Is China really the new emerging Asian innovation leader? No, not yet! For one simple reason: Japan – the former, and still reigning, Asian innovative champion!
In the midst of a veritable media blizzard regarding China’s newly-found innovative prowess (especially with respect to green technologies)
Thomas Friedman has made it fashionable to speak about the world becoming “flat”, and this might actually be happening – to some small extent – when we speak about invention; in other words a lot of people doing research. But, innovation is the ability to produce, apply and distribute these inventions. It is the ability to create positive change by turning new ideas into application. Richard Florida pointed out that “The world is spikey”; and the spikes are centered on the location of powerful multinational corporations with global reach and global brands. These MNCs can take products, processes or business model improvements and turn them into new practices that change the way an entire industry works, on a global scale. New ideas (a commitment to research) are simply not enough. Innovation requires this, for sure, but also the ability to apply these new ideas, and this is where the Sonys, Matsushitas and Nintendos of the world provide a Japanese advantage that China simply does not yet have.
Unlike their more globally established Japanese rivals, most Chinese “innovators”
Energy, enthusiasm and good intentions (or five-year plans) are simply not enough when we speak of innovation on a global stage; nor is “good-enough”
Bill Fischer is Professor of Technology Management at IMD. He directs IMD’s Mastering Innovation Globally program which will take place in Tokyo (June 7-9) and Hong Kong (October 25-27).
Let us be clear. The Western stereotype that lasted well into the 1980s that Japan is a nation of copiers and incapable of innovation was completely wrong and ultimately also expensive. By underestimating Japan’s competitive challenge in innovation, Western firms in many sectors succumbed. The Swiss watch industry is one of myriad examples. Japan’s great strength has been in the rapid commercialization of incremental innovation and in areas such as production technology.
But Japan has reached its limits primarily because of certain social structural features and chauvinism. The point can be vividly illustrated by the remarks made by one of Japan’s few Nobel Prize Winners, Susumu Tonegawa, when he paid a brief visit to Tokyo after having won the 1987 Nobel Prize for Physiology and Medicine. After getting his bachelors degree from Kyoto University in 1963, he left Japan to undertake his PhD in the US and for the ensuing decades pursued research in America and in Switzerland. He was at the time living in the US attached to MIT. And what he said as he got off the plane from Boston in Tokyo was that had he stayed in Japan, he would never have won the Nobel Prize.
Japan has two main problems. One is that all institutions in Japan suffer from a rigid suffocating hierarchy, including universities and research institutes. Researchers’
It may be noted by way of parenthesis that in the rare cases when these hierarchies do not exist, the Japanese can be masters of innovation. It is generally recognized, for example, that the Japanese are global leaders in culinary innovation. The Michelin Guide has attributed three stars to more restaurants in Tokyo than in Paris. This is in great part because chefs are independent agents who do not report hierarchically.
The problem of hierarchy in some respects accounts for the second. From Cordoba in the 10th century to California in the 20th, the evidence is quite strong that global hubs of innovation are ones that are at the epicentre of cross-cultural pollination. Japan has failed to attract researchers and inventors from other parts of the globe because in research as in virtually everything else Japan is a closed society with a chauvinistic orientation. The fact that Japanese are so poor in English – the lingua franca of global dialogue and innovation – is both cause and consequence.
The future (and in many ways current) Asian leader of innovation is India. The words of the title of Amartya Sen’s famous book, The Argumentative Indian, mean that the conditions for probing, challenging and hence creating are prevailing. India is not a nation, but a hodge-podge of cultures that in cross-fertilizing generate the incredible fountain of thought that India has been in many fields, including in science and mathematics. The internationalization of Indian research is reflected in many ways, including through the very intellectually rich and dynamic Indian diaspora. Japan is closed not only to foreigners, but also to Japanese who have resided abroad. Tonegawa did not return to Japan. Had he done so, in all probability he would have not been offered a job!
Jean-Pierre Lehmann is Professor of International Political Economy at IMD and the founding director of the Evian Group. He teaches on the Mastering Technology Enterprise (MTE), Orchestrating Winning Performance (OWP) and Leading the Global Enterprise (LGE) programs as well as on the International Seminar for Top Executives (ISTE).
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