Late last year, Futures Group did a video presentation – “Rise of the Rest”. So we reckon that if the Future lies here in Asia, wouldn’t it be interesting to learn and understand how Enterprises in Asia, especially those in China, India and even Indonesia, are evolving? How different are these Enterprises today as compared to 10-20 years ago and what they will look like moving forward?

Hence in May this year, we embarked on the first leg of our Future of Enterprise project focusing on Chinese Enterprise, and here’s the slides on some of the trends observed.

Note: This is a synthesis of ideas from more than 100 people (Including business leaders, academia, entrepreneurs, bloggers, etc. in both Singapore and China) interviewed over the past 3 -4 months.

Chinese enterprises have long enjoyed a low-cost structure, and after decades of being labeled “Factory of the World”, the Chinese understood that apart from manufacturing and/ or producing copies/ imitations, they would have to innovate in order to differentiate themselves from the competition. In addition, we also learnt that it is not always about product innovation, but the ability to adapt foreign ideas or create new hybrids to fit local context as well as the ability to monetize it (Example of Facebook Vs QQ). Another key observation is the need to understand State Policies – We learnt how state policies can affect and even create new industries in China (example of One Child Policy and its impact on education, healthcare and internet industry as well as removal of licensing requirement which led to the boom in Shenzhen’s cottage phone industry).

As China prepares herself to be a dominant force in the global economy, what are the opportunities and threats faced by Singapore and our enterprises? Well, something to mull over while we continue phase II of our project – India. Here We Come!

More and more companies are starting to position their products and services with consumer affordability in mind. Innovating with price as the starting point, more companies are stripping out the undesired frills – sacrificing indiscernible differences in quality, features and standards – for portability, ease of use and most importantly, significantly lower price than the next best substitute. Think of $400 netbooks, $2,500 cars, $40 cellphones, etc.

Known as the theory of disruptive innovation by Clayton Christensen, new entrants often enter at the bottom of the market, where they are ignored by established incumbents. These products then grow by taking away significant market share to the point where they eclipse the old product. MP3 music technology, Internet long distance phone calls all entered their respective markets that way. Offering flexibility, convenience over features and sound/voice quality. Consumers want quick and dirty over slow and polished. Having it here and now is more important than having it perfect. “High-quality” or what we think of as a “better product” has a different meaning in today’s world. Suddenly what seemed perfect is anything but, and products that appear mediocre at first glance are often the perfect fit. Here’s an excellent article in last month’s Wired on The Good Enough Revolution: When Cheap and Simple Is Just Fine.

One common thread among the companies that have profited from “going no frills” and selling to the Good Enough market, is in crafting the perfect concoction of price/quality/feature tradeoffs that appeal to their new customers. Can your firm innovate to the extent that it is five times cheaper and trade down on features whose perceived value is less than five times the price? In a way, it’s simply Blue Ocean strategy with the emphasis on affordability.

Here are some ideas I’ve posted on slideshare. Enjoy!

We just returned from a fruitful trip to Korea, lots that we’ve learnt there, but up front sticking in my mind are East Asia’s online hermit kingdoms. These are the QQs, Navers, Mixis etc that have shown new ways or organising, socialising and monetising networks that facebook, myspace etc have not. We are thinking of doing some animation to highlight these kingdoms, but for now, there’s a very useful slideshare below from Benjamin Joffe of pluseightstar, who was also at LIFT Asia presenting on a similar topic.

Delicious slideshare from the British Chamber of Commerce on the future of the economy.  The green shoots are real enough, but the big issues facing the economy are very real. Look for slide 18 for the demand gap. Emerging Asia’s economic prospects are intact, but true Asian decoupling is a 2028, not 2008, event. Look at slide 25.

I stumbled upon this slideshare of McKinsey’s China’s Urban Billion presented in Delhi. I like the map on page 15 because it shows future city clusters that we can extrapolate from R Florida’s existing LRP map. And of course bears asking how well we know these centers of future demand

This started out intriguingly by iFTF’s Anthony Townsend’s “The Future of Technology-led Economic Development“. Research parks and incubators are starting to show their age as an economic development tool. Tectonic shifts in the way scientific research and technological innovation happen are leaving them behind, and pioneering new models of collaboration that will require us to rethink how we create places for these activities.

Townsend’s work focuses on the impact of new technology on cities and public institutions, essentially the intersection of science parks + incubators, mobility + urbanisation, future R&D models. It’s fascinating stuff, especially relevant as Singapore was one of the first to enter the real estate science park play and make it really work as a driver of growth.

Townsend is now building out the iFTF ‘Science in Place’ program, which will focus on understanding how future science and technology trends will shape innovation at various scales: the laboratory, the campus, the region and the world. Townsend’s ideas are also summarised in his slideshares below.

I think the last slideshare is the more interesting one. Specifically, most of what Townsend mentions are not unknown to Singapore, and we are already doing it. What is missing is the flexibility, what in FG we used to call scalable infrastructure, to quickly build out for prototyping. Here you might want to take a look at slide 34 for the ecosystem of innovation that builds in community buzz and experimentation (instead of science being isolated) and slide 44 which actually urges mixed uses for future science spaces. Our Biopolis is a step in the right direction, but so much more should be done.

Finally, also in collaboration with Townsend, a Future of Science Parks map. Both Townsend and the creators of the prezi map mention they will unveil the full results of the future of science parks forecast at the XXVI Annual World Conference of the International Association of Science Parks in Raleigh, North Carolina, June 1-4, 2009.

PheiSunn just sent this around from her Finland trip, a set of scenarios of the world post-crisis from the Finnish Business and Policy Forum EVA. Interesting overlaps with what we’ve also designed for the future of global demand post crisis.

From McKinsey, an analysis on the impact of US savings and the fall in world consumption. Clincher takeaway is each percentage point increase in savings leads to a fall of US$100bil in spending, making recovery much more difficult. The entire article is here.

Finally got around to doing a quick summary of my takeaways for Emtech India 2009. I’ve mentioned before that my primary aim, which is also the aim of Emtech India, is to see what disruptive innovations will come from India, specifically Bottom of the Pyramid technologies. If India gets this right, it will unlock a lot of potential of its rural areas and slums.

What I came away with was there was plenty of innovation from the bottom of the pyramid. This series of Discovery Channel “My Technology” commercials shows it amply.

But what also came up in the conference was a certain sense of stuckness and tiredness, a repetition of what has been heard (like one laptop per child). What’s holding bottom of the pyramid developments back? I can certainly sense a lack of infrastructure to commercialise the innovations arising from the people living in the bottom of the pyramid, and a lack of infrastructure or incentives to scale it for mass production. mChek is the most promising app I came across, but is that it? Or was it Emtech India 2009 that did not do justice to this rich topic? I told the organisers that the discussions were not deep enough, plenty of banalities and corporate spiel I can put up with, but I want to hear business cases on what worked, what didn’t work. Having the MIT name will pull people to attend once, but it had better be good for the second or third round. I summed up some of my thoughts in a quick and dirty .ppt posted on slideshare below.The raw notes are on ipaper here.

I enjoyed interacting with the many MIT alumnis at the conference. So many MIT/IIT alums who also went to Sloan, Chicago, Stanford MBA schools, India’s elite brains are incredible. There is so much promise.

It’s done. The six week plus project is done. Global demand after the crisis, we call it the 1-4-3-5 step, very Chinese One Chimerica, 4 legacy effects, 3 post-demand models, 5 strategies. And we have a big-ass paper that looks at it in some detail. This is just the start, because more importantly I would like people to start questioning and talking, this is no return to the status quo of export-led Asia. I’ll take a little break here, but after that I’ll put some animation together to try to explain it, maybe try some downloadables and maybe a comic. (update: I’ve put up a scrubbed version on slideshare and scribd).

One of the models is called ‘Chasm’, basically the bottom drops out of Asia as G3 export permanently evaporates. I think we are only getting a taste of it these few months. More to come. But first, the excellent FT article on what the ‘Chasm’ feels like as it hits Asia. h/t to Keith, thanks!

Asia and the crisis: Unlucky numbers

By David Pilling
Published: February 9 2009

…The upshot was that Asia swapped dependence on external financing for dependence on external demand….China (and others) will have to engineer a massive rebalancing of their economies towards domestic-led growth if they are to adjust to a world in which US consumers must rebuild depleted savings…The export-led model has outlived its usefulness….. it signifies the start of a profound – and no doubt painful – transformation as they adjust to a world in which the US consumer is no longer the buyer of last resort.

Well, someone took a stab at it and here’s one view of the world economy by 2030, from UK based Outsights. The scenarios are based on two axes, resources and technology, a very Malthusian view of the world.

It didn’t really address something more fundamental, which is the good-bye of Chimerica, and what would the world look like then? Would I put demand on one axis, with one end being G3-led-consumer demand (continuation of the past) and the other end being US-China internal-government demand? Then what of the next axis? I would put technology, with one end being technology/innovation as a powerful driver of growth and creating new possibilities, and the other end as it being stifled. Same as Outsights.

What would that look like then? let you know as the process crunches on …

For now, here is a snip of the Outsights scenarios plus the full thing on slideshare.

The future of the global economy to 2030

The global economy is at a juncture of great uncertainty and change. To explore a broader understanding of what the future of the global economy may hold, Outsights gathered experts from different sectors – Government, the City, Business and NGOs – to consider what is shaping the future to 2030. This report builds on the output of the workshop with further research and scenario development by Outsights.

The aim was to build scenarios – alternative and plausible stories of how the future might unfold – for the global economy to 2030. Rather than creating a conventional economic forecast – the inherent weaknesses of which are the unforeseen disruptions in the model – the group focussed on the major uncertainties of today’s world, especially the non-economic issues, to challenge current assumptions.