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Where Does Innovation Come From Nowadays?

December 2, 2018 • BUSINESS & INNOVATION

By David De Cremer 

For innovation to take place in the new technological era, collaborations that are open and flexible need to develop, the author argues, as those are the best conditions for all parties involved to learn, pursue their own interests whilst creating shared value for society. A Chinese company that has been focussed on developing this type of innovative process and outcome is Huawei.

 

We live in a world that is constantly changing. Global forces influence local practices and new structures are quickly emerging to replace more traditional ways of working. With change also comes the need to stimulate and explore new ways of generating knowledge that will lead to innovative and successful approaches to the new situation that has emerged. How can our institutions in such challenging conditions survive to remain innovative?

It is important to realise that innovations in today’s world depend increasingly on how organisations operate and interact within networks of firms and manage to coordinate such interactions in optimal ways. This reality indicates that today a complex ecosystem has emerged when it comes down to innovation. And, even more importantly, because of the necessity to work and function within networks, everyone has their place in the process leading to innovation. Two important institutions that have a significant impact on how innovation is transforming business and society concern companies and academia. In the last decade, the collaboration between the corporate and the academic world has intensified because we want our basic research to generate more practical applications and research funding for this fundamental type of research – usually provided by governments – is gradually decreasing. A Chinese company that has been focussed on developing and contributing to this type of collaboration is Huawei.

It is important to realise that innovations in today’s world depend increasingly on how organisations operate and interact within networks of firms and manage to coordinate such interactions in optimal ways.

Huawei is Chinese in its foundation but has a strong global appeal (more than 40 000 non-Chinese employees – out of 170 000 – are employed) that contributes to its successful R&D efforts (Tian, De Cremer, & Chunbo, 2017). In the fiscal year of 2017 Huawei´s revenue reached CNY603.621 billion (US$92.549 billion) and CNY56.384 billion (US$7.276 billion) in net profit. With respect to promoting innovation by means of research, the Huawei innovation research programme is the company’s flagship funding initiative. It provides funding opportunities to universities and research institutes. The reason for such an initiative is the idea that for innovation to emerge companies need to have an open and flexible mindset to prepare people for a world that we do not know yet.

To promote such reality, the business world has started to explore the philosophy that to achieve innovation for the good of the world, collaboration is the name of the game rather than only competitiveness. In fact, loud voices are saying that to achieve innovation in today’s world it is necessary that organisations seek to influence each other by investing in knowledge creation and dissemination – something the Huawei innovation research programme aims to do.

 
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About the Author

David De Cremer is the KPMG chaired professor in management studies at the Judge Business School, University of Cambridge, UK, and an affiliate at the Justice Collaboratory at Yale Law School, Yale University. He has published over more than 250 academic articles and book chapters and is the author of the book Pro-active Leadership: How to overcome procrastination and be a bold decision-maker and co-author of “Huawei: Leadership, culture and connectivity”.

 

References

1. De Cremer, D., & Tian, T. (2015). Leading Huawei: Seven leadership lessons of Ren Zhengfei. The European Business Review, September/October, 30-35.

2. De Cremer, D. (2016). Corporate social responsibility in China: The Huawei case. The European Business Review.September/October, 61-65.

3. MacCormack, A., Forbath, T., Brooks, P, & Kalaher, P. (2007). Innovation through global collaboration: A new source of competitive advantage. Harvard Business School (no 07-079), Boston, MA.

4. Tian, T., De Cremer, D., & Chunbo, W. (2017). Huawei: Leadership, culture and connectivity. Sage Publishing.

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