SCMP | Claim the Future

Hong Kong’s angry youth can find hope in innovation and entrepreneurship
Edward Tse says a chance of upward mobility through business may placate a young generation frustrated with the status quo, and they can learn from successful peers on the mainland

It is no understatement to say that, over the past several years, Hong Kong’s youth have displayed increasing frustration. Occupy Central, riots at Lunar New Year, campaigns against parallel goods traders, the Hong Kong independence initiative, along with the controversy over the Wang Chau housing plan, clearly reflect the frustrations of our young generation.

So, what’s behind this? There is probably no single reason, but rather a variety of political, social and economic factors.

Hong Kong’s young people today live in a city that is very different from the one their parents grew up in. Hong Kong in the 1970s and 1980s was tough, but the city was growing and there were plenty of opportunities for young people. There was potential for upward mobility and young people working hard could build a better life for themselves.

However, today’s youngsters have it pretty hard. Hong Kong’s economic structure has become much more narrow. There are still some good jobs available offering upward mobility, such as in the top-end financial services sector, but our youth do not have any distinctive edge over mainland or overseas competitors.

So, what is the best way for Hong Kong’s youth to find new opportunities for social mobility? I believe the answer lies in innovation and entrepreneurship.

Innovation is a process of creating substantial value through new ideas. These “new ideas” could come from existing concepts, tools or technologies. It is different from invention, which often refers to creating a product or introducing a process which is entirely new.

So, in business, it can take the form of product innovation, service innovation or business model innovation. Sometimes, the core of the innovation is due to the introduction of new technology; sometimes, it is simply enabled by existing technology; and, at other times, it can have no relationship to technology at all, simply a new way of doing things.

During the first dotcom era at the end of the 1990s, Hong Kong had a short period of pretty vibrant innovation and entrepreneurship. Quite a number of entrepreneurs emerged and some were able to create a mark for themselves. Unfortunately, those roots were not planted firmly enough.

When the dotcom bubble burst, Hong Kong’s wave of innovation and entrepreneurship vanished. The city’s economic structure reverted to being driven by property development, financial services, travel, tourism and retail and, in this process, the possibility of upward mobility for our youth faded.

Meanwhile, mainland China has thrived on innovation and entrepreneurship. Entrepreneurs are getting younger (many are post 80s or post 90s). They are not only in big cities like Beijing, Shenzhen or Shanghai, but also in Hangzhou (杭州), Chengdu (成都)and Chongqing (重庆). They are all over China.

From the end of the 1990s, the private sector in China has grown much faster than the state sector in terms of both overall revenue and profit. Many of the noteworthy entrepreneurial companies are in the internet sector, but there are also many in non-internet-centric technology areas, financial services, connected mobility, retail and health care. While some of these thrive on technology innovation, many derive their growth from business model innovations.

There are a number of reasons why China has become a major breeding ground for business innovation. The years behind the gradual transition from a planned to a market economy has created many discontinuities, exposing society’s “pain points” and thus providing many opportunities for observant entrepreneurs. The prevalence of technology, especially wireless internet, has acted as a major enabler. Coupled with that is the massive market allowing business innovation to rapidly scale up; and last, but not least, capital is abundant through well-funded venture capital and angel investors.

For Hong Kong’s youth, mainland China can provide real opportunities for entrepreneurial pursuits for those who are willing to see it in this way. Increasingly, the mainland is putting more value on knowledge and the environment is tolerant of multiple trials and errors. In terms of intrinsics, Hong Kong’s youth are not so different from those on the mainland. China’s operating environment for businesses has many flaws but those who make it are those who can achieve things in spite of these imperfections. Hong Kong’s youth just need to try. In fact, the mainland can become the platform for Hong Kong youth to become the world’s best in their own chosen area of focus.

There are cases of Hongkongers making it in China, such as Martin Lau Chi-ping, president of Tencent, and Victor Koo Wing-cheung, founder of popular video hosting service Youku.

Today, exponential value creation increasingly comes from entrepreneurs’ command of knowledge. Of course, there will still be people who can create wealth in other ways, both on the mainland and in Hong Kong. However, as technology and other factors drive down artificial barriers, knowledge is becoming more prevalent in value creation. And, innovation and entrepreneurship are merely the means to capturing and leveraging knowledge.

Hong Kong’s youth must focus on capturing knowledge, and use it for innovation and entrepreneurship to create value. Entrepreneurship is by definition difficult. Only a very small percentage will succeed. However, that small percentage could capture significant value and can become role models.

The Hong Kong government’s creation of the Innovation and Technology Bureau is a good move. It allows a top-down approach of driving innovation and entrepreneurship. However, this isn’t enough. Success requires a partnership between the public and private sector, as well as collaboration between Hong Kong and the mainland. Shenzhen and neighbouring cities in Guangdong, given their proximity to Hong Kong, would make the most natural partners.

For this to take off, it only needs a few successful cases of Hong Kong youth making it big, serving as role models for the next generation of entrepreneurs. This multiplier effect can lead to significant upward mobility for Hong Kong’s youth and is a way for them to truly take back the initiative for their future.

Edward Tse is founder and CEO of Gao Feng Advisory Company, a global strategy and management consulting firm with roots in Greater China. He is the author of China’s Disruptors


新浪财经 | 谢祖墀:战略的全面性和背景的重要性

文 | 谢祖墀 高风咨询公司董事长

源自于西方传统的企业战略理论在今天快速变化的商业环境里已经不再适用。从迈克尔.波特(Michael Porter)的五力法到布鲁斯.亨德森(Bruce Henderson)的波士顿矩阵,以及到C.K.普拉哈拉德(C.K.Prahalad)与加里.哈默尔(Gary Hamel)所提倡的核心竞争力(CoreCompetence)理论都是“定位论”经典。这些理论支配了西方企业CEO们和资本市场的思想近30年,到今天还有不少市场,特别是核心竞争力理论。

此外,由欧洲工商管理学院的W.钱.金(W.Chan Kim)和勒妮.莫博涅(Renée Mauborgne)于2005年提出的蓝海战略(BlueOcean Strategy)亦是定位论之一,本质上与上述的理论没有很大的分别。

核心竞争力理论最大的问题就是究竟什么是企业的核心竞争力?原先作者和后来呼应他们的其他作者,诸如BCG的乔治.斯托克(George Stalk)和菲利普.埃文斯(Philip Evans)定义核心竞争力为该企业与其他企业与众不同的能力,有差异性的和能为企业带来持续价值的。骤眼看来,但却很合理。但深入研究一下,我们却发现不少问题。

核心竞争力理论背后是指出企业必须聚焦(Focus),西方的资本市场非常喜欢这种想法。“聚焦等于好”已成西方资本市场过去几十年的金科玉律。但聚焦的衡量标准是什么呢?众所周知,可口可乐(Coca-cola)和百事(Pepsi)是强劲的竞争对手。可是可口可乐只做饮料,而百事除了饮料之外亦做食品,那谁对谁不对?谁聚焦谁不聚焦?于2012年,美国的一家食品公司卡夫(Kraft)一分为二,一家改名为亿滋国际(Mondelez)业务包括休闲食品(snack food),而另一家保持卡夫原名,业务保留了原有的其他类别的包装食品。为什么“食品”不是已经相当聚焦的呢?为什么在如此具有核心竞争力的前提之下,企业还需要去被分割?



在今天的瞬息万变的商业社会里,这些静态思维为主的定位论已经不合时宜。以寻找到一种可一劳永逸的定位为依归根本上不可能。动态战略的核心其实是在混沌与有序之间的不断取得平衡,亦即是说structured chaos。

战略必须与组织的DNA 匹配, 具有一致性






谢祖墀博士(Dr. Edward Tse)是高风管理咨询公司(Gao Feng Advisory Company)的创始人兼首席执行官。中国管理咨询业的先行者。过去的20年里,他创立并领导了两大国际管理咨询公司在大中华区的业务。外界评价他为“中国的全球领先商业战略家”和 “谢博士之于中国企业界就如大前研一之于日本企业界”。他曾为数以百计的公司(总部设在中国及其它地区)咨询过所有关键战略和管理方面的业务,涉及中国的各个方面和中国在全球的地位。他还为中国政府在战略、国有企业改革和中国企业走出国门等方面做过咨询。他已发表200多篇文章并出版了4本书,其中包括于国际获奖的《中国战略》和《创业家精神》。谢博士获得了加州大学伯克利分校工程学博士、MBA以及麻省理工学院的工程学学士、硕士。


谢祖墀 | 立体的一带一路
















谢祖墀博士(Dr. Edward Tse)是高风管理咨询公司(Gao Feng Advisory Company)的创始人兼首席执行官。中国管理咨询业的先行者。过去的20年里,他创立并领导了两大国际管理咨询公司在大中华区的业务。外界评价他为“中国的全球领先商业战略家”和 “谢博士之于中国企业界就如大前研一之于日本企业界”。他曾为数以百计的公司(总部设在中国及其它地区)咨询过所有关键战略和管理方面的业务,涉及中国的各个方面和中国在全球的地位。他还为中国政府在战略、国有企业改革和中国企业走出国门等方面做过咨询。他已发表200多篇文章并出版了4本书,其中包括于国际获奖的《中国战略》和《创业家精神》。谢博士获得了加州大学伯克利分校工程学博士、MBA以及麻省理工学院的工程学学士、硕士。

Nikkei Asian Review | Newcomers Shake up China’s Mobile Payment Industry

September 22, 2016 12:00 pm JST
Dr. Edward Tse, Ian Meller and Jackie Wang

Mobile payments have been embraced in China at a rate unseen anywhere else in the world, reaching approximately 16.3 trillion yuan ($2.5 trillion) in 2015. Whether it’s buying plane tickets or electronics or even paying utility bills, the Chinese consumer instinctively reaches for his or her smartphone. This is largely due to a consumer class that has leapfrogged the era of the personal computer and jumped directly into the smartphone age. China’s mobile payments industry has entered a new and exciting phase.

There have always been alternatives to the dominant Alipay and WeChat Pay sevices, but in the past year credible challengers have started to emerge. February saw the launch of Apple Pay, in partnership with state-owned payment processor China UnionPay. Samsung Pay arrived a month later. Viable alternatives backed by companies including Huawei Technologies, Xiaomi and LeEco are the latest to arrive.

Alipay, owned by Ant Financial Services Group, an affiliate of Alibaba Group Holding, remains the largest mobile payments player in China. It had a market share of 68% at the end of 2015 and has more than 400 million registered users, thanks to its links with Alibaba’s Taobao and Tmall shopping sites. WeChat Pay also has backing from parent Tencent Holdings that helps its reach. It is linked into WeChat, China’s largest instant messaging and social media platform.

Last year, WeChat Pay’s market share was 20%, making it a distant second to Alipay. But WeChat’s growing number of users and the increasing popularity of social media are helping it gain market share. This past Chinese New Year’s eve, some 8 billion “red packets,” gifts of cash traditionally exchanged at the holiday, were given through WeChat Pay.

The competition between Alipay and WeChat Pay has reached new heights as both are transforming into global e-wallets not only for Chinese domestically but also overseas. Both services have been building partnerships with foreign retailers and e-commerce platforms allowing customers to purchase products in yuan while abroad and on foreign websites. Travelers can also get tax refunds abroad through Alipay, which can save time at the airport.

NEW PLAYERS The emergence of Apple Pay in the China mobile payments market is significant, marking the arrival of the first legitimate foreign competitor to Alipay and WeChat Pay. For once, the two incumbents face a competitor whose ecosystem can rival their own.

Apple is one of the top smartphone companies in China, where it has been aggressively expanding. Yet before Apple Pay had even launched in China, analysts had discounted its ability to match the range of functions offered by Alipay and WeChat Pay and noted the lack in China of near-field communications, or NFC, terminals for contactless payment. When Apple revealed a partnership with UnionPay rather than Alipay, analysts again called it a mistake.

Within two days of Apple Pay’s launch in China, more than 30 million bank cards were connected to the service, implying linkage with one-third of the phones in the country then equipped to support NFC payment. By partnering with UnionPay, Apple gained access to China’s largest banks and thus a majority of China’s consumer class.

Before Apple Pay’s launch in China, Apple had already ensured that popular Chinese apps, such as those of food delivery service Meituan, e-commerce site and online travel agent Qunar, would support its payment service. Crucially, Apple Pay could soon be used on Tmall due to a new Chinese law requiring that e-commerce websites allow payments via competing systems, eliminating one of Alipay’s major competitive advantages.

PHONE MAKERS Apple isn’t the only one diving into China’s mobile payments market. Samsung Electronics, Huawei, Xiaomi and LeEco, the parent of Leshi Internet Information & Technology, are all making their own plays. Samsung followed Apple by partnering with UnionPay and getting the backing of China’s major banks for Samsung Pay, but Samsung has also integrated Alipay into its e-wallet.

When Huawei, now the largest smartphone company in China, originally announced its mobile payment service in March, it had the backing only of Bank of China(BOC). But by the time it launched in August, Huawei had added another 24 banks. In addition, its latest flagship smartphone, the Huawei P9, allows users to directly activate HuaweiPay through a fingerprint scanner on the back of the phone, even when the keypad is locked.

Other Chinese companies are in various states of building their own mobile payment systems. Xiaomi, one of China’s highest valued startups and the creator of the popular Mi series of smartphones, launched Mi Pay in early September. LeEco, which recently started offering mobile phones, has been building up its payment infrastructure by hiring a think-tank in Beijing to study internet finance and mobile payments.

For dedicated hardware providers like Xiaomi, Samsung, Apple and Huawei, mobile payments are another node of their ecosystems. The payment systems are features designed to increase the loyalty of consumers and help keep them hooked on the companies’ hardware.

Internet companies like Tencent and Alibaba are playing a much longer game, with mobile payments just a starting point for their bigger ambitions in internet finance.

Ant Financial has built an intricate and elaborate ecosystem that offers a variety of financial services and products to Chinese consumers including Sesame Credit, a credit scoring system based on Alipay payment histories, and policies from Zhong An Insurance. Alipay also offers loans to consumers based on online purchasing records on Tmall and Taobao. WeChat Pay users can also buy investment products.

The early success of Apple Pay in China and its ability to change the mobile payment behavior of the Chinese consumer is the largest threat that Tencent and Alibaba have yet faced on the mobile shopping front.

We are witnessing companies with different ecosystems clashing over the Chinese consumer’s wallet. This is an exciting and innovative period in China’s mobile payments sector. While Alibaba is the dominant player now, new entrants, both local and foreign, which are bringing their own service portfolios and a culture of innovation and disruption, are more than capable of challenging the status quo. It remains to be seen if these new players can ultimately unseat incumbents whose ambitions go far beyond simple mobile payments.

Dr. Edward Tse is founder and CEO of Gao Feng Advisory Co., a global strategy and management consulting company, and the author of “China’s Disruptors” (Portfolio, 2015).

Ian Meller and Jackie Wang are consultants at Gao Feng.