Singapore as Innovation Nation

ETHOS Issue 05, Nov 2008

What does it mean for a nation or a country to be innovative? Can a nation’s overall innovative capacity be usefully determined?

I think we’re still at an early stage in terms of trying to measure the innovation capability of countries. Some rankings of national innovation capacity exist, which I think are inadequate. The tendency is to count objective factors such as patents, advanced degrees and so on.

I would look at other factors, based upon my assumption of how innovation works—which is that people with disruptive ideas, business models and insight often come from a society that is more diverse and stresses on thinking at the edges of disciplines. I would look for people with inter-disciplinary backgrounds and the level of diversity and tolerance in the society they come from, which suggests a culture that supports innovation.

Societies that will succeed are those which have done great job of cultivating home-grown talent through education and creation of opportunities, or have welcomed that sort of talent from abroad. They would have cultural sensitivity and the intelligence to build bridges across social and cultural boundaries. Also, they would have the money, the managerial talent and the will to invest in the future, such as in the form of basic and applied research and infrastructure.

This kind of societies is likely to better appreciate and reap the fruits of innovation on a worldwide basis. I think you’ll see small societies that are very sophisticated when it comes to innovation begin to pull away from the pack and develop disproportionate wealth creation. My bet is that these communities would include Singapore, Finland and the San Francisco Bay area.

What are the key barriers to a nation’s innovative capacity?

One of the dilemmas of innovation is that when you are on top of the game, you have to, in some respects, throw away what you know and take one or two steps back, in order to see what the next best step is.

The most important but subtle barriers are mindset, ethos and values. If you have on paper the desire to carry out innovation in a big way but the cultural DNA is one of avoiding risks or valuing smooth and efficient career progression, you’re not going to change people’s behaviour. Of course, every society has its own unique set of psychological barriers.

The problem in many otherwise well-run countries is the absence of a big national idea beyond simply trying to maintain a standard of living.

I think one of the reasons why you don’t seem more entrepreneurial in Singapore—even though there are plenty of people who are capable of being entrepreneurs—is because while there is a rewarding upside of being successful in a public sector or private sector track, the downside is also huge, compared to many other societies. In Silicon Valley, the saying is: if you haven’t gone bankrupt at least a couple of times, you’re not working hard enough. In Singapore, if you have business trouble, everybody knows about it; it is considered bad, a game-ender. I think this mindset will create an interesting cognitive dissonance for Singapore as it aspires towards becoming a centre for innovation, a talent magnet and a global city.

You could also argue that the problem in many otherwise well-run countries is the absence of a big national idea beyond simply trying to maintain a standard of living. Look at great companies—they are not about creating shareholder value exclusively. Someone said a long time ago that great companies make meaning.¹ They create value in the realm of intangibles that make life worth living. And if you think about how hard innovation is to practise, there has to be a reason why you would get out of bed in the morning to engage with those kinds of challenges.

For me, an innovation nation is a country that mobilises the creativity of its people for the purpose of addressing large-scale complex challenges and trying to make the situation of humanity better. So it isn’t about just making new stuff to make money but about aligning with an important national purpose.

However, a national idea has a lot of subtleties. You can’t just cook one up and sell it like a brand because it has to have a certain authenticity. On the other hand, without some degree of attention on the part of leadership to articulate the national narrative and ensure that there are stewards and catalysts for that process, innovation is not going to happen—simply having millions of people think about it isn’t going to generate the necessary results. A national character tends to be the result of complicated social, historical, emotional and cultural factors. At any given moment in history, you need leadership to crystallise those factors into a national purpose.

Why is it important for a country to have a coordinated national strategy for innovation, instead of allowing it to emerge spontaneously?

A society that only relies on the bubbling up of innovation from the ground is going to be at a disadvantage for two reasons. First, a government’s policies are significant enablers of national innovation. A government nurtures the roots of the innovation economy through its education policy. Fiscal, regulatory and investment policies encourage certain kinds of entrepreneurial behaviour. Governments may also sponsor dual-use technologies, where there is a national security and a commercial or broader application.

The kind of innovation that is increasingly important is not about coming up with a new way to design, for example, a teapot, but actually transforming innovation into something that yields broad new streams of opportunities. This scale of innovation requires a great deal of human capital and infrastructural investment. So even if you had a very vibrant venture capital industry as the US does, it is not necessarily going to be enough to ignite an entire industry. You need support in academic research, basic science and so on.

A government's policies are significant enablers of national innovation.

Yet in societies where you only have top-down development of ideas, there is a great potential for getting it wrong because governments are often not very good at the business of picking winners. So every society is going to be a blend of government action complemented by innovative entrepreneurial behaviour on the part of the public. The question is really what the balance between the two should be.

Many countries are now adopting innovation as an organisational principle— not just for how they coordinate their resources and development, but also in terms of how they plan to compete on the global stage. An innovation strategy is really about focusing on the most important agendas, having some sense of priority and matching resources against those priorities, because no country can do everything.

What’s interesting about innovation is its potential to lead to non zero-sum outcomes, in the sense that the more we have countries that are innovative and the more fruits of innovation are shared, the more humanity’s overall innovation capability increases, presumably with benefits for all of us.

In your view, what approaches to innovation might Singapore successfully pursue?

Your expectations are going to be the keys to your outcomes. So if your expectation is that you’re going to be a platform for the innovative activities of others—based on decades of experience as a platform for multinationals and certain kinds of technical development—then that’s likely what will happen.

Certainly, being a sort of system integrator makes sense for Singapore. There is money, sound business practice, IT, financial engineering and human capital here, where wild and crazy entrepreneurs from elsewhere can come to create new things in a competent environment and split the upside with Singapore. Perhaps there will be some trickle-down in the process to local entrepreneurs over time. It’s not a bad strategy.

Yet it would be a pity to stop there, because my impression is that there are many smart, really creative, cosmopolitan people here who, given the right circumstances, could be every bit as accomplished as entrepreneurs in any part of the world, bringing world-changing ideas to fruition using Singapore as a platform. So therefore I think you shouldn’t just think about Singapore as an enabler because then you’ll only be an enabler.

I think the cultural milieu in Singapore will eventually evolve to a point where creative risk-taking, expeditionary activities like those you see in Silicon Valley become an everyday occurrence. But because this will take time, it might be useful to start thinking about setting up creative enclaves—like some companies in Finland—in which entrepreneurial and innovative activities can flourish with a certain degree of insulation from the external environment, where the right mix of talent is freed up from responsibilities for a good length of time and given access to resources to make a serious foray towards big expeditionary goals.

How should government and public service capacity evolve in order to better support an innovation nation?

I think there is a need for real clarity about what innovation is: that it’s not just science, technology, creativity or improvement, but that it occupies a spectrum of concerns that many people are engaged with. My sense is that for the public sector to really drive the innovation agenda in Singapore, it needs to move on to a 2.0 conceptualisation of what innovation is and also what skills can manage it.

Because design is an approach to innovation that involves prototyping, visualisation, collaboration and other useful skills, it is also important for a country to invest in design in terms of educational institutions and resources, the arts and so forth.

So what do the managers of innovation need to do? It’s not that they need to know about brainstorming. Instead, they have to know how to foster collaboration so that emerging possibilities become visible. They must understand how to create alliances across disciplinary boundaries. They need to be able to craft a vision for their work group, and know which talents to bring in or what activities they should be involved in. They need to make useful exceptions. They need to be conscious about their willingness to encourage risk-taking and exploratory behaviour, and accept that a certain percentage of these ideas is not going to work out. All these are very subtle skills.

I’m not worried about Singapore being able to continue as a well-engineered society with well-engineered processes. I am, however, concerned about Singapore’s ability to think in a very expansive way about the future and put enough effort into that task so that real fruit comes out of it.

It has been said that the bottleneck for science and technology innovation is no longer the generation of ideas. There are plenty of ideas and lots of idea-generating capability. What’s lacking is the capacity to transition ideas from the laboratory into the marketplace. To do that you need people who understand both science and the entrepreneurial business process, which is why places like the California Institute for Quantitative Biosciences has training programmes that are called “Idea to IPO...and Beyond”.

Similarly, it doesn’t matter if you have a zillion patents if they don’t yield value for end-users. All these great technologies are not going to do any good unless they are applied to something that’s going to change somebody’s life. Over-engineering processes will lead to improvement and predictability but that won’t necessarily lead to innovative design. It is all about the interfaces that enable transfer among disciplines.

Because design is an approach to innovation that involves prototyping, visualisation, collaboration and other useful skills, it is also important for a country to invest in design in terms of educational institutions and resources, the arts and so forth. There are many deep skills embedded in the design disciplines that need to be unpacked for greater benefit.

I think that if Singapore remains a primarily engineering-oriented culture, it will miss out on opportunities in the future. When I come back, say, in ten years’ time, I’d like to see deep design as a much more ingrained mindset, not only in terms of product development but in terms of how senior policymakers plan and carry out their vision for the country.

ABOUT THE AUTHOR

In Singapore as Senior Visiting Fellow to the Civil Service College from 12 to 14 February 2008, Dr John Kao was interviewed by ETHOS Editor, Alvin Pang. He is the Chairman and CEO of Kao & Company, and author of several bestsellers, including Innovation Nation (Free Press, 2007) and Jamming: The Art and Discipline of Business Creativity (Harper Collins, 1996). Dr Kao served as a faculty member of the Harvard Business School from 1982 to 1996, where he developed courses on innovation and entrepreneurship. He was a Visiting Professor at the MIT Media Lab and served as a Distinguished Visiting Professor of Innovation at the US Naval Postgraduate School. The Economist has called him “Mr. Creativity” and a “serial innovator”.

NOTES

1. Pascale, R. T. and Athos, A. G., The Art of Japanese Management (New York: Simon and Schuster, 1981)

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