This post is in part based on the 2019 book “Tech Titans of China: How China’s Tech Sector is challenging the world by innovating faster, working harder, and going global” by Rebecca Fannin. To purchase the book on Amazon, Click here.
In the fast, messy, and global world of today, one only needs to blink to open their eyes to a new reality. One such reality is the emergence of China as an entrepreneurial and tech powerhouse.
That China could be a world leader in innovation might sound strange to a generation of westerners who grew up knowing China as an imitator of advanced western tech. Yet, the China of today has produced such a robust tech scene, that ironically, western companies are now copying from their Chinese counterparts.
E-commerce platform Pinduoduo and Messaging app WeChat are gaining recognition abroad. Bike-Sharing platforms are a Chinese innovation copied globally. Chinese advanced Electric car brands are beginning to make inroads in the US.
It remains to be seen whether China will surpass the US in innovation. Regardless, China’s rise serves as an excellent case study for the power of innovative infrastructure and goal setting for innovation within an organization.
The Rise of Tik Tok
Consider the case of Beijing-based Tik Tok, possibly the world’s fastest-growing social media platform. Since its launch, the Tik Tok app has had over 1 billion downloads. In 2018, it was the number one downloaded app in the iTunes app store. And most surprisingly, much of its new growth has been in the US.
Tik-Tok allows users to edit and post 15-second videos about anything, whether it’s lip-singing or cooking tips. While Tik-Tok has been credited with “making social media fun again,” the app’s true innovation is its seamless blend of AI technology into its user interface.
Rather than simply a Chinese take on social media, it is Tik-Tok’s advanced AI (that feeds content to users without requiring the user to ever set any preferences) which makes it stand out as a company.
The app has grown so rapidly that it is now seen as a threat to social media giants such as Facebook, which has since released its own (and not particularly successful) version of Tik Tok called Lasso.
Tik Tok is symbolic of the cycle of Chinese innovation today – rather than Chinese companies creating “Chinese versions” of apps such as youtube, China is coming up with new ideas, and the rest of the world follows suit.
The Power of Innovation Planning
China has always been a place for innovation (Paper, Fireworks, Kites), so it’s no surprise that the China of today would continue the historical trend. However, the rapid rise in innovation and the emergence of leading Chinese companies all in less than a decade cannot simply be explained as a result of organic innovative growth.
Rather, China serves as a paradigmatic meta-example of how actively building infrastructure for innovation can act as a catalyst for unleashing potential.
The steps the Chinese government has taken to foster innovation are enormous. There exist today in China numerous multi-year strategic plans to stimulate innovation and the tech sector.
For example, China has created a $15 billion “New Era technology” fund to finance Chinese tech startups. China’s education plan has encouraged student enrollment into STEM fields; by 2030, China is expected to grow its number of STEM graduates by 300%.
The Chinese government plan — Made in China 2025 — was created to help upgrade Chinese manufacturing from low-tech into high tech sectors such as robotics.
China’s latest five year calls for accelerating innovation, entrepreneurship, and research.
China is literally building innovative infrastructure by creating a mega-business region in what is known as “the Greater Bay Area” to compete with Silicon Valley. Features include a 34-mile bridge linking Hong Kong to Macau, new rail lines, and the construction of innovation hubs.
Whether government spending is the best way to fund innovative infrastructure is not the question (the right and left-wingers can duke that out elsewhere). Rather, what is clear is that innovation can prosper as a result of building the necessary infrastructure, whether by government or a private company.
Micro Perspective – Company Level Innovation
When approaching the Chinese model from an organizational perspective, it is important to note that, of course, there many differences between national and corporate projects. However, there are key principles that can be distilled from a comparison.
Chiefly, that while the raw ingredients for innovation must be present for innovation to take place, such as creative talent, the rate of innovation can be increased if the right steps are taken.
A smoothie can either be made in a mortar and pestle or a blender. The result is the same. The time spent is not.
Similarly, the more innovative platforms a company has, the quicker it will turn out innovation; And innovative ability has never before been so crucial to companies’ competitive advantage.
In an ever more unstable business environment where competition can just as easily come out of Shenzhen as it can from Silicon valley, 21st Century leaders must invest in innovation infrastructure not as a luxury, but as a basic tool for survival.
Release (2019) by Rebecca Fannin. An excellent resource for those who want to explore China’s rise over the last decade.