Move over Silicon Valley – it’s time to learn from how China does tech innovation, says Prof. Steven Van Belleghem
Every year, I take groups of senior business leaders from across Europe on a series of ‘Innovation Tours’. We visit the likes of Facebook, Amazon and SpaceX in Silicon Valley to see first-hand some of the technological developments that will be changing the lives of customers in the coming years, but actually, often the most eye-opening experiences happen when we visit China.
The Chinese city of Shenzen has now established itself one of the world’s leading tech hubs. Some reports suggest the region is involved in the production of as much as 90% of all electronic devices, which means it not only exports to Europe and the US, but also the rest of the world.
On a recent tour, I got the chance to sit down with David Li, who is the founder of the Shenzen Innovation Lab. This is an organisation that was set up in 2015 to help transform Shenzen from being just another big industrial city into a truly collaborative ecosystem for tech companies. The success of the project has been remarkable – not only enabling the city to handle mass production of electronic devices, but also become a ‘go-to’ destination for global entrepreneurs that want to develop hardware solutions on a much smaller scale.
It was fascinating to get some of David’s views on China’s position in the world technology industry, where he believes the big opportunities in tech can be found and why Europe and the US move much more slowly when it comes to innovation.
Protecting IP could be a waste of time
When you visit the Shenzen Electronics Market, it is difficult not to be blown away by the scale and variety of everything you find there. Many of the devices you see there look remarkably familiar, so what should Western brands be doing to protect themselves from Chinese companies replicating their ideas?
Talking to David, it certainly sounds like tech companies are fighting a losing battle: “The reality is that when anyone in Europe or America releases a $1,000 device, if it is popular, you will see the same device on sale in Shenzen for $100 within 3 months. And it will be on sale for as little as $10 in 12 months.
“IP is good if you are a big company who can afford $500-per-hour lawyers that can sue people. As a start-up, however, IP doesn’t do much.” David also believes that tech companies focus on the wrong things when it comes to IP, continuing: “IP does not protect ideas, it protects implementation. There are 10,000 different ways to implement any idea, so as a start-up you should focus on getting your idea to market as fast as possible, getting sales and building a brand, rather than wasting time on IP. That can come later.”
Running out of ‘real’ problems
After seeing how fast things move in Shenzen compared to Europe and the US, I was interested to hear David’s views on what Western tech companies are doing wrong. He believes that entrepreneurs are now emerging from all areas of society, but it isn’t the ones who can afford to spend six months creating PowerPoint decks and having meetings to raise venture capital who will be successful. “If you look at Silicon Valley, they are running out of real problems. The Google Duplex is a most impressive application of AI, but really, the only problem they are solving is avoiding speaking to a real person for 30 seconds.”
“Entrepreneurs need to find real problems. If you missed China 20 years ago, Africa is the place to be – they still have real problems to solve, and it is on a large scale.” When I mentioned to David how I had witnessed the emergence of “The Internet of Stupid Things,” he agreed: “Everyone seems to be making smart cookware at the moment, like a device that is the smartest way to cook an egg. What’s interesting is that when we work with Africa, you never see an ‘internet of stupid things’ idea – they solve real problems and they add real value.
“If you can solve one small problem in an African village, that same solution can be scaled horizontally across hundreds of thousands of villages.”
The more time I spend in China, the more convinced I am that they are pointing the way for the rest of the world’s technology companies. Of course, there are companies in Europe in the US that are doing truly amazing things with tech, but when it comes to speed and the scale of their endeavours, we can learn a lot from China’s ambition.
Prof. Steven Van Belleghem is an expert in customer focus in the digital world and an award-winning author. His new book, Customers The Day After Tomorrow, is out now. Follow him on Twitter @StevenVBe, subscribe to his videos at www.youtube.com/stevenvanbelleghem or visit www.stevenvanbelleghem.com.