Early innovation can lead to success

July 05, 2024 | 15:27
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Innovation continues to become one of the driving forces for businesses, especially large ones, in the era of continuously developing technology, constantly fluctuating markets, and fiercer competition.

According to survey results published by Viet Research and VIR last week, 86 per cent of businesses admitted innovation is the most important growth driver for the next 3-5 years, a slight increase compared to the rate of 82 per cent in the 2023 survey.

Early innovation can lead to success
A raft of companies have been acknowledged for their innovative efforts in Vietnam

In 2024 alone, the rate of businesses implementing product and service innovation is likely to reach 83.5 per cent.

According to Mai Kieu Lien, Vinamilk CEO, innovation is the path that must be followed so that the company can inherit the cultural heritage of a 48-year-old brand and inject fresh, more youthful energy into it. In 2023, Vinamilk attracted attention with a brand repositioning campaign that spread well in the media as well as social platforms, followed by a series of product packaging changes.

“However, repositioning the brand is only the first step in the next 5-year strategy of the brand that holds more than half of the market share of Vietnam’s dairy industry, accompanied by a series of changes in digital transformation, employee recruitment, and management processes, with the goal of reaching consumers faster and more effectively,” Lien said.

“A brand that wants to exist for 100 or 200 years must always change with real conditions. During nearly 50 years of formation and development, Vinamilk has also changed many times and this change is no exception,” added Lien.

Fast Software Co., Ltd, one of the businesses honoured in the Top 5 Most Innovative Enterprises Vietnam 2024 in the field of providing solutions and business management software, believes that developing new products and improving existing ones is an important strategy that helps it compete with competitors in the same industry and accompany partners in the digital transformation journey.

“Technology requires innovation, and businesses that understand management technology early will easily achieve success. When supporting businesses in digital transformation, especially businesses that are operating in a traditional form, Fast Software is both a solution provider and a training provider to change their habits about technology,” said Nguyen Duy Hien, marketing director of Fast Software.

According to Nguyen Duc Hien, Deputy Chairman of the Party Central Committee’s Economic Commission, Vietnam has unveiled many policies to promote innovation. Resolution No.10-NQ/TW has the content of encouraging and supporting the private economy to invest in research and development activities, boost advanced technology transfer, develop innovation funds, and apply high technology.

Similarly, Resolution No.52-NQ/TW also set the goal of maintaining Vietnam’s ranking on the Global Innovation Index among the top three ASEAN countries by 2025 and being among the top 40 countries in the world by 2030.

“Vietnam also established the National Innovation Centre, with the mission of leading and connecting to build a complete innovation ecosystem nationwide. However, the weakness is that the proposed policies have not yet been effective,” said Nguyen Duc Hien. “There are still no guidelines related to policies to support small- and medium-sized enterprises in the spirit of Resolution 10. Meanwhile, state-owned enterprises also lack legal corridors and mechanisms to promote innovation.”

The pressure to innovate is becoming more intense in a context where the world and regional economies are experiencing strong fluctuations.

Last year’s survey conducted by McKinsey on 200 organisations in different industries showed that up to 85 per cent of CEOs believe that the economic crisis will have a permanent impact on customer demand within the next five years. However, only 21 per cent believe their company has the resources and commitment to pursue growth, and two-thirds of those surveyed said this is the most enduring challenge of their leadership career.

The results also indicated that in the last 10 years, the typical lifespan of a business model has decreased from 14 years to just five years.

Dang Phuoc Huong Thao, senior human resources manager Nestlé Vietnam

Early innovation can lead to success

Innovation and creativity in human resources management is an essential part of Nestlé Vietnam’s innovation and creativity endeavours.

In the challenging economic landscape, where many businesses have had to downsize their workforce, we chose to maintain its employee welfare programmes, salaries, bonuses, work environment, and career development opportunities as a means of ensuring that employees can work with peace of mind and contribute in the long run.

Nestlé consistently invests as much as $500,000 annually in training activities to develop its employees, including advanced training courses aimed at enhancing their expertise, knowledge, and working skills.

The company also provides opportunities for employees to work at Nestlé’s offices abroad, enabling them to leverage their skills in more challenging environments and be ready to take on higher positions at Nestlé Vietnam upon their return. Additionally, we organise senior management classes with the participation of a significant number of Vietnamese employees.

We continuously strive to improve work efficiency and reduce time-consuming tasks for its employees. We also organise training programmes to enhance mental wellbeing, with the participation of experts who provide support in stress management. This helps our employees maintain good health and achieve a healthy work-life balance.

Vo Tri Thanh, director, Institute for Brand and Competitiveness Strategy

Early innovation can lead to success

Never before has Vietnam faced such great development pressure as it does today. Previously, the state was considered to have the most important role in the innovation ecosystem. Yet, businesses are now considered the dominant factor.

Businesses play a central role in fulfilling development goals. It is necessary to have breakthrough policies to form and develop national enterprises and large-scale enterprises, with a leading role in key industries and sectors. Two essential keywords for understanding national businesses, leading businesses, and pioneering businesses are Vietnamese identity, culture, and impactful business philosophies.

For a decade, Vietnam has embraced innovation, striving to accompany and exceed global innovation growth instead of simply catching up. Moreover, the human factor, which includes interaction and emotion, is a noteworthy aspect of innovation and business development. Despite the unpredictable context, we remain optimistic about the creative initiative of Vietnamese businesses. Private initiatives, such as Nam Cau Kien Industrial Zone and FPT’s AI urban city in the south-central city of Quy Nhon, have been leading the way in policy for many years.

Vu Minh Khuong, associate professor Lee Kuan Yew School of Public Policy, National University of Singapore

Early innovation can lead to success

There are several major directions that can boost business innovation and drive growth. Firstly, businesses have to decide whether to catch up quickly or lead breakthroughs in specific areas. To grow effectively, businesses should consider three distinct levels of innovation.

Level 1, namely incremental innovation, includes researching areas that are new to businesses to play the game of innovation. Level 2 as breakout innovation, the focus is on uncovering new features that can boost product value and establish dominance in targeted sectors. At level 3, breakthrough innovation targets the utilisation of novel technologies in the industry to change the game.

The second direction to boost innovation is strategic response. To succeed, businesses must catch up with trends and stay ahead of the changing landscape. In particular, it is necessary to focus on effectiveness instead of just increasing efficiency, since this is the foundation for sustainable, long-term development and increasing social trust in businesses.

Thirdly, businesses should be proactive in identifying their weaknesses and focusing on improvement. Core weaknesses can stem from factors such as quality, price, product unique selling points, and brand value. According to our research, businesses that focus on improving vulnerabilities tend to make more advances in innovation

Additionally, the organisation’s innovation capacity also needs to be improved. The willingness of leaders to embrace innovation is essential for driving it throughout the organisation. Furthermore, innovation requires the collaboration and alignment of all departments.

It is also key to understand how to tap into the wealth of human knowledge and optimise tech advancements by promoting tech transfer activities and analysing and narrowing development gaps.

Last but not least, businesses must also be supported by policies to harness innovation’s advantages and mitigate risks.

Event honours innovative businesses Event honours innovative businesses

The ceremony of the Top 50 Most Innovative Enterprises Vietnam (VIE50) and the Top 10 Most Innovative Enterprises Vietnam (VIE10) was held on June 24 in Hanoi, organised by Vietnam Investment Review and Viet Research.

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Vietnamese Minister of Planning and Investment Nguyen Chi Dung held meetings with members of the Vietnam Innovation Network and technology giants in Silicon Valley (San Francisco) during a business trip to the United States during June 22-26.

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Technological innovation will help promote the energy transition in Vietnam, with the proportion of renewable capacity in Vietnam’s power system increasing rapidly.

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Vibrant innovative and creative activities, ranging from simple to complex, have brought breakthrough business results to many enterprises in Vietnam, Truong Minh Tien, CEO of Viet Research, spoke with VIR’s Tra My.

By Oanh Do

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