What the ESC didn’t tell you abt innovation and creativity?

Now you may not believe this. But right now when we are facing the greatest recession in decades – I actually believe there are a plethora of opportunities to take advantage of. I know that if you’re just a middle manager, housewife or some $3,500 per month ISD officer, this whole idea sounds counterintuitive and even dumb.

But bear with me; because it stands the test of reason and the whole idea goes something like this:  as long as there are problems to be solved, there will always be room for innovation – I am not even talking about high tech innovation or Philip’s Yeo’s holy grail of creating some aqua vitae  by crossing a gorilla gene with a coconut helix (whatever the outcome, if I see it in cold storage, I’ve probably wouldn’t argue with it and just make teeth sucking sounds and buy it for self preservation sake) – I am talking good old plain simple innovation better toasters, vacuum cleaners and even traffic cones that can stack up better those sort of things which is really just another way of saying innovation doesn’t mean you need tons of money or even get really intelligent folk with IVY league degrees – don’t get me wrong; I believe firms that can find a cure for cancer or verbal diarrhea can have tremendous potential.

But I also believe very strongly before we can even buy into new idea of what I can only term as ninja innovation – we really need to jettison some of our time honored assumptions.

For example; I am not a big fan of the ESC recommendations – the only utility I see there is it makes a great door stopper – cost cutting and improving productivity can only take you so far!  – and let me share with you why: first you can only improve profits by cutting costs to a certain point (economist call this point – diminishing returns bell curve), take the idea of cost cutting too far and you will end up with a condition where a firm suffers either from anorexia or delusions – I call this the Singapore sensor tap syndrome – do you notice malls these days claim they are saving X, Y and Z by using less water.  But what they don’t realize is, 9 out of 10 whenever you put your hand underneath those water saving sensor taps, water doesn’t come out  half the time - and by the time you’ve finished waving your hand around along with mumbling abacadara; you’ve already gone out of the door with that, “I am done!” feeling – that’s also the time when the water spouts out. My point is when you talk about productivity and cost savings; you really need to put it in the right context; it deserves a sense of scale otherwise you will just be so obsessed with the numbers that you end up missing the point.

The Soviets discovered this quirky calculus the hard way; measure the productivity of a glass firm by square meters manufactured and what happens is people will produce glass so thin, they crack like porcelian dolls requiring extra shipping cost – measure it by tonnage and what invariably happens is that same factory will begin producing goblets that are closer to paper weights than something level headed people will use in their kitchen.

In a nutshell, productivity is a double edged sword and what’s missing in the ESC report is contextual framing.

 Neither do I believe in retraining for the sake of retraining works either – that can only work if you believe it’s possible to put the cart before the horse and still make progress – it cannot be done –  the demand has to be there first, then the supply kicks in – that’s basic economics. In other words, if you make those sort of recommendations in the US, Japan or Korea – then I say,  you’re good to go – but in Singapore, that’s like pouring water into an tin pot with a hole – its no good. Why? You don’t even have the basic building blocks for innovation.

And this brings me to my point; this evening, the only way to innovate these days is to break the rules, don’t go too high tech; don’t go down and nasty cheap either – find a middle ground where the old and new sits happily together – the success of the ipod is a good example finding the perfect balance between old and new; it’s still delivering the same old stuff that vinyl records used to do; only it’s doing it in a way where you don’t have to go through all the hassle of keeping your stylus clean and trying to figure out where this or that cable is supposed to go – in other words – it’s old dressed up as new with an intuitive twist that just takes out all the hassle of enjoying music on the go.

Understand this entrepreneurship is not founded on just the power to invent; a big chunk of it is knowing where to put your money – so if you happen to be a ISD officer with a breadcrumb salary take my advice; junk 4D, that’s a loser’s game and hit the internet; drill deep and look out for those firms right now that are trying to marry the old and new to produce something innovative – remember, it doesn’t have to be super duper high tech, it just needs the right balance between old and new; chances are these disruptive companies stand the best opportunities to dominate, thrive and grow – not those companies that just rely on their marquee like UBS, Citi or firms chasing some pie in the sky like bio tech – those firms IMHO are kaput; they just went way to far – and I don’t even understand the innards of their business process.

Look out for firms that are shedding the old, yet retaining the core old ideas –  in the way Facebook went from a college “hello is anyone there?” project to a global business.

Spotting these winners aren’t easy; they often require copious amounts of research so remember –NEVER EVER TAKE MY ADVICE AT FACE VALUE, DO YOUR OWN RESEARCH, BETTER STILL CONSIDER ME A DUNCE.  LAGI BEST, CONSIDER ME A CON MAN! – and this brings me to one firm that I believe manages to marry the old and new perfectly with the help of technology to produce what I call real innovation in the true spirit of going where no mind dares to go – it’s SIRIUS XM RADIO (TICKER: SIRI).

My take is simple; radio is as old as the hills, but you go drill and find out how they’re fusing it with the new ( I am sorry, you just owe it to yourself to do some homework – there are no free rides here – so I am not even going to tell you!); all I am prepared to say is SIRI hits all my green buttons on my clip board.

Like I said, one part of innovation is spotting a winner; the other part which is significantly more important and even life changing is learning how to ride on the back of a winner to make you a mini-me winner – that to me is real innovation and creativity, because you are not following the crowd, you’re going your own way – remember always, you don’t need to be highly paper qualified to be a winner; you just need to stick real close to a winner to be a winner and avoid those legends in their own minds like the bubonic plague – that simply means you need to develop the skill to spot firms that are breaking the bounds of normalcy and engaging in risky yet  intelligent shifts in their industries and remember keep the balance between old and new just on an even keel – the key here is to find the right balance between old and new – if you can do that, you may not need to own a patent, but you can certainly ride on the benefits and still reap all the goodies – I can’ t think of a better way of innovating – can you?

Happy Hunting and need I say caveat emptor

DISCLOSURE: THE AUTHOR HAS POSITIONS IN SIRI

Darkness 2010

“Hey **** you! You all heard me **** you! You think the Japs just woke up one day and traded in their sushi and samurai swords for mausers and Taylor mass production technology – that’s bullshit; they copied from the West; they copied so much so well that every camera, fridge, car and even paper clip that came out from Japan in the 40′s, 50′s and even 60′s was a direct one to one copy – you know why Singapore doesn’t have one molecule of enterprenuerial spirit, we are too proud; as a result we have become emasculated when it comes to innovation and creativity; it’s because we see copying as beneath us; that’s a form of arrogance and pride; we are all like prim and proper English public school boys fighting with Queensbury rules; we see copying as something that is akin to taking a cheap shot – that’s bullshit; understand this! 

No industrialized country has ever managed to innovate before it first copied on a mass production basis – I can even prove it! 

Tell me if Marco Polo didn’t tuck into Lahmian on the make do you think the Italians would be tucking into spaghetti today? think it through, they will still be stuck on potatoes and krauts - so don’t come down here and tell me about honor -there is no shame in copying –  The Americans even copied from the Nazi’s, who do you think was the CEO of NASA during those Apollo missions? Seig heil!  the Japanese did the same from the Europeans and the Chinese are doing it right now on a massive scale – you want a ipod, I can get you one at one tenth the cost in Shanghai, so there you go! **** your Queensbury rules - so don’t come down here and tell me that something can ever come out from nothing – we will copy; if the Japs think they can run us over with the power of cute with their anime dolls, big eyes, platform shoes, frills and laces - then our liaison officers better do the same; we need to shed our aggresive quasi military image; our uniforms look like the Waffen SS; all our buildings in Primus look like Soviet warehouses – so is it such a wonder whenever, we appear, they all say, “something must be wrong, why have they come?”; we need to kidnap one of those new breed of Japanese ambassadors and learn how harness the power of cute –  this is not marketing 101, it’s survival Gentlemen! we have to innovate or die, or maybe i should say we copy and after that we if they make noise, we go to the UN!”

Darkness 2005 – when asked in the great hall as how the brotherhood and their allies should respond to the emergence of the Japanese Anime cult (Recorded by the Chronicler in the Book of Ages / debate about how the Anime is garnering market share in the virtual and how to repel them – the Brotherhood Press 2010.