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Revisiting Business Strategies in Asia: Our 2012 Predictions

Revisiting Business Strategies in Asia: Our 2012 Predictions

In 2011, we published an article detailing what we believed would be the top ten innovative trends of the next year. Now, let’s take a look back at two of those predictions to see if we were right.

Governments Will Become Increasingly Involved in Innovation

We originally predicated that in 2012, we’d see governments become increasingly involved in innovation – and not just in the United States or within the European Union. Six years prior to this prediction, China’s government already began introducing an innovation strategy along with policies and procedures that would help fuel innovation. In fact, in 2012, Asian countries were among the top spenders in Research and Development. /p>

Also in China, local government is offering incentives for innovative business that move in to the local area of Wuhan. Offering businesses up to three years of free office rentals, a one-year interest free loan to set up a business and up to 15.8 million dollars to new companies, Wuhan is taking innovation seriously. It seems to be working: its local economy is growing 12.5% annually as the city continues to shift its focus from manufacturing to technology.

Companies that Do Not Innovate Will Fail

This is a prediction that has been proven time and again: take, for example, the company now known as 3M. Before it began innovating it was on the brink of folding. Once it established a pattern of innovation, it became the successful company it is today, employing more than 84,000 people.

Another, more famous failure of a company that did not innovate and paid the price is Kodak. Once the leading manufacturer of film and camera, Kodak has now filed for bankruptcy protection, all because the company focused on the past instead of innovation. Many companies are now taking the same business strategy as companies in Asia: innovation that is more open, allowing all employees instead of a select few to pursue their innovative ideas.

Another large company that suffered a major setback in stock prices in 2012 is Research in Motion. Blackberry Creator RIM made its first mistake by not taking Apple’s iPhone and its resulting popularity very seriously. Reporting losses of almost one billion dollars in 2012, it’s clear that Research in Motion is just another company in a long line of failures due to resisting innovation.

Traditional Book Publishing and E-Books

Finally, we predicted that in 2012, traditional publishing would take a hit as E-books publishing and sales continued to rise. Indeed, 2012 showed a rise in self-published and self-marketed books, especially of the electronic variety. Amazon’s sales of its Kindle Device rose dramatically, doubling the sales of the previous year. Additionally, sales of electronic books (regardless of the device used to read them) rose 42 percent in the fiction category alone, with sales of $1.8 billion dollars. On the flip side, sales in traditional brick and mortar stores fell seven percent and sales of mass market paperbacks sharply declined as well.

It’s clear that in order for a company to survive they must not only have a good business strategy but must take innovation seriously. Allowing employees at all levels contribute to innovation opens up a vein of creativity that they may not have had before.

Sources: 1, 2, 3, 4, 5