Asia in Action: Key themes from the Asia Business Conference

Gotta catch ’em all: Hatoyama describing replicating his Hello Kitty strategy and how he’s electrified consumer appetite for Pikachu.
Ryo Takahashi, CEO Emeritus

Students engage with business leaders from Asia at the Annual Asia Business Conference.

As the sun rose in Boston on March 1, the annual Asia Business Conference kicked off at Klarman Hall. A collaboration among Harvard Business School, Harvard Kennedy School, Harvard Law School, and Harvard’s Graduate School of Design, the conference brings speakers and participants together every year to discuss key trends and themes shaping Asia and their global ramifications.

The Asia Business Conference, which has been held annually since 1994, drew hundreds of registrants this year. As Asia has gained both economic and geopolitical importance, attendees have become increasingly diversified.

“In recent years we’ve had participants fly in from all over, ranging from Chicago to Columbia,” says Mo Congsomjit (MBA ’20), Co-Chair of the Conference, who also organized the conference last year.

“At HBS, we have case studies about Asia, but few people know about Asia from a first-hand perspective. We bring people and real perspectives from people who actually work in Asia.”

Five Emerging Themes in Asia

The opening keynote was delivered by Mike Peng, Co-founder of IDEO Tokyo. Peng, who was born in the United States but whose parents are from Taiwan, had been eager to work in Asia for as long as he could remember.

“I’ve itched to be in Asia to actually see what it’s like to not only live in Asia but also work there as well,” Peng said.

The fortuitous opportunity came in 2011, when he was offered a role to work in Japan. The move also showed how unpredictable Asia can be; the same year, Japan was hit by the 3/11 earthquake, one of the most catastrophic natural disasters in the nation’s recent history.

Working in Asia, Peng quickly realized things were done differently there.

“It’s often hard to get beneath the surface. We like to save face. We hide a lot, we shield a lot of what we’re thinking,” he said.

“In Japan, people may start sentences but not end them in anticipation that the other person will finish the sentence for them. As a foreigner who doesn’t speak fluent Japanese, it’s perfect for me,” he joked.

Emerging themes: Mike Peng, Partner at IDEO and Co-founder of IDEO Tokyo, discusses 5 emerging themes in Asia at Harvard Business School’s annual Asia Business Conference

The Power of Enlightened Leaders

Peng’s role in Asia has kept him busy applying IDEO’s design thinking approach (which is free online). In China, IDEO is working with Tsinghua University to train leaders from various industries to redefine how leadership is understood and practiced in Asia.

The program, called Lead a Creative China 2030, graduated its first cohort in January 2019.

“How might we continue to find, nurture, and grow future enlightened leaders in Asia who will ask the right questions?” said Peng.

The task is more daunting than it seems. In China, where rote learning and bureaucratic institutions are embedded in its educational ideals, envisioning leaders as those who ask questions as opposed to those with all of the answers is a fundamental shift in how leadership is defined.

That, argues Peng, is an important mindset shift necessary to unlock creative leadership and entrepreneurship.

The Scale of Systemic Change

IDEO is also creating innovative solutions that brighten the lives of poorer households in Asia., the non-profit arm of IDEO, has helped to provide over 4 million households with solar lanterns that cost $5 each.

IDEO applied its design thinking to create solar lanterns that are based on direct observation of how kerosene lamps were used in consumers’ homes.

Kerosene lamps, which are costly, create respiratory problems, and carry the risk of fire from gas lamp exposure, are obviously suboptimal, but solar lamps were too expensive for many households. Until IDEO helped design the d.light.

“We’re deploying this to the region’s poorest households,” said Peng.

A beacon of creativity: Peng discusses the d.light, designed by IDEO’s non-profit arm, which has helped to provide affordable lighting to Asia’s poor.

The Potential of Creative Thinking

In agriculture, IDEO works with farmers in Thailand to teach creative thinking. It has built a Modern Farm Academy in Thailand that utilizes mobile apps to make the learning experience fun and increase agricultural efficiency.

“In approaching this question, we’re asking ourselves how to get farmers to be curious, passionate, and optimistic,” says Peng.

The Rise of Aspiring Entrepreneurs

In Japan, IDEO launched D4V (Design for Ventures) to accelerate entrepreneurship in Japan.

“We’re asking ourselves, how might we catalyze greater change through different flavors of entrepreneurship?” says Peng.

IDEO is working with traditional Japanese corporations, such as trading companies, to help “de-silo” talent and unlock their workforce’s creative potential. For trading companies, this shift in business model from “connecting” to “creating” is a disruptive pivot.

IDEO worked with Mitsui & Co., one of Japan’s largest trading companies, to create Moon Creative Lab, which encourages Mitsui’s 42,000 employees to think outside of their traditional roles and embrace creative thinking.

“It’s misguided to simply copy Silicon Valley,” says Peng. “Asia needs its own flavor of entrepreneurship.”

Unlocking Japan Inc.’s creativity: Peng discusses his role helping Japanese trading companies unlock their employees’ creative potential

The Influence of Cultural Philosophy

IDEO’s goal, says Peng, is to try to blend the best of the West and East. One important prerequisite is to first understand how business practices are in Asia.

“Japan is an extreme version of where everything is in the unsaid, it’s not what people say but what people leave out,” said Peng.

This intentional omission, which Peng identifies as ma (), has subsequently been applied to IDEO’s design principles, for instance, in how to design for space when entering and exiting a car.

“Japanese design is very intentional in creating a space for ma—you can see it in how traditional homes genkan (玄関、, entranceways) are designed,” said Peng.

From Asia to the World

The opening keynote by Peng was followed by Rehito “Ray” Hatoyama, the former CEO of Sanrio. Today, he is the founder & CEO of Hatoyama-Soken, a research and consulting company. While at Sanrio, Hatoyama helped to turn the company around by turning Hello Kitty into an iconic global brand.

Feline fumbles: Participants at the Asia Business Conference baffled at Hello Kitty trivia.

“Who here knows Hello Kitty?” asked Hatoyama. Almost every hand shot up in the air.

“How much does Hello Kitty weigh?” asked Hatoyama.

No one in the audience braved an answer (answer: 3 apples).

“How tall is Hello Kitty?” Again, the audience seemed perplexed (answer: 5 apples).

“Where does Hello Kitty live?”

Someone in the audience hazarded a guess: “Tokyo!”

“No! Hello Kitty lives in London!” said Hatoyama.

The point of the exercise was not a Hello Kitty trivia per se, but it was rather to illuminate how brands could become iconic (i.e., create high consumer awareness) while consumers were relatively uninformed of deeper details behind the brand.

By collaborating with influencers and diversifying the product offerings (such as by turning characters into trendy fashion apparel), Hatoyama has since replicated his success with Hello Kitty with Pikachu and Pokémon GO.

Fostering Innovation in Asia

The afternoon keynote was delivered by Jihoon Rim, the former CEO of Kakao, a mobile platform technology company valued at more than $10 billion.

Under Rim’s leadership, Kakao successfully expanded into finance, content, and mobility industries and its revenue and operating profit had doubled within two and a half years.

Stepping off the brakes: Rim encouraging innovation to be defined as a collaborative and inclusive effort, which involves breaking down Asia’s traditional hierarchical culture

“Is Uber an example of innovation?” Rim asked.

Rim argued that words such as “disruptive,” “radical,” “breakthrough,” and “discontinuous” deter people into thinking that innovating is too difficult.

By contrast, his observations of successful bottom-up innovation of mobile banking and comic book services at Kakao have led him to believe the opposite.

According to Rim, innovation can only thrive when working team members feel empowered to speak up and feel encouraged to disagree with their superiors, which is often difficult in Asian cultures.

“Innovation means creating a new market with significantly enhanced value to customers, one that can be captured by products and services often created by working team,” he said.

 “Whatever discussion we are having, if there is no disagreement, something is wrong.”

Asia in Action

From IDEO’s design thinking in Asia to Hatoyama’s globalization of Asian brands, Asia is transforming from the world’s factory to one of the world’s most vibrant and important centers of creative entrepreneurship and innovation.

 “The world is so connected that what happens in Asia will ripple throughout the world,” says Congsomjit. The ripple effect may not be hard to trace; all one has to do is track the dissemination of Hello Kitty and Pikachu apparel.

Just remember: Hello Kitty weighs 3 apples, and though the pickings of Asia’s growth may be ripening, harvesting the growth will require a deep understanding of its details, in particular, the ma.

Ryo Takahashi (MBA ’20), originally from Japan, is a management consultant and writer. Prior to Harvard Business School, he worked as a Project Manager at the World Economic Forum (WEF) and was a Senior Associate at McKinsey & Company. Prior to these roles he worked at the Economist and the Japan Times. His writing has appeared in Time magazine, the Economist, the Japan Times, and the World Economic Forum, among other outlets. He received his B.A. in Economics (with Distinction) from The University of Tokyo and was also a Rotary Scholar to the London School of Economics.