Wednesday, 22 August 2007

Executive Insights - August 2007

Sidney Yuen
Chairman, HKCCA

Driving growth through innovation, simplicity and collaboration

Having interviewed a large number of senior executives in Hong Kong and Asia, I have come to a conclusion that there are three key enablers to drive sustainable growth and productivity: innovation, simplicity and collaboration.

Over 90% of what you need to know to grow your business is outside of your industry! To what degree can you really grow your business by focusing on the three enablers? The answers to the following questions will hold the keys.

More than one third of 3M’s total revenue comes from products that didn’t exist five years ago – a pattern that 3M has sustained for 45 years and will carry them well into the next millennium. Innovation is the only growth strategy at 3M. Are you innovating faster than your competitors? What percentage of your revenue comes from products and services that you introduced within the past12 months? What innovations would you have to introduce to double that percentage over the same period of time? What steps must you take to foster an innovative culture? When was the last time you achieved a process innovation? By what percent have you reduced your cycle time within the past 12 months?

Less is more. Making things simple for your customers is the new competitive advantage. Google says it has the functionality of a complicated Swiss Army Knife, but the home page is their way of approaching it closed. It is simple and elegant, you can slip it in your pocket, but it’s got the doodad when you need it. That sums it all. What are your costs of confusion and the value of clarity? What if your next competitor -- the one stealing your customers and talent -- gets simple first? How do you clarify your goals quicker? How do you change the way you structure and communicate for building and keeping a team of champions? Are you doing enough to demonstrate that you respect your people?

No company grows alone. Collaborating with other partners, even competitors, enables companies to sustain growth. We have seen how banks collaborate with telecommunication operators, while software development companies work with consultancy firms -- the examples are endless. Increasingly, we expect to see how the dynamics of new partnerships come together, fall apart, deliver on their promise or fail. Can you grow faster through collaboration? What percent of your business relationships are interdependent? To what extent are you forming alliances with your suppliers, customers and employees? How do you know that lessons learned have been integrated into your existing process that lead to a new business relationship?

Final thoughts
Simplicity is innovation’s and collaboration’s biggest paradox. We want more -- more functions, more power, more features -- and yet we demand that it be easy to use. Where do we find the balance? But one thing is for sure: if you focus on innovation, simplicity and collaboration, your organization will achieve world-class quality.

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