Tuesday, November 29, 2011

STEVE JOBS AND NEXT - A RARE VIDEO

Hat tip to the fantastic Brainpicker website which has found a rare video of a 1986 PBS documentary known as The Entrepreneurs.

It offers "a rare glimpse of Jobs’ original vision with NeXT, from his aspirations for higher education and simulated learning environments to his decision-making process on price point and product features to his approach to company culture and motivational morale".

Watch and marvel.


Monday, November 28, 2011

CAMBRIDGE PHENOMENON - LESSONS FOR WALES

Last week, Sir Terry Matthews announced the establishment of the Welsh version of his bootcamp for technology entrepreneurs via the Alacrity Foundation.

Based in Newport, the scheme will take on ten graduates to develop products in information technology, eventually creating companies in Wales by the end of the year in which the recruits will have a 25 per cent stake.

Such a scheme is long overdue and may finally begin to address the innovation deficit that has plagued Wales for too long when compared to other parts of the UK.

In fact, the challenge in developing a growing knowledge-based economy were demonstrated by a report released this month on one of the great success stories when it comes to maximising regional innovation potential.

The city of Cambridge in East Anglia has long been seen as one of the major innovation hotspots not only in the UK but in the World. The development of this success was first documented by the seminal 1980s publication, “The Cambridge Phenomenon”, which demonstrated how technology-based firms had been developed around one of the World’s top universities.

The new report, entitled “Cambridge, from the lab to the limelight” picks up the story twenty-six years later on the continuing growth of the region.

Despite being a small educational city with a third of the population of Cardiff, it is estimated that there are now 1,500 technology firms situated in Cambridge itself with around 40,000 employees. Contrast this to 1984, when the Cambridge Phenomenon report identified 300 firms employing 15,000 people.

However, if we look at the greater Cambridge region itself (20 mile radius), there are currently 27,500 firms, employing more than 700,000 people, mostly in high skilled industries. Their contribution to the local economy is estimated to be around £12billion per year, which is roughly a fifth of the annual GVA of the entire Welsh economy.

In fact, seven billion dollar businesses have been developed in the Cambridge area during the last fifteen years including Autonomy, which was recently sold to Hewlett Packard for $12billion.

And the effect of this can be seen in the wider economic statistics. The unemployment rate in Cambridge is 2.1 per cent (as compared to 9.3 per cent in Wales) and the number of jobs in the research and development sector is eighteen times the national UK average.

So what are the reasons for this success?

Obviously, it has one of the World’s top universities with around 7,000 graduate students every year but both Oxford University and Imperial College London are also regularly in the top ten global institutions and have nowhere near the track record of Cambridge in developing technology-based firms.

Some have suggested whilst the University itself is the source of knowledge on which new companies are based, the commercialisation potential is magnified through the presence of a strong innovation ecosystem.

These includes a small but significant network of institutions and associations that foster innovation and support entrepreneurship working alongside a group of successful entrepreneurs who have become the angel investors that fund the new high technology companies in the region.

It is also worth noting that the Cambridge economy isn’t about picking winners but about supporting commercialisation of ideas from wherever they emerge. That is why some of the leading companies are not limited to one or two sectors but are based across a spectrum of industries ranging from biotechnology to gaming to medical technology to materials.

Is the Cambridge Phenomenon unique or can such success be replicated?

In Wales, perhaps the biggest problem is that there still seems to be a disconnect between the different actors in the private and public sectors when it comes to developing a similar approach in Wales, especially in terms of innovation support.

Certainly, the failure of the Technium programme to have any real impact on changing the innovation ecosystem and developing any significant cluster of high technology companies shows that there must be greater partnership and interaction between government and business if such ambitious projects are to succeed.

Of course, there are also problems in Cambridge that can be instructive to Welsh policymakers.

For example, a recent study suggested that one of the key issues is the lack of facilities for new R and D firms to move from pure research into production or manufacturing, which then results in those firms leaving the region or even the country altogether. It is certainly something that urban planners in Wales need to consider carefully if there is to be a focus on stimulating greater numbers of spinouts from the University sector or via the Alacrity Foundation, especially as Wales is the only region in the UK which does not have a proper science park.

Therefore, I am sure that there are lessons to be learnt from the Cambridge experience, especially by those who are working hard to develop Cardiff, Swansea and Newport, all of which have aspirations to become cities based on the knowledge emanating from the local university sector.

Sir Terry’s bootcamp programme is certainly a step in the right direction but there is a real need to consider what other key factors are necessary within the Welsh economy to not only develop the successful technology companies of the future, but to grow and retain them here in Wales.

Thursday, November 24, 2011

THE SINGAPORE ECONOMY - WILL IT CONTINUE TO GROW?

Arrived in Singapore yesterday afternoon for a four day jetlagged visit.

Given the fact that the island economy is still seen as one of the growth regions of the World, it is always revealing to examine what has been going on in recent months.

Certainly, growth has been outstripping that of the UK, with the Straits Times reporting that Singapore's economy is expected to grow by around 5 per cent in 2011.

Despite this good news, the expansion of the economy is not expected to last and is expected to slow down next year - growth is estimated at  anywhere between 1 and 3 per cent. The last time Singapore experienced such weak growth was in 2008 when the economy expanded by just 1.5 per cent (although it contracted by 0.8 per cent in 2009).

However, in calculating the state of the economy in 2012, the Ministry for Trade and Industry has not factored in downside risks to growth, such as that of a worsening debt situation leading to a full-blown financial crisis in the advanced economies. In fact, the outlook for Singapore's export-dependent economy seems volatile, with some economists even warning of a contraction if global demand continues to falter, especially following a 16 per cent drop in non-oil exports in October, double what the market had expected.

With non-oil domestic exports to the US falling by 51 percent and to the European Union by 31 percent, it demonstrates that the Asian economy is still affected by what goes on in the old economies of the World.

However, Singapore remains a growth centre with which other nations are keen to do business, which is not surprising given that it was ranked first in the World for employment in knowledge-intensive industries, innovation linkages and export performance by the Global Innovation Index (and third overall in the World).

Take, for example, the France-Singapore Innovation Days programme, put together to facilitate greater linkages between the two nations, which included showcasing five French companies and four Singaporean companies at different stages of development. Certainly, I would like to see the Welsh Government trying to do more to support linkages, especially in linking up our university sector with both higher education and industry in Singapore.

Tuesday, November 22, 2011

GOOGLE AND STANFORD - A STORY WORTH LISTENING TO

Google founders Larry Page and Sergey Brin talk about the influence of Stanford University as a catalyst for university-industry interaction.

Monday, November 21, 2011

ENCOURAGING ENTREPRENEURSHIP AMONG YOUNG PEOPLE

For a man who is not shy in courting publicity, it is not surprising to see Sir Richard Branson in the business press again this week.

Yet his audacious purchase of Northern Rock, soon to be merged with Virgin Money, may have overshadowed another more important development namely the publication of a report sponsored by Virgin Media entitled “Control Shift: the Rise of Young Entrepreneurs”.

Through the Control Shift campaign, hundreds of young entrepreneurs have been consulted by Branson’s team on what can be done to develop and encourage a new generation of businesspeople in this country.

By challenging current thinking, they have developed a set of proposals that are a wake-up call to all politicians and policymakers who want to reinvigorate the economy.

For too long, entrepreneurship has been seen as a last resort policy by many to economic development and unemployment. Yet there is overwhelming evidence that start-ups are the job creators of the economy and whilst entrepreneurs need courage, conviction and commitment, they also need investment and, more importantly, support.

So what do young people themselves believe could be done to help develop a more entrepreneurial climate amongst their peers?

First of all, they propose that the way that entrepreneurship is taught in schools should be transformed to ensure that self-employment is promoted as a viable career option for students. This can be done through increased exposure to real life businesses and utilising local businesspeople as mentors.

Secondly, a greater culture of collaboration should be encouraged in enterprise support for young people so that information is not split amongst different organisations, thus creating confusion and duplication for those wishing to start a business. Instead the public, private and voluntary sectors need to work more closely together so that potential entrepreneurs can be supported effectively and efficiently.

Thirdly, big business should be encouraged to support new start-ups by adjusting their processes and making smarter use of their assets, such as better procurement, using staff as business mentors and opening up office space for new firms.

Fourthly, society should look at the way it invests in young people. Whilst it is relatively easy for an 18 year old to get a student loan to go to University, it is almost impossible to get a loan to start a business. Government could change this by ensuring that the student loan company makes start-up loans available to young people on the same terms as student loans.

Finally, young people should be encouraged to do it for themselves. Whilst most of the news is about the rising unemployment and the lack of job opportunities, there is a requirement for everyone to encourage young people to take full advantage to explore and exploit the opportunities in the market.

At a time when unemployment amongst 16-24 year olds has passed the one million mark in the UK, it is critical to support those young people who want to start up a business and contribute to the economic wealth of this nation.

With the right advice and support, they could develop the next big thing and many of the superstar companies of the last decade were developed not by experienced managers but by young people. Sergei Brin and Larry Page were both in their mid twenties when they established Google and Mark Zuckerberg was only nineteen when he launched Facebook in his dorm at Harvard University. 

Even Branson himself started off his entrepreneurial career in his teens by establishing a student magazine whilst at school.

However, whilst the vast majority of young people have a strong entrepreneurial spirit and display incredible drive and enthusiasm, they still need support on their business journey. If government, as well as large firms, would do more to help nurture young entrepreneurs and maximise their potential, then the UK can emerge from this austere era into one of opportunity, enterprise and growth.

Thursday, November 17, 2011

THE WORLD OF SOCIAL MEDIA IN 2011

If you thought the impact of social media couldn't get more pervasive, it is worth having a look at this presentation.

Wednesday, November 16, 2011

WALES AND CHINA - SHOULD WE BE FOCUSING OUR EFFORTS ON THE SMALLER INNOVATIVE CITIES?

The First Minister of Wales recently visited China to sign an agreement with Chongqing, a major city in the west of the country.

This commits Wales to furthering economic development links and continuing to work together with this municipality in the fields of science, technology, culture, health, education, agriculture, forestry management, environment, governance and tourism.

Whilst a visit by the First Minister to China to develop further links is to be welcomed, this is hardly groundbreaking progress.

In fact, this latest relationship merely builds on an earlier memorandum of understanding (MOU) between the Chongqing Municipal Government and the Welsh Assembly Government, signed by Rhodri Morgan in 2006 in which they agreed to collaborate and co-operate in a number of areas.

As regular readers of this blog will know, I am an avid supporter of Wales going out to the World  to not only trade with different nations, but to form important relationships that can help change the way we work and live.

However, I find it disappointing that in twelve years of devolution, the Welsh Government has made little progress beyond reaffirming an existing arrangement with a single Chinese City.

One would have thought that as a small trading nation, we would be choosing our partnerships carefully, especially as much of the focus of the recent trade missions was in building links between universities and businesses in both countries.

In fact, it is worth noting that according to the influential business periodical, Forbes China, Chongqing was not rated as one of the twenty five most innovative cities on the Chinese mainland this year.


Ranking
City
Administrative Levels
Province
Innovation Index
1
Shenzhen
City with separate budgets
Guangdong
1
2
Suzhou
Prefecture-level
Jiangsu
0.998
3
Shanghai
Municipality
-
0.992
4
Beijing
Municipality
-
0.978
5
Wujiang
County-level
Jiangsu
0.950
6
Wuxi
Prefecture-level
Jiangsu
0.949
7
Hangzhou
Provincial capital
Zhejiang
0.945
8
Kunshan
County-level
Jiangsu
0.922
9
Changshu
County-level
Jiangsu
0.920
10
Zhangjiagang
County-level
Jiangsu
0.919
11
Dalian
City with separate budgets
Liaoning
0.892
12
Dongguan
Prefecture-level
Guangdong
0.889
13
Nantong
Prefecture-level
Jiangsu
0.879
14
Ningbo
City with separate budgets
Zhejiang
0.876
14
Shaoxing
Prefecture-level
Zhejiang
0.876
16
Yixing
County-level
Jiangsu
0.864
17
Zhongshan
Prefecture-level
Guangdong
0.861
18
Wuhu
Prefecture-level
Anhui
0.847
19
Guangzhou
Provincial capital
Guangdong
0.838
19
Hefei
Provincial capital
Anhui
0.838
21
Taicang
County-level
Jiangsu
0.814
22
Tianjin
Municipality
-
0.803
22
Foshan
Prefecture-level
Guangdong
0.803
24
Yangzhou
Prefecture-level
Jiangsu
0.784
25
Changzhou
Prefecture-level
Jiangsu
0.781


Not surprisingly, the number one city on the list was Shenzen in South East China (across from Hong Kong) where the total output value of high-technology products reached 1 trillion yuan (£100 billion) in 2010.

Therefore, if Wales is to build international links that benefit our universities and the technological capacity of our business community, then surely policymakers should consider innovation hotspots like Shenzen.

But given the size of Wales, perhaps it should not be large cities like Shenzen or Chongqing that should be the focus of the Welsh Government, especially as they would also be developing partnerships with other economies looking for trade links with the most populous areas of China.

For example, businesses from Sheffield have also recently taken part in a trade mission to Chongqing as they seek out international trade opportunities. And in the same week that Carwyn Jones was signing his new MOU, the Belgian port of Antwerp was entering into agreements with the city for training purposes and to create trade partnerships.

So where should Wales focus its effort on building stronger links with China?

It is worth noting that more than half of cities on the list of the most innovative in China are far smaller than Chongqing.

Indeed, of the top ten, four have a population of less than two million and are located less than two hours’ drive from the business giant that is Shanghai.

Given their small size, perhaps these are the cities that Wales has more in common with and, more importantly, would be more willing to have a closer relationship than the one we currently enjoy with Chongqing.

The Welsh Government remains determined to focus all of its efforts on one Chinese city, but surely we should start to build links with some of the smaller innovative cities in China?

At the very least, it would enable  universities and businesses to identify new opportunities and establish a more direct and less competitive route into one of the World’s fastest growing economies.