Monthly Archives: October 2009

Beyond Borders: Booze&Co Global Innovation 1000 Report Released

Booze&Co has released it’s report on global innovation, and it’s certainly interesting. Download it here. Some points worth noting:

  • In 2007, the top 80 U.S. corporate R&D spenders deployed an estimated US$80.1 billion of their $146 billion R&D funds overseas. The top 50 European companies spent $51.4 billion of their $117 billion total outside the continent. In Japan, the top 43 Japanese firms exported $40.4 billion of their total $71.6 billion to other countries
  • Companies that invest wisely in a multinational innovation footprint are gaining far better returns on their R&D investment than companies that exclusively keep their laboratories at home
  • Booze Allen identified the 1,000 public corporations worldwide that spend the most on researching and developing products and services for their marketplaces. Those 1,000 companies spent a total of $492 billion in 2007 on R&D, a 10 percent increase over the prior year, and, once again, they found no statistically significant evidence that higher levels of spending guarantee better results.
  • Between 2004 and 2007, global multinationals increased their total R&D sites by 6 percent, and of those new sites, 83 percent were in China and India. They also increased R&D staff by 22 percent; 91 percent of that increase was in China and India.
  • Cost reduction is not the most important of the several reasons that multinationals are moving their R&D facilities abroad. Furthermore, it is receding in significance.
  • Many companies are heading overseas in search of access to the burgeoning numbers of talented engineers and scientists around the world, and to the ideas that they are generating
  • Global companies are learning quickly that specific countries are gaining specific skills (automotive engineering in India, electronics in China), and they are chasing that talent accordingly
  • As companies sell their products and services in markets around the world, they find it valuable to site R&D closer to those growing markets
  • Overall, their analysis suggests that companies taking a more aggressive posture in globalizing their R&D footprint enjoy stronger sustained financial performance. Of the 184 top spenders that they studied closely, those that deployed more than 60 percent of their R&D outside their home countries tended to perform better, over the past three years, on several performance indicators, including operating margin, total shareholder return, market cap growth, and return on assets. These results
    indicate that for these companies there is a payoff from greater deployment of capabilities and capacity on a global scale, and greater success in serving local market

Booze&Co’s top innovation 20

top 1000

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Innovation Special Report

There is report in BusinessWeek on Innovation. It’s entitled Growth Through Innovation. Headlines include:

Now Is Not the Time for Caution

The Design of Business

Hershey’s Arrested Development

Godiva Goes to the Supermarket

Slide Show: Obama’s 25 Ways to Rebuild America

San Diego Zoo’s Newest Exhibit: Innovation

Podcast: Defining Large-Scale Innovation

Want To Grow? Look At Your Business Model

Worth a read!

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Design, Innovation and Crowdsourcing on a National Scale

Great example of the intersection of design, innovation and crowdsourcing on a national scale! Australia’s highest circulating advertising and marketing magazine B&T and crowdsourcing firm DesignBay are launching a competition to find a logo and tagline that could represent Brand Australia. It’s national branding on steroids. See brief here.

The competition is in response to the Australian Government’s recent announcement that it is looking for an agency to develop a new brand identity to embody Australia in the 21st century. The government through the Australian Trade Commission has set aside a budget of $20 million over four years to promote Brand Australia internationally.

The B&T/DesignBay competition, which is open to anyone anywhere in the world, will run over two weeks, with the winners and short-listed entrants announced in B&T magazine in November. The winning entry will receive a $2000 prize, with cash prizes also given to second and third-placed entrants.
A public vote together with the expert opinions of industry professionals and those of B&T’s editorial team and DesignBay staff will decide the winning entry.

Visit and complete the free registration process where a brief can be found. Anyone wishing to view the entries as they come in can do so at the same URL. The competition is open from 4pm on October 13, 2009, closing at 5pm on October 29, 2009.

B&T editor Tim Addington said: “We wanted to cast the net as wide as possible to get a fresh perspective on what a brand identity for Australia might look like in 2009, and which captures the essence of the nation as a great place for living, education, business, manufacturing and investment.”

DesignBay founder Alec Lynch said: “Australia’s brand is important. We want to find the best logo and tagline ideas that Australia’s creative talent and the world can come up with and we’re going to offer them, for free, to the government. We want to give people the opportunity to contribute to Australia’s brand and we want Australia’s brand to be the best it can be.”

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Emerging Markets post Record Highs

Investor Mark Mobius said he expects emerging markets to surpass previous records, predicting a continued rally with “corrections along the way.”

“If the money supply keeps on growing we will continue to see a bull market,” Mobius, who oversees about $25 billion as Templeton Asset Management Ltd.’s Singapore-based executive chairman, said in an interview in Manila. “We are just halfway from where we were before and we will surpass previous highs.”

Emerging-market stocks rose to a 13-month high yesterday as investors sought higher-yielding assets on expectations of a global economic recovery. The MSCI Emerging Markets Index added 0.8 percent as of 11:52 a.m. in London today.

“We will see a pretty fast pickup in earnings and that’s what markets are anticipating,” said Mobius, who spoke in an investors conference in Manila. He said he prefers consumer and commodities industries in emerging markets.

Apart from Brazil, Russia, India, and China, Pakistan and Turkey are “quite interesting now and we are adding to some of our holdings on a slight basis,” Mobius said. He said he is “bullish” on oil, driven by rising crude demand in China and India. He declined to name companies.

The “secular bull market” that pushed emerging-nation equities to the highest level relative to developed world stocks in 15 years has further to run, Jonathan Garner, Morgan Stanley’s chief Asian and emerging-market strategist, said this week. See full report from Bloomberg.

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Clinton talks about effects of globalization

Former President Bill Clinton spoke to a sold out crowd at the Pasadena Civic Auditorium in the USA on Monday, lecturing about the current political climate while detailing the advantages and pitfalls of living in an increasingly interdependent world.

Entering to an enthusiastic standing ovation in the 2,900-seat theater, Clinton shared his take on globalization and its effects, focusing on the challenges he believes an interdependent world faces.

“While we’re all connected, this is a very unequal world and in most places it’s growing more unequal,” Clinton said.

Clinton discussed pervasive discrimination that remains against women in most parts of the world as well as the growing income disparity in the U.S. He spent a

significant amount of time arguing for health care reform.

“We’re the only rich country in the world that can’t figure out how to give everybody health insurance,” he said, calling our current system “embarrassing.”

Clinton also addressed humanitarian intervention in the world, arguing that such intervention increased national security by improving the image of the country abroad.

“Anything we do to make chances slightly more balanced makes people think more of us,” Clinton said, adding that he recently returned from a humanitarian visit to Haiti.

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The “How” of Open Innovation

I want to alert you to an recent excellent report on the “how” of Open Innovation. The report is a product of two years work within the Cambridge Open Innovation Network. This network is funded by Unilever and the Cambridge Integrated Knowledge Centre. The report aims to answer the question “I want to implement Open Innovation – where should I start and what should I do?”. It provides and overview of existing approaches to Open Innovation and outlines how a company can start to implement a strategy to match the organisation’s needs.

Unilever has been a long-standing proponent of Open Innovation. Not only does this report talk about the theory of Open Innovation, but it draws on Unilever’s experience, and contains the results of 36 interviews and workshops.

An excellent document. Download it now.

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The Rise and Rise of China

For decades, China followed the dictum of its late supreme leader, Deng Xiaoping, to keep its head down abroad and focus on development at home. But earlier this decade, emboldened by success and mindful that their globalized economy needs stability, communist leaders started pressing for a place among the nations that manage world affairs.

These days, Beijing is claiming a bigger voice in global economic forums such as the Group of 20 and is getting more deference in the United Nations, which could mean protection for friends such as Iran and Myanmar. Its military spending is the world’s second-highest, behind that of the United States.

Explosive growth in China and India, coupled with Japan’s clout as the world’s No. 2 economy, has long been expected to shift economic power from the United States to Asia as this century progresses. The financial crisis and resulting Great Recession are accelerating that process.

“China certainly comes out of the crisis stronger rather than weaker, and it’s the opposite for the United States,” says Stephen Roach, chairman of Morgan Stanley Asia.

Even some Americans have begun declaring this the “Chinese century” since it began nearly a decade ago. But while they and others fear the rise of China in international relations and the global economy, the reality is less dramatic: Beijing is still getting its own sprawling, chaotic house in order and is in no position to supplant the United States as global leader in the near future.

At the same time, Beijing’s power remains undefined: On an unfamiliar global stage, it is unsure what role it wants to play.

“China is very likely to be the second-most-powerful country — if it isn’t now, then within a decade,” says Kenneth Lieberthal, director of the Brookings Institution’s John L. Thornton China Center in Washington.

For the United States, it’s a mixed blessing. The American and Chinese economies are intertwined, and the success of one depends on the health of the other.

The United States is China’s biggest trade partner. China sent $338 billion in goods here last year. Beijing is Washington’s biggest creditor, with more than $800 billion invested in government debt. American automakers look to China’s growing market to propel future sales.

The financial crisis set back U.S. growth by years and will add trillions to the federal debt over the next decade. But China avoided the worst of the crisis. Its banks are healthy and, with the help of a 4 trillion yuan ($586 billion) stimulus, this year’s economic growth is on track to top 8 percent. See complete ap story..

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