Stimulating Innovation in Southeast Asia

Most Western countries perceive Asian markets as fascinating innovation hubs, where technologies are leapfrogged and where people are open to new digital innovations and transformations. But is it a reality for all Southeast Asian countries, and what is still necessary to get there? At the ISPIM Conference Bangkok 2020, a panel discussion was held with Theresa Mathawaphan (Deputy Executive Director of National Innovation Agency of Thailand), Dr. Suraya Sulaiman (Innovation Provocateur of Alpha Catalyst), Detlef Reis (Founding Director of Thinkergy) and James Engel (Chief Learning Architect of SEAC Thailand), chaired by Vincent Ribiere (Managing Director of Institute for Knowledge and Innovation Southeast Asia of Bangkok University). The panellists shared what they have personally experienced and saw as successful solutions to stimulate various forms of innovation in Southeast Asia. This is an excerpt from the conversation which took place.

Starting off the conversation, the speakers discussed the current state of innovation in the Southeast Asian region. Innovation within the Southeast Asia region varies dramatically in terms of maturity, and can be roughly divided into three categories:  the advanced (Singapore), the intermediate (Malaysian-Thailand-Indonesia) and the emerging (Laos-Cambodia-Myanmar). Malaysia tended to produce more product or service-oriented innovations, while Singapore developed more tech innovation. Other than the variation between innovation focus; cultural diversity, regulations, availability of sandboxes/testbeds also played a part in distinguishing the level of innovation maturity.

Moving into examples of innovative companies emerging from the region, Grab and Go-jek was  top most in mind. Grab, a technology company which started off offering ride-hailing transport services have now ventured into: online food delivery, insurance, courier service, prepaid and payment solutions, all on a single seamless platform. Suraya quoted Grab’s impeccable exponential growth- visible through their downloads, number of rides and revenue. Within 5 years, their app downloads increased from 600,000 to 100 million (across the Southeast Asia region). Their annual revenue grew from 0.5 billion to 2.3 billion within three years (as of 2019). She highlighted that the key success she’s observed was  how they leverage on attributes associated with the exponential organisation (ExO) model such as leveraging assets, usage of algorithms and utilising staff-on-demand. Theresa brought up another similar Indonesian startup, Go-Jek. With a social mission to improve the welfare and livelihood of the Indonesian people, Go-Jek is an app for transportation, food delivery, logistics, payment and daily services. Due to their drive to fulfil their social mission, Go-Jek has been commended for their approach to localisation. Other panellists also highlighted other startups such as QQ, a Tencent’s eCommerce app which also integrates online social games, music, microblogging and group & voice chat software; and HotelManagement.Asia, a one-stop app for event management. Apart from being successful, these startups have two common themes between them: the identification and solving a specific issue or problem; and are platform providers by aggregating solutions and leveraging on assets. 

Other than being different from one another, Southeast Asia also varies internationally. Detlef highlighted that the main difference between the European ecosystem and Asia’s is the culture. The culture has influenced the behaviour of employers and employees, and the interactions between them. Asian organisations tend to have higher levels of hierarchy, leading to a higher power distance. With Asians being collectivists rather than individualists, they are less verbal and outspoken with their thoughts and ideas. Hence, the main barrier towards innovation is the mindset. Taking into consideration the culture, they agreed that innovations worked best when it is initiated top-down, however, the top must also walk the talk rather than giving mere commands. Another barrier discussed was the retirement issue within the older generation workforce. As they approached their retirement age, the observation was that they tended to opt for less risky or tedious projects- possibly due to the high responsibility or energy investment needed. In addition, risk and failure acceptance was seen to be low overall, and is comparatively lower internationally. However, the panellists have all witnessed that there is a positive shift in the mindset- whereby employees are becoming more open to being involved with the organisation’s future and their innovative efforts- displaying a promising future. Due to the culture where Asian tend to not voice out their ideas and thoughts, interfaces such as digital tools and digital innovation management softwares can provide the avenue for expression and sharing of ideas. Through these platforms, organisations will be able to tap on the collective insights from their employees, as well as minimising the effect of hierarchy. 
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Due to the cultural difference, most innovation management system theories from the Western part of the world are less applicable to the Asian ecosystem. Coming from an innovation management consulting firm specialised in the Asian perspective, Dr Suraya discloses that the systems are well designed, however is not possible to use entirely, and would need to be adapted to suit the context and culture. 
The discussion has highlighted the cultural difference, however, that may be Southeast Asia’s strongest point. With the positive mindset transition, the future for innovation is definitely promising and worth looking out for!