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Creating IN and OUT values through entrepreneurial innovations to sustain start-ups
[Sponsored article] A leading global supply chain management scholar suggests young people sustain start-up programmes by creating “In” and “Out” values through entrepreneurial innovation activities.
Speaking at the PolyU 80th Anniversary Global Leader Lecture Series recently, Professor Hau L. Lee – also a pioneer in the studies of entrepreneurship and innovations in developing economics, and value chain strategies – shared his insights on how values created through entrepreneurial innovations can be a powerful means to support economic development in developing economics.
His lecture entitled “Creating IN and OUT Values Through Entrepreneurial Innovations” was also a highlight of the Global Youth Leaders Summit organized by PolyU, in which students from all over the world presented their social entrepreneurship project ideas, sharing their views and aspirations to make the world a better place.
PolyU is celebrating its 80th Anniversary this year with a Global Leader Lecture Series in which influential leaders around the world will deliver lectures on a wide variety of topics, including healthcare, business, innovation and entrepreneurship, art and culture, sports and sustainable urban development.
The significance of IN and OUT Values
In explaining why and how entrepreneurial innovations can be successful, Professor Lee, who is the Thoma Professor of Operations, Information and Technology at Stanford Graduate School of Business, emphasized that entrepreneurial development was “a powerful means to support economic development in developing economies” while “great values can be created when the entrepreneurial activity involves an innovation that can be a combination of product and process transformation”.
He firmly believes that these values come in the form as either IN or OUT. “‘IN’ refers to helping to serve the needs of people in developing economic countries. This means providing affordable healthcare, improving access to food and medicine, and developing education opportunities for citizens. ‘OUT’ refers to helping entrepreneurs develop their businesses so that they can export and trade. By doing this, they are creating values through outside of their economies. I would say both are the useful ways to improve the well-being of developing countries.”
Innovation vs Sustainability
Professor Lee also attended the presentations of student-leaders on various social entrepreneurship projects at the Global Youth Leaders Summit. He praised the projects as being highly innovative and diverse, and hopefully being able to create IN and OUT values.
However, he reminded the young participants of the importance of sustainability. “No matter how innovative and wonderful a project is, it must be sustainable. This is often the most challenging part of starting a new business. And if it is a social entrepreneurship project, it may become even more difficult as some founders or funders may care less about accountability, treating it as sort of charity.”
Professor Lee provided his expertise to help young budding entrepreneurs achieve sustainability.
“The first step is to apply basic knowledge of supply chain management through better control of cash flow, information, and logistics to ensure a social entrepreneurship project can work. However, it is important to determine whether the project is a merely a substitute or an upgrade of something that already exists on the market. If the answer is the latter, then it has a higher chance of being sustainable.”
He cited the presence of Internet as an example. “From the very beginning, people obviously treated sending e-mails over the internet as a substitute of posting letters or faxing documents. At the time, no one imagined how it would lead to the flourishing development of e-commerce.”
Innovation vs broad scope of knowledge
When asked to compare the approaches in nurturing the minds of innovative youths between Stanford University and the universities in Hong Kong, Professor Lee highlighted several key differences.
“Unlike in Hong Kong, students in Stanford don’t need to select their major and minor subjects right away,” he said. For example, science students can choose to study history if they are inclined to do so, thus allowing them to broaden their scope of knowledge.
Secondly, most of the academics in Stanford are recruited directly from the industries. This is a good practice because they can really inspire students through their real-life experiences.”
Regardless, Professor Lee was pleased to see the university system in Hong Kong change to a four-year framework. “It is a very important step. There is so much to learn during university, so having more time to learn is certainly a good thing.”
Besides being a large influence through his teaching and research, Professor Lee has been an active consultant within the industry. He has also been an entrepreneur, having co-founded DemandTec, a data-analytic company on price-optimization, which went public in NASDAQ in 2007. Currently, he is on the board of Synnex, Frontier Services Group, Global Brands Group, Esquel, and 1010 Printing. He has also served as an advisor to numerous venture capital companies as well as NGOs and Foundations on creating and nurturing entrepreneurs in developed and developing countries.