Innovation - Making Breakthroughs in Growth

 

Outstanding examples
The Dien Quang Bulb Joint stock Company is one example. In response to the Government's policies on energy saving, the company has researched and marketed new 32 watt fluorescent tubes which have the same light quality with 40 watt tubes but can save 20 per cent of energy. At the same time, the manufacturer can save materials, thus helping the company reduce production costs. The company has renewed technology for manufacturing fluorescent tubes and marketed the product model of Max 801, which uses tricolor phosphor powder. The solution resulting from research into why the number of short-sighted pupils and students has increased sharply. The company has offered products, which are safe to eyes of users, especially those of children, and help save energy. The company, therefore, has had advantages in terms of price and outstanding features of its products.

Apart from scientific and technological application, Vinacafe Bien Hoa, which won the WIPO prize in 2005, has become famous for the number of creative ideas, especially regarding intellectual property applied to production and business activities. Sixty five per cent of the company's innovation ideas belong to young engineers, technicians and workers. Nguyen Thanh Tung, marketing manager of Vinacafe Bien Hoa, said in quantity, each year the company developed around 100 innovative ideas, which had helped the company increase its revenues by between five and seven per cent, making a contribution to increasing the company's share in the local instant coffee market to 50.4 per cent. As a result, the company's export turnover in 2005 reached US$3.8 million.

There are many other Vietnamese enterprises, which have been successful with innovative ideas in production and business. The Viet Tien Garment Company, which won the 2004 WIPO prize, is an example of success in applying the intellectual property system. As a result, the company is the leader among six enterprises with the highest profit within the Vietnam National Textile and Garment Group (Vinatex). In the financial and banking sector, such banks as Vietcombank, Techcombank and BIDV have applied modern technology, especially information technology solutions and products in their activities to provide better services for customers as well as to catch up with modern technology trends in the world.

CEOs' opinions on renewal and creativity in enterprises
Renewal and innovation are understood as a process of developing and transforming a new idea into trade values. These include the launch of a completely new or renovated product (eg, Pentium chip, hybrid seeds, genetically modified food,..), new production method (eg, the Henry Ford automobile production line and the Pilkington switchable glass technology,…), new business models (eg, franchise, joint venture,..), new convenience, markets and new distribution channels for existing products (online selling and other new supplies...).

Those groups and companies, which have been successful in applying innovative ideas, have similar features. Accordingly, they have focused on the global market and expanded their activities in the international arena. They have had balance growth strategies and invested more in research and development in accordance with their market orientations. Furthermore, they have concentrated on customer-related issues and a creative culture to create the growth by developing new products and services.
Recent IBM research entitled 'Expand your innovative vision' about CEOs globally, shows that CEOs of many major groups and leaders of some governments considered renewal and innovation major factors resulting in their organisations' success.

According to statistics in the research, two out of every three questioned CEOs said that they wanted strong changes in their organisations in two years' time. It is surprise that no CEOs said they were discouraged by change. Instead, they had seen opportunities, which could be taken via renewal and innovation. Among the fields which need renewal and creativity, innovation in business model is very important.

Meanwhile, co-operation with the outside is indispensable. CEOs stressed the importance of innovation alliance, which has been beyond the boundary of an enterprise or a company. Business partners and customers are considered as the first sources of innovation, while research and development have dropped to a lower position.
However, big challenges remain in developing business plans and innovation. This includes exploiting maximally hidden talents in companies and groups with policies, which may change the management behaviour in both private and State-owned companies. According to experts, at the national level, Vietnam should establish a business strategy building institute, which is responsible for balancing and distributing and allocating policies and instruments for companies and combining plan development with business activities, stimulating a change in behaviour, so that business plan development, renewal and innovation will be given with more attention