Southeast Asia can be at the forefront of tech- and human-centric innovation: Deloitte Center for the Edge

“There’s a common misconception that Silicon Valley is the sole source of innovation and tech startups,” observes Michelle Khoo, centre lead at the Deloitte Center for the Edge Southeast Asia. “We wanted to challenge [that narrative] and spotlight the innovation in Southeast Asia. There are a lot of different challenges here, and yet, there [are plenty of] startups that are turning disadvantages into advantages.”

Developed in collaboration with the Economic Development Board and the US-Asean Business Council, the second edition of the report delves into organisations across Southeast Asia that are tackling social needs through innovative approaches. 

The research uncovered a pattern of six distinct strategies, and surprisingly, not all were tech-centric. “[We learnt that] innovation is not just tech-centric, but also human-centric. It’s about finding creative ideas for reinvention,” says Khoo.

 

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What were some of the surprising findings of the report?

One surprising finding centred on business model innovation. We initially assumed it would be heavily tech-centric. However, Southeast Asia’s diversity challenged this notion. We found organisations turning limitations, like the lack of scale, into strengths. For example, in the Philippines, Billionbricks are helping low-income communities turn into homeowners through self-financing solar homes, blurring the lines between community and business.

What’s triggering this innovation in Southeast Asia?

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It’s a combination of factors, such as the region's economic growth, safe and advanced cities, and a large, educated, youthful population. Southeast Asia is no longer just a developing market; it is a promising region.

Can you give us an example of a strategy outlined in the report?

One of them is about finding value in things that we commonly overlook, like dormant surfaces. For example, companies like Xinterra are creating new sustainable materials where your fabrics are treated in such a way that they turn us all into carbon absorbing agents, like trees. 

Why should traditional companies care about creativity and innovation?

Change is accelerating with technology. It’s not just technological cycles that are getting shorter and shorter, but also social demographics in terms of the number of years between generations.  

Companies simply can’t rest on their laurels. They should be asking: How much of my industry can be disrupted, or how can I be a disruptor?

How do you inculcate values of innovation, progress and creativity into a workplace culture?

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I don't have any scientific backing to this question, but I do suspect that we have the capacity for creativity in Southeast Asia, but we might not have the permission. This means, giving employees the autonomy to explore things on the edge of their [responsibilities], and giving them the autonomy to learn from outside their industry.

We always tell our clients: If you really want to be trailblazing, you have to look outside your industry.

How have the past four years informed the trends and strategies we see today?

The Covid-19 pandemic forced organisations to adapt and innovate. Then, there’s the rise of new technologies, Gen Z’s focus on purpose, and the current geopolitical climate that are all shaping the innovation landscape.

How can governments ensure innovation while protecting the integrity of our society?

Governments play an important role in enabling and regulating innovation. But the challenge now lies in how fast things are changing. As a former policymaker, I understand the challenge of not wanting to overreact, which means you end up overregulating and stifling innovation. But you want to figure out the right time to intervene.

These are complex questions without easy answers. It’s important to recognise that the government shouldn’t act as a nanny, and individuals shouldn’t remain passive observers. We all share the responsibility of engaging in open conversations and contributing to solutions that promote both innovation and societal well-being.

Based on the report, do you have any recommendations on how governments can form policies to foster innovation?

Enabling infrastructure is important so we can all have access to fast internet. Singapore has already announced the ambition of increasing broadband speeds by 10 times by 2030 and Thailand has one of the fastest broadband speeds in the world. The benefits of enabling infrastructure help both businesses and end-customers.

Another role governments can play is in developing the ecosystem amongst startups, research communities, innovators and entrepreneurs.

What are some of the biggest challenges you foresee that entrepreneurs and companies might face in the next few years?

The challenge for Southeast Asia will always be scaling up in the region because there are so many cultures and languages. It’s not a new challenge, but it will continue to remain one.

Another aspect is the receptiveness to new ideas and tech, especially by older, more traditional companies and corporates. Many of them have decades of history and may not always be receptive to new ideas or tech. I think if they collaborate more with innovative outfits, they can de-risk the adoption of new ideas and tech, and the region can grow.

How can companies from Southeast Asia get more visibility on a global stage?

A positive trend I’ve seen is that companies are now more authentic and connected to their culture. That’s how they can [stand out] rather than try to be like the west. Many are returning to their culture and learning about the region.

What advice would you give to aspiring innovators and entrepreneurs in Southeast Asia based on the report?

I think Southeast Asia is the future and when you visit Southeast Asian cities, you get a sense of the energy here. My advice would be that you don't have to look for where the grass is greener.

 

Karishma Tulsidas is an editor and the founder of Contente, a content and PR company.