Thursday, 23 May 2019

Competitiveness is developing core capabilities

The United States-China trade war that started early last year took another twist last week with new US restrictions on technology that could pose a risk to its national security, and worst affected by the ban was Huawei Technologies Co Ltd, a leading provider of technology equipment.
The restrictions led to a ban on the Chinese technology firm from buying components and technology made in the US.
Interestingly, Huawei’s founder seemed to brush off the impacts of the restrictions, saying its 5G push wouldn’t be affected and, in fact, boldly proclaimed that “nobody will be able to catch up” with Huawei.
Ren Zhengfei also thanked the US suppliers for their support previously and said his company would survive and thrive.
While only time will tell how this will play out – how long this trade war will last, and what are the impacts it will pose to companies and value chains around the world – the key point that struck me was how bold these companies can be in the face of crisis.
To be as bold in the face of global adversity requires confidence backed by core capabilities that are unrivalled and dominant.
The ability to develop and supply 5G networking equipment has been a driver in the Chinese technology firm’s dominance, allowing it to evolve into the world’s biggest supplier of telecommunications equipment. Huawei leads market shareholding in mobile soft switches, broadband cards, optical hardware and mobile network equipment, among others.
The brand is not only strong within the business-to-business market but also the business-to-consumer markets as the third largest global market shareholder after Samsung and Apple Inc.
The brand popularity emerged through strong blends of traditional public relations campaigns and clever digital marketing. Most importantly, it boasts 21 research and development institute in countries all over the world – creating high-end careers for a multinational network of expertise and value chains.
All this was built in the span of only three decades, as the company was founded by Ren in 1987, and in the same space as major technology names the likes of Microsoft, IBM, AT&T, Nokia and Ericsson.
When we cite examples such as Huawei of China, Nokia of Finland, Ericsson of Sweden – the only thing that is certain is uncertainty. For us to move forward and develop our capabilities, there are no standards or criteria for success.
Advantages and disadvantages can be broken by a multitude of political, social or economic disruptions. Populations – large or small – have all recorded global success, and countries have emerged from war and poverty to become global economic superpowers in the span of mere decades.
As a nation moving in the area of connected mobility and technology, it is important to look into developing critical mass and core capabilities in emerging technology fields, particularly in automation and Internet of Things-based technologies such as artificial intelligence, nano-engineering, data science, vehicle connectivity, etc, to ensure a thriving value chain exists and has the capabilities to meet global demands.
As the transportation and telecommunications industries converge in the future, policy frameworks, regulation and implementation must be realigned with new business strategies and development to ensure continuity.
It is important for us to study the trends that affect the global economy, and foresee how it will benefit our own economy.
Analysts have suggested that Malaysia is well placed as Chinese firms relocate their supply chains due to the trade war, particularly in communication, electronic integrated circuits and natural gas products – due to our business-friendly environment and stable policy administration.
As I pondered how one man can be so confident in facing risks worth billions of dollars, I realised that risks can be mitigated through perseverance, self-development and foresight.
You don’t need a backup plan if your preparation presents one whenever you need it.
The writer is the chief executive officer of Malaysia Automotive, Robotics and IoT Institute.

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