China And Electric Cars

"China is set to become the world's largest producer of environment-friendly cars within 10 years, largely due to the central government's backing and the domestic car makers' ambitions to push electric vehicles, according to business consulting firm Bain & Company."

See the complete article at the China Daily here. The Cherry S18 electric car is pictured on the right.

This level of Chinese government push this early in the country's automotive industry's growth bodes well for the future of the Chinese consumers and their environmental aspirations.

Communities Of Choice - The Avenue For 21st Century Breakthroughs

I have written consistently and proven the point that there is a myth called wisdom of the crowds. Perhaps it is a marketing term now engulfing the tera-intellect.


An excellent example in the Wired magazine article "There's Power In The Puzzle" here, highlights yet again how the power of communities formed by choice can drive breakthroughs past the imagination of the initiators of the idea for the community. The article discusses a SETI@home like program yet driven from a gamer's perspective, i.e. putting the people in the center of the process. The result is a game called Foldit -

"It simply serves up a multicolored knot of spirals and clumps—a 3-D render of a protein. Players use the cursor to grab, bend, pull, and wiggle the chain of amino acids anywhere along its length, folding the protein into its optimum shape. The only rules are based on physics—opposite charges attract, atomic bonds have limited angles of rotation, and the parts of the molecule that stick to water tend to point outward. The closer your model's properties adhere to those rules, the more points you get."

Yet, the important part of this activity was:

"Working on test proteins for which Baker already knew the structures, folders quickly started to make friends via the in-game chat channel. They shared insights and half-finished puzzles; teams emerged, and collective efforts proved far more successful than any solo folder. A member of the leading team named Jason Kuznicki ... set up a wiki that Popović adopted as Foldit's official manual. "We even built a mini-Facebook for them," he says."

I believe the 21st century is going to be about "communities of choice" driving breakthrough innovation. The internet will continue to flatten the intellectual landscape and making collaboration ubiquitous, where a student who has completed the MIT computer science course work through MIT's open-courseware in Vietnam's low socio-economic class (see excellent article here) can engage in direct scientific analysis with individuals independent of geography.

Note that the winner of the game of Foldit who developed a complex protein is a 13 year old.

Product Innovation from India

While at P&G, I developed a R&D center outside of the USA. It is exciting to read this article "Outsourcing: Product Innovation from India" here, highlighting how India has slowly but steadily moved up the product innovation value chain at RealInnovation.com. Even though the article is based on a white paper originally published by Zinnov in 2005, it is insightful. The article states:

"As of 2005, more than 150 international companies, large and small, were doing R&D in India. Multinational companies started hiring strong leaders to run their development centers in India. Some of these companies imported expats (professionals returning from the United States, the United Kingdom and other Western countries) to run their operations in India. The leadership teams of these companies understood that they could do a lot more from India than simply being a back office to the product teams in their home countries. Thus began a quiet revolution. The India-based leadership teams of these companies convinced their executive management to allow them to take ownership of certain products whereby the Indian teams could conceptualize and build new features and modules."

Here an excellent diagram from the article showing the product companies operating in India as of 2005.



Update: A macro-economic number showing India had 5.4% growth in Q1 2009 vs. projected growth of 5.2%.

Smart Mobs!

Interesting article on communities of choice (not wisdom of crowds) leading the way to collaboratively support each other towards a goal in the article "Smart Mobs, Smarter Puzzles", here authored by Clive Thompson. The article states:

"It's in becoming a neuron in a much bigger intelligence: Finding a piece of evidence, contributing it to the wiki that players inevitably create, and brainstorming with others to figure out what everything means. ARGs could not have existed before the Internet."

One of the best examples of this phenomena is the coupons and discount codes space on the internet that is not corporation or for profit organization driven.

China - Recession Proof?

Very good video and transcript at The McKinsey Quarterly, "Is China Recession Proof?" here.

China - Consumer Sector Updates

Through my good friend Mr. Tony Tsai:

Ministry of Health to launch two-year crackdown on illegal food additives
May 11, Su Zhi, deputy director of the Food Safety and Sanitation Surveillance Bureau under the Ministry of Health, says the ministry will launch a two-year crackdown on illegal food additives. He puts forward a five-point proposal on the crackdown of illegal additives, such as improving related standards on food additives and further strengthening the government's measures for food safety supervision and crackdown.

It is hard to keep China's fuel prices in line with international crude oil prices
The National Development and Reform Commission (NDRC) has published the administrative measures for crude oil prices, taking effect May 8 on a trial basis. According to the measures, China will adjust domestic fuel prices when global crude oil prices report a daily fluctuation band of more than 4% for 22 working days in a row. The launch of the measures is aimed at keeping China's fuel prices in line with international crude oil prices, in order to ensure Chinese fuel prices do not drop lower than international crude oil prices. If that happens, the Chinese government will have to increase fiscal subsidies to oil companies and the domestic oil industry and market will become disorderly. Zhou Xiaogang, an energy expert, thinks it is hard to keep China's fuel prices in line with international crude oil prices. China's oil market is not competitive. Private oil firms are still weak, and unable to compete with domestic state-owned oil giants.

PWC: there is a great deal of room to increase human capital effectiveness in China
PricewaterhouseCoopers (PWC) recently published the research report about human capital influence among China's listed enterprises for 2008. The report pointed out it is a good idea for Chinese enterprises to increase core competitiveness of human capital which can help them tackle economic crisis and realize long-term sustainable development. Compared with enterprises in the US and Europe, there is a great deal of room for China-listed enterprises to increase human capital effectiveness.

Expert: consumer prices expected to show rise in second half of year
May 11, the National Bureau of Statistics says that China's Consumer Price Index (CPI) fell 1.5% in April from a year earlier, marking the third straight decline. China's Producer Price Index (PPI) fell 6.6% in April year-on-year, marking the fifth straight decline. But some experts believe that consumer prices should show an upward trend in the second half of the year. The government stimulus package and explosive loan growth will drive industrial product prices and consumer prices up.

Beijing to reduce 300 hectares of land supply for commercial buildings and to loosen control on foreign investment in local real estate market
May 11, the Beijing Municipal Bureau of Land and Resources publishes the 2009 annual land supply plan. By the end of last year, approximately 40m sq m of commercial buildings had not been sold, which is expected to meet market demand for two to three years. Compared with last year, land supplied for the construction of commercial buildings in Beijing this year will be down by 300 hectares. The Beijing Land Reserve Center will loosen control on foreign investment in Beijing's real estate market.

Coca-Cola claims it will focus on existing brands and give up take over of Huiyuan Juice. According to media reports, Coca-Cola is set to abandon any attempt to take over the Huiyuan Juice Group. Buying a small stake with no decision power is not what Coca-Cola wants at all. May 12, Coca-Cola says in a statement, "We were disappointed, but we also respect the Ministry of Commerce's decision not to approve our proposed purchase of the Huiyuan Juice business. We are now focusing all of our energies and expertise on growing our existing brands and continuing to innovate with new brands, including in the juice segment. Beyond that, it is our policy not to comment on speculation."

Thoughts on Consumer Insights

Below is a quick and nice look at what consumer insights mean from a presentation on SlideShare. What provided me value from it? The author, Giulio Bonini, states that there are four properties of a consumer insights: (1) Deep, (2) Original, (3) Base of your communication, and (4) Specific for your target. Enjoy!

World's Most Innovative?

Here is an article from BusinessWeek on "The 50 Most Innovative Companies". Fascinating!

More enjoyable is the article "The World's 25 Unsung Innovative Companies" here.