An articulated way for Latin America to face the challenges of the 4IR
This “quick-guide” takes an open innovation approach to propose a way in which Latin America can harness the opportunities of the Fourth Industrial Revolution. It also addresses the challenges of systemic thinking and social system re-defining much discussed during this years’ Annual Meeting of The New Champions of Innovation (AMNC for short), which focuses on innovation and entrepreneurship as forces that shape our world. This particular year the emphasis was on how to keep innovation people-centered in order to answer to the Fourth Industrial Revolution’s biggest challenges.
Aperture and trust are the way
We are going through the Fourth Industrial Revolution (4IR); dominated by hyper-connectivity and where the economy of attention, artificial intelligence and machine learning are the stars. The fact that everything is connected to everything creates the need to re-think our systems and ourselves as part of those systems:
- Each with a role.
- Each one perceives benefits or is affected by the good or bad functioning of the rest of the systems.
- All contributing to the balance of the planet — just as the human body works.
This means that we must also optimize existing systems: transport, work, social security, health, energy distribution, etc. Aperture harnesses connectivity and allows us to work efficiently, articulated and in sustainable ways that were not possible before. Phenomena such as Big Data and Open Data empower more and more actors to fulfill a role and make it possible for them to add value to the process.
So we have the tools and proper conditions to do it, but we lack trust which is key to the success of innovation ecosystems. Therefore, building trust among different peers is step one. We still give too much credit to ideas, we hide what we have and we do not allow it to cross-pollinate and exponentially improve a concept. In addition, we do not believe in local talent and prefer to spend millions on outside experts who often lack context and experience in local markets. As Jan Carbonell — a Global Shaper from Barcelona pointed out during the AMNC, Silicon Valley still has the best culture of trust in order to make things happen and nurture win-win relationships, and it is because they understand that opening their ideas and projects to different knowledge creates opportunities and accelerates innovation.
The barriers remain the same: gaps in education, delayed adoption of technologies, distrust that prevents us from working together and corruption — think of the Odebrecht case and how all Latin America got hurt by it.
This is sad because LatAm as a regional or even a niche market has a lot of potential: almost 650 million people and a combined GDP of USD $ 5.2 trillion. However, only 3 Latin countries: Chile, Costa Rica and Mexico appear in the Global Innovation Index. This is because despite having talent and resources, we do not produce the necessary outputs as a region: patents, certificates and quality standards, new products, technologies, etc. But this is not an isolated case for Latin America, it happens everywhere in the world.
The invitation is to recognize that what we have in common creates a space of convergence and what differentiates us gives us strength. We also have the responsibility to identify that the opportunities are greater if we articulate and work together: regions connected by worldwide systems.
ECO-systems not EGO-systems
It is natural that, given the potential that innovation brings, we discover opportunities and want to capitalize on them. It is natural to want credit and expect recognition. But to be able to do this, we must first learn to prioritize — that often means the necessity of choosing and even giving up on other ventures. This makes it easier for us to focus on the opportunities or challenges where we really are the best stakeholders.
Regarding innovation hubs and startup communities; it is a mistake to want to concentrate the entire offer in a single district or physical space and try to control demand and supply (of tech, challenges, talent and ideas). These are mistakes since they hinder the organic development of the ecosystem and the cross-pollination that we mentioned earlier. It is also very unproductive to seek prominence where there has been nothing built yet. Avoid discussions about intellectual property — yes, even that is being disrupted in the face of 4IR — and understand that the cake is sliced only after it’s been baked, not before.
That is why the main challenge for articulation is to ensure that these spaces of convergence are free of egos and full of willingness to collaborate.
A viable model
I come from Medellin, a beautiful city in Colombia that went from being the most violent city in the world at the beginning of the 90s to one of the most innovative in the world — due to our process of social transformation — while it is not a secret that Medellín has taken giant steps to consolidate itself as a hub of entrepreneurship and innovation in LatAm, there is still much to be done. The city adopted the initiative of having a University-Company-State Committee where the 3 parties could talk and define a clear north and the goals to achieve, aimed towards increasing competitiveness and facing the challenges of the future.
That being said, a model with only 3 stakeholders falls short, so I’d like to share the Quintuple Helix model instead. This one also includes the Entrepreneurs and Civil Society as active parties of the process, as key stakeholders.
Let’s check the roles proposed for each party and the reasons why they foster a bigger sense of systemic-thinking and co-creation.
- Academia: it has been said that it is difficult and, sometimes even impossible to innovate with researchers and universities. Cases like Nexentia show us that it is possible and that it can be done well — even in Latin industries. The key here is to understand that the world is demanding different sets of skills than those the Academy had specialized in developing. The role of universities should be to train talent and transcend from a research model focused on generating publications to one of applied research. For this to happen it is necessary to build trust, communication and close relationships with the private sector, because it is from this stakeholder where Academia can identify the skills that are missing and where to focus its research.
- Private sector: companies must ensure the capacities so that talent can add, co-create and generate value. It is through companies where most human talent is transformed and channeled. Hence, the other role that the private sector must assume is the design and marketing of sustainable products and services that truly improve our quality of life.
- Public sector: we cannot expect to have highly innovative cities and societies without the government and administration playing their part. Just as we demand from Universities and Companies to innovate, so we should from Governments since they have the responsibility to update laws at the same speed as the world is changing. This supposes a role in which legislation and regulation advance accordingly to the speed of technology. Governments must also ensure mechanisms to trace and bring transparency to the investment and expenditure of public resources. Last but not least, Public Sector has to foster social development, give access to opportunities , technology and resources that empower civil society instead of pushing it away by intensifying ruptures such as the one between rural areas and cities across the globe.
- Entrepreneurs: today the large companies and corporations have begun to see value in the entrepreneurs, the startups and small businesses. When old, rigid structures boycott dynamism and competitiveness of industries, entrepreneurs find new technologies and different ways of doing things to generate disruption. This is why entrepreneurs play a vital role in the articulation of ecosystems since they are the ones that show efficiency, they show us the new ways, the opportunities and the ways to take advantage of them. It is also to be noted that most of the ecosystem creation comes from the interaction between this party so there is no need to reinvent the wheel, but to allow entrepreneurship communities to lead the way and give us access.
- Civil society: civil society must actively participate in these ecosystems. It is society that validates or invalidates a business model or an innovation (remember that if the market does not adopt it, there is no innovation), but it is also the part that can exert pressure, serve as supervisors and ensure that products and services are people-centered.
It should be noted that there are 2 activities that any of the 5 parties can do and one that is everyone’s responsibility. All of us can be investors and contribute ideas, and we are all responsible for the sustainability of our systems — think of the SDGs.
How are innovation and entrepreneurship ecosystems articulating in your cities and countries?
What systems are being disrupted by technology and entrepreneurs?
What success stories do you know about collaborative innovation or open innovation?