Hong Kong Must “Deploy or Die”
January 11, 2016 7:30 pm JST
Edward Tse and Sunny Cheng
Hong Kong finally set up an official bureau of innovation and technology in November after several years of seeking legislative approval.
Value creation through innovation will be critical for Hong Kong to generate sustainable growth. Since its handover to China in 1997, the territory has relied on a narrow range of industries, including tourism, retail and financial services, for growth. It has become clear however that this formula cannot carry the economy forward.
Prof. Nicholas Negroponte, founder of the renowned MIT Media Lab, demonstrated that he could move an image displayed on a cathode-ray tube monitor with his finger about 30 years ago. Today, even a three-year-old can swipe and move images on a tablet but at the time, Negroponte faced the challenge of just convincing others this was possible. The lab’s motto was “demo or die.”
In 2011, Joi Ito became the director of the MIT Media Lab. Joi is an innovator and has been in and out of college, each time leaving to pursue something more interesting than a degree. When the March 2011 tsunami struck Japan, Joi was in Boston while his wife was about 200 miles away from the damaged nuclear reactors in Fukushima Prefecture. He and many others were concerned about the environmental effects of radiation, so he and some friends jointly created an information-sharing website.
They also started scooping up Geiger counters to measure radiation. When supplies dried up, they decided to build their own. Within a month, 25 people from all over the world started working on a low-cost, innovative Geiger counter. Soon they were producing an open-source device that could fit into a lunch box. These new meters collect data and upload it to Safecast, a new web-based network to share readings. Within a year, the network had collected over 3 million data points.
The group then raised some money through funding platform Kickstarter and began making sturdy low-cost Geiger counters for the mass market. In three years, Safecast has collected over 16 million data points, making it the largest environmental monitoring network in the world. This demonstrates that when governments, nongovernmental organizations and experts are ineffective, citizen scientists can step up. In this case, such volunteers created a giant collaborative network in record time.
When Ito took up the MIT Media Lab job, he changed its motto to “deploy or die.” The Safecast radiation monitoring project is a good example of this new way of doing things. Situations can evolve too quickly for forward planning, but possessing the wherewithal to ad lib is the new way ahead.
Competition is rife today. In particular, competition with Chinese enterprises can be challenging. The Chinese government ensures that initiatives it implements are executed within the scope of official five-year plans. When the Chinese set a goal, they do whatever they must to achieve results. Chinese companies often follow the direction of change highlighted when the government issues a new five-year plan.
The latest plan for 2016-2020 highlights innovation as the engine for sustainable economic growth. Entrepreneurship has been growing in China, with 19% more new businesses formed in the first half of 2015 than a year earlier. The tech sector has significantly overtaken the industrial sector, recording 10% growth compared with the latter’s 4%.
Beyond just Alibaba Group Holding, Baidu and Tencent Holdings, China’s entrepreneurship scene is extremely dynamic, with many up-and-coming, exponentially growing players already disrupting the order set by older counterparts, which must constantly reinvent themselves to survive.
If Hong Kong doesn’t take advantage of the new five-year plan pending before the National People’s Congress, it will fall behind. Hong Kong must change rapidly and adapt. It must live by “deploy or die.”
Hong Kong politicians need to adapt to new political realities. Voters are often swayed by opinions on social media as they go viral. The government must be able to react. It can no longer afford six months to study conditions and another six months to write policy papers.
South Korea, at the forefront of technology in the Asia-Pacific region, has the world’s fastest average broadband connections, coming in at 23.6 megabits per second with Hong Kong following closely behind at 16.7 Mbps, according research by cloud computing services company Akamai.
However, on the mobile network front, Hong Kong comes in only at the sixth place in the region, with an average mobile network connection of 6.5 Mbps, behind South Korea, Japan, Singapore and others. Hong Kong is only now setting plans for fifth-generation mobile networks while South Korea already began preparations in early 2014. South Korea also has a thriving startup community with at least 10 software startups valued at more than $1 billion. Meanwhile the Japanese government is actively investing in self-driving automotive technologies in the hopes of taking the lead in the next industrial revolution.
Hong Kong policymakers are often restrained by unwritten rules and unable to think creatively. This applies to the way they approach innovation. “Crowdsourcing” is an effective way to find ideas. This has worked for South Korea and many innovative projects elsewhere, and Hong Kong must learn to adapt in the same manner.
The Australian government is a pioneer, committed to crowdsourcing with a dedicated taskforce, as well as equity crowdfunding initiatives. It is also one of the first governments to adopt Creative Commons licensing that allows open access and free licensing for intellectual property creators. The Singapore government has been engaging citizens with open public initiatives since 2010 as a cost-effective dual government-citizen approach to unlock social innovation and technological advancement.
Hong Kong must follow these examples and cut through bureaucratic walls and financial silos. Let ideas drive Hong Kong forward and cut red tape. Opportunities abound. Capturing the opportunities will require the right mindset.
Edward Tse is founder and CEO of Gao Feng Advisory, a strategy and management consulting company, and author of “China’s Disruptors” (Portfolio, 2015). Sunny Cheng is a Hong Kong-based environmental technology