The Chinese Innovation Conundrum

It’s common to hear that “Chinese can’t innovate or create”. It’s not wrong – but it’s not accurate. Chinese can be very innovative, but not in the way Westerners expect or desire. In other words, not in a way we know how to make money off of.

Pure research vs. applied research
In some ways, it boils down to same pure science vs. applied research gap that we’ve been hearing in Asia ever since the 1980s when Japan was the flavor of the month. Americans, led by their university researchers and big, expensive corporate R&D teams, think that innovation and originality are the same thing. Asian researchers, driven by a combination of Confucian conservatism and market-driven practicality put a premium on refinement and adaptation.

Americans like blue-sky research. We look for category killers that have never been imagined before. We favor inspiration and originality. Steve Jobs was our reigning king of geekdom, and our motto is “build it and they’ll come (to buy)”.

Chinese techies are resourceful problem-solvers. In the pre-Deng bad-old-days when China was struggling with shortages and poverty, these were the guys who could make the machines work without parts, tools or instructions. They are incremental refiners. Chinese techies want to know what it will do before they try anything. They favor adaptation and adjustment. “When they come we’ll build it.”

One approach is not better – or even more profitable – than the other, but they aren’t interchangeable.

Managing Inspiration: Lightning strikes vs. Stepping Slowly
This will be a key challenge for international managers, because as China becomes a crucial market and regional management center we’ll all be looking for Chinese to apply their knowledge and creativity to shape organizations, design products for Chinese (and global) markets, and devise distribution and supply chains. Many western HQs, however, still view China as a nation of factory workers, clerks, middle managers and of course, consumers. That’s a pretty sterile and unproductive view coming from people who pride themselves on “the vision thing”.

Maybe the problem isn’t really about creativity at all. It’s more about management, communication and organizational behavior. Chinese innovation and creativity are there, but Chinese are not comfortable shouting out ideas at brainstorming sessions.

In China, if you want creativity then you have to negotiate for it. Americans volunteer how smart we are, Chinese guard it. Sometimes they are embarrassed to stand out from their group, but sometimes they simply don’t want to give it away for free. “Knowledge is power” is taken to extremes in China, and smart people don’t give away something valuable for nothing. As international managers, we have to make innovation and problem-solving part of the bargain.

Tapping into Chinese creativity is part-and-parcel of the relationship building process. We have to align goals, build trust and explicitly build communication channels. Western managers must stop expecting locals to follow the same linear thought process that characterize our definition of intelligence. Sometimes the best thing for leaders to do is spell out the challenge, discuss goals and then walk away. Let them sort it out in their own messy process.

Driving your team on, or driving them out?
American managers see themselves as motivators – as the stick that drives the organization forward beyond old limits. To a Chinese colleague, however, this can seem like a betrayal of the terms governing your professional relationship. For many old-school western bosses, their main managerial contribution to the creative process is either approval or dissatisfaction. International leaders have to add value – or prepare for obsolescence. Our Chinese partners don’t want yes or no. They would prefer some synthesis of our technological inspiration and their incremental refinement.

Americans who buy into the mantra of the “uncreative Chinese” risk being left in the dust by a local partner or employee who innovates just fine when it comes to striking out on his own with a tweaked, improved version of your technology or business plan.

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