The Asian Century: An opportunity for innovation over isolationism
In the words of Bob Dylan: The Times They Are A-Changin’. Last year delivered two historic changes in the West: Brexit and the election of President Trump. The implications for international tax, trade and immigration are great. But from the Asian perspective, it is doubtful that these changes are for the greater good.
This new era in Western politics coincides with the Asian Century, the region’s race for growth. By 2050 Asia is expected to be as wealthy as Europe on a per capita basis and the signs of progress are already evident. After all, it’s Asian companies that are going global and Asian companies that increasingly feature on the Fortune 500 list. Take the 2016 list, for example: China alone offers over 100 companies, three of which rank among the top five.
From this position of strength, we see more foreign direct investment (FDI) by Chinese companies in the US. A recent report by the Rhodium Group, which examines FDI between China and the US, states that the volume of investment across industries has grown dramatically—on average more than 30% annually from 2011 to 2015. Yearly flows soared from less than $5 billion in 2011 to more than $15 billion in 2015—and are on track to double from that level in 2016. In 2015, Chinese FDI in the US exceeded US flows into China for the first time.
Asian businesses are vulnerable abroad in a post-truth era
But the Trump administration will undoubtedly challenge Asian companies, particularly those in China, who seek global expansion. Many of them, particularly in sensitive areas such as technology, already face political opposition and isolationist policies will only further restrict their growth.
It is these technology companies—not just in China but all across Asia—that are driving innovation and earning the region the reputation for being one of the world’s most dynamic for e-commerce, social networking, ride sharing and gaming.
In China, for example, the likes of Alibaba and Tencent apply technology to create bold new business models such as Alipay and WeChat. These are not copycat products and services of Western offerings—they are truly disruptive. They satisfy the needs of domestic consumers and create needs in Western consumers (wouldn’t you love to book your next holiday over text message?).
In this new era, Chinese internet companies will have specific reputational challenges to overcome. The upcoming PRC Cybersecurity Act will make it difficult for Chinese companies to reconcile the demands of their domestic and international stakeholders.
Chinese companies looking to invest in the US will also increasingly face scrutiny over their impact on national security. In November last year in Washington, a Congressional Commission recommended that the US place curbs on investments by Chinese entertainment, media and internet companies in response to censorship and restrictions that Western media and internet companies face in China. Whether these concerns are valid is irrelevant—perception is driving policy in this post-truth era.
Eight ways companies in Asia can win in the West
So, what does this mean for us as communicators? How should we communicate this story of Asian innovation in an increasingly isolationist world? Here are eight ways how Asian companies can win in the West:
- Don’t underestimate the importance of values to stakeholder analysis—the US election shows that we know less about one another than we think.
- Analyse the implications of greater protectionist policies on your company’s work force, your country’s trading partners and the regulations by which you currently operate. Start preparing your position on this now across key Western markets, most notably the US and the UK.
- Seek partnerships with NGOs and government to identify opportunities for shared value. Partners can be your most valuable allies.
- Continue to embrace diversity and expand inclusion. This is not only good business, it’s smart business.
- Communicate the benefits of your products to local communities. Focus on what they mean for people and their families, rather than how they’re better than your competitor’s offer.
- Use your power to convene. A story on your role in nurturing the innovation ecosystem is as important as the product innovations that result.
- Use your power to convene for a higher purpose that establishes your brand best in the new world order. Look for opportunities to connect and lead tri-sector Your role in nurturing the innovation ecosystem, for example, is as important as the product innovations that result.
- Continuously tell and retell your story in a fresh light, as well-equipped for the future, leveraging and leading change to maximum advantage.
The Asian Century is still in development, and its promise threatens to be curtailed by isolationism and protectionism. As communicators, we have an opportunity to positively shape this era by connecting people, ideas, and points of view across East and West. The times are certainly a-changin’, and it’s our responsibility to ensure they’re changing for the greater good.