Innovation "critical" for Asian firms

HONG KONG: A majority of firms in Asia believe innovation is "critical" to their prospects, but few currently draw on the opportunities provided by third parties or internal crowdsourcing, a study has found.

The Chartered Institute of Personnel and Development and the Hong Kong Institute of Human Resource Management, the industry bodies, polled executives representing 1,088 brand owners in six countries.

Some 59% of contributors agreed R&D was "critical", a total peaking at 77% in China and 64% in South Korea. This could be compared with 55% in Singapore, 54% in Taiwan and Malaysia and 51% in Hong Kong.

A further 34% of organisations stated their business was "slow moving" and operated in an environment where this area was "not prioritised", while 15% were yet to establish a strategy covering this discipline.

More specifically, 46% of enterprises pursued "process innovation" enabling them to deliver products quickly and efficiently to customers. China had the highest score on 53%, versus a low of 34% in Taiwan.

Elsewhere, 34% of the sample argued this activity was essential to identifying ideas that could facilitate their entry into new markets and categories, a metric where Taiwanese firms assumed the lead on 49%.

An additional 35% of businesses engaged in product development and improvement. A 55% majority of Chinese brand owners emphasised this matter, 15 percentage points ahead of any other nation.

Just over 35% of companies were involved in "specialist and technical" product development that necessitated long timescales.

For 37% of corporations, managers were encouraged to innovate on a continuous basis, while 32% utilised employee suggestion programmes to source ideas, and 29% asked certain teams to head up schemes.

A 22% share of companies let all their staff members take time to pursue such projects, while 19% allied with external partners, and 17% licensed firms and individuals to work on their behalf.

"This clearly represents an opportunity to do more, the study said. "After all, some of the best ideas come from the bottom-up and, in particular, from employees on the front line working with customers."

The main obstacles at present included a lack of manpower on 44%, insufficient budgets on 39%, the absence of management support on 38%, and uncertainty caused by the economic climate on 27%.

Data sourced from Chartered Institute of Personnel and Development; additional content by Warc staff, 20 September 2012

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