innovation, the Innovation Cities Index measures three factor preconditions for innovation. The Index is a cocktail comprising cultural assets, human infrastructure, and networked markets.
Cultural Assets include arts, culture, sports, music, environment, parks and spaces -- they inspire new ideas. Human infrastructure means universities and businesses which help with the development of ideas. And networked markets through physical trade or digital communication enable the sharing of ideas with the rest of the world.
This is quite a mouthful, but you probably follow the drift. A melting pot of artists, academics and investors, men and women, young and old, and of different ethnic and cultural backgrounds, provides a potent force for generating and realizing new ideas.
It also helps if there is an environment which tolerates or even encourages differences, rather than conformity, promotes risk taking, and does not instantly punish making mistakes.
It is not surprising that North American and European cities should lead the pack of Innovation Cities. These economies are already very much at the global technological frontier. And they are the heart of the free world.
Boston tops the global ranking with the highest score for the Innovation Cities Index. San Francisco comes 2nd, New York 4th, Seattle 25th, and Los Angeles 29th. Canada's Toronto also score highly at 10th.
Overall, there are more European than American cities among the top 30 Innovative Cities, notably Paris (3rd), Vienna (5th), Amsterdam (6th), Munich (7th), Copenhagen (9th) and London (11th). Germany has some five cities in the top 30! We shouldn't write off Europe just because of the Mediterranean countries.
Asia also scores well with 8 cities in the global top 30, including Melbourne (17th) and Sydney (20th). But the highest scoring Asian city, Hong Kong, only has a global rank of 15th. Then comes Japan, with Tokyo at 22nd and Kyoto at 30th. China manages just one city, Shanghai at 24th, and then there is Singapore at 26th and Seoul at 28th.
India does not score highly, notwithstanding its reputation for "frugal innovation" and its booming IT sector. Mumbai comes in at 120th globally.
Overall, Asia is a laggard in the Innovation Cities league, mainly for cultural reasons. Too many academics are locked away in ivory towers. Small and medium size enterprises are more often subcontrators for large companies, rather than independent drivers of entrepreneurship.
Societies are usually male-dominated, hierarchical, conservative and conformist, rather than risk-taking. And migrants are marginalized, rather than providing the power of diversity.
This is why innovation in Asia rarely involves disruptive, major breakthroughs, and tends to be "incremental innovation" which adapts and perfects innovations coming from elsewhere.
Most Asian governments are very conscious of their innovation challenge. But they are also uncomfortable with the free and open societies which provide the fertile soil for people like Steve Jobs, and Michael Jackson to flourish. And too often they perceive success stories like Ai Weiwei, Masayoshi Son or even Muhammad Yunus as threats than social assets.
PS
After drafting this article, I noticed an excellent piece, The Asian Innovation Century, Again, by Scott Anthony, on the Harvard Business Review Blog.
Scott says -- Over the last three years I have consistently stated my belief that Asia was emerging as a global innovation powerhouse ... While my long-term optimism remains, I think the region must overcome some very real hurdles before it can realize its potential. Some of these, like creaky infrastructure and a lack of a fully functioning risk-capital market, are straightforward and don't require further detailing. More pernicious and harder to address are three critical mindset shifts that need to happen.
You will find a link to the article below.
Executive Director
Asian Century Institute
www.asiancenturyinstitute.com
But there comes a point, especially for advanced economies like Japan, Korea, Hong Kong and Singapore, where innovation and knowledge creation becomes increasingly important. And cities are the human hubs where most innovation takes place.
Which are the world's most successful innovation cities? And how do Asia's cities stack up in the innovation stakes? To help us answer some of these questions, the Melbourne-based "2thinknow" has created the Innovation Cities Index.
First of all, what do we mean by innovation? The OECD, through its "Innovation Strategy", identifies four types of innovation -- namely, product innovation, process innovation, marketing innovation and organisational innovation.
And what is key in all these types of innovation is that something be "new" or "significantly improved". In other words, the concept of innovation goes far beyond the confines of research labs to users, suppliers and consumers everywhere.
To capture the breadth of the concept of innovation, the Innovation Cities Index measures three factor preconditions for innovation. The Index is a cocktail comprising cultural assets, human infrastructure, and networked markets.
Cultural Assets include arts, culture, sports, music, environment, parks and spaces -- they inspire new ideas. Human infrastructure means universities and businesses which help with the development of ideas. And networked markets through physical trade or digital communication enable the sharing of ideas with the rest of the world.
This is quite a mouthful, but you probably follow the drift. A melting pot of artists, academics and investors, men and women, young and old, and of different ethnic and cultural backgrounds, provides a potent force for generating and realizing new ideas.
It also helps if there is an environment which tolerates or even encourages differences, rather than conformity, promotes risk taking, and does not instantly punish making mistakes.
It is not surprising that North American and European cities should lead the pack of Innovation Cities. These economies are already very much at the global technological frontier. And they are the heart of the free world.
Boston tops the global ranking with the highest score for the Innovation Cities Index. San Francisco comes 2nd, New York 4th, Seattle 25th, and Los Angeles 29th. Canada's Toronto also score highly at 10th.
Overall, there are more European than American cities among the top 30 Innovative Cities, notably Paris (3rd), Vienna (5th), Amsterdam (6th), Munich (7th), Copenhagen (9th) and London (11th). Germany has some five cities in the top 30! We shouldn't write off Europe just because of the Mediterranean countries.
Asia also scores well with 8 cities in the global top 30, including Melbourne (17th) and Sydney (20th). But the highest scoring Asian city, Hong Kong, only has a global rank of 15th. Then comes Japan, with Tokyo at 22nd and Kyoto at 30th. China manages just one city, Shanghai at 24th, and then there is Singapore at 26th and Seoul at 28th.
India does not score highly, notwithstanding its reputation for "frugal innovation" and its booming IT sector. Mumbai comes in at 120th globally.
Overall, Asia is a laggard in the Innovation Cities league, mainly for cultural reasons. Too many academics are locked away in ivory towers. Small and medium size enterprises are more often subcontrators for large companies, rather than independent drivers of entrepreneurship.
Societies are usually male-dominated, hierarchical, conservative and conformist, rather than risk-taking. And migrants are marginalized, rather than providing the power of diversity.
This is why innovation in Asia rarely involves disruptive, major breakthroughs, and tends to be "incremental innovation" which adapts and perfects innovations coming from elsewhere.
Most Asian governments are very conscious of their innovation challenge. But they are also uncomfortable with the free and open societies which provide the fertile soil for people like Steve Jobs, and Michael Jackson to flourish. And too often they perceive success stories like Ai Weiwei, Masayoshi Son or even Muhammad Yunus as threats than social assets.
PS
After drafting this article, I noticed an excellent piece, The Asian Innovation Century, Again, by Scott Anthony, on the Harvard Business Review Blog.
Scott says -- Over the last three years I have consistently stated my belief that Asia was emerging as a global innovation powerhouse ... While my long-term optimism remains, I think the region must overcome some very real hurdles before it can realize its potential. Some of these, like creaky infrastructure and a lack of a fully functioning risk-capital market, are straightforward and don't require further detailing. More pernicious and harder to address are three critical mindset shifts that need to happen.
You will find a link to the article below.
Author
John WestExecutive Director
Asian Century Institute
www.asiancenturyinstitute.com