The Launch of the Malaysia: Innovation Nation National Convention

By Monday July 19th, 2010 No Comments

1. It gives me great pleasure to stand in front of this large group of leaders and future leaders, both from the public and private sectors, from Malaysia and also from abroad to speak on a topic that is so important for us in facing future challenges. I am especially delighted to see the presence of creative young people, eager to make a change and drive their vision, and I’m glad that this conference affords the opportunity not only for industry players and members of academia to exchange views, but also for the young to absorb new thinking and share their own thoughts on innovation and creativity as an essential part of our path forward. I thank Limkokwing University of Creative Technology for their initiative to host this National Convention on Malaysia as an Innovation Nation, and I thank Tan Sri Dr. Lim Kok Wing and his team for inviting me to be a part of this important discourse.

Ladies and gentlemen,

2. The world that we live in today, and the world of tomorrow is and will be quite different from the world some of us knew in our younger days. Today, the forces of globalisation are making changes which once were considered not possible. Large countries that had closed borders are now open playgrounds for the business and industrial communities. Those who believed in closed doors now have an “open door” policy. The BRIC countries (Brazil, Russia, India, China) are making such headway that disruption to the status quo is inevitable. Heraclitus, the Greek philosopher who lived more than 2500 years ago, was right when he said that “change is the only constant”.

3. The changes that we are experiencing today are largely a result of an accelerated pace of innovation. Time and again, we have seen that innovation leads countries out of their “locked space” and propels them forward, thereby increasing both their economic status as well as the quality of lives of their citizens. We are now at a stage in Malaysia’s adolescence where we too have to take the plunge and work towards making the country and citizens climb up the ladder of improvement. This is the very purpose of the New Economic Model that I have initiated. I want Malaysians, of all races and backgrounds, to benefit from a high-income economy through inclusiveness and sustainable activities that do not compromise future generations.

4. The New Economic Model charts the way forward for us. To achieve the bold ambitions that have been set out, we will need to change the way we have been doing things. In other words, we will have to innovate. We have achieved tremendous success so far, but what got us to this stage will not necessarily take us to the next stage. Innovation is one key mechanism that will. Our efforts to innovate therefore, have to be intensified at a relentless pace.

5. There are many definitions of innovation but from my perspective, two manifestations stand out. The first is that innovation is something that generates new wealth for the individual, the company or the country. Using creativity as a building block, innovation results in activities that allow one to tap new sources of revenues which were not previously possible. The second instance of innovation is where, using creative methods and approaches, social improvements are achieved. Either way, the end result of innovation is a better and improved life for the citizens of Malaysia, and this is my main drive in pushing innovation to the centre stage and making it a national agenda.

6. The necessary conditions or determinants of innovation may be analysed at two levels: the determinants of organisational innovation over which firms have control (the internal environment), and the external social, business and regulatory environment within which firms and individuals operate.

7. For innovation to flourish, the environment in which one innovates has to be optimum. This means that the eco-system must support and not repress innovation. The actors in the eco-system must have access to the right conditions that encourage and stimulate them to innovate. This is a difficult balance to achieve as there so many factors that have to be looked at and addressed. One important area is education. The early skills of innovation lie in an ability to think critically, analyse and reason. Today, facts and information are widely available and are no longer differentiating factors. Just look at Wikipedia, the world’s largest encyclopedia that is available online and is totally free for anyone to use. Wikipedia is a good example of the economist Schumpeter’s idea of “Creative Destruction” – the traditional encyclopedia no longer holds the appeal that it once did. A person sitting in Kuala Lumpur has online access to the same information as another person in New York or Beijing. When information is no longer a possessive domain, the ability to analyse and critically examine that information becomes the competitive edge. Analytical and Critical Thinking (ACT) skills have to be developed in our education system so that this important requirement of the innovation eco-system is met.

8. The education system also requires a creative thinking ability. Creativity, unlike what was thought previously, is a highly organised and systematic activity. Michelangelo, the brilliant Italian painter and sculptor of the 16th Century, was so methodical and structured in his creative process that his diary almost reads like a scientific journal. His ability to create masterpieces was built on preciseness similar to that seen in high-technology industries. For the innovation eco-system to bring benefit to the country, we have to nurture this form of creative thinking in our education system.

9. Universities are a cornerstone of the innovation eco-system and have a major role to play. In developed countries, there is an active two-way flow of talent between universities and industry. This has enabled the infusion of innovation methodologies and best practices from industry into academia, resulting in universities becoming the hotspots of innovation. In Malaysia, this has not yet happened to the extent that is desirable or optimum and as a result, Malaysian universities are focused more on research – rather than innovation. Both are important, but a healthy balance has to be struck. Lessons on innovation from industry have to permeate the universities so that university research becomes more aligned to industry needs. Similarly, university students have to become conversant with the innovation requirements of employers.

10. The Government too is an important component of the innovation eco-system. We have embarked on a Government Transformation Programme and this is already beginning to show favourable results. We cannot stop at this – more has to be done. We have to bring innovation into government and government into innovation. This involves every level of the public sector – from the highest downwards. Decision makers in government must become conversant with innovation. This will enable them to formulate frameworks, regulations and policies that support innovation and not hinder its growth. Without a favourable regulatory environment, innovation cannot stoke economic growth.

11. The success of any innovation-driven growth strategy depends on the ability to attract a large community of creative individuals from different fields. Entrepreneurs, a large component of the innovation eco-system, have to be supported with skills that will foster innovation. These skills are typically found in the larger companies or in Multi-National Corporations (MNCs). The innovation ability of global giants like Nokia or Samsung or Apple has to trickle down to our SMEs, so that the eco-system is balanced and remains healthy.

12. Funding is yet another component that has a critical role in the innovation eco-system. The Malaysian Government has always had a generous allocation for R&D Grants and Risk Capital. It is time that we streamline these funding sources in order to optimise and maximise our Return on Investments (ROI).

Ladies and Gentlemen,

13. The government is well aware that the innovation eco-system in Malaysia needs to be tweaked and fine-tuned. We have been listening to the voices from the ground and have taken stock of the needs and requirements of the business and industry sector. It is the private sector that has to generate the income that we need to become a high-income economy. For the private sector to do this effectively, we have to create the right environment – from funding to talent to government policies. A highly evolved innovation ecosystem enables participants to work across enterprise boundaries, focus on customer value creation, respond quickly to shifts in market demand, accelerate the transition from research to production and be more adaptive to change.

14. An “Innovation Infrastructure” is required because the creative process is stunted whenever the environment is not correct. Last week, I announced the formation of a new unit under my office, called UNIK (Unit Inovasi Khas). This unit will start work in less than two weeks and will begin by identifying solutions to address the gaps in the innovation eco-system. UNIK will be examining all the areas of the eco-system that I have mentioned – government, universities, the education system, funding and skills.

15. Today, economies and innovation are more complex, dynamic and global than ever. Funding research institutes is no longer sufficient to drive innovation. The government is keen to extract the wealth hidden in the decades of R&D work that has been conducted in the country. We have to commercialise our work and unleash the economic gains trapped in the Intellectual Property. This will be done by the National Innovation Centre, announced by the Government in October last year. Given the significance of innovation in driving the nation forward, the National Innovation Centre will be placed under the Prime Minister’s Office in its formative years – similar to what was done with the Multimedia Super Corridor upon its inception. UNIK will drive strategies and policies while the National Innovation Centre will become its implementation arm.

Ladies and Gentlemen,

16. The government is with the people and the industries on this exciting passage towards a nation that is innovative and creative. The entire country has to come together, in true 1Malaysia fashion, to make this dream a reality. Innovation is a culture and this culture has to be ignited in our country. Malaysia must regain its competitiveness and move on to become one of the greatest nations in the world. To do this we must all work together, the public and private sectors; industry-players and individuals; one Malaysia, undaunted and relentless in the pursuit of excellence.

17. Let me conclude by once again congratulating the Limkokwing University for conducting this convention. This is an institution that has been pushing innovation in education for the past 20 years and at its helm is a man who has been advocating change through innovation for more than 3 decades. I commend Tan Sri Lim Kok Wing personally for his untiring commitment to creativity and innovation and I am certain the many students who hone their creative talents at his learning institutions are inspired by his dedication and zest for all things new and innovative.

18. To the speakers presenting their papers I wish to thank you for the effort and your support. I look forward to receiving the constructive ideas that I am sure will emanate from this meeting of dynamic minds. I wish you all the very best and hope that you have a productive conference ahead.

Thank you.

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