Innovation And Change For Business Sustainability

Innovation and Change for Business SustainabilityNik Mohd Hasyudeen YusoffCEO, Inovastra

Competitiveness Through Innovation and Strategy



Source: NEAC


Source: NEAC


Source: NEAC



Source: NEAC


Source: NEAC


Source: NEAC


Source: NEAC


“We were successful in the past in transforming the economy from agriculture to industrial-based.

We now have to shift to new economic model based on innovation, creativity and high value-added activities. Only then we will be able to remain relevant in a competitive global economy”

2010 budget speech


Source: NEAC


Key Strategic Thrust Relating to Innovation•Thrust 1 – Move the economy up the

value chain▫Increase the value add of manufacturing,

services and agriculture▫Generating new sources of wealth in

technology and knowledge intensive sectors

▫Expending the market for Malaysian product and services


•Thrust 2 – To raise the capacity for knowledge and innovation and to nurture First Class mentality▫Improving access to and quality of

education system▫Nurturing top quality research and

development, and scientific and innovation capability

Key Strategic Thrust Relating to Innovation


What Is a Business?•A business:

▫Needs to serve customers▫Needs to compete▫Creates value and return to

shareholders and stakeholders▫Operates in business environment

that keeps on changing▫Is affected by global developments▫Generates profit through risk

taking (uncertainty)


Value Creation is Key to Business Sustainability

• Value creation is multi-facet and could be viewed from internal dimension as well as external dimension

• Balancing the value proposition to shareholders and stakeholders would be key to business sustainability

Value Creation Facets of BHP Billiton


Leadership

Strategy

Values

People Processes

PlatformIntellectual assets

Business partners

Physical resources

Institutional partners

Value proposition

Functionality

Feelings

Financials

Internal resources Value creation

External network

Protocol

Customers

Inovastra’s view of value creation

How Does A Business Create Value?


• In ensuring business sustainability, the appreciation of risks and mitigation of risks at the strategic level is very important

•Key strategic risks are:▫Demand risk▫Competitive risk▫Capability risk

Doing Nothing About Risk is Definitely Risky


YourBusiness

YourCustomers

YourCustomers

YourCustomers

YourSuppliers

YourNetworkPartners

YourCompetitors

YourCompetitors

Economy

Environment

Technology

Society

Politics

Changing business landscape and risk profile


•Politics drive government policies which would affect the economy and business climate

•Global and regional political developments add to the complications of local politics

•How far would the G-20 initiatives would affect you?



• The inter-linkages between economies could not be denied anymore and any changes in other places would affect the local economic conditions

• The globalisation and regionalisation of business require businesses be involved in more than one economic regions

• Do you think the AEC 2015 will affect you industry and your business?



•Rights•Health•Education•Security•Distribution of wealth•New lifestyles•Demography

•Which one of these elements would affect you business most?



•Technology has been one of the factors that levels economies and markets

•Enables new business•Destroy existing business•Allows different ways of running

businesses

•Would Web 2.0 makes your business model obsolete?



• The Green Economy would be more visible in the years to come

• Rules and regulation, domestically and in the market you serve, would require businesses to assess the business models

• Is your business already affected by environmental issues?

• What will happen post Copenhagen?



•Don’t be caught like a frog!


Series1

0

2

4

6

8• Turbulence is the

unpredictable and swift changes in an organisational internal or external environment that affects its performance

• A business arrives at a strategic inflection point when its old strategy no longer works and must be replaced by new one if it want to ascend to new heights

LevelOfChaos

Time

Strategic Inflection Point



• Giving up the illusion that you could predict the future is a very liberating moment. All you can do is to give yourself the capacity to respond to the only certainty of life – which is uncertainty. The creation of that capability is strategy.

Lord John Browne, Group Chief Executive of BP

Ability to Respond Swiftly to the Change is Critical


Network-Centric Innovation






Services and it’s Economic Significance•Trade in services grew by

18% compared to 15% in good in 2007

•However, trade in services in only 19% of total world trade

WTO International Trade Statistics 2008


Services and it’s Economic Significance•Trade in commercial

services in 2007 was highly concentrated in North America, Asia and Europe (representing 15, 29 and 50 per cent respectively of total commercial services trade).

WTO International Trade Statistics 2008


Services and it’s Economic Significance

• Since the 1990s, the volume of exports of EU goods and services increased in a broadly similar pattern, both by about 6.5% per year on average. Consequently services maintained their share of roughly 22% of overall international trade during this period.

European Union international trade in services, Analytical aspects


Moving Forward•Malaysia need to move from

thinking and talking to DOING•Sustainability of business depends

of the ability to create value in the ever changing environment

• Innovation needs brainpower including those outside of the organisational wall

•Services would be the key contributor to our economic growth
