A recent article in SCMP reported on the decline of HK in the global innovation index [1]. The same paper (pre-Alibaba) reported on the city’s positive movement up the very same scale 3 years ago [2].
What has (or not) changed in our city to trigger such a metric?
Coincidence? Conspiracy? Complacency? Over reliance on the “gateway to China” factor? Creative bleed? Improved government initiatives, overseas investment, archaic transactional infrastructure?
We all have theories but let’s not speculate – after all, accountants only deal with numbers, right?
Let’s take an overly simplistic but illustrative equation from a bloke called Steve Tobak who wrote an article in Entrepreneur.com [3]:
Entrepreneur + Capital = Products + Customers = Business. If you want to be a successful entrepreneur, don’t start out wanting to be one. Start out with a customer problem and a product that solves it. Get capital. Make the product, market it, win customers. Someday you’ll wake up and realize what you’ve become: a guy who took a risk, started a business, and made money. An entrepreneur.
The key is that it starts with solving a customer problem. Being innovative is one of the core elements of solving problems. One definition is to “make changes in something established, especially by introducing new methods, ideas or products”. Being an entrepreneur, then, is about solving an existing problem(s) creatively, not just for your profits, but primarily for your customers.
We should then theoretically have seen an abundance of this sentiment in our city throughout all sectors, ranging from consumer goods or services, banking or regulation in the past decade…that matches the rapid change in modern consumer (and merchant) landscape.
What I have observed in HK is increasing costs in the value chain and a disproportionate focus managing those costs – but this isn’t isolated to our quaint little city.
Has the pressure of being profitable stifled the innovative capacity of HK?
Perhaps a re-calibration to innovate for customers first, profits second may be counter intuitive/cultural, but naturally provides a foundation to build intrinsic value in a business.
– Adrian
1 http://www.scmp.com/news/hong-kong/economy/article/2004297/hong-kong-slips-global-innovation-ranking-regional
2 http://www.scmp.com/business/economy/article/1284562/hong-ko
ng-keeps-innovation-lead-asia
3 https://www.entrepreneur.com/article/244565
